BIRANA COLLEGE

MASTER OF BUSINESS ADMINISTRATION IN

GENERAL MANAGEMENT

DETERMINANTS OF EMPLOYEE MOTIVATION: A

CASE STUDY OF COMMERCIAL BANK OF ETHIOPIA
IN D/MARKOS DISTRIKT

BY: ASCHENEK WASIE

Adviser beza muche(Dr)

(JULY, 2022) D/MARKOS ETHIOPIA

Declaration
IASCHENEK WASIE EMIRU registration number/I.D number MBA/049/13,do hereby
declare that this thesis is my original work and has not been presented for a degree in any other
university and that all sources of materials used for the thesis have been duly acknowledged.

Name: _____________________

Signature: __________________

Date: _______________________
CERTIFICATION

This is to certify that Aschenekwasiehas done the study on the topic “Drivers of Employee
Motivation: A case study commercial bank of Ethiopia in D/Markos district. This study is
authentic and has been submitted for examination for the fulfillment of management
(MBA ).Birana college

Confirmed by:

Advisor: ______________________

Signature: _____________________

Date: __________________________
 Acknowledgements
First of all, my greatest thank goes to the Almighty God and his mother St. Marry, for giving me
the direction, strength, wisdom and dedication to finish this work successfully.
I would like to express my deepest gratitude to my advisor ,Bezamuche (Dr).. whose unreserved
advice guided me throughout the thesis process. In this opportune moment, I would like to thank
all respondents who participated in filling the questionnaire because without them it would be
impossible to accomplish this thesis.
Last but not list, my special thanks to my parents and my friends for their unconditional support
and unreserved effort during the thesis work and all throughout the program.
Finally, I want to forward my thanks to those who encouraged me which I did not mention their
name by providing all the necessary support when it was necessary.

Aschenekwasie

.
 Table of Contents

Declaration.............................................................................................ii
CERTIFICATION......................................................................................................................iiii

ACKNOWLEDGEMENTS......................................................................................................... iii

LIST OF TABLES..................................................................................................................... iv

ACRONYMS...............................................................................................................................v

ABSTRACT................................................................................................................................ vi

CHAPTER ONE: INTRODUCTION.....................................................................................1

1 1.1 Background of the Study.................................................................................................... 1

1 1.2 Background of the Organization ........................................................................................1

3 1.3 Problem Statement .............................................................................................................2

4 1.4 Research Questions .............................................................................................................3

Research Objective ......................................................................................................................4

1.5.1 General Objective ...............................................................................................................5

1.5.2 Specific Objectives ..............................................................................................................6

1.6 Hypothesis of the Study..........................................................................................................7

Significance of the Study .............................................................................................................8

6 1.8 Scope of the Study ..............................................................................................................9

6 1.9 Limitation of the Study ......................................................................................................10

6 1.10 Definition of Key Words and Variables ...........................................................................11

CHAPTER TWO: LITERATURE REVIEW .........................................................................12

2.1 Introduction ............................................................................................................................12

2.2 Conceptual Literature ..............................................................................................................12

2.2.1 Definition and Concept of Motivation .............................................................................13

2.2.2 Types of Motivation .............................................................................................................14

2.2.2.1 Intrinsic and Extrinsic Motivation ...................................................................................15

2.2.2.2 The Relationship between Intrinsic and Extrinsic Motivation .........................................16

2.3 Theoretical Literature ..............................................................................................................17

2.3.1 Content Theories ...............................................................................................................18

 2.3.2 Process Theories of Motivation ........................................................................................19

2.3.3 Theoretical Framework .......................................................................................................20

2.4 Empirical Concepts on Employees Motivation ......................................................................21

2.4.1 Reasons for Motivating Employees ...................................................................................22

2.4.2 Challenges of Motivating Employees ..................................................................................23

2.5 Synthesis ...............................................................................................................................24

2.5.1 Dimensions of Motivations Under Study .........................................................................25

2.5.2 Conceptual Framework of the Study ..................................................................................26

CHAPTER THREE: RESEARCH DESIGN AND METHODOLOGY .............................27

3.1 Introduction .............................................................................................................................27

3.2.ResearchApproach .................................................................................................................27

3.3 Population, Sample Size and Sampling Technique ................................................................28

3.4.1 Population ............................................................................................................................29

3.5.2 Sample Size .........................................................................................................................30

3.6.3 Sampling Technique ..........................................................................................................31

3.4 Data Types ............................................................................................................................32

3.5 Data Collection Instruments ...................................................................................................33

3.6 Data Analysis Methods ..........................................................................................................34

3.7 Reliability and Validity .........................................................................................................35

3.8 Ethical Considerations ............................................................................................................36

CHAPTER FOUR: DATA PRESENTATION ANALYSIS AND INTERPRETATION ....37

Introduction....................................................................................................................................37

Table 4.10 Mean value of variables...............................................................................................39

Table 4.11 Table Summery of Regression Model........................................................................40

Table 4.12 Significance of the Regression Model.......................................................................40

Table .4.14.2 Response Rate........................................................................................................37

4.3 Demographic Characteristics of Respondents ........................................................................37

4.4 Descriptive Analysis ...............................................................................................................38

4.5 Summery of Employee Motivation..........................................................................................39

4.6 Result of Regression Analysis ................................................................................................40

4.7Testing Hypothesis ..................................................................................................................41

CHAPTER FIVE: CONCLUSION AND RECOMMENDATION ......................................42

5.1Introduction ..............................................................................................................................42

5.2Conclusion ...............................................................................................................................42

5.3 Recommendation.....................................................................................................................43

LIST OF TABLES

Table 3.1 Total population of the respondents...............................................................................28

Table3.2ReliabilityAnalysis...........................................................................................................29

Table4.1ResponseRate..................................................................................................................30

Table 4.2 Characteristics of Respondents......................................................................................31

Table 4.3 Frequency and percentage of respondent on payment items.........................................32

Table 4.4 Frequency and percentage of respondent on Benefit items...........................................33

Table 4.5 Frequency and percentage of respondent on Promotion items......................................34

Table 4.6 Frequency and percentage of respondent on working condition items.........................35

Table 4.7 Frequency and percentage of respondent on Employee Recognition items..................36

Table 4.8 Frequency and percentage of respondent on Employee Autonomy items....................37

Table 4.9 Frequency and percentage of respondent on Career developme

Table 4.13 Coefficients of Regression Model...............................................................................42

References......................................................................................................................................43

Appendix – Questionnaires............................................................................................................44
 ACRONYMS

CBE: Commercial Bank of Ethiopia

HRM: Human Resource Management

SPSS: Statistical Package for Social Science

SD: Standard Deviation

ABSTRACT
This study attempts to examine determinants of employees work motivation in
Commercial Bank of Ethiopia In D/Markos district through empirically testing the
variables including work content, working condition, payment, benefit, promotion,
recognition and autonomy and carrier development. a quantitative research design
using questionnaire survey method so as to gather the perception of determinants of
employee’s motivation in Commercial Bank of Ethiopia. The study was done based on
primary and secondary data sources. The sampling technique are uses probability and
non-probability sampling technique A self-administered questionnaire was designed
to collect relevant information from the selected 266 respondents. Among these 254
questionnaires are returned and analyzed. The collected data was analyzed by SPSS
version 21 using descriptive statics and multiple regressions. Based on this motivation
variables have positive relationship with employee’s motivation. Based on the result
of multiple linear regression variables like payment, benefit, working condition,
recognition and promotion have positive and significance effect on employee’s
motivation but employee autonomy and career development opportunity have no
significance impact on employee’s motivation. Since the relationship between
variables and motivation exist the management of commercial bank of Ethiopia should
clearly state well-articulated motivational policy by involving some employees in the
process of developing it in order to increase the employee’s motivation and to achieve
its own goal.
Key Words: Motivation, Payment, Recognition, Drivers of Motivation
 CHAPTER ONE

1. INTRODUCTION

This chapter contains background of the study, background of the organization, statement of the
problem, general and specific objectives of the study, definition of key terms, significance of the
study, scope of the study, limitation of the study and organization of the paper. The researcher
were identify employee job motivation and its influence on service quality in the case of
Commercial bank of Ethiopia InD/Markosdistrict

1.1. Background of the Study

In the modern competitive world, business organizations are facing ever-growing challenges
regarding commitment, engagement, belief, recruitment and retention of their employees.
Multiple studies in different countries and across industries show that employees who are
passionate about their jobs and the organizations in which they work are in the minority.
Motivation is about giving your staff the right mixture of guidance, direction, and resources and
rewards so that they are inspired and keen to work in the way that you want them to. So, a large
portion behind these difficulties can easily be solved by imparting proper motivation. (Norm
2017).

Motivation is defined by Stephen and Timothy as “the process that account for an individual’s
intensity, direction, and persistence of effort toward attaining a goal” (Stephen & Timothy,
2010). Intensity here means the degree of how hard an employee performs in an organization.
And when managers try to motivate employees, they will mainly focus on the part of intensity.
Secondly, an organization cannot reach success without a right direction. Therefore, how to
organize employees work well towards the organization’s goals is an important issue to be
considered. However, employee motivation is an endless process. Employee motivation is one of
the policies of managers to increase effectual job management amongst employees in
organizations (Shadare, 2009).
A motivated employee is responsive of the definite goals and objectives he/she must achieve,
therefore he/she directs its efforts in that direction. Rutherford (1990) reported that motivation
formulates an organization more successful because provoked employees are constantly looking
for improved practices to do a work, so it is essential for organizations to persuade motivation of
their employees (Kalimullah, 2010).

Every organization and business wants to be successful and have desire to get constant progress.
The current era is highly competitive and organizations regardless of size, technology and market
focus are facing employee retention challenges. To overcome these restraints a strong and
positive relationship and bonding should be created and maintained between employees and their
organizationsMotivation results from the interaction of both conscious and unconscious factors
such as the intensity of desire or need, incentive or reward value of the goal, and expectations of
the individual and of his or her peers. (Akhtar, 2014). These factors are the reasons one has for
behaving on a certain way. Most employees need motivation to feel good about their jobs and
perform optimally. Some employees are money motivated while others find recognition and
rewards personally motivating. Motivation levels within the workplace have a direct impact on
employee productivity. Workers who are motivated and excited about their jobs carry out their
responsibilities to the best of their ability and production numbers increase as a result. An
incentive is a motivating influence that is designed to drive behavior and motivate employees to
be produce quality work. Employers use several types of incentives to increase production
numbers. Employee incentives come in a variety of forms including paid time off, bonuses, cash
and travel perks. Incentives drive employee motivation because they offer workers more to strive
for than a regular paycheck. Many employees need recognition from their employers to produce
quality work. Recognition and employee reward systems identify employees who perform their
jobs well. Acknowledging a job well done makes employees feel good and encourages them to
do good things. Employers recognize workers by tracking progress and providing feedback about
how they have improved over time. Public recognition is also a motivating factor that drives
worker productivity. Some employees are motivated through feeling a sense of accomplishment
and achievement for meeting personal and professional goals. Many workers are self-disciplined
and self-motivated. (Gray, 2000).
Motivation can be specified as a management process, which encourages people to work better
for the overall benefit of the organization, by providing them motives, which are based on their
unfulfilled needs. The matters arising are: “why managers need to motivate employees?”
(Herzberg, 1959). Traditional motivation theories focus on specific elements that motivate
employees in pursuit of organizational performance. For example, motives and needs theory
(Maslow, 1943) states that employees have five levels of needs (physiological, safety, social,
ego, and self-actualizing), while equity and justice theory states that employees strive for equity
between themselves and other employees (Adams, 1963, 1965). However, current research on
employee motivation is more cross-disciplinary and includes fields such as neuroscience, biology
and psychology.

According to Jones & George (2008), there are three major components of motivation which are
direction, intensity, and persistency. Direction is a goal that forces an individual to perform an
act to achieve it. There are factors that influence a person in selecting the goal, including both
internal and external factors, and the final goal is the best one chosen among potential
alternatives. The intensity is the level of determination or effort put by an individual in the
process of achieving the goal; how hard an individual has tried, and how much energy, time,
money, or any other mental or physical things have been used during the Process to achieve the
goal. Persistence is the ability of an individual to maintain the motivation through times even
though obstacles may exist (Robbins and Judge 2013). It is not an exaggeration to say motivation
is the core to being successful. A motivated person is likely to willingly put more effort into
doing a task and a good result is within expectations. When goals are achieved, it drives a feeling
of being satisfied and enjoyment for the employees and creates a positive working attitude in the
workplace. According to Smith (1994) it is because of the survival of the company. Amabile
(1993) contributed to this statement by arguing that it is necessary for managers and leaders of
organization to learn to understand and effectively deal with their employee’s motivation; since
motivated employees’ are the pillars of successful organization in present and future century. She
also indicates that unmotivated employees may probably contribute little effort in their jobs, stay
away from workplace as much as possible, go out of the organization and make low quality of
work. When employees are well motivated, they help the organization to grow and survive in
fast changing workplaces (Lindner 1998, 36). Lindner also indicates that the most difficult role
of managers is to motivate employee, because what motivates employees changes always
(Bowen and Radhakrishna 1991, 16-22).

According to Armstrong (2005) described that it depends on several factors. Like, individual
needs and aspiration, expectation about the reward, equity and fairness (the felt fair principle)
and other factor. Generally speaking motivation is a life blood of an organization and therefore it
is important for managers to understand the factors that motivate their employees to perform to
the best of their ability.

Schuler and MacMillan (1984), argue that effective HRM results in an enhanced ability to attract
and retain qualified employees who are motivated to perform. When employees are motivated to
perform there are many positive effects, such as greater profitability, low employee turnover, and
high product quality. An organization can create competitive advantage over its competitors by
using human resource practices to improve employee motivation, especially when their
employees are less motivated (Schuler & MacMillan, 1984) Individual differences, work-context
characteristics and job placement may lead to differences in employees’ motivation, job
satisfaction and performance (Sharma and Sharma, 2011). When organizations seek to attract
and retain highly qualified employees, the managers and designers of motivation systems should
carefully scrutinize and evaluate the reward preferences of their human resource. By doing so the
organizations expect employees to follow the rules and regulations, work according to the
standards set for them. On the other hand, the employees expect in their respective place of
assignment; the presence of good working conditions, fair pay, fair treatment, secure career,
power and involvement in decisions (Sharma and Sharma, 2011) To address these expectations,
the organizations should understanding of employee motivation is required. In order for an
organization to meet its obligations to shareholders, employees and society, its top management
must develop a relationship between the organization and employees that will fulfill the
continually changing needs of both parties. . This study attempts to asses the overall motivation
scheme in Commercial Bank of Ethiopia.

1.2. Problem Statement

Employee motivation programs range from a spontaneous and private
thank-you to widely publicized formal programs in which specific types
of behavior are encouraged and the procedures for attaining recognition
are clearly identified. Numerous studies have proved that motivating
employees is one of the best ways to keep the work force happy and
productive. Based on the preliminary interview the basic problems is that
Commercial bank of Ethiopia provides different packages of financial and
non-financial motivation for employees. But commercial bank has many
challenges and weaknesses like attitude problem, poor performance,
employee’s turnover, knowledge gap, which most of them arises from
employee’s lack of motivation, had been put as a threat that will hinder
the bank from achieving its vision and mission, turnover rate has been
increasing. In addition to this other financial and non-financial
motivations provided by the bank like, transport, loan, housing and
hardship allowances are said to be not enough and not equivalent with the
cost of living. The health service and the educational opportunity
provided by the bank are also not adequate. If those problems are not
solved, the bank may face more challenges, like Customer dissatisfaction,
reduction of revenue, and loosing of highly skilled and potential
employees and customers, which are key for the banks success and
achievement of mission and vision. Bearing these problems in mind, in
Ethiopian context researchers like MengistuKefelegn, EphremTemtime
and YaredKebede undertaken study on the effects of motivation on
employee’s performance in different Ethiopian organizations. However up
to the researcher’s consideration little research was undertaken regarding
the effect on motivation on employees of CBE. So the researcher tries to
fill this gap by investigating the effects of different determinants of
employee’s motivation in commercial bank of Ethiopia and set to answer
the following questions
1.4. Research Questions

1. What types of motivations and schemes are practiced in Commercial Bank of Ethiopia (CBE)?
2. What motivates the employees of CBE?
3. Is there any relationship between employee’s motivational factors and service quality?
41.5. Research Objective
1.5.1 General Objective
The main objective this study is to investigate the types of employee motivation used in
commercial bank of Ethiopia.
1.5.2 Specific Objective
1. To identify types of motivations practiced in CBE
2. To assess the determinants of employee motivation
3.To find out any relationship between motivational factors and service quality of staff of
Commercial Bank of Ethiopia
1.6. Hypothesis of the Study
Benefit

H0: There is no significant relationship between benefit and employee’s motivation.

H1: benefit has a positive and significant effect on employee’s motivation.
Payment
H0: There is no significant relationship between payment and employee’s motivation.
H1: payment has a positive and significant effect on employee’s motivation.
Working Condition
H0: There is no significant relationship between working condition and employee’s motivation.
H1: Working condition has a positive and significant effect on employee’s motivation.
Promotion
H0: there is no significant relationship between promotion and employee’s motivation.
H1: Employee’s promotion has a positive and significant effect on employee’s motivation.
Employee Recognition
H0: There is no significant relationship between recognition and employee’s motivation.

H1: Employee’s recognition has a positive and significant effect on employee’s motivation.

Employee’s Autonomy

H0: There is no significant relationship between employee’s autonomy and employee’s

motivation.

H1: Employee’s autonomy has positive and significant effect on employee’s motivation.

Career Development Opportunity

H0: There is no significant relationship between career development opportunity and employees
motivation

H1: Career development opportunity has positive and significant effect on employee’s
motivation

1.7. Significance of the Study

The results of this study expected to help the executives of human resource management and line
managers of Commercial Bank of Ethiopia to understand different issues of employees
motivational schemes and strategies that could satisfy and motivated staffs to ensure
productivity and service quality to customers. The study also used as an input for bank
stakeholders and a benchmark for future researchers.

1.8. Scope of the Study

The study investigates determinants of employees work motivation working in Commercial
Bank of Ethiopia. How different motivational variables such as payment, promotion, recognition,
benefit, working condition, career development opportunity and autonomy affect the practice of
job motivation of employees. The study examines the practice of employee motivation
Commercial Bank of Ethiopia at seven branches.

1.9. Limitation of the Study

To conduct this study there were some challenges that affect the quality of the paper and hinder
the progress of the research. The researcher challenged by lack of cooperation on the side of few
respondents in filling out and returning back questionnaires due to time constraint and work load
in addition to social desirability bias. The other limitation of this study was missed to address all
motivation variables that have impact on motivation which may have some impact on the
outcome of the study as the dependent variable is subject to other motivation variables.

1.10. Definition of Key Words and Variables

Recognition: acknowledgement for a job well done or it is non-financial reward that increases
job satisfaction (Armstrong, 2004).

Working condition: Working condition refers to the working environment and all the existing
circumstances affecting labor in the work place, including job hours, physical aspects, legal
rights and responsibilities or it is about providing healthy, safe and so far as practicable pleasant
working environment for employees (Armstrong, 2006).

Payment: all compensations which are given to an employee against his work (Dessler 2008).

Employee benefits: are elements of remuneration given in addition to the various forms of cash
pay (Armstrong, 2003).

Motivation: Internal and external factors that stimulate desire and energy in people to be
committed to a job or make an effort in attaining a goal.

Promotion:Heery and Noon (2006) define promotion “getting high status in workplace by doing
effective work, generally increase the status, position and remuneration of employee in the
organization”.

Career development opportunity: is the process of improving an individual’s abilities in

anticipation of future opportunities for achieving career objectives.

Employee’s autonomy: According to Wilkinson (1998) empowerment/autonomy is the extents

to which employees‟ are encouraged to take firm decisions by employees without consultation
with their managers..structur of the bank was based on their procedure such as president pay
precedent up to the low level
 CHAPTER TWO
2. LITERATURE REVIEW

2.1. Introduction

his chapter reviews the literature of important concepts of motivation, Types of motivation:
Intrinsic motivation and Extrinsic motivation, two motivation theories Need theories of
motivation its component; Maslow's theory of need, Alderfer ERG theory, McClelland's theory
of need, Herzberg's theory of Hygiene, and Process theories of Motivation; Expectancy theories,
Goal setting theory, Equity theory, Cognitive evaluation theory, Empirical review of intrinsic
and extrinsic motivation,

2.2. Conceptual Literature

2.2.1. Definition and Concept of Motivation

Motivation is the force that energizes, directs and sustains behavior. A motive is a reason for
doing something. Well-motivated people who are those with clearly defined goals, prepared to
exercise discretionary efforts who take action that they expect will achieve those goals and high
performance (Armstrong and Taylor, 2014).The word motivate is frequently used in the context
of management as a transitive verb: motivation is by implication something done by one person
or group to another. A further implication of this usage is that the motivated parties need to be
induced to perform some action or expend a degree of effort which they would not otherwise
wish to do. That this is an issue of vital importance to the prosperity of commercial organizations
is emphasized by Lawler (1973): “Those individual behaviors that are crucial in determining the
effectiveness of organizations are, almost without exception, voluntary motivated behaviors”.

Motivation concerns that “psychological processes that cause the arousal, direction and
persistence of behavior” (Ilgen and Klein, 1988). Whilst there is general agreement in the
literature about these three components of “motivation” (Korman 1974, Kanfer, 1990), the nature
and place of motivation in a work-related context has been the subject of a long and developing
study. Theories have been propounded, tested and superseded at a pace which has left
organizational practice often several steps behind the researchers.. Employee motivation has
always been a central problem for leaders and managers. Unmotivated employees are likely to
spend little or no effort in their jobs, avoid the workplace as much as possible, exit the
organization if given the opportunity and produce low quality work. On the other hand,
employees who feel motivated to work are likely to be persistent, creative and productive,
turning out high quality work that they willingly undertake. There has been a lot of research done
on motivation by many scholars, but the behavior of groups of people to try to find out why it is
that every employee of a company does not perform at their best has been comparatively un
researched. Many things can be said to answer this question; the reality is that every employee
has different ways to become motivated. Employers need to get to know their employees very
well and use different tactics to motivate each of them based on their personal wants and needs.
Inspiring employee motivation requires much more than the old-fashioned carrot- and-stick
approach. Today’s manager needs to understand the reasons why employees work and offer the
rewards they hope to receive. Motivated employees have a drive to succeed no matter what the
project. Managers cannot “motivate” employees, but they can create an environment that inspires
and supports strong employee motivation.

Motivation is psychological forces that determine the direction of a person’s behavior in an

organization, a person’s level of effort and a person’s level of persistence”(Jones & George
2008). The concept of motivation could be broad; however, according to Jones & George (2008),
there are three major components of motivation which are direction, intensity, and persistency.
Direction is a goal that forces an individual to perform an act to achieve it. A goal is chosen
consciously or unconsciously by an individual. There are factors that influence a person in
selecting the goal, including both internal and external factors, and the final goal is the best one
chosen among potential alternatives. The intensity is the level of determination or effort put by
an individual in the process of achieving the goal; how hard an individual has tried, and how
much energy, time, money, or any other mental or physical things have been used during the
Process to achieve the goal. Persistence is the ability of an individual to maintain the motivation
through times even though obstacles may exist (Robbins and Judge 2013). It is not an
exaggeration to say motivation is the core to being successful. A motivated person is likely to
willingly put more effort into doing a task and a good result is within expectations. When goals
are achieved, it drives a feeling of being satisfied and enjoyment for the employees and creates a
positive working attitude in the workplace. Additionally, the concept also mentions in the
classification of motivation types which can be divided as intrinsic (internal) motivation and
extrinsic (external) Motivation (Richard & Edward 2000). Intrinsic motivation comes from one’s
self-desire to seek out new things and to challenge oneself. It is the eagerness to learn, to gain
knowledge and to explore self-values and capabilities (Ryan 2000). When a person has intrinsic
motivation, it means he or she does the job with interest and enjoyment. Such persons have the
tendency to be engaged in their jobs, do their work with passion and willingness, striving for best
results and self-reward as well as continuously improving their skills and abilities (Wigfield
2004). On the contrary, extrinsic motivation refers to the performance of activities to achieve the
desired outcomes. Extrinsic motivation can arise from both internal and external factors.
However, most of the time, it comes from the impact of external factors rather than internal ones
(e.g. individual itself). Therefore, the main question to answer is from where to get the extrinsic
motivation and how a person can sustain his/her motivation (Ryan 2000). There are factors that
create extrinsic motivation, for example, competitions, appraisals, external rewards, or
punishment (Dewani 2013).

Motivation is a basic psychological process (Tella, Ayeni&Popoola, 2007). It is a factor that

exerts a driving force on actions and work. According to Luthans (1998) motivating is the
management process of influencing behavior based on the knowledge of what make people
think. It contributes to the process of stimulating people to act and achieve a desired task.
Luthans indicated that motivation was the process that arouses, energizes, directs, and sustains
behavior and performance. As defined by Bartol and Martin (1998) motivation was a force that
energizes behavior, gives direction to behavior, and underlies the tendency to persist. Attitude
was important concept in motivation; it is defined as a response to objects, people, or events in
either a positive or negative way (Dessler, 2008). This definition recognizes that in order to
achieve goals, individual need to act based on the work process of managing performance
ensures that specific goals and outcomes are established As motivation concern, reward system is
an important tool for management use to channel employees’ motivation in desired ways.
Reward defined by Minden (1982) as any strengthened behavior followed immediately by a
positive reinforce. Currently, either public or private sectors are implementing the reward
programs. According to Vroom (1964), it clearly stated that employees’ effort is increased when
rewards are offered. In reward program, large amount of money are spent. The reason behind
these, hopefully it will increase employees’ motivation. As stated by Ballentine (2003), the
purpose of reward is to recognize excellent job performance, provide feedback, make it easier to
get work done, encourage employees to be more productive and help management achieve their
goal.

2.2.2. Types of Motivation

According to Armstrong and Taylor (2014) there are two types of motivation: Intrinsic
Motivation and Extrinsic Motivation

2.2.2.1. Intrinsic and Extrinsic Motivation can be classified as intrinsic and extrinsic motivation;
intrinsic or internal motivation and extrinsic or external motivation. The two motivations differ
in the source of pressure or pleasure that boosts each of them. Amabile (1993) elaborates further,
by saying the followings:

2.2.2.1 Intrinsic Motivation

Intrinsic motivation can come up from the self-generated motivational factors that influence
people's or employees' behavior. Intrinsic motivation is not created by external incentives. It can
take the form of motivation by the work itself when individuals feel that their work is important,
challenging and interesting and that it provides them with a reasonable degree of autonomy
(freedom to act), opportunities to achieve and advance, and scope to use and develop their skills
and abilities. Deci and Ryan (1985) suggested cited by Armstrong and Taylor (2014) that
intrinsic motivation is based on the need to be competent and self-determining (that is, to have a
choice). Michael Sandel (2012: 122) cited by Armstrong and Taylor (2014), remarked that:
„When people are engaged in an activity they consider intrinsically worthwhile, offering money
may weaken their motivation by “crowding out” their intrinsic interest or commitment‟. Intrinsic
motivation can be enhanced by job design. Katz (1964) suggested that jobs should in themselves
provide sufficient variety, complexity, challenge and skill to engage the abilities of the work

• Individuals are intrinsically motivated when they seek enjoyment, interest, satisfaction of
curiosity, self-expression, or personal challenge in the work.
• Individuals are extrinsically motivated when they engage in the work in order to obtain some
goal that is apart from the work itself (Amabile 1993, 185-201.)

Intrinsic Motivation Intrinsic motivation refers to the motivation that comes from inside an
individual and is not created by external incentives. This motivation is generated through
satisfaction or pleasure that one gets in completing or even working on a task. It can take the
form of motivation by the work itself when individuals feel that their work is important,
interesting and challenging and provides them with a reasonable degree of autonomy (freedom to
act), opportunities to achieve and advance, and scope to use and develop their skills and abilities.
Factors that influence on intrinsic motivation include responsibility, freedom to act, scope to use
and develop skills and abilities, interesting work and opportunities for advancement. These
motivators, which are concerned with the quality of work life, tend to have a long-term effect
since they are inherent in individuals and not imposed from outside (Armstrong 1988).

Intrinsic motivation comes out from an individual pleasure or interest in the task and it does not
involve working on activities for the sake of external rewards, it instead necessitates the feeling
of inner pleasure in the activity itself. It can be seen as a force that involves doing activities
without external incentive. According to Amabile (1993), individuals are intrinsically motivated
when they seek enjoyment, interest, satisfaction of curiosity, self-expression, or personal
challenge in the work (Amabile 1993, 185-201).

According to Hackman and Oldham (1974), cited by Armstrong and Taylor (2014) emphasized
that the importance of five core jobs dimensions that result in intrinsic motivation, namely: skill
variety, task identity, task significance, autonomy and feedback.

2.2.2.2.Extrinsic Motivation

Extrinsic motivation exist when things are done to or for people to motivate them. Extrinsic
motivation include rewards such as incentives, increased pay, praise or promotion; and
punishments such as disciplinary action. Extrinsic motivators can have an immediate and
powerful effect, but it will not necessarily last long. When people are motivated extrinsically
such as pay or recognition, the aim is to make a direct impact on individual performance. The
intrinsic motivators, which are concerned with the „quality of working life‟ are likely to have a
deeper and long term effect because they are inherent in individuals and their work and are not
forced from outside in such forms as incentive pay (Armstrong and Taylor, 2014).

Extrinsic Motivation Extrinsic motivation occurs when things are done to or for people to
motivate them. It arises from factors outside an individual, such as incentives, increased pay,
praise, promotion, punishments such as disciplinary action, withholding pay, or criticism. These
rewards provide satisfaction and pleasure that the task itself might not provide. Extrinsic
motivators can have an immediate and powerful effect, but will not necessarily last

2.2.2.3 The Relationship between Intrinsic and Extrinsic Motivation The

difference between intrinsic and extrinsic motivation is apparent, yet researchers argues that
intrinsic and extrinsic motivation also have an effect on each other. Deci (1972) claims that in
some cases extrinsic motivation can minify intrinsic motivation. He argues that if money is
administered contingently, it minifies intrinsic motivation. But this event will not occur if the
money is non-contingently distributed. Amabile (1993) respond to this discussion by stating that
although extrinsic motivation can work in opposition to intrinsic motivation, it can also have a
reinforcing effect:”once the scaffolding of extrinsic motivation is taken care of, intrinsic
motivation can lead to high levels of satisfaction and performance”. She went further to state in
her research that both intrinsic and extrinsic values can motivate employees to do their respective
work, however intrinsic and extrinsic motivation can have very different effects on employees.
(Amabile 1993, 185-201) In conclusion, it can be stated that employees can be intrinsically and
or extrinsically motivated to carry out certain work (Amabile, 1993), and that extrinsic and
intrinsic motivation can reinforce each other, but in some cases extrinsic motivators can also
minify intrinsic motivation (Deci 1972, 14-23). Moreover, researchers, argue that not all people
are evenly motivated, some employees are more intrinsically and others are more extrinsically
motivated (Furnham et al 1998, 1035-1043). Motivation in the workplace is a broadly researched
topic (Rynes et al 2004, 381-394) earlier research has been conducted by Maslow (1943) and
Herzberg (1959), who were innovators at their subject. Many definitions have been composed,
e.g. Herzberg’s definition of motivation in the workplace is: per-forming a work related action
because you want to (Herzberg, 1959). Some divergence took place about the important of
certain aspects, but consensus is in the fact that motivation is an individual process, it is
described as being deliberate, it is multifaceted and that the purpose of motivational theories is to
predict behavior (Mitchell 1982, 80-88.) The difference between intrinsic and extrinsic
motivation is also explained. Namely, individuals are intrinsically motivated when they look for
pleasure, interest, satisfaction, enjoyment and curiosity, self-expression or personal challenges in
the work. And individual are extrinsically motivated when they engage in the work in order to
gain some goal that is apart from the work itself (Amabile, 1993). Both intrinsic and extrinsic
motivators are necessary in motivating employees (Herzberg, 1959). It must be argued that
managers must not only concentrate on the necessary factors, since, according to Herzberg
(1959) managers need to address all hygiene and motivator factors to motivate employees
(Saiyadain 2009, 158).

2.3. Theoretical Literature

There are a lot of motivation theories and research findings that attempt to provide explanations
of the behavior-outcome relationship. These theories can be classified in to Content approach
and Process approach. What distinguish between content and process motivation theories are
Content theories focus on what factors within a person that energize, direct, sustain and stop
behavior, while process theories focus on how behavior is energized, directed, sustained and
stopped.

2.3.1 Content Theories of Motivation

Content theories explain why people have different needs at different times. These needs usually
fall into three groups: physiological needs, need for social interaction, and psychological needs.

This section will look at Maslow’s need hierarchy theory, Alderfer’s ERG theory, and
Herzberg’s two-factor theory.

A. Maslow’s Theory One of the earliest works in employee motivation and job satisfaction was
presented by Maslow (1954). This work is considered pioneer in motivation theories and has
served as a basis for many other theories. Maslow’s work provided valuable notions, concepts,
and ideas related to organizational behavior and job satisfaction. According to the theory of
Maslow's there some most basic level of needs of a human that must be met before a person
develops a strong desire or get motivated for higher level needs . He presented the five tier
hierarchy of needs in 1942 to a psychoanalytic society and identified that the most basic need
emerges first and the most sophisticated need last. The most powerful employee motivator is the
need which has not been satisfied. According to Maslow, physiological needs are the things we
require for survival, like food, clothing, shelter, and sleep. In corporate world, adequate wages
represent such type of needs. Next level is of safety needs, which are necessary for physical and
emotional security. Through job security, health insurance, retirement benefits, and safe working
environments, these needs are satisfied. Moving up to the third level is the social need, where
people seek for love, affection and belonging. Relationships in the work environment and in the
informal organization, as well as in social networks with family and friends outside the
organization are good examples of social needs. Next level is the esteem need, where we urge for
respect, recognition, accomplishment and worth. The management can fulfill such needs by
matching the skill and ability of the employee to the job, by showing workers that their work is
appreciated. Finally, the self-actualization needs, which are the desires to grow and develop up to
ones fullest. He suggested that people start on the bottom and put efforts to go up to needs
hierarchy. When one need is fulfilled, it loses its strength and the next level of needs is activated.
A satisfied need is longer a motivator. The term "meta motivation" was coined by Maslow to
describe the level of motivation of a person who attempts to go beyond the basic needs and
strives for improvement constantly the human brain is complex and there are various processes
running parallel and simultaneously, and these processes affect the motivation level of a person.
Maslow made clear statements and relations regarding these levels and their impact on the
satisfaction of a person. According to this theory, once the needs at a particular level in the
hierarchy of needs are satisfied, they are no longer a motivating factor for an individual. The five
levels of hierarchy are Physiological needs, security needs, social needs, esteem needs and self-
actualization needs. As each of these needs become substantially satisfied, the next need
becomes dominant and the individual moves up the hierarchy. A good pay and interesting work
are keys to higher motivation (Shafiq, 2011)

B. Herzberg Two-Factor Theory One of the most prominent theories establishing relationship
between employee performance and motivation is the Herzberg’s two-factor theory. According
to Herzberg, there are various factors that motivate employees to excel at their jobs. Fredrick
Herzberg based his theory on the works of Maslow and Porter and concluded that it is not
possible to keep employee satisfied by meeting their low level needs. In fact, the basic benefits
such as salaries and other facilities for example an adequate working space, do not necessarily
ensure that employees are happy and motivated. Thus based on Herzberg’s theory, managers
should seek to meet the higher needs of the

employees, particularly psychological needs such as appreciation and recognition. This theory
argues that managers should seek job improvements by planning personal and professional
development of employees in order for them to be satisfied that they have significant personal
and professional growth in future in their current employment (Herzberg, 1966). Herzberg in his
two-factor theory identified motivation and hygiene factors that tend to maximize the
performance of employees. Motivation factors motivate employees to excel at their jobs and
tasks and hygiene factors typically ensure that the staff remains happy and satisfied. Thus it can
be inferred that the factors that influence job satisfaction (i.e. motivation factors) are different
than those factors that lead to dissatisfaction among employees. Thus the author developed the
motivation-hygiene theory explain the effect of these factors. The factors that increase
satisfaction are called the satisfier factors or the motivators, and the factors that lead to
dissatisfaction, are called the dissatisfies or the hygiene factors (Herzberg, Mausner, and
Snyderman, 2011). Herzberg also theorized that people have different requirements that must be
fulfilled to keep them satisfied. People firstly have physiological requirements that are typically
met by financial gains out of the job such as the salary. Secondly, there are also some
psychological requirements that must be met so that they feel driven to improve and grow. This
theory is relevant to this study as rewards can act both as satisfiers and dissatisfies and cater both
motivation and hygiene factors (Ahmed 2010). There is another aspect of Herzberg’s theory. He
believed it is also possible for managers to improve job performance by using threat,
punishment, or similar stimuli however, he concluded that these factors have a short time
influence and overall have negative impact on employee motivation. This study highlights that
the motivation and hygiene factors theory should be considered in formulating reward system
and to make sure that reward system distinguishes satisfiers and dissatisfies and cater them both
to maximize job satisfaction among employees. Within the context of corporate world, Herzberg
theory suggests that managers need to identify satisfaction factors and dissatisfaction factors
both. They must improve the former and discourage the later to maximize employee satisfaction
and motivation (Tooksoon, 2011).

C. ERG Theory This theory is published in1972 by Alderfer who argues that there are three
groups of core needs: existence, relatedness, and growth. In contrast to the hierarchy of needs
theory, the ERG theory demonstrates that (1) more than one need may be operative at the same
time, and (2) if the gratification of a higher level need is stifled, the desire to satisfy a lower-level
need increases. Maslow’s need hierarchy follows a rigid, step like progression (Robbins, 1998).
Maslow’s physiological and safety needs belong together to existence needs. Relatedness can be
harmonized to belongingness and esteem of others. Growth is the same as Maslow‟s self-esteem
plus self-actualization. Both Maslow and Alderfer tried to describe how these needs, these stages
of needs become more or less important to individuals.

2.3.2. Process Theories of Motivation

A. Theory of Expectancy The underlying motive behind the reward system is to motivate
employees to perform at a higher level when attractive rewards are offered (Jacobsen &Thorsvik,
2002). The core of the expectancy theory is relying on employees‟ willingness to perform a
certain activity. This is depending on the extent to which a specific target is rewarded, which for
example could be a higher salary or a promotion within the organization. If the employee within
the organization perceive the reward as valuable, the performance will be greater. On the other
hand, if the rewards are demotivating the employee, the performance will be poorer
(Alvesson&Sveningson, 2008). It is essential that the reward is of a nature which is preferred by
employees. The higher degree of an actual desire for the reward, will affect to which extent the
employees are motivated to put down greater effort to perform. It is fundamental that there is a
clear-cut connection between a higher degree of effort, and that these actions are leading to the
preferred reward. This is the expectancy parameter, which summarize the individual employee’s
degree of expectancy to put down the effort in alignment with the organization. The achieved
results are depending on factors such as roles, ability to perform a certain action and other human
resources, which affect the ability to reach the result. Therefore, employees within the
organization are often to a great extent motivated to act in a certain way. Hence, not all of the
employees have the ability to perform actions that leads to the preferred result. (Jacobsen
&Thorsvik, 2002)

B. Instrumentality Theory Instrumentality is the belief that if we do one thing it will lead to
another. In its crudest form, instrumentality theory states that people only work for money. The
theory emerged in the second half of the 19th century with its emphasis on the need to rationalize
work and on economic outcomes. It assumes that people will be motivated to work if rewards
and penalties are tied directly to their performance; thus the awards are contingent upon effective
performance. Instrumentality theory has its roots in the scientific management methods of
Taylor (1911), who wrote: “It is impossible, through any long period of time, to get workmen to
work much harder than the average men around them unless they are assured a large and
permanent increase in their pay.” Motivation using this approach has been and still is widely
adopted and can be successful in some circumstances. But it is based exclusively on a system of
external controls and fails to recognize a number of other human needs.

C. Reinforcement Theory Reinforcement theory as developed by Hull (1951) suggests that

successes in achieving goals and rewards act as positive incentives and reinforce the successful
behavior, which is repeated the next time a similar need emerges. Conversely, failures or
punishments provide negative reinforcement, suggesting that it is necessary to seek alternative
means of achieving goals. This process has been called “the law of effect” the connection
between the behavior and its outcome and, second, on the extent to which they are able to
recognize the resemblance between the previous situation and the one that now confronts them.
Perceptive ability varies between people as does the ability to identify correlations between
events. For these reasons, some people are better at learning from experience than others, just as
some people are more easily motivated than others.

D. Goal-Setting Theory Latham and Locke (1979) argue that setting goals are a fundamental
aspect in achieving motivational effectiveness. In addition, the authors emphasize that those
goals, which are unrealistic and arbitrary, could become a demotivating aspect for the
Organization’s employees. According to their analysis, goals that are designed to a slightly
difficult approach are the ones that to a greater extent are motivating the employees to greater
productivity. On the other hand, goals that are too hard to achieve or too easy to reach is
resulting in a less productive action by the employees. According to Locke and Latham (2002)
goals are mainly serving four different mechanisms. Firstly, the goals serves as a distinct
directive function, which allows the employee to, at a greater extent, focus on goal-oriented
activities, instead of focusing on activities that is beyond the goals. This mechanism provides the
fact that the firm can align the employees with the organization’s overall targets, when well-
designed goals are used. The second aspect that Locke and Latham points out is that goals allow
employees to take on greater effort and is functioned as a stimulating function. If the
organization had tougher goals, the employees would to a larger extent put more effort in
comparison with low-setting goals, which provide less effort by the employees. Thirdly, goals
are providing persistence affection to the employees, which imply that employees that control
their own time to reach the goal increase their effort in the task. Finally, the authors describe that
goals are encouraging employees to use their overall knowledge and expertise to solve the task.
To reach goals, commitment is essential in the sense that the employees are dedicated to reach
the goals. This is especially important when the goals are more complex, since greater
complexity requires higher efforts in comparison with lower level of complex tasks. Another
vital aspect in reaching more effective goals is to provide employees with constant feedback
from the managers. This feedback is fundamental since it allows the employee to receive
comments on progress to reaching the goal. This feedback can enhance the effort, since unaware
low-performing employees is more likely to enhance their effort to achieve the goal if they are
well aware of that they are below the current goal level. Goal effectiveness is also depending on
the task’s complexity, which implies that it is of great importance that the goals are designed
properly to suit the task. (Locke & Latham, 2002) The motivational effect is underpinning that
the goals need to be achieved, and a potential threat can occur when employees is taking
shortcuts to achieve the goals, which results in performance that is less qualitative (Heedgard
Hein, 2012). The goal-setting theory is presented in order to generate a wider picture of how
organizations use goals and feedback to improve the motivation within the organization. The
researcher will have used this theory in the formation of the surveys and interviews as well as in
the analysis of the empirical findings.

E. Equity Theory Equity theory (Adams, 1965) is concerned with the perceptions people have
about how they are being treated as compared with others. To be dealt with equitably is to be
treated fairly in comparison with another group of people (a reference group) or a relevant other
person. Equity involves feelings and perceptions and it is always a comparative process. It is not
synonymous with equality, which means treating everyone the same, since this would be
inequitable if they deserve to be treated differently. Equity theory states, in effect, that people
will be better motivated if they are treated equitably and demotivated if they are treated
inequitably. It explains only one aspect of the processes of motivation and job satisfaction,
although it may be significant in terms of morale.

There are two forms of equity: distributive equity, which is concerned with the fairness with
which people feel they are rewarded in accordance with their contribution and in comparison
with others; and procedural equity, which is concerned with the perceptions employees have
about the fairness with which company procedures in such areas as performance appraisal,
promotion and discipline are being operated.
F. McGregor’s Theory X and Y Douglas McGregor (1960) produced his analysis of the different
views about people and how they should be motivated. Theory X is the traditional view that the
average human dislikes work and wishes to avoid responsibility and that; therefore, most people
must be coerced, controlled, directed, and threatened with punishment to get them to put forward
adequate effort towards organizational objectives. In contrast, theory Y emphasizes that people
will exercise self-direction in the service of objectives to which they are committed and that
commitment to objectives is a function of the rewards associated with their achievement. The
associated concept of operant conditioning (Skinner, 1974) explains that new behaviors or
responses become established through particular stimuli, hence conditioning – getting people to
repeat behavior by positive reinforcement in the form of feedback and knowledge of results. The
concept suggests that people behave in ways they expect will produce positive outcomes .The
degree to which experience shapes future behavior does, of course, depend, first, on the extent to
which individuals correctly perceive.

2.3.3. Theoretical Framework

Employee motivation is a critical aspect at the workplace which leads to the performance of the
department and even the company. Motivating employees needs to be a regular routine. There
are several reasons why employee motivation is important, mainly because it allows
management to meet the company’s goals. Motivated employees can lead to increased
productivity and allow an organization to achieve higher levels of output. Imagine having an
employee who is not motivated at work. They will probably use the time at their desk surfing the
internet for personal pleasure or even looking for another job. This is a waste of your time and
resources. When employees are motivated to work, they will generally put their best effort in the
tasks that are assigned to them and this will increase employee commitment. Motivation can
facilitate a worker reaching his/her personal goals, and can facilitate the self-development of an
individual. Once that worker meets some initial goals, they realize the clear link between effort
and results, which will further motivate them to continue at a high level. An employee’s
efficiency level is not only based on their abilities or qualifications it is also based on motivation.
For the company to get the very best results, an employee needs to have a good balance between
the ability to perform the task given and willingness to want to perform the task. This balance
can lead to an increase of productivity and an improvement in efficiency. (Mario Andretti)
2.4. Empirical Concepts on Employees Motivation

If any person has to come up with the question that is there any need for employees motivation?
The answer to this type of question of-course should be simple-the basic survival of every
organization is public or private limited before, today and in the foreseeable future lies in how
well its work force is motivated to meet the objectives of the organization. This explains why the

human resource department in today’s organization became more focused on its functions. I
think that motivated employees are needed in this rapidly Business world where the
principallatent conflict is the issue confronting most managers. Most organizations now consider
their human resources as their most valuable assets (a strategic or competitive advantage).
Therefore, in order to effectively and efficiently utilize this strategic asset, I believe managers
and the organization as a whole must be able and willing to understand and hopefully provide the
factors that motivate its employees within the context of the roles and duties they perform. This
is because highly motivated employees are the cause of high productivity levels and hence higher
profits for the organization. Having noted this rationale the next question one may ask are what
factors motivated today’s employees? “According to Wiley (1997, p265) at some point during
our lives, virtually every person may have to work. He claims that working is such a common
phenomenon that the question “what motivates people to work is seldom asked. Wiley went on
to say that “we are much more likely to wonder why people climb mountains or commit suicide
than to question the motivational basis of their work”. Therefore, exploring the altitudes that
employees hold concerning factors that motivate them to work is important to creating an
environment that encourages employee motivation.

2.4.1 Reasons for Motivating Employees

Managers need to find creative ways in which to consistently keep their employees motivated as
much as possible. Motivation is highly important for every company due to the benefits that it’s
able to bring. Such benefits include (Bob Nelson, 2003):

1. Human Capital Management A company can achieve its full potential only by making use of
all the financial, physical, and human resources that it has. It is through these resources that the
employees get motivated to accomplish their duties. This way, the enterprise begins to glisten as
everyone is doing their best to fulfill their tasks.
2. Meet Personal Goals and Help an Employee Stay Motivated Motivation can facilitate a worker
reaching his/her personal goals, and can facilitate the self-development of an individual. Once
that worker meets some initial goals, they realize the clear link between effort and results, which
will further motivate them to continue at a high level.

3. Greater Employee Satisfaction Worker satisfaction is important for every company, as this one
factor can lead towards progress or regress. In the absence of an incentive plan, employees will
not fill ready to fulfill their objectives. Thus, managers should seek to empower them through
promotion opportunities, monetary and non-monetary rewards, or disincentives in case of
inefficient employees.

4. Raising Employee Efficiency An employee’s efficiency level is not strictly related to his
abilities and qualifications. In order to get the very best results, an employee needs to have a
perfect balance between ability and willingness. Such balance can lead to an increase of
productivity, lower operational costs, and an overall improvement in efficiency, and can be
achieved only through motivation.

5. A Higher Chance of Meeting the Company’s Goals Any enterprise has its goals, which can be
achieved only when the following factors are met: • There is a proper resource management •
The work environment is a cooperative one • All employees are directed by their objectives •
Goals can be reached if cooperation and coordination are fulfilled at once through motivation

6. Better Team Harmony A proper work environment focused on cooperative relationships is

highly important for an Organization’s success. Not only that it can bring stability and profits,
but employees will also adapt more easily to changes, fact which is ultimately in the company’s
benefit.

7. Workforce Stability of the personnel is highly important from a business point of view. The
staff will stay loyal to the enterprise only they meet a sense of participation within the
management side. The abilities and potency of staff can be used in their own advantage, but also
in the benefit of the company. This may cause an honest public image within the market which
can attract competent and qualified individuals into the business.

2.4.2 Challenges of Motivating Employees

Identifying what motivates each employee is very difficult task for managers. According to
Kumar (2012), motivating employees to contribute their best efforts to achieve organizational
goals and objectives require that managers make it possible for employees to satisfy their needs
by making such contributions. However, this is one of the most challenging tasks for the
managers of an organization because they have to first identify the needs that the employees try
to satisfy at work. Identifying a list of needs that is both sufficiently comprehensive and
workable is not easy. There are no defined rules or guidelines whereby the managers can identify
those needs. Moreover, different employees have different needs to satisfy through their work
which further complicates the manager’s task to identify those needs. It requires a high degree of
human skill and creativity on the part of managers to identify them. Then, they have to create
conditions and work environment which facilitate the employees to satisfy their needs at the
work place. Managers have to be innovative and participative in the approach to create such
conditions and work environment. Furthermore, all the needs cannot be satisfied as some of them
may be against the interest of the organization as a whole and therefore, must be discouraged, but
without de-motivating the employees having such needs which itself is a challenging task
(Kumar 2012)

2.5 Synthesis

2.5.1 Dimensions of Motivations under Study

A. Payment Pay is defined as, what an employee gets against his work after fulfilling his duty.
Payment include basic salary, bonuses, pay for doing extra work and incentives. According to
Herzberg‟s motivation-hygiene theory, salary is one of those hygiene factors which eliminate job
dissatisfaction. Salary is a factor which leads employees from dissatisfaction to no
dissatisfaction. On the other hand Expectancy theory described that people do effort because they
want some rewards in term of money, promotion etc. People expect that if they work well in the
workplace then their performance will increase and automatically their pay will increase and
they will be promoted. This will cause increase in their job satisfaction and motivation level.

B. Recognition is one of the most powerful methods of rewarding people. Recognition is the
acknowledgement of an individual or team's behavior, effort and accomplishments that support
the organization's goals and values. According to (Oosthuizen, 2001) recognition is the
acknowledgement of an individual contribution showing appreciation and to reward the
individual for an accomplishment of a task or sound performance. Recognition is the component
that is used to strengthen the relationship between organization and people. Through the
recognition employee feel rewarded and motivated. Employees become more loyal to their
organization if organization recognizes their work. Recognition can be provided by positive and
immediate feedback from managers and colleagues that acknowledge individuals and team
contributions. It is also provided by managers who listen to and act up on the suggestion of their
team’s members. Other actions that provide recognition include acknowledge contribution,
allocation to a high-profile project, and enlargement of the job to provide scope for more
interesting and rewarding work (TezeraMisganaw, 2006).

C. Benefits are elements of remuneration given in addition to the various forms of cash pay.
They provide a quantifiable value for individual employees, which may be deferred or contingent
like a pension scheme, insurance cover or sick pay, or may provide an immediate benefit like a
company car (Armstrong, 2007)

D. Autonomy According to Wilkinson (1998) empowerment/autonomy is the extents to which

employees‟ are encouraged to take firm decisions and (Carless, 2004) also add it is the decision
made by employees without consultation with their managers so that it can enhance employees‟
decision participation. This aspect concerns the decision of the leadership behavior (Lee &Koh,
2001), and therefore can be defined as the strengthening of the building, which has delegated
management by providing employees with authority and autonomy over their tasks (Hsieh &
Chao, 2004).Autonomy enhances self-belief, gives people more opportunity to achieve and
provides an opportunity to develop skills. This increases the motivation of workers to a greater
extent (Kalleburg, 1977).

E. Promotion is defined as “getting high status in workplace by doing effective work, generally
increase the status, position and remuneration of employee in the organization” (Heery and
Noon, 2001). Graham (1986) defines promotion as “shifting from lower designation to high
designation within an organization and usually increases in pay package”. If organizations are
not giving promotion to their employees then employees will be dissatisfied and their turnover
rate will be high (De Souza, 2002). Several researchers focused on the correlations between
motivation and promotion. Locke (1976, p.1323) advocates that the wish to be promoted stems
from the desire for psychological growth, the desire for justice and the desire for social stays.
Management should therefore bear in mind, that promotion can serve as a very positive
motivating tool in ensuring that the employee attains goals at a higher level. The importance of
promotion appears to be different for people that belong to different social classes and who
perform at different skill levels. For professional and managerial people, work is part of their
career and promotion is the highest reward. For semiskilled and unskilled people, promotion is
less important (TezeraMisganaw, 2006).

F. Working condition is about providing healthy, safe and so far as practicable pleasant working
environment for employees (Michael Armstrong, 2006). It is the conditions in which an
individual or staff works this includes the relationships with colleagues, working hours, work
load, availability of resources and the like.

G. Career development opportunities Career development is the process of improving an

individual’s abilities in anticipation of future opportunities for achieving career objectives. A
formal approach taken by an organization to help its employees acquire the skills and
experiences needed to perform current and future jobs is termed as career development.
Company’s policies especially policies regarding promotion, counseling the employees,
opportunities to excel in future help employees to develop their career. Career development
consists of skills, education and experiences as well as behavioral modification and refinement
techniques that allow individuals to work better and add value. Career development is an
ongoing organized and formalized effort that recognizes people as a vital organizational
resource. It differs from training in that it has a wider focus, longer time frame, and broader
scope. Recently, career development has come to be seen as a means for meeting both
organizational and employee needs, as opposed to solely meeting the needs of the organization
as it had done in the past. Now, organizations see career development as a way of preventing job
burnout, providing career information to employees, improving the quality of work lives and
meeting affirmative action goals. That is, career development must be seen as a key business
strategy if an organization wants to survive in an increasingly competitive and global business
environment.

2.5.2 Conceptual Framework of the Study

After studying the literature review the following conceptual framework is developed in order to
relate employee motivation with various variables such as payment, recognition, benefits,
autonomy, promotion and work condition. The motivational factors in conceptual framework are
adopted from Herzberg's two factor theory. Employee motivation is the dependent variable and
will be examine through texzh the following factors that are seven factor such as
paymentbenefit e.t. On the other hand the independent variable.

Independent variable Dependent variable

Payment
Benefit

Working condition Employee Motivation

Recognition
Employee Autonomy
Career development opportunity

CHAPTER THREE

3. RESEARCH DESIGN AND METHODOLOGY

This chapter presents the research methodology that was used in conducting the study. It focuses
on the research design, population and sampling technique, data collection methods.

3.2. Research Approach and Design

For this research quantitative research approach was used. Quantitative business research is a
research that addresses research objectives through empirical assessments. It involves numerical
measurements and analysis approaches (Zikmund, 2010). In order to achieve the research
objectives and to search answers for the basic research questions the researcher used a
quantitative research design using questionnaire survey method so as to gather the perception of
determinants of employee’s motivation in Commercial Bank of Ethiopia.

The research designs used for this study were explanatory research. Explanatory Research
Design is used because it helps to critically examine the relationship between the dependent
variable and independent variable. This Research design basically comprises of the blueprint for
collection, measurement as well as the analysis of data; it is the plan or overall research program
that helps the researcher obtain answers to the research questions; it includes an outline of what
the researcher will do right from writing the hypothesis to the analysis of the data; it outlines the
research problem structure by showing the relationship of the different variables of the study and
the research plan that is used to acquire empirical evidence on the various relationships (Cooper
and Schindler, 2014). The study was made to examine the practice of employee motivation in
Commercial Bank of Ethiopia. The research helped us to measure how various variables
motivate employees in Commercial Bank of Ethiopia.

3.3. Population, Sample Size and Sampling Technique

3.3.1. Population

A population is defined as the elements of which some study or inferences will be made (Cooper
and Schindler, 2014). According to Quinlan (2011), a population can be made up of several
individual cases, units or individuals. The target population has to be defined by the elements,
time and geographical boundaries showing that the scope of study and the research objective
play a major role in the definition of the target population (Bougie and Sekaran, 2013). The study
population in this research consists of 800 permanent employees of commercial bank of Ethiopia
in six branches.Yamane's formula for sample size determination is:-

*n= N

1+N(e)^2

Where * n= Sample Size

N= Total Population

e = Sampling of error ( generally 0.05 and acceptable error.)

The researcher uses for the study 0.05 sampling error and 90 confidence level.

n=800

1+800(0.05)2

=266

No Branch Total population Sample Responded

size
1 Yetimen branch 112 60 58
2 Amber branch 130 30 29
3 Dejen branch 98 18 16
4 Abbay sheleko branch 126 35 33
5 Wejel branch 110 70 68
6 Lumamie branch 79 23 20
7 Muga branch 142 30 30
Total 800 266 254
Source on Survey2022

3.3.2. Sample Size

The number of target population that was used for the study was 800. Using Taro Yamane
(1967), sample selection method with a probability of 90% free error, a total of samples would
be drawn from the total target population. n=N/1+N(e)2

Where n is the required sample size, N is the population size and e is the level of precision. The
formula was developed by Taro Yamane (1967). BY applying the above formula

So from the target population 800employees the researcher selected266 employees as sample to
distribute the questionnaires. Since the number of people in each branch is not the same, the
number of samples for each branch is taken based on their proportion of number of employees.

3.3.3. Sampling Technique

Sampling procedure or technique can further be divided into “two broad categories, probability
and non-probability samples “(Ghauri and Gronhaug, 2010, p. 139). According to Sekaran and
Bougie, 2013), “in probability sampling, the elements in the population have some known,
nonzero chance or probability of being selected as sample subjects. In non-probability sampling,
the elements do not have a known or predetermined chance of being selected as subjects.” (p.
245). This study used a stratified random sampling technique which is a type of probability
sampling (Ghauri and Gronhaug, 2010). This is done by grouping the population in to subgroups
such as age, gender, year of service, educational qualifications. By taken of some employees
form select seven branchwitn in given position.

It also used was used in this research was non-probability sampling to select the branches from
seven D/markos techniques. The nonprobability sampling technique was used Debremarkos
districts. The researcher also used simple random sampling technique to distribute the
questionnaires for respondents. The rationale behind using simple random sampling technique
for this study is to give each member of the study population equal chance of being selected.

3.4. Data Types

For this research both primary and secondary sources of data was used. Considering that using
primary data. Primary data was collected by distributing structured questionnaire for the
employees of Commercial Bank of Ethiopia. On the other hand the secondary data was collected
from sources like prior researches, , books, and different documents of the bank. The main data
collection instrument that was used in this study is questionnaire. Questionnaire is usually
inexpensive, easy to administer a large number of employees and less time-consuming and
normally gets more consistent and reliable results than other instruments

3.5. Data collection Instrument

The type of data used in the study is primary data which assisted in answering the research
questions. According to Ghauri and Gronhaug (2010) Primary data have the advantage of being
collected for a particular project that is at hand and are therefore more consistent with research
questions and objectives. Ghauri and Gronhaug also state that ‘data on motivation’ which is one
type of primary data provides information that can help in understanding the motives that
influence behavior towards a particular issue. Data collection can be done in various ways and in
different settings such as field or in a lab and from many different sources according to Sekaran
and Bougie (2013). “Data collection methods include interviews (face-to-face interviews,
telephone interviews, computer-assisted interviews, and interviews through electronic media);
observation of individuals and events, with or without videotaping or audio recording;
questionnaires, which can be personally administered, sent through the mail, or electronically
administered; and a variety of motivational techniques such as projective tests. Interviewing,
observing people and phenomenon, and administering questionnaires are the three main data
collection methods in survey research” (Sekaran and Bougie, 2013, p. 116). The primary data
which was used in the study used a structured questionnaire method to collect the data.”
Questionnaires are generally highly structured data collection instruments (Quinlan, 201 1, p.
223). Questionnaires enabled the researcher collect a large number of quantitative data (Sekaran
and Bougie, 2013) hence attaining the most information possible. Thequestionnaires to was used
closed questions (for example yes/no responses), (Quinlan). The questions was presented in the
form of statements on a 1-5 Likert scale ranging from 5=strongly agree, 4=Agree, 3=Neutral,
2=Disagree, and 1=strongly disagree.

3.6. Data Analysis Methods

According to Cooper and Schindler (2014), data analysis is “the process of editing and reducing
accumulated data to a manageable size, developing summaries, looking for patterns, and
applying statistical techniques (p. 655). Cooper and Schindler state that what managers need is
information and not raw data. It is therefore the duty of the researcher to generate the needed
information through analysis of the collected data. Data analysis according to Quinlan (2011) is
done in four stages namely; description (the researcher describes what is in the data),
interpretation (the researcher at this stage will state what they think the data means), conclusions
(at this stage, the researcher uses the data to draw a minor or major conclusion about the data),
and theorization (this is theorization of the analysis which should contribute to theory and the
knowledge body). In this study, before processing the responses, data preparation was carried out
on the completed questionnaires through editing, entering, and cleaning the data. Data analysis
was done using two tools namely; Statistical Package for Social Science (SPSS) and Excel. By
using these data analysis tools frequency, percentage of respondents for each variable and mean
was computed, was made, each hypothesis was tested by using the result from the regression
analysis .The study results are presented in the form of tables.

3.7. Reliability and Validity

Validity refers to the extent to which measurement of instrument actually measure what is
intended to measure. It is the strength of our conclusions, inferences or propositions. It involves
the degree to which you are measuring what you are supposed to, more simply, the accuracy of
your measurement (Adams, 2007).

In this research when collecting the questionnaires, tried to make sure that it is the respondents
who have complete the questionnaire through having an informal conversation where ever
possible and sample test was made for representatives to check the reliability.

Table 3.2 Reliability Analysis

Dimensions Cronbach’s alpha

Payment 0.779
Benefit 0.824
Promotion 0.784
Working condition 0.842
Recognition 0.821
Employees autonomy 0.842
Career development opportunity 0.842
Source: Own survey 2014

As shown in the above table, Scale Reliability Cronbach Alphas coefficients for different
dimensions item range from 0.779 to 0.842. Therefore, the expected scales used in this study
demonstrate high reliability.

3.8. Ethical Considerations

Participants of the study were informed to participate voluntarily and their privacy and
anonymity would be kept in secret and would be used for only academic purpose. According to
Creswell (2012), “as the researcher anticipate data collector, the need to respect the participants
and sites for the research”. In the study there should be maintain objectivity, courtesy and no
falsification, alteration or misrepresentation of data for political or other purposes. Moreover, the
use of offensive, discriminatory or other unacceptable languages were avoided in the formulation
of questionnaires.

CHAPTER FOUR

4. 1 DATA PRESENTATION ANALYSIS AND INTERPRETATION

In this section, Statistical Package for the Social Sciences (SPSS) version 21 was used for the
purpose of analysis and presentation of results. It also presents a discussion of the final results
and the process through which the Results were obtained.

4.2. Response Rate

A total of 266 questionnaires were distributed to the randomly selected employees of 7selected
branches of CBE found in D/Markos district .Out of these questionnaires, 254 were properly
collected. As a result, the overall response rate was 95% which is acceptable for data analysis
and discussion of the study.

Table 4.1 Response Rate

Number Number of Number of branch of Reponses rate

questionaries’ questionaries’
distributed of collected of
266 254 7 95%
Source: Survey questionnaire 2022

4.3. Demographic Characteristics of Respondents

In this section the demographic information is represented. The respondents gathered for these
studies were gender, age, marital status, job category, education level, and years of service.

Table 4.2 Characteristics of Respondents

frequency percent Valid Cumulative

 percent percent
Gender male 155 61.0 61.0 6.10
female 99 39.0 39.0 1000
Age of 21-30 124 48.8 48.8 48.8
respond
indents 31-40 84 33.1 33.1 81.9
41-50 30 11.8 11.8 93.7
Above 50 16 6.3 6.3 100

Marital status Married 110 43.3 43.3 43.3

Single 137 53.9 53.9 97.2
Widowed 3 12 12 98.4
Divorced 4 1.6 1.6 100
Educational Diploma 40 15.7 15.7 15.7
Qualifications Degree 166 65.4 65.4 81.1
Masters 48 18.9 18.9 100
Age of <3years 110 43.3 43.3 43.3
services 3-5years 99 39.0 39.0 82.3
6-10years 45 17.7 17.7 100
total 245 100 100
Source: Survey questionnaire, 2022

As indicated in Table 4.2 above, out of 254 respondents the number of male respondents is 155
(61%) and the remaining 99 (39%) are female. The majority of the respondents are male
reflecting the gender distributions in the commercial banks of Ethiopia.

The age of participants were divided into four groups, the larger no of employees is between the
ages of 21-30 which adds to 124 respondents representing to 48.8% of the total respondents
followed by 31-40 age categories which accounts 33.1% of the respondents. The rest age
category 41-50 and over 50 will cover 11.8% and 6.3% of the population respectively. From this
result we can observe that the majority of employees of the CBE are at the young and productive
 age group. Hence the CBE does not face the problem of aged employees and can be more
productive if motivated properly.

The above table shows the majority of respondents are single which account 53.9% followed by
married and divorced one with percentage of 43.3% and 1.6% respectively. The minority of the
respondents are widowed that accounts 1.2%. Diploma holders have the lowest count with
15.7% of the respondent following the master’s degree holders 18.9%. Degree holders have the
largest percentage 65.4%. From this we can see that most of employees of CBE are degree
holders.

The majority of the respondents is with in less than five year experiences. Those with less than
three year experience have the largest count with 42.9% followed by employees worked in CBE
within 3-5 year of experience which is 33.9 % of the respondents. 17.7% of the respondent has
the experience of 6-10 years. However, only 5.5% of the respondents are worked in CBE for
more than 10year service. The largest groups of the respondents are employees with less than 3
years of experience.

4.4. Descriptive Analysis Result

The following tables summarize the frequency and percentage of respondents with their level of
agreement with regard to questions asked.

Table 4.3 Frequency and percentage of respondent on payment items

Items SD D N A SA

Count Percent count percent count percent coant perce coant percent
nt

Iam happy and satisfied with by current salary 72 28.3 38 15 17 6.7 126 49.6 1 0.4

Iam happy and satisfied with the bonus offered by by 80 31.5 37 14.6 26 10.2 94 37 17 6.7
employee

The basics of payment for example over time 65 25.6 34 13.4 65 25.6 73 28.7 17 6.7
payment are reasonable

The pay scale and benefits of our company treat each 84 33.1 32 12.6 51 20.1 53 20.9 34 13.4
employee equitable

The way bonus payment distributed is fair and based 63 24.8 65 25.6 43 116.9 64 25.2 19 7.5
on performance
The current salary is adequate to cope up with the 92 36.2 63 24.8 45 17.7 43 16.9 11 4.3
ongoing cost of life

Tota 254 100 254 100 254 100 254 100 254 100

Source: Survey questionnaire, 2022

As we can see in the above table 72 (28.3%) are not happy and satisfied about the current salary,
38 (15%) disagree, 17 (6.7%) are neutral, 126(49.6%) agree and 1 (0.4%) strongly disagree.
From these we can see that majority of the respondents are not happy and satisfied about the
current salary.

When we come to the bonuses offered by the company 80 (31.5%) strongly disagree, 37 (14.6%)
disagree, 26 (10.2%) neural, 17 (6.7%) strongly agree. From this majority of the respondents are
not satisfied with the bonus provided.

When we come to the basic payment 65 (25.6%) strongly disagree, 34 (13.4%) disagree, 65
(25.6%) neutral, 73 (28.7) agree and 17 (6.7%) strongly agree.

When we come to the pay scale and benefits majority of the respondents 84 (33.1%) are not
satisfied, majority of the respondents 65 (25.6 %) disagree with the way bonus payment is
distributed, 92 (36.2%) of the respondents suggest that the current salary is not adequate to cop
up with the ongoing cost of life.

Table 4.4 Frequency and percentage of respondent on Benefit items

Items sd d n a sa
The benefit system of the organization treats each employee 8 3.1 70 27.6 57 22.4 101 39.8 18 7.1
reasonably
My medical scheme is satisfactory 15 5.96 23 9.1 87 34.3 103 40.6 26 10.2
My pension benefits are good 29 11 18 9.1 111 43.7 80 31.5 16 6.3
The organization insurance scheme enhances the satisfaction of 44 17.3 14 5.5 97 38.2 74 29.1 25 9.8
employees
I never have problem with my leave arrangement 52 20.5 68 26.8 16 6.3 85 33.5 33 13
Total 254 100 254 100 254 100 254 100 254 100

Source: Survey questionnaire, 2022

 As we can see in the above table 8 (3.1%) strongly disagree with the reasonability of the benefit
provided by the company, 70 (27.6%) disagree, 57 (22.4%) are neutral, 101 (39.8%) agree and
18 (7.1%) strongly disagree. From these we can see that majority of the respondents disagree
with the reasonability of the benefit system provided by the company.

When we come to the medical scheme provided by the company 15 (5.9%) strongly disagree, 23
(9.1%) disagree, 87 (34.3%) neural, 103 (40.6%) agree, 26(10.2%) strongly agree. From this
majority of the respondents are satisfied with the medical scheme provided.

When we come to the pension benefit provided by the company 29(11.4%) strongly disagree, 18
(7.1%) disagree, 111 (43.7%) neural, 80 (31.5%) agree, 16 (6.3%) strongly agree

When we see the insurance scheme provided 44 (17.3%) strongly disagree, 14 (5.5%) disagree,
97(38.2%) neural, 74(29.1%) agree, 25(9.8%) strongly agree.

When we come to the leave arrangement 52 (20.5%) strongly disagree, 68 (26.8%) disagree, 16

Table 4.5 Frequency and percentage of respondent on Promotion items

Iteme SD D N A SA
he promotion paths are Cleary stated and communication to the 58 22.8 65 25. 56 22 65 24. 13 5.1
employee
8 4
The opportunity for promotion exist in this organization 49 19.3 56 22 56 22 22 8.7 71 28
Everyone has equal chance to be promoted 67 26.4 47 18. 77 30.3 21 8.3 42 16.5
5
Staffs are promoted in a fair and transparent way 66 26 44 17. 45 17.7 77 30. 22 8.7
3 3
The possibility of gittign a promotion influences my performance 34 13.4 53 20. 63 24.8 87 34. 17 6.7
9 3
254 100 254 100 254 100 254 100 254 100
Source: Survey questionnaire, 2022

As we can see in the above table 58 (22.8%) strongly disagree on the clarity of promotion paths,
65 (25.8%) disagree, 56 (22%) neural, 62 (24.4%) agree, 13 (5.1%) strongly agree. Therefore
 majority of the respondents disagree on the clarity of promotion paths stated and communication
to the employee.

When we come to the chance for promotion 67 (26.4%) strongly disagree, 47 (18.5%) disagree,
77 (30.3%) neural, 21 (8.3%) agree, 42 (16.5%) strongly agree.

When we come to the transparency and fairness of promotion 66(26%) strongly disagree, 44
(17.3%) disagree, 45 (17.7%) neural, 77 (30.3%) agree, 22 (8.7%) strongly agree. Therefore
majority of the respondents agree with the transparency and fairness of promotion.

When we come to the influence of promotion on performance 34 (13.4%) strongly disagree, 53

(20.9%) disagree, 63 (24.8%) neural, 87 (34.3%) agree, 17 (6.7%) strongly agree. Therefore
majority of the respondents agree the possibility of getting a promotion influences their
performance.

Table 4.6 Frequency and percentage of respondent on working condition item

Itemes SD D N SA A
My working hours are reasonable 45 17.7 39 15. 32 12.6 84 33.1 54 21.3
4
I get the opportunity to communication 15 5.9 66 26 39 15.4 102 40.2 32 12.6
on aspects of our works
I am satisfied with the way my workers 92 36.2 47 18. 75 29.5 17 6.7 1 0.4
get along with each other 5
The arrangement of office layoutis 33 13 62 24. 67 26.4 76 29.9 16 63
convenient for employee 4
Basic resource are employee 76 29.9 58 22. 51 20.1 68 26.8 1 0.4
8
Total 254 1000 254 100 254 100 254 100 254 100
Source: Survey questionnaire, 2022

As we can see in the above table 45 (17.7%) strongly disagree on the reasonability of the
working hour, 39 (15.4%) disagree, 32 (12.6%) neural, 84 (33.1%) agree, 54 (21.3%) strongly
agree. Therefore majority of the respondents agree working hours are reasonable.
 When we come to opportunity to communicate on aspects of work 15 (5.9%) strongly disagree,
66 (26%) disagree, 39 (15.4%) neural, 102 (40.2%) agree, 32 (12.6%) strongly agree. Therefore
majority of the respondents agree on the opportunity to communicate on aspects of work

When we come to the way co-workers get along with each other 92(36.2%) strongly disagree,
47 (18.5%) disagree, 7 (29.5%) neural, 17 (6.7%) agree, 1 (0.4%) strongly agree. Therefore
majority of the respondents are not satisfied with the way co-workers get along with each other.

When we come to the convenience of the arrangements of the office layout 33 (13%) strongly
disagree, 62 (24.4%) disagree, 67 (26.4%) neural, 76 (29.9%) agree, 16 (6.3%) strongly agree.
Therefore majority of the respondents agree with the convenience of the arrangements of the
office layout.

When we come to the availability of resource 79 (29.9%) strongly disagree, 58 (22.8%) disagree,
51 (20.1%) neural, 68 (26.8%) agree, 1 (0.4%) strongly agree. Therefore majority of the
respondents are not satisfied with the availability of resources

Table 4.7 Frequency and percentage of respondent on Employee Recognition items

Item SD D N A SA
I am adequately recognized for my 48 18. 64 25. 69 27. 53 22 17 3.1
achievements at work 9 2 2
The achievement and recognition system of the 35 13. 89 35 69 27. 53 20.9 8 3.1
organization is adequate 8 2
I often receive recognition for my work 17 6.7 97 38. 61 24 45 17.7 34 13.4
achievements 2
Total 254 100 254 100 254 100 254 100 254 100
Source: Survey questionnaire, 2022

As we can see in the above table 48 (18.9%) strongly disagree on the adequately recognition for
achievements at work. 64 (25.2%) disagree, 69 (27.2%) neural, 56 (22%) agree, 17 (6.7%)
strongly agree.

When we come to the adequacy of achievement and recognition system of the organization 35
(13.8%) strongly disagree, 89 (35%) disagree, 69 (27.2%) neural, 53 (20.9%) agree, 8 (3.1%)
 strongly agree. Therefore majority of the respondents disagree on the adequacy of achievement
and recognition system of the organization.

When we come to the recognition for achievement 17 (6.7%) strongly disagree, 97 (38.2%)
disagree, 61 (24%) neural, 45 (17.77%) agree, 34 (13.4%) strongly agree.

Table 4.8 Frequency and percentage of respondent on Employee Autonomy items

Items SD D N A SA
I have the authority to correct daily problem when 5 2 44 17.3 76 29. 123 48.4 6 2.4
they occur 9
I am encourages to handle daily problems by myself 9 3.5 31 12.2 57 22. 146 57.5 11 4.3
4
I have control over how I solve the daily problems 20 7.9 10 3.9 91 35. 122 48 11 4.3
9
I Am able to control the social contact with others 23 9.1 13 5.1 60 23. 143 56.3 15 5.9
6
Total 254 100 25 100 254 100 254 100 254 100
4
Source: Survey questionnaire, 2022

As we can see in the above table 5 (2%) strongly disagree on the authority to correct daily
problem when they occur 44 (17.3%) disagree, 76 (29.9%) neural, 123 (48.4%) agree, 6 (2.4%)
strongly agree. Therefore majority of the respondents agree on the authority to correct daily
problem.

When we come to the encouragement to handle daily problems by themselves 9(3.5%) strongly
disagree, 31 (12.2%) disagree, 57 (22.4%) neural, 146 (57.5%) agree, 11 (4.3%) strongly agree.
Therefore majority of the respondents agree on the encouragement to handle daily problems by
themselves.

When we come to the control over how they solve daily problems 23 (9.1%) strongly disagree,
13 (5.1%) disagree, 60 (23.6%) neural, 143 (56.3%) agree, 15 (5.9%) strongly agree. Therefore
majority of the respondents agree on the encouragement over how they solve daily problems.
 When we come to the ability to control the social contacts with others 23 (9.1%) strongly
disagree, 13 (5.1%) disagree, 60 (23.6%) neural, 143 (56.3%) agree, 15 (5.9%) strongly agree.
Therefore majority of the respondents agree on the control the social contacts with others.

Table 4.9 Frequency and percentage of respondent on Career development opportunity items

Items SD D N A SA
I have god access to development opportunity 36 14.2 67 26.4 55 21.7 86 33.9 10 3.9
in my current job
I see a future for myself in a higher level role 67 26.4 27 10.6 50 19.7 86 33.9 24 9.4
in this organization
my organization has a program mentoring 34 13.4 59 23.2 76 29.9 74 29.1 11 4.3
program for jobs like mine
Total 254 100 254 100 254 100 254 100 254 100
Source: Survey questionnaire, 2022

As we can see in the above table 36 (14.2%) strongly disagree on the access to development
opportunities in their current job 67 (26.4%) disagree, 55 (21.7%) neural, 86 (33.9%) agree, 10
(3.9%) strongly agree. Therefore majority of the respondents agree there is a good access to
development opportunities in their current job.

When we come to future in higher-level role in this organization 67 (26.4%) strongly disagree,
27 (10.6%) disagree, 50 (19.7%) neural, 86 (33.9%) agree, 24 (9.4%) strongly agree. Therefore
majority of the respondents see a future for themselves in a higher-level role in this organization.

When we come to formal mentoring Program for jobs 34 (13.4%) strongly disagree, 59 (23.2%)
disagree, 76 (29.9%) neural, 74 (29.1%) agree, 11 (4.3%) strongly agree.

4.5. Summary of Employee Motivation

Table 4.13 below shows the means and standard deviations of motivation variables such as
payment, benefits, promotion, working condition, recognition, employees autonomy and career
development opportunity rated by respondents.

Table 4.10 Mean value of variables

 N minimum maximum mean
Payment 254 1 4 2.6333
Benefit 254 1 4 3.1496
Promotion 254 1 4 2.8315
Working condition 254 1 5 3.0717
Recognition 254 1 5 2.7664
Employee autonomy 254 2 5 3.3976
Career development opportunity 254 1 5 2.8806
Valid N(list wise) 254
Source: Survey questionnaire, 2022

 As we can see in the table relatively better mean result for benefit, employee
autonomy, working condition was found (M=3.1496), (M=3.3976) respectively.
Relatively moderate mean value for other variables like promotion, career
development opportunity, recognition (M=2.8315,), (M=2.7664) respectively and
less mean scoring variables such as payment (M=2.6333).
 From this we can see that among those employee motivation packages given by the bank
benefit, employee autonomy, working condition have relatively acceptable by the
employees of commercial bank of Ethiopia but other like promotion, career development
opportunity, recognition payment have mean value of below the average of five likert
scale which implies the employees are not satisfied by these packages especially with
payment and benefit given by the bank which have the lowest mean value.

4.6. Result of Regression Analysis

Multiple regression analysis applied to find out whether there was statistically significant relation
surfaced between work motivation and the seven motivation dimensions or not. To know about
the impact of individual dimensions of motivation variables on the employee’s motivation
multiple regressions using the following model was run:

y=a+b1x1+b2x2+b3x3+b4x4+b5x5+e motivation=a+b1(payment)+b2(benefits)+b3(promotion)
+b4(recognition)+b5(workingcondition) +b6(employee “autonomy)+b7(career development
opportunity)+e

Table 4.11 Table Summery of Regression Model Model summery

model R R square Adjusted Std error of the

Rsquare estimate
 1 .891 .794 .788 .38212
Source: Survey questionnaire, 2022

Predictors: (Constant), Career development, Work condition, Benefit, Recognition, Promotion,

Payment

As indicated in the model summery table the linear combination of the independent variable was
significantly related to the dependent variable, R=0.794, R square= 0.794 adjusted R
square=0.788 , F=15.228 (p=0.000). R value tells that the overall motivation dimensions such as
payment, benefits, promotion, recognition, working condition, employees autonomy and career
development opportunity have moderate effect on the dependent variable(motivation). R-square
0value 0.794indicates that 78.8 % of variation on dependent variable (motivation) is explained
by the above dimensions (payment, benefits, promotion, and recognition, working condition,
employee’s autonomy and career development opportunity).

Table 4.12 Significance of the Regression Model ANOVA

model Sam of square df Mean square F Sig

regression 138.593 8 19.799 135.598 .000
residual 35.919 246 .146
total 174.519 254
Source: Survey questionnaire, 2022

a) Predictors, (constant), payment, benefits, promotion, recognition, working condition,

employee’s autonomy and career development opportunity

b) Dependent variable, motivation

Table 4.13 Coefficients of Regression

Model Unstandardized coefficient Standardized T sig

coefficients
B std.error Beta
Constant -1.164 .279 -4.164 .000
Payment .419 .044 .492 9.594 .000
Benefit .099 .055 .080 1.787 .005
.057
Working condition .572 .057 .366 9.985 .000
Promotion -110 .040 .120 -2.765 .006
recognition .133 .037 .131 3.564 .000
Employee autonomy .058 .044 .046 1.305 .193
Career development .287 .030 .351 9.502 .000
Source: Survey questionnaire, 2022

Dependent Variable: motivation A) Predictors, (constant), payment, benefits, promotion,

recognition, working condition, employee’s autonomy and career development opportunity

The regression coefficients explain the average amount of change in the dependent variable due
to a unit change in the independent variable holding other explanatory variables constant.

4.7. Testing hypothesis

Based on the above regression result the hypothesis of the study are tested and presented as
follows

Payment
H00: There is no significant relationship between payment and employee’s motivation. H1:
Payment has a positive and significant effect on employee’s motivation.

As shown in table 4.18 payment is significantly and positively correlated with employee work
motivation with b value 0.419, P<0.05. This implies we reject the null hypothesis and accept the
alternate one. It means that increase or decrease in payment will bring corresponding change in
employee work motivation. Expectancy theory described that people do effort because they want
some rewards in term of money, promotion etc. People expect that if they work well in the
workplace then their performance will increase and automatically their pay will increase and
they will be promoted. This will cause increase in their job satisfaction and motivation level.

Benefit
H0: there is no significant relationship between benefit and employee’s motivation. H1: benefit
has a positive and significant effect on employee’s motivation.

Employee work motivation with value of b 0.099, P<0.05 Hence, The increase or decrease in
benefit will bring corresponding change in employee work motivation. Therefore we reject the
null hypothesis and accept the alternate hypothesis of existence of significant relationship with
motivation. The expected positive coefficient estimates of pay and benefits are consistent with
Moncarz (2009) and Chiu (2002). According to these papers it can be explained that salary was
the prime factor for the motivation of salaried employees. In addition, benefits are a motivator
for employee commitment within an organization, which results in attraction and retention

Working condition
H0: There is no significant relationship between working condition and employee’s motivation.
H1: Working condition has a positive and significant effect on employee’s motivation.

Working Condition is significantly and positively correlated with employee work motivation
with b 0.572 value, P<0.05 Hence, we reject the null hypothesis and accept the alternate one.

This positive and insignificant coefficient of working condition is consistent with Baron and
Greenberg (1995) and Robbins (2001). According to these papers absence of working conditions
such as good temperature, lighting, ventilation, hygiene, noise, working hours, staff relation and
resources can impacts poorly on the worker’s mental and physical well-being which leads to
lower motivation.

Promotion
H0: There is no significant relationship between promotion and employee’s motivation. H1:
Employee’s promotion has a positive and significant effect on employee’s motivation.

Promotion is significantly and positively correlated with employee work motivation with value
of b 0.11, P<0.01 Hence, the null hypothesis is rejected. It means that increase or decrease in
promotion will bring corresponding change in employee work motivation.

This finding is consistent with Azim and Sharma (2012) Study finding suggesting that
satisfaction with promotion opportunities do not have a direct and positive impact on motivation.
And inconsistent with Peterson, (2003),Kreitner and Kinicki (2004). According to these papers it
can be explained that opportunities for promotion has a great connection with motivation

Recognition
H0: There is no significant relationship between recognition and employee’s motivation H1:
Employee’s recognition has a positive and significant effect on employee’s motivation.

Recognition is significantly and positively correlated with employee work motivation with value
of b 0.133, P<0.05 Hence, we reject the null hypothesis and accept the alternate one. According
to Oosthuizen, (2001) recognition is the acknowledgement of an individual contribution showing
appreciation and to reward the individual for an accomplishment of a task or sound performance.
Recognition is the component that is used to strengthen the relationship between organization
and people. Through the recognition employee feel rewarded and motivated. Employees become
more loyal to their organization if organization recognizes their work. According to this paper it

means that increase or decrease in recognition will bring corresponding change in employee
work motivation
Employee’s autonomy
H0: There is no significant relationship between employee’s autonomy and employee’s
motivation. H1: Employee’s autonomy has positive and significant effect on employee’s
Employee’s autonomy

H0: There is no significant relationship between employee’s autonomy and employee’s

motivation. H1: Employee’s autonomy has positive and significant effect on employee’s
motivation.

Autonomy can be defined as the strengthening of the building, which has delegated management
by providing employees with authority and autonomy over their tasks (Hsieh & Chao,
2004).Autonomy enhances self-belief, gives people more opportunity to achieve and provides an
opportunity to develop skills. This increases the motivation of workers to a greater extent
(Kalleburg, 1977).

When we come to employees autonomy, the hypothesis which states employee’s autonomy has
positive and significant effect on employee’s motivation is rejected with b 0.058, the p value is
0.193 which is greater than 0.05 and it has an insignificant effect on employee motivation.

motivation. Employee’s autonomy

H0: There is no significant relationship between employee’s autonomy and employee’s

motivation. H1: Employee’s autonomy has positive and significant effect on employee’s
motivation.

Autonomy can be defined as the strengthening of the building, which has delegated management
by providing employees with authority and autonomy over their tasks (Hsieh & Chao,
2004).Autonomy enhances self-belief, gives people more opportunity to achieve and provides an
opportunity to develop skills. This increases the motivation of workers to a greater extent
(Kalleburg, 1977).

When we come to employees autonomy, the hypothesis which states employee’s autonomy has
positive and significant effect on employee’s motivation is rejected with b 0.058, the p value is
0.193 which is greater than 0.05 and it has an insignificant effect on employee motivation.

Autonomy can be defined as the strengthening of the building, which has delegated management
by providing employees with authority and autonomy over their tasks (Hsieh & Chao,
2004).Autonomy enhances self-belief, gives people more opportunity to achieve and provides an
opportunity to develop skills. This increases the motivation of workers to a greater extent
(Kalleburg, 1977).
When we come to employees autonomy, the hypothesis which states employee’s autonomy has
positive and significant effect on employee’s motivation is rejected with b 0.058, the p value is
0.193 which is greater than 0.05 and it has an insignificant effect on employee motivation.

Career development opportunity Career development opportunity

H0: There is no significant relationship between career development opportunity

and employees motivation H1: Career development opportunity has positive and
significant effect on employee’s motivation

When we come to career development opportunity, the hypothesis which states

employee’s autonomy has positive and significant effect on employee’s
motivation is supported with b 0.287, P<0.01 It means that increase or decrease
in career development opportunity will bring corresponding change in
employee work motivation.

Generally based on the above analysis the researcher concludes that payment,
working condition, carrier development opportunity variables have the highest
positive and significant impact on employee’s motivation. Promotion and
benefits have low positive and significant effect on employee’s motivation and
employee autonomy has positive but insignificant effect on motivation. Career
development opportunity

H0: There is no significant relationship between career development

opportunity and employees motivation H1: Career development opportunity
has positive and significant effect on employee’s motivation

When we come to career development opportunity, the hypothesis which states

employee’s autonomy has positive and significant effect on employee’s
motivation is supported with b 0.287, P<0.01 It means that increase or decrease
in career development opportunity will bring corresponding change in
employee work motivation.

Generally based on the above analysis the researcher concludes that payment,
working condition, carrier development opportunity variables have the highest
positive and significant impact on employee’s motivation. Promotion and
benefits have low positive and significant effect on employee’s motivation and
employee autonomy has positive but insignificant effect on motivation.

Career development opportunity

H0: There is no significant relationship between career development

opportunity and employees motivation H1: Career development opportunity
has positive and significant effect on employee’s motivation

H1: Career development opportunity has positive and significant effect on employee’s
motivation
When we come to career opportunity, the hypothesis which states employee’s autonomy
has positive and significant effect on employee’s motivation is supported with b 0.287,
P<0.01 It means that increase or decrease in career development opportunity will bring
corresponding change in employee work motivation.
Generally based on the above analysis the researcher concludes that payment, working
condition, carrier development opportunity variables have the highest positive and
significant impact on employee’s motivation. Promotion and benefits have low positive
and significant effect on employee’s motivation and employee autonomy has positive
but insignificant effect on motivation. Career development opportunity
H0: There is no significant relationship between career development opportunity and
employees motivation
H1: Career development opportunity has positive and significant effect on employee’s
motivation
When we come to career development opportunity, the hypothesis which states
employee’s autonomy has positive and significant effect on employee’s motivation is
supported with b 0.287, P<0.01 It means that increase or decrease in career
development opportunity will bring corresponding change in employee work
motivation.
Generally based on the above analysis the researcher concludes that payment, working
condition, carrier development opportunity variables have the highest positive and
significant impact on employee’s motivation. Promotion and benefits have low positive
and significant effect on employee’s motivation and employee autonomy has positive
but insignificant effect on motivation.
Caer development opportunity
H0: There is no significant relationship between career development opportunity and
employees motivation
H1: Career development opportunity has positive and significant effect on employee’s
motivation
When we come to career development opportunity, the hypothesis which states
employee’s autonomy has positive and significant effect on employee’s motivation is
supported with b 0.287, P<0.01 It means that increase or decrease in career
development opportunity will bring corresponding change in employee work
motivation.
Generally based on the above analysis the researcher concludes that payment, working
condition, carrier development opportunity variables have the highest positive and
significant impact on employee’s motivation. Promotion and benefits have low positive
and significant effect on employee’s motivation and employee autonomy has positive
but insignificant effect on motivation.
H0: There is no significant relationship between career development opportunity and
employees motivation
H1: Career development opportunity has positive and significant effect on employee’s
motivation
When we come to career development opportunity, the hypothesis which states
employee’s autonomy has positive and significant effect on employee’s motivation is
 supported with b 0.287, P<0.01 It means that increase or decrease in career
development opportunity will bring corresponding change in employee work
motivation.

CHAPTER FIVE

5. CONCLUSION AND RECOMMENDATIONS

5.1. Introduction

This chapter contains the summary of findings, conclusions, and recommendations of the
research study.

5.2. Conclusion

As stated in the literature the seven explanatory variables of motivation were; payment, benefits,
promotion, recognition, working condition, employee’s autonomy and career development
opportunity. The result of descriptive analysis shows that employee’s autonomy and working
condition, benefit has the highest mean value. Career development opportunity, recognition have
a moderate mean, payment has the lowest mean. In addition to this mean value of motivation
shows that the level of motivation in commercial bank of Ethiopia is very low. From the positive
correlation between motivation and dimensions presented in the analysis, we can conclude that
payment, benefits, promotion, recognition, working condition, employee’s autonomy and career
development opportunity have positive relationship with employee’s motivation. From the
regression result we can conclude that that payment, benefits, recognition, promotion autonomy
and career development opportunity have significant effect on employee’s motivation. But
employee autonomy has no significant effect on employee motivation.

5.3. Recommendations

As the mean score result of career development opportunity, recognition,

payment is below average in so that the management of the bank expected to
improve the payment package of the employees to retain employees who are
dissatisfied, keep their staff motivated and improve their productivity and also
the bank must revised salary structure of staff annually and there should be
proper structure of compensation that offer general increases,
bonuses/incentives, fringe benefits equally at all. Moreover, the mean score of
promotion is below average in CBE thus, the management of these banks should
be expected to improve the promotional policy and design transparent system
of promoting staff members and provide an equal chance of promotion in a fair
and honest way have to be practice promotion by consider employees’
experience and performance appraisal in Bank. Give test to employees for
promotion is not appropriate and open to favoritism through relatives, friends
and ethnic. Training is learning process that involves the acquisition of skills,
concepts, rules, or attitudes to increase the performance of employees.
Therefore, Commercial Bank of Ethiopia should create awareness about the
bank mission, motivation policy and strategy to employees through training
and, employees should actively involve in development of motivational policy
and strategy in the bank. Monetary compensation alone is insufficient to
motivate employees. Other factors such as giving greater

Recognition, creating employees autonomy and establishment of better

leadership system have the greatest impact on employee motivation.

The researcher having all the findings the base for recommendations to improve
the case organization's motivational factors so as to increase its employees' job
motivation and productivity, the study gives the following recommendation.

As the result of the findings most of the respondents are dissatisfied with the
current promotion criteria and it needs attention by the organization to make
the necessary corrective actions so as to improve employee’s job motivation.
The bank be supposed to craft and implement appropriate promotional policy.
This can be done by recognizing employee’s performance and making it the
basis for reward, recognition and promotion.

As the study revealed that, majority of employees disagree that they are paid a
fair amount of salary for the work they perform and they believe that their
salary don't encourage them to work hard. So, CBE ought to work on adjusting
current salary and benefit packages. This can be done by using key performance
indicator such as balanced score card. When employees get the necessary
reward/ pay for the work they perform, it is motivated to increase their
productivity and encourage to work hard. The bank need to be translate its
corporate vision into measurable operational goals and communicate it to
employees link them to individual performance.

The study shows that even if employees of Commercial bank of Ethiopia

believes that the bank recognizes their achievement and career advancement,
the organization supposed to analyze, draft and implement clear and
appropriate career advancement procedures that could be applied consistently.
The current career path trend should be evaluated and redesigned by
considering the competencies of employees. Establishing fair, workable and
consistency administered promotion policy and procedures. This done by
facilitating by providing employees career coaching, helping managers develops
clear selection criteria.

The study revealed that majority of respondents agrees there is no clear

motivational policy in the bank that are known by employees. So the bank
ought to implement appropriate motivational technique that helps employees
to motivate and perform well that leads to productivity. This can be done by
recognized employees adequately, reward them for their achievement and
based on promotion. Assessing employee’s interest to get information as to
what motivates them and bring about that put into practice. Knowing its
employees will allow the bank what will actually motivate them.

As the result of the findings even if majority of employees of CBE believe that
they get adequate recognition from their supervisor for the job well done, the
bank ought to incorporate formal and informal employee recognition programs
to avoid dissatisfaction of employees leads to demotivation. Continuous
motivation of employees , proper and timely recognition should be part of the
system of the organization. This can be done by being specific when giving
recognition, being specific helps employees relate the recognition to their
behavior , encouraging them to continue strong performance and show
employees their reward is personalized to them.
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Appendix – Questionnaires
Dear Participant, I am conducting a research on “: Assessment of employee motivation: a case
study of commercial bank of Ethiopia.” This research is conducted in partial fulfillment of the
Masters in Business Administration (MBA). The survey is intended to study the extent to which
employees are motivated Please note that the survey is developed to be anonymous and I, the
researcher will have no way of connecting the information to you personally. The questionnaire
will not take more than10 minutes of your time. The study will keep any individual information
provide here in confidential and only grouped data will be presented for academic purpose. It
would be greatly appreciated if you would assist by completing the questionnaire listed below. I
thank you in advance for sharing your valuable experience and time in completing the
questionnaire.
Part I: Demographic characteristics

Please tick [√] inside the appropriate box below

1. Gender: Male(----)Female (---)

2. Age: 21-30 {----] 31-40 [---] 41-50 [---] Over 50 [--]

3. Marital Status: Married [---] Single [--] widowed [---] Divorced [--]

4. What is job category of your current position?

Non-professional/Non-clerical [---]

Professional /Clerical [---]

Managerial [---]

5. Education: Diploma [--] Degree [--] Masters [---] others [---]

6. Year of service: <3 years [---] 3-5 years [---] 6-10 years [--]above
[-----]
 Please tick in the appropriate box where 5= Strongly Agree, 4= Agree,
3=Neutral, 2= Disagree and 1= Strongly Disagree
Questions Strongly agree neutral disagree Strongly
agree agree
1.payment
The payment system is clearly stated and
communicated to the employee
I am happy and satisfied with my current salary
I am happy and satisfied with the bonuses offered by
my employer
The basic of payment for example over time payment
are reasonable
The pay scale and benefit of our company treat each
employ equitable
The way bonus payment distributed fair and based on
performance
The current salary adequate to cop up with the ongoing
cost of life
2.benefit
The benefit system of the organization treats each
employ reasonable
My medical scheme satisfactory
My pension benefits are good
The organizations insurance scheme enhances the
satisfactory of employee
I never have problem with my leave arrangements
3.promotion
The promotion paths are clearly stated and
Communication to the employee
The opportunity for promotion exists in this
organization
Everyone have equal chance to be promoted
Staff are promoted in a fair and transparent way
The possibility getting promotion influences my
performances
4.working condition
My working hour are reasonable
I get the opportunity to communicate on aspect of our
work
I am satisfied the way my co-workers get along with
each other
The arrangements of the office layout is convent for
employee
Basic resource are available for my work
5.recogexnation

I am adequately recognizes for my achievements at work

The achievement and recognizes systems of the
organization is adequate
Being recognized for my work achievements
6.employee autonomy
I have to authority to correct daily problem when they
occur
I am encourage to handle daily problems by my self
I have control over how I solve daily problem
I am able to control the social contact with others
7.career development opportunity
I have good access to development opportunities in my
current job
I see future for myself in a hair –level role in this
organization
My organization has a formal mentoringprogram for
jobs like mine
8.motivetion
Being offered a good salary and compensation package
motivates and makes me improve my performance
The benefit provides by the company motivates me
The promotion provides motivated me to do a better job
each day and increase my productivity
The working condition is favorable and it motivates
The autonomy in the company creates the sense of
belongingness and motivate me
Being offered a good salary and composition package
motivates and make me improve my performance
Being recognized for my work achievements motivates
me
Being recognized for my achievement at work would
greatly motivate me in to improving my performace