THE EFFECT OF MOTIVATION ON EMPLOYEES PERFORMANCE AT DEVELOPMENT BANK OF ETHIOPIA

Abstract

The purpose of this study paper is to examine the effect of motivation on employee’s performance at Development Bank of Ethiopia head office. The study considers three measurements of employee performance. These are direct financial factors, indirect financial factors and non-financial factors that motivate employees to increase their performance. The researcher used both quantitative and qualitative research approach, from this the researcher used both descriptive and explanatory research design to describe and explain the relationship between the independent variable (direct financial factors, indirect financial factors and non-financial factors) with the dependent variable employee performance. From the total population 2380 employees of Development bank of Ethiopia, the researcher selected only 1001 professional employees from trainee junior officers to director level were selected. From this the researcher used 286 employees as a sample respondent and 300 questioner are distributed from this 288 questioner were collected. Also the researcher used an inferential statistics (correlation and multiple regression) analyses to measure the effect of independent variable on the dependent variable. From this the Pearson correlation test conducted between direct, indirect and non-financial factors to the dependent variable of employee performance they are strong, week and strong correlation respectively. Also the multiple regression analysis result confirmed that, the linear combination of all the component of independent variable except the indirect financial factors consider under the presented study was significantly contribute to the dependent variable which is employee performance. The ANOVA test result also confirmed that, the prediction power of motivation is found to be statistically significant. From the beta coefficient analyses result the researcher obtained that, non-financial factors are the most important and significant variable in predicting the dependent variable employee performance Followed by direct financial factors. Therefore the researcher concludes that non-financial and direct financial factors have a positive and significant effect on employee performance. Thus the development bank should work more on non-financial and direct financial factors rather than the indirect financial factors.