ADIGRAT UNIVERSITY

COLLEGE OF BUSINESS AND ECONOMICS

DEPARTMENT OF MANAGEMENT

ASSESSMENT OF EMPLOYEES REWARD AND MOTIVATION SYSTEM

(IN CASE OF WOGAGEN BANK ADIGRAT BRANCH)

BY:

CHALACHEW ALEMU

IDNO 2228

ADVISOR: MICHAEL T.

A PROPOSAL PAPER SUBMITTED TO DEPARTMENT OF

MANAGEMENT OF ADIGRAT UNIVERSITY PARTIAL FULFILLMENT
OF THE BACHELOR OF ART (B.A) IN MANAGEMENT

ADIGRAT, ETHIOPIA
ASSESSMENT OF EMPLOYEES REWARD AND MOTIVATION SYSTEM
(IN CASE OF WOGAGEN BANK ADIGRAT BRANCH)

BY:

CHALACHEW ALEMU

IDNO 2228

ADVISOR: MICHAEL T.

Advisor signature date

_________________ ____________ ______________

Examiner

_________________ ____________ ______________

ADIGRAT, ETHIOPIA

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 Table of Contents
Content page

Chapter One...................................................................................................................................1

1. Introduction............................................................................................................................1

1.1. Background of the study....................................................................................................1

1.2. Background of the organization........................................................................................1

1.3. Statement of the problem...................................................................................................2

1.4. The research questions.......................................................................................................2

1.5. Objective of the study.........................................................................................................3

1.5.1. General objective.............................................................................................................3

1.5.2. Specific objective.............................................................................................................3

1.6. Significance of the study.....................................................................................................3

1.7. Scope of the study...............................................................................................................3

1.8. Limitations of the study......................................................................................................4

1.9. Organization of the paper..................................................................................................4

Chapter Two...................................................................................................................................5

2. Review Literature...................................................................................................................5

2.1. Over view of employees reward and motivation..............................................................5

2.2. Types of reward..................................................................................................................6

2.2.1. Intrinsic reward...............................................................................................................6

2.2.2. Extrinsic reward..............................................................................................................7

2.3. Objectives of Reward and motivation...............................................................................7

2.4. Significance of studying reward and motivation.............................................................7

2.5. Theories of motivation........................................................................................................8

2.5.1. Content theories of motivation.......................................................................................8

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2.5.1.1. Hlearchy of needs theory............................................................................................8

2.5.1.2. Herzberg’s Two factor theory....................................................................................9

2.5.1.3. McGregor’s theory x and theory.............................................................................10

Chapter Three..............................................................................................................................11

3. Research Methodology.........................................................................................................11

3.1. Research Design................................................................................................................11

3.2. Data type and sources.......................................................................................................11

3.3. Data collection methods...................................................................................................11

3.4. Target population.............................................................................................................11

3.5. Data analysis , presentation and interpretation............................................................11

2.6. Ethical consideration........................................................................................................11

2. Budget schedule.......................................................................................................................13

3. Time schedule.......................................................................................................................14

Reference......................................................................................................................................15

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Acknowledgement
First of all I would like to my God for helping the successful accomplishment this paper ,
these and my special graduated my respected and honored advisor Michael T. for giving his
unrestricted comments suggestion and offering useful advances throughout in the paper .

Third I would like to thank Adigrat University specially the college of business and economics
for designing such program through which students develop their knowledge and skill.

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 CHAPTER ONE

Introduction
1.1. Background of the study
The long term success of failures of many organizations depends on the quality of its work force
among many resources the organization

have human material, financial, information and soon. Human resource require the most
significance attention from management .providing the right sort of reward and motivation to
theses human resource and encouraging them to take advantage of it not factor the quality but
also give organization its most basic and control source of comparative advantage the skill to do
the job well ( Daring , 1993,p;1) . According to Steven (1998, p475), reward and motivation is
important for organization to develop suitable payment plans for their employees in order to
satisfy them. To improve organization survival and to increase the confidents of employees to
achieve profitability of the organization managers would be creative and dynamic in good
reward and motivation system.

Since employees reward and motivation would be professional in their respective area and
aggregates objective of the organization would met (Kumar,2001 p;1991). This concept would
be discuss detail about employees reward and motivation. It can be try also use to initiate, attract
and satisfy all stock holders in the organization.

Generally reward and motivation system is a mechanism through which the organization can be
able to equip the human resources whom the necessary knowledge and skill soul to meet the
future need and want the organization (Steven, 1996, p475).

1.2. Background of the organization

Adigrat town is found in eastern part of Tigray region. Adigrat is surrounded by mountain and it
is weather condition is favorable for human being. Adigrat town has 72314 populations and these
towns there are three languages like, Tigrigna, Erop and Kunoma. Wegagen bank is located in
Tigray region at Adigrat town which found in 06 kebelle. It was established 1992 E.C, around
peyassa. wegagen bank aggressively expand it is branches all over the country less stored by
small numbers of employees and relatively less professional people to provide service to the

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organization. However, now, a day, it has 28 workers. The organization provides many services
to customer to fulfill their need and want to achieve organizational goal.

1.3. Statement of the problem

Although reward motivation is important in the organization, it has many challenges in order to
assess them, correctly in the bank. There are many problems in the organization like. Low skills
of the employees’ unsuitable condition of the environment, equal payment for equal work and
group conflict related to score resources.

According to Robbins (2010) motivation and reward is not a simple task in the organization in
order to treat themselves without any difference so that and the other factor many affect the
organization performance. But the researcher would be like that the reward and motivation is a
challenging factor for not only the manager but also the employees, so the researcher many not
able to figure out why the employees are not rewarded and motivated for their work and how to
change their behavior.

This was related with high employee turnover, lack of belongings and other related problems in
general; the motivation and reward system must be based on the performance of the employees,
skill and full of free interest, the organization uses different type of motivation system. In order
to create them by different aspects, there are some type of motivation would be intrinsic reward
and extrinsic rewards.

The research questions

On this study the researcher will try to investigate the practice of employees’ reward and
motivation system. In wegagen bank to answer the following questions.

1. What motivation system does the organization use?

2. What is the problem that relates to the bank with regard motivation?
3. What are the attitudes of employees towards motivation system in the bank?

1.4. Objective of the study

1.4.1. General objective
General objective of the study was to assess employee’s reward and motivation
system in wegagen bank Adigrat branch.

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 1.4.2. Specific objective
To accomplish the general objective of the study the researcher designs the following
specific objective.
 To asses motivation system the organization use
 To identify problems of that was occurring in the bank
 To know the attitude of the employees towards the motivation why in bank.

1.5. Significance of the study

Every study has its own important contribution for many purposes like that of other study the
investigation has the following significances for organization of this study was used to provide
relevant information for the management bodies in order to understand the important of
rewarded and motivation.

For other individual the study focused on the nature of the reward and motivation of employees
in wegagen bank. so that one can get information about how the division function accomplish its
task and also the finding of this would be to provide some other researcher to perform better and
in depth study to wider scale to update the practices of employees reward and motivation and
overcome the problems to be identify in the study . For the researcher this study has created
awareness, knowledge, experience how to solve the challenging task in any time at any place.

1.6. Scope of the study

Geographically even if there are many banks in Adigrat, due to shortage of time and cost this
study was conducted wegagen bank Adigrat branch. The study has tried to look reward and
motivation system of wegagen bank but not study other human resource management like, jobs
satisfaction employee turnover performance appraisal and so the study will try to perform only in
this year (2008 in E.C) Ethiopia calendars).

1.7. Limitations of the study

Every investigation will have its own limitations. Hence this study passed through some
constraints, these includes the research would have the problem that it was concerned on Adigrat
area. The proposal was conducted on Wegagen Bank in Adigrat Branch, because it was imposed
to assess the level of employee reward and motivation system in all banks and the respondents
during work of research was not voluntary to fill the questionnaire.

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1.8. Organization of the paper
This study is organized in to four main chapters. The first chapter deals the introduction, includes
backgrounds of the study, statement of the problem, research questions, objective of the study,
significance of the study, research design an organization of the paper. The second chapter
consists of review of related literature, chapter three in corporate data analysis and presentation
and the last chapter which is four includes conclusion and recommendation.

CHAPTER TWO
2. Review Literature
2.1. Over view of employees reward and motivation
Employee reward and organization programmed are considered to be vital for the success of any
organization. This program is a guarantee more than self interest in order to succeed. This
chapter presents a brief discussion of the major motivational theories that must be consider with
in deals with employees in the work environment so managed should be sensitive to variation in
employees need, abilities and goals must consider different in preference in preferences for

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rewards so that they enable to maximize the performance potential of the organization human
resources . All motives are directed towards, goals and needs and desires affect or change your
behavior, which goal oriented (Koranpal, 2011).

The organization use reward and motivation to try to overcome their employee’s problems. The
effective reward and motivation system can produce productivity gains that more than of self the
cost of the reward and motivation the management should try to understand the motivation of
individual which case different types of behaviors.(Seeth ramam, Prasad,2007).

Rewarde and motivation is the mechanism through which the organization can be able to equip
the human resource which the necessary knowledge and skills so as to meet the current and
future needs of an organization. No one questions the contract role that reward and motivation
play and shaping human behavior and specifically influencing work performance in an
organization. Motivation is a continuous process (Pulop, Sabba Rao 2013).

The word motivation implies that affecting which internally urges or push as a person to do or
retrain from an act in emotion, and is of course evidential to words his doing or not to be
evidenced, we must rely two sorts of data. The person own expression of the emotion and
external circumstance likely in human experience to arouse the emotion (Wigmore, 1986, p,76).

Motivation is an organization is the willingness of an employee to respond to organizational

requirement. The more positive the individuals motivation and rewards the organization the more
effective is his/her performance (Schemeerni, 1996, p.336).

The term motivation was originally derived from the Latin word moved which means to move,
(Mailain, 1995, p.107).

According to for land motivation refers to the way in which urges, desired aspiration , striving or
needs direct controls or explain the behavior to words the goals of human beings (Humar,1974,
p,1978).

According to person and Steiner’s motivation is an inner state that energizes , activities, more
and directs or channel behavior towards goals, Mishra, 2001,p,149/ .so in general motivation has
to do with three bodies areas with respect to an individual behavior. Direct what some is trying to
do so, effort how long some is trying and persistence ho long some one continuous trying.
Reward also defined as the design of works an organization to ensure the effective and

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effectiveness use of human talent to accomplish organization work setting godu (Lvaneevisch,
1999).

Reward plan that attract; remain and motive every organization employees in order to remain
language human capital to maintain competitive advantage reward should be contingent on
performance many of those rewards salary increase, employees benefit, preferred job
assignments are organization are organization controlled. So reward is for many defined as the
work outcome of positive value to the individual. a motivation work setting is reach in reward
for people whose performance accomplishment help to meet organizational objectives (Shermal,
1996, p,336).

2.2. Types of reward

The type of reward an organization can allocate are more complex in generally an obviously,
there are two basic types of reward available to people at work place. They are intrinsic and
extrinsic rewards. An organization has to balance fairly both extrinsic and intrinsic reward (Pulap
and Subba, 2013).

2.2.1. Intrinsic reward

Are those that individual receive themselves. They are a result of the workers satisfaction with
his / her job. Techniques like job environment and effort s job design or result cure work to
increase its personal worth to the employee may make the work more intrinsically reward
(Amiable, 1976).

2.2.2. Extrinsic reward

Reward received from the environment surrounding the context of the work. The reward are not
associate with the work itself but are influenced by the co-workers, informal groups and other
organizations, it includes for direct and compensation, money, fringe benefit and non financial
rewards (Robbins,2005, p,659).

2.3. Objectives of Reward and motivation

Reward and motivation administration reduces the like likely hood of fruition and grimaces over
wage in equalities. It attracts qualified employees by ensuring adequate payment for all the jobs.
The satisfaction of employees and employer is maximized and conflict of interests minimized
motivated employees are on the line to do more for the organization productivity and service

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offering, payment is also dismounted to the employees in a fairly and equivalent manner for
smooth and long organizational objectives (Robbins,1996).

Reward and motivating employees focuses primary on helping employees to improve their
abilities or skills. In addition an organization must be concerned about the development of
management team, supervisory, middle level managers and top level exclusives management
development focuses and developi9ng the knowledge base, attitude, basis skill, interpersonal
skills and technical skills of managerial course. Those people pose knowledge, skill and
motivation (Lvancerich, 1991).

2.4. Significance of studying reward and motivation

Primarily the study of reward and motivation system is retreated concept with human resource
management function like recruitment and selection, salary and wage aim cult ruction, tracing
and development, hiring and living of employees (Durling, 1993. Pl).

Secondary, the organization effectiveness efficiency is measured instantly by these reward and
motivation administration,. Because of worldwide completion for organizational modernity and
achievement these human resource management function play a vital role for is survival and
continuity of every entity (Klumar, 2001, p181).

Third, both white and blue collar people needs more attention and concern for their day today
personal life improvement with reward and motivation practice in order to contort the constraint
of increasing personal life standard. Finally, while organizations have four are important
resource that needs proper control and management for the full realization of organizational
survival. Generally significance focusing more attention with reward and motivation focusing
more attention with reward and motivation is corner stone for assisting human resource
management system of an organization , motivation identify employee potentialities (Pulop and
Subba, 2013).

2.5. Theories of motivation

Various theories motivation has been forwarded in explain human behavior at work place in
different situation. These theories are grouped in to two types this are content and process
theories.

2.5.1. Content theories of motivation

Content theories emphasis explicitly on that attempts to develop as understanding of human
needs it focus on the factors within the person energize, direct sustain and stop behaviors. These
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theories of motivation explain human behavior in terms of human needs which are known as
content theory (Klumar, 2001, p181).

2.5.1.1. Hlearchy of needs theory

One of the most widely mentioned theories of motivation is the hierarch of needs theory put forth
by psychologist Abraham Maslow’s in the 1940. Abraham Maslow’s hierarch of needs theory
assumed that; human want are unlimited but resources are limited man is a wanting animal as
soon as one of this need is satisfied. Another appears in its place; a satisfying need is no more a
motivation that means for satisfying human needs can be provided by management. The basic
human needs identified by Maslow are as shown below (Munappa, 1996, p19-25).

1. Physiological needs: these are the most basic needs for sustaining human life itself
these needs are independent of each other and in some cases can be identified with a
specific location in the body. It includes food, water, shelter, clothing, sleep and sexual
satisfaction, this needs are cyclic and are satisfied only for short period . Then they are
reappearing. Satisfies of these needs are usually associated with money and other
material incentives.
2. Security needs: the needs for safety, stability and absence of pain, threat, or illness are
all equity needs. Like physiological, unsatisfied security needs cause people to be pre
coupled with satisfying them. People who are motivated primary by security needs
value their jobs mainly as a defense against the loss of basic need satisfactory.
3. Social needs or acceptance needs refers to belongingness need for love and affection is
best described as the need to belong not only as a wanted member of a family unit but
also as a member of other relatively small grouped such as working groups since people
are social being they need belong to be accepted by others need for friendship close
relationship, untimely live and belongings. A simple index of satisfactory of social
needs in organized setting as the frequency with which employees spend their free time
to gather and a ways from work situation(Munappa,1996,p,19-25).
4. Esteem needs: they are needs for a positive image and self-respect, a sense of personal
achievement and reorganization from others.
Needs that relate one’s self esteem needs for self confidence for independence for
achievement, for competence and for knowledge, needs relate one regulation for needs
for status, for reorganization for appreciation for respect of his follows. in satisfying

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 these needs people sack opportunities for achievement ,promotion, percentage and
status that will provide recognizing of their competence and works.
5. Self actualization needs: these are needs for personal growth, self fulfillment and the
relation of a person’s full potential, this group of needs is the cup stone of the hierarchy
of needs.

2.5.1.2. Herzberg’s two factor theory

According to Herzberg and his associated, uncovered, a set of factors that product job
satisfaction and motivation and another set of factors that lead to job dissatisfaction (hygiene
factors).

1. Hugiene or maintain are factor in includes salary, job security, working condition
organizations policies and technical quality of supervision.
2. Satisfiers or motivators: includes such thing as responsibility, achievement growth , and
opportunities and feeling of recognition and are the key to job satisfaction and motivation ,
for example managers condo find out what people relay to in their jobs and make
improvement . Thus increasing job satisfaction and performance.

2.5.1.3. McGregor’s theory x and theory

Me Gregory assumed that motivating people involves certain assumption about human nature it
involves certain assumption, generalizations and hypothesis relating to human behavior and
human nature. McGregor proposed two defined views of human beings, one basically negative a
behavior theory x and the other basically positive labeled theory

1. Theory x: is based on assumptions and believes which are based on the study of many
people at work and the nature and structure of many organizations and their styles
supervision. These assumptions imply that the supervision has a low opinion of the opinion
of the workers and still lower expectation from them. This theory also implies that employees
dislike work, are lazy, dislike responsibility and must be corrected to perform.
2. Theory Andy is positive assumptions about workers that lead to the concussion that a
manger’s task is to create a work setting that encourage commitment to organizational goals
and provides opportunities for workers o be imaginative and to exercise imitative and self
direction . in contrast, theory assumes that workers are not inherently lazy , do not naturally
dislike work and if given the opportunity will do what is good for the organization.

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 CHAPTER THREE
3. Research Methodology
3.1. Research Design
The research design used descriptive type of study because it describes the state of nature as it
exists at present this try of research aim is to provide a verbal and numerical picture about
phenomena it describes and report only what has happened or happening.

3.2. Data type and sources

The research will use both primary data source and the secondary data source. The primary data
source will be collected from the employees using questionnaires and the management using
interviews. The secondary data will also collect from journals and from written materials.

3.3. Data collection methods

In order to collect data from employees of wegagen bank of Adigrat the researcher will use
closed ended and open ended questions.

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3.4. Target population
The target populations of the study are the employees of wegagen bank in Adigrat branch which
consists of 28 employees. Hence, the study will use census method.

3.5. Data Analysis, Presentation and interpretation

The data which is collected by the researcher will be analysis and presented using percentage and
table these are main tools in order to present the collect data.

2.6. Ethical consideration

Letter of cooperation will be obtained from Adigrat university department of management to the
respective study population. Verbal and informs consent obtained from the managers of the
concerned bodies by informing the purpose of the study, conserving the right privacy of the
respondents maintain the confidentiality of the identify each participating in all cause the name
will kept confidential.

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 Work plan and budget estimate
Table 4.1 Work plan and Time schedule
No Activities /Tasks February March April May

1. Topic selection
✓
2. planning and proposal writing
✓
3. Completion of final research proposal
✓
4. Literature review Prepare and
distribution questionnaires
✓
5. Data collection for analysis ,Checking
analysis method And Check the result
✓
6. Review of final research at advisor level
✓
7. Writing a document (draft) and Final
documentation
✓
8. Submition of final research and
✓
Presentation

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 Table 4.2 Budget Estimation
Work Description Reason for Budget Unit Unit Rate Amount(birr)
No.

Topic Selection Telephone Card Pcs 5 50

1
Proposal Preparation Paper, Print Pcs 2 52
2
Literature Review Paper No. 0.5 50
3
Research Sample Identification Transportation, Telephone Pcs 500
4 and data collection Card,
Analyzing The Collected Data Paper, Print Pcs 2 100
5
Research Writing Paper, print No. 2 160
6
Other Expenses Unexpected Expenses Pcs 200
7
Total Budget
=1,112 birr

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