School of online post graduate study

Factors Affecting Employee Engagement in Case Of Banks in Ameya

Town

By
Natnael Getahun Dugo

A Thesis Submitted to School of Online Post Graduate Study of Yardstick

International College in Partial Fulfillment of the Requirements for the
Award of a Master’s Degree in Master of Business Administration

September, 2023
Addis Ababa

1
School of online post graduate study

Factors Affecting Employee Engagement in Case of Banks in Ameya

Town

By
Natnael GetahunDugo

A Thesis Submitted to School of Online Post Graduate Study of Yardstick

International College in Partial Fulfillment of the Requirements for the
Award of a Master’s Degree in Master of Business Administration
Advisor
Dr Berihun Muchie

September, 2023
Addis Ababa

2
 Declaration

I, the undersigned, declare that this study entitled “Factors Affecting Employee Engagement in case of
Banks in Ameya” 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 study have been duly acknowledged.
Declared by: Name: Natnael Getahun dugo
Signature_________________________________________
Date_____________________________________________

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 Certificate

This is to certify that this study, “Factors Affecting Employee Engagement in case of Banks in
Ameya.”, undertaken by Natnael Getahun for the partial fulfillment of the Requirements for Master of
Business Administration at Yardstick International College.

Research Advisor: Dr Berihun Muchie

Signature __
Date____________________________________

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 ACKNOWLEDGEMENT

This research project is reached at this stage with the help of God and the contribution of many people
around. In this regard, my first appreciation goes to my advisor Dr Berihun Muchie who provided me
his support and valuable recommendations. Then I would like to thank ameya towen Education office
that help me throughout my education and also I would like to thank the staff of Commercial Bank Of
Ethiopia Ameya Branch, Bank of Abyssinia Ameya Branch and Wogagen Bank Ameya that helped me
in distributing and filling the questionnaire. Last but not least, I would like to appreciate and thank all
my families and friends for their overall support in the work of this research project since from the
beginning.

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 Abstract

This paper reports on findings related to factors that affect employee engagement in the case of Banks
in Ameya based on social exchange theory. Descriptive & cross-sectional survey research designs were
employed; quantitative research approach was also used. Census method was used to collect data from
professional employees and managers who work on three banks in ameya. Accordingly, 56
questionnaires were distributed and 56 were returned & used for further analysis. The collected data
was analyzed using SPSS software version 20; to analyze the collected data descriptive statistics
(frequencies, means & standard deviations) and inferential statistics (correlation & regression
analysis) were used. Based on the evidence of the R square value obtained which indicates that 67.7%
of the variance on employee engagement can be predicted by the independent variable (Job
characteristics, Reward & Recognition, perception of organizational justice and perceived
organizational support). So the four independent variables as a cumulative have a positive and
significant effect on employee engagement. However, this study is subjected to limitations since the
research project applied descriptive, cross sectional, quantitative, small sample size and only 4
independent factors where a common method bias is a serious limitation. Hence, future research might
apply a longitudinal in large scale by considering banking sector in Ethiopia and by including many
factors that might help to explain employee engagement.

Key Words : Job Characteristic, reward and recognition, organizational justice And
perceived organizational support

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Table Contents
Declaration.....................................................................................................................................................iii
Certificate.......................................................................................................................................................iv
ACKNOWLEDGEMENT.....................................................................................................................................v
Abstract..........................................................................................................................................................vi
CHAPTER ONE.............................................................................................................................................1
1. Introduction.................................................................................................................................................1
1.1. Background of the Study........................................................................................................................1
1.2. Background of the organization................................................................................................................3
1.3. Statement of the Problem........................................................................................................................3
1.4. Objectives of the Study.............................................................................................................................5
1.4.1. General objective...............................................................................................................................5
1.4.2. Specific objectives.............................................................................................................................5
1.5. Research Questions...............................................................................................................................5
1.6. Significance of the Study.......................................................................................................................5
1.7. Scope of the Study....................................................................................................................................6
1.8 Organization of paper/division of chapter.................................................................................................6
Chapter Two....................................................................................................................................................8
2. Review of related literature.........................................................................................................................8
2.1. Introduction..............................................................................................................................................8
2.2. Concepts and Operational Definition of Employee Engagement..............................................................8
2.3. Theoretical Review...................................................................................................................................9
2.3.1. Self-Determination Theory................................................................................................................9
2.3.2. Job burnout theories.........................................................................................................................10
2.3.3. Social Exchange theory...................................................................................................................10
2.4. Factors affecting Employee Engagement.............................................................................................11
2.4.1. Job characteristics............................................................................................................................11
2.4.2. Reward and Recognitions................................................................................................................12
2.4.3. Organizational Justice......................................................................................................................13
2.4.4. Perceived Organizational Support...................................................................................................15
2.5. Levels of Employee Engagement........................................................................................................15

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2.6. Outcomes of Employee Engagement......................................................................................................16
2.7. Employee Engagement Strategies........................................................................................................17
2.8. Empirical Review................................................................................................................................19
2.9. Conceptual frame work of the study....................................................................................................21
Chapter Three................................................................................................................................................22
3. Research Methodology..............................................................................................................................22
3.1. Research Design.................................................................................................................................22
3.2. Research Approach.............................................................................................................................22
3.3. Research Method................................................................................................................................23
3.4. Data Sources.......................................................................................................................................23
3.5. Population and Sampling Technique..................................................................................................23
3.6. Data Collection Instruments...............................................................................................................24
3.7. Data Analysis Methods.......................................................................................................................25
3.8. Model Specification............................................................................................................................25
3.9 Validity and Reliability Tests............................................................................................................26
3.10. Conclusion............................................................................................................................................26
Chapter Four..................................................................................................................................................27
4. Data Analysis, Interpretation and Discussion...........................................................................................27
4.1. Demographic Background of Respondents.........................................................................................27
4.2. Reliability Test of the Survey.............................................................................................................30
4.3. Descriptive Statistics of factor affecting employee engagement.........................................................30
4.3.1. Job characteristics............................................................................................................................31
4.3.2. Reward and recognition...................................................................................................................32
4.3.3. Perceived organizational justice......................................................................................................33
4.3.4. Perceived organizational Support....................................................................................................35
4.3.5.Employee Engagement...................................................................................................................36
4.4.2. Multiple Linear Regression Analysis...............................................................................................39
4.4.2.1. Assumptions Test.........................................................................................................................40
4.4.2.1.1. Linearity Assumption Test.........................................................................................................40
4.4.2.1.2. Normality Assumption Test.......................................................................................................40
4.4.2.1.3. Multi-co linearity.....................................................................................................................41

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 4.4.2.1.3. Heteroscedasticity Assumption Test..........................................................................................42
4.4.2.2. Model Summary...........................................................................................................................44
4.4.2.3. ANOVA Model Fit.......................................................................................................................44
4.4.2.4. Regression Coefficients................................................................................................................45
4.5. Hypothesis test...................................................................................................................................46
4.6. Summary of Hypothesis test...............................................................................................................48
Chapter Five..................................................................................................................................................49
5. Summary of finding, Conclusion and Recommendation......................................................................49
5.1. Summary of finding...........................................................................................................................49
5.2. Conclusion..........................................................................................................................................50
5.3. Recommendations..............................................................................................................................51
5.4. Limitations.........................................................................................................................................52
5.5. Implication for future research...........................................................................................................52
References.....................................................................................................................................................52

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List of Acronyms
CBE- Commercial Bank of Ethiopia
MBI-Maslach-Burnout Inventory
STD-Self- determination theory
SPSS- Statistical Package for the social science
VIF- Variance inflation factor

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 List of Table

Table 3.1 Target population of the research--------------------------------------------------------------------24

Table 4.1 Demographic Background of Respondents--------------------------------------------------------29

Table 4.2 Alpha Coefficient----------------------------------------------------------------------------------------31

Table 4.3 Mean and Standard Deviation Results of Job Characteristics-------------------------------32

Table 4.4: Mean & Standard Deviation Results of Reward and Recognition--------------------------33

Table 4.5 Mean & Standard Deviation Results of perceived organizational justice-----------------34

Table 4.6 Mean & Standard Deviation Results of Perceived Organizational Support---------------35

Table 4.7 Mean & Standard Deviation Results of Employee engagement----------------------------37

Table 4.8 Correlation matrix of the independent variables & employee engagement------------39

Table 4.9 Result of Multi -collinearity test-------------------------------------------------------------------43

Table 4.10 Model Summary-------------------------------------------------------------------------------------45

Table 4.11 ANOVA------------------------------------------------------------------------------------------------46

Table 4.12 Regression Coefficient-----------------------------------------------------------------------------47

Table 4.13 Summary of Hypothesis--------------------------------------------------------------------------48

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 List of Figure

Figure 2.1 Conceptual Frame Work--------------------------------------------------------------------------------22

Figure 4 1 Linearity Assumption test............................................................................................41

Figure 4.1 1 Normality Assumption Test ---------------------------------------------------------------42
Figure 4.2 Homoscedasticity Assumption Test---------------------------------------------------------44

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 CHAPTER ONE

1. Introduction

In this section researcher the Will try to indicate information about; Background of the
study, Background of the organization, statement of the problem, research question,
general and specific objective of the study, significance of the study, scope of the study,
organization of the study and definition of key terms.

1.1. Background of the Study

Employee engagement is an emerging concept in business, management,
organizational psychology and human resource development fields (Wollard& Shuck, 2011).
Around the world there is currently great deal of interest in the concept of employee engagement.
Employee Engagement is the extent of employees' involvement to their works which
depends on organizational practices to achieve organizational goal. Gruman& Saks (2011) have
identified employee engagement as the key to achieve organizational success and competiveness.

However employee engagement has emerged as one of the greatest challenges in today’s
workplace. The challenge today is not only just retaining talented people, but fully
engaging them, capturing their minds and hearts at each stage of their work lives. With
complexities and stringent regulations in many organizations, employee engagement will
continue to challenge organizations in the future (Mishra, Boynton, & Mishra, 2014).
This aspect challenges management because engagement is a critical element in maintaining
the organization’s vitality, survival, and profitability (Albercht, Bakker, Gruman, Macey, & Saks,
2015). In recent years the term “employee engagement” has taken a fundamental role on
organizational effectiveness (Saks, 2006).
Organizations that have highly engaged employees have greater profits than those that do not
(Society for Human Resource Management, 2014).

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A lot of antecedents were identified by researchers that are responsible for enhancement of
employee engagement. Saks (2006) organizational support or supervisory support and justice are
among the factors that enable employee engagement, Rasheed and Khan (2013) identified four
antecedents of employee engagement which are supervisor support, organizational support,
procedural justice and distributive justice. Ram and Prabhakar (2011) identified job
characteristics and rewards (intrinsic and extrinsic) as antecedents of employee engagement,
which can raise organizational performance.

Moreover, Meily, Ratna, Sri and Hendra (2018) investigated the level of influence of
these factors and concluded that Job characteristic, Reward and recognition, Perceived
organization support and Perceived supervisor support influenced employee engagement by
22%, 28.6%.,
27.1% and 25.1% respectively.

This relationship is also very important in banking industry. Banking institutions in Ethiopia
provide sheer emphasis on quality service provision which called for having employees that are
engaged at their work and strive for quality contributions. Ensuring employee engagement
in turn requires in-depth understanding of how it is influenced and which factors induce
those influences (Heartfield, 2012). So the main reason why conducting an employee
engagement survey was to find out the factors that actually drive employees to perform
their best. It is important in order to establish sync between what top management offers and
what employees’ expectation. The reason behind, nowadays, is that managers are keener in
knowing what actually can engage or disengage employees. The organizations keep on
conducting employee engagement surveys from time to time so that they can design or redesign
the existing policies and implement key changes in order to increase the productivity and
efficiency of employees. Besides that, it will assist them in retaining the best talent within the
organization.Therefore, this study was focused on assessing factors that determines employee
engagement in the Banks located in "Ameya" city administration. Because of the time it
concedes and researchers’ capacity for this study, four of personal and organizational
factors that influence employee engagement, (job characteristics, reward and recognition,
organizational justice, and perceived organizational support) as depicted in previous studies,
Will select to test their effect on employee engagement
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1.2. Background of the organization
February 15, 1906 marked the beginning of banking in Ethiopia when the first Bank of Abyssinia
was inaugurated by Emperor Menelik II and It was a private bank whose shares were
sold in Addis Ababa, New York, Paris, London, and Vienna.(Nmanne2015).
According to 2019/2020 national bank report there are 30 Private and government owned Banks
in Ethiopia; among them 28 of them are private and 2 government owned commercial
Banks under operation. The study under taken within three banks which is Commercial Bank of
Ethiopia was established in 1963, Bank of Abyssinia was established in 1996 and Wogagen Bank
was established in 2010. Now days, Commercial Bank of Ethiopia, Abyssinia Bank and
Wogagen Bank have 1877 branches, 825 branches, and 397 branches respectively around
Ethiopia (National bank report). According to 2021/2022 national bank report 17.8 billion, 4.6
billion and 1.4 billion birr annual gross profit earned by CBE, Abyssinia and Wogagen bank
respectively all over the country. In the study area Commercial bank of Ethiopia ameya
was established in 2011, Abyssinia Bank established in 2021 and Wogagen Bank
established 2018; each of them is one branch in Ameya.

1.3. Statement of the Problem

An engaged employee is aware of business context, and works with colleagues to
improve performance within the job for the benefit of the organization (Virginia, 2013).
Therefore, according to Vance (2006), it is imperative to organizations to commit their
resources and management capability through their policies and procedures to foster
engagement of their employees at their work. To acquire higher level of engagement
organizations need to commit their employees to get what required from them. An engaged
employee has a desire and commitment to alwaysdoing the best job; they grip any task with
energy and enthusiasm (Gupta and kumar, 2018) Recent trends are indicating that retaining
employees within their organizations are being given great value instead of attracting best
talents (Wang, 2016). Therefore, significant resources of organizations are flowing towards
ensuring enhanced commitment and engagement of employees through which
organizations can easily secure best talents of their employees in order to achieve organizational
goals (Ikon&Chukwu, 2017)

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However, many empirical research outputs indicate that ever increasing disengagement of
employees in organizations. A study conducted by Cureton (2014), also pointed out the existence
of misalignment between investments made to secure engagement of employees and level
of employee engagement that led to loss of revenue due to disengagement of employees in spite of
resources committed. Consultant studies reveal that an estimated 14-30% of the employees are
engaged in running the business (Schwartz et al.2007). To further emphasize how widespread this
problem is and how critical it can be, consider the Gallup study Kim et al. (2008) in which
hundreds of companies were surveyed. The results of surveys showed that 54% of workers were
not engaged and 17% were actively disengaged.

According to Society of Human Resource Management the cost of replacing one $8 per
hour employee can exceed $3,500, which gives companies a strong financial incentive to
maintain their existing staff members through strong employee engagement practices.
To overcome the problem of engaging and retaining employee organizations need to asses
different ways. According to Tinypuls reports (2019), revealed that people who don’t feel
supported in their professional development are 3× more likely to be job hunting; the study also
added that employee who receive frequent recognition rose their enthusiasm for reapplying their
job 32% higher than worker who are not well-recognized. It is of great importance to understand
key elements of employee engagement that can heavily influence the minds and hearts of
employees to commit themselves to their work for overall achievement of organizational goals.
Hence, organizations are required to wisely monitor the engagement level of their
employees with respect to organizational interventions explained through managerial efforts,
money and time expected to raise those levels (Hartsfield, 2012). Recentreports of the bank
showed that good achievements regarding deposit, customer base, accessibility and other
parameters in the banking industry, significant staff turnover and disengagement are
identified (CBE Employee Satisfaction Survey).
Therefore, employee engagement is crucial for the service quality and customer retention efforts
of the banking industry, and also in order to compete foreign banks which may start banking
service in a few years. Engagement studies in Ethiopia concentrated in Addis Ababa, increasing
competition in the banking industry of Ethiopia and with the different initiatives undertaken by the

16
banks were reason why important to conduct this research and it may help banking service
administrators understand and foster the positive state of staff engagement in their organization

1.4. Objectives of the Study

1.4.1. General objective
The general objective of the study was to assess factors affecting employee engagement of Banks
in Ameya city administration.

1.4.2. Specific objectives

Under the shadow of this general objective, the study will have the following specific objectives:
 To investigate the job characteristics in the Banks as factor affecting
employee engagement;
 To examine the reward and recognition in the Banks as factor affecting employee
engagement;
 To examine the organizational justice in the Banks as factor affecting employee
engagement;
 To investigate the perceived organizational support in the Banks as factor affecting
employee engagement.

1.5. Research Questions

 Do job characteristics have an effect on employee engagement?

 Do reward and recognition have an effect on employee engagement?

 Does perception of organizational justice has an effect on employee engagement?

 Does perceived organizational support have an effect on employee engagement?

1.6. Significance of the Study

This research Will be helpful for the following reasons: The concept of employee
engagement has gained considerable attention in the recent modern business environment.
17
But the subject remains with great gap for empirical research especially in our country and
specifically for Banks located in Ameya. Then, the finding of the study will have practical
significance in banks and stakeholders in developing engaged human capital. Thus this study will
give opportunity to gain deep knowledge about the level of engagement of their employee and
factors that affect employee engagement in the case banks. Last, the study will draws some
conclusions and identifies the major factors affecting Employee Engagement in Banks. Thus, it
will give signal to the management of the bank in particular and policy makers in general
to focus on the main factors affecting Employee Engagement. Furthermore, the study will
contribute benefit for both academicians and other practitioners as a documented study in this are

1.7. Scope of the Study

There are various authors and researchers that proposed different drivers of
employee engagement, which include a wide range of factors (Kahn, 1990; Saks, 2006) and it is
difficult to best conceptualize factors affecting of employee engagement. This study however,
focused only on main four factors affecting of employee engagement, which are job
characteristics, reward and recognition, perceived organizational justice and perceived
organizational support. The study used only quantitative research design. The basis behind using
quantitative approach is due to the nature of the equations and the method employed to
answer the research questions and also limited itself on employees of three Banks.
Geographically and time scope, the study will be delimited to Banks located in Ameya city
administration. The reason is that it is difficult to cover all Banks, areas and branches throughout
the country. Time allotted to conduct this research is not enough and there is also resource
constraint; the researcher Will conduct purposively select research area and used census
sampling method.

1.8 Organization of paper/division of chapter

The study Will be organized in to five chapters that includes: Chapter one: - introduction of the
study, background of the study area, problem statement, research question, General and
specific objective, significance of the study scope and definition of key terms; Chapter two: -
18
review of related literature; Chapter three: - will about the research methods used for the study&
deals with topics like research approach research design and method of data analysis;
Chapter four: - is about data presentation, analysis & discussion; Chapter five: - will the last
chapter of the study and presents the summary, conclusion and recommendation of the study
along with areas of future research. References and Annexes that contain the questionnaire willbe
used to collect the primary data for the study will be attached.

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 Chapter Two

2. Review of related literature

2.1. Introduction

This chapter will address the literature related to Concepts and definition of
employee engagement, theoretical factors affecting employee engagement, levels of engagement,
outcomes of employee engagement, and empirical review, and the development of
the theoretical framework to be tested in the study.

2.2. Concepts and Operational Definition of Employee Engagement

Employee engagement has become a widely used and popular term (Robinson Perryman
&Hayday, 2004). According to Saks (2006) Most of what has been written about
employee engagement can be found in practitioner journals where it has its basis in practice
rather than theory and empirical research.

In the academic literature, a number of definitions have been provided. Kahn (1990)
defines personal engagement’s the harnessing of organization members’ selves to their
work roles; in engagement, people employ and express themselves physically, cognitively,
and emotionally during role performances.” Personal disengagement refers to “the
uncoupling of selves from work roles; in disengagement, people withdraw and defend
themselves physically, cognitively, or emotionally during role performances”. Thus, according to
Kahn (1990, 1992), engagement means to be psychologically present when occupying and
performing an organizational role. Rothbard (2001) also defines engagement as psychological
presence but goes further to state that it involves two critical components: attention and
absorption. Attention refers to “cognitive availability and the amount of time one spends
thinking about a role” while absorption “means being engrossed in a role and refers to the

2
0
intensity of one’s focus on a role chaufeli et al. (2002) define engagement “as a positive,
fulfilling, work-related state of mind that is characterized by vigor, dedication, and absorption.”
They further state that engagement is not a momentary and specific state, but rather, it is “a more
persistent and pervasive affective- cognitive state that is not focused on any particular
object, event, individual, or behavior”. According to Gallup, employee engagement can be
categorized into three categories which are engaged employees, followed by non-engaged or
disengaged and disengaged. The engaged employee is the employee that happy in doing their
task, passion, energetic and goes the extra mile for the organizational growth while the non-
engaged or disengaged employee is the employee who is still working without any passion
towards the job and always passive.

Therefore analyzing both academic and practitioner understandings of employee

engagement could add to the knowledge of how employee engagement is understood as well as
whether or not employee engagement is a meaningful concept and warrants further
academic research to strengthen its theoretical foundations and practical application.

2.3. Theoretical Review

2.3.1. Self-Determination Theory

The theory of work engagement, SDT, was formally introduced in the mid-1980s by Deci and
Ryan (1985) to examine employee motivational factors. Deci and Ryan developed the SDT,
which has been used in professional and academic research that relate to employee engagement.
SDT relates to natural or intrinsic tendencies to behave in healthy and effective ways. Employee
engagement and human behaviors have a connection to the SDT and the essence of work
engagement (Deci& Ryan, 1985). An employee’s level of engagement derives from his or her
being able to control personal behaviors and goals. Disengagement and personal engagement are
related to the SDT in that an employee’s behavioral state is a key driver of motivation
to demonstrating behavior at the professional and personal levels. The engagement level of
employees affects the productivity of an organization. The motivation level of an employee is

2
1
related to job satisfaction. The emotional state of an employee also relates to motivation (Deci&
Ryan, 1985). When employees begin to withdraw, and hide their identities, ideas, and feelings,

2
2
2.3.2. Job burnout theories

This theory of engagement is based in the literature on job burnout. In a review of the
job burnout literature, Maslach et al. (2001) discussed job engagement as an expansion of the
burnout construct noting that engagement is the opposite of burnout. They further suggested that
engagement can be assessed by the opposite pattern of scores on the three Maslach-
Burnout Inventory (MBI) dimensions. According toMaslach et al. (2001), job burnout is the
result of mismatches in six critical areas of organizational life, which are considered to be
the major organizational antecedents of burnout: workload, control, rewards and recognition,
community and social support, perceived fairness, and values. The greater the gap or mismatch
between the person and these six areas, the greater the likelihood of burnout. Conversely,
the greater the match or fit between a person and these six areas of organizational life,
the greater one’s engagement. In other words, engagement is associated with a sustainable
workload, feelings of choice and control, appropriate recognition and reward, a supportive work
community, fairness and justice, and meaningful and valued work. Maslach and Leiter (2008)
found some support for their theory with respect to the perception of fairness in the
workplace. This approach also suggests that, like burnout, engagement mediates the
relationship between these six work-life factors and work attitudes (e.g., job satisfaction,
organizational commitment) as well as stress- related health outcomes. In other words,
mismatches lead to burnout, while matches lead to engagement, and burnout and engagement
lead to work and health outcomes.

2.3.3. Social Exchange theory

Social exchange theory is a prominent theoretical paradigm for understanding workplace
relationships (Cropanzano& Mitchell, 2005) and employee attitudes (DeConinck, 2010).
According to Saks (2006) a stronger theoretical rationale for explaining employee engagement
can be found in social exchange theory.

Various authors (Cropanzano& Mitchell, 2005; Emerson, 1976; Ward &Berno, 2011) tend to
agree that these obligations are generated through a series of interactions between parties who are
in a state of reciprocal interdependence. Saks (2006) state that one way for individuals to

10
repay their organization is through their level of Engagement. That is, employees will choose to
engage themselves to varying degrees in response to the resources they receive from their
organization. Bringing oneself More fully into one’s work roles and devoting greater amounts of
cognitive, emotional, And physical resources is a very profound way for individuals to respond to
an organization’s actions. It is more difficult for employees to vary their levels of job
performance given that performance is often evaluated and used as the basis for compensation
and other administrative decisions. Thus, employees are more likely to exchange
their engagement for resources and benefits provided by their organization, (Saks 2006).
Robinson. et.al. (2004), as supporters of this theory explained the two-way characteristics of that
employee engagement which is based on reciprocity. Therefore, organizations can understand
what is needed to make employees well engaged in their work as part of their role to satisfy their
individual needs. In relation to this, Schaufeli (2013) stated examples on how employees react as
an exchange to their organization such as having competitive pay, personal development
opportunities, public praises, etc... As a recent touch to this theory, In other
words, interdependence requires a bidirectional exchange to take place, whereby “something has
to be given and something returned” (Cropanzano& Mitchell, 2005). Employees experience
social exchange relationships with their colleagues, customers, suppliers, direct supervisor,
and their organization (Masterson et al., 2000). Each of these relationships has cognitive,
emotional and behavioral impacts whereby employees reciprocate the socioemotional benefits
they receive (Blau, 1964; Cropanzano& Mitchell, 2005). An employee’s desire to reciprocate
favors toward their organization and their direct supervisor are the result of these relationships
(Cropanzano& Mitchell, 2005).
Even though there are various theories that explain the relationship between
employee engagement and its antecedents, this study focused mainly on social exchange theory
because it was found to have a strong theoretical rationale for explaining about employee
engagement.

2.4. Factors affecting Employee Engagement

There are many factors that influence employee engagement and few of them which are
the interest areas of this study are briefly discussed below.

11
2.4.1. Job characteristics
Kahn (1990) pointed out that it is more likely to be able to engage employees in a task whenever
it is accompanied with characteristics that most excite employees. These characteristics include:
➢ Challenge – workers commit themselves to find out solutions to a challenging task;
➢Variety – substantially complicated tasks that require a variety of skills usually attains the
commitment of employees;
➢Personal discretion – room for making individual decisions on how task is completed also
matters most in ensuring employee engagement;
➢ Opportunity for important contributions – employees are often excited when they know how
they can contribute to organizational achievement;
Employees who work on duties with higher rate of existence of characteristics listed above are
inclined to be more engaged in their work. In line with this, Castellano (2015) noted that the five
core dimensions of job characteristics produce positive outcome on employee’s response. These
dimensions are skill variety, task identity, task significance, autonomy and feedback. Most
of this dimensions are similar with the one listed by Kahn (1990). According to Castellano
(2015), employees who perceived significant existence of those dimensions show high
rate of motivation, convenience and presence at work station.
According to Saks (2006) The Social Exchange Theory perspective is that employees who are
provided with enriched and challenging jobs will feel obliged to respond with higher levels of
engagement. Therefore, based on the literature reviewed and on the tenets of the social exchange
theory, the researcher makes the following hypothesis:
Hypothesis 1: High job characteristics have a significant effect on Employee Engagement in
Banks in Ameya.

2.4.2. Reward and Recognitions

According to Mahapatra (2009) there are a number of ways of classifying rewards. A commonly
discussed dichotomy is Extrinsic versus intrinsic rewards. Extrinsic rewards are the
tangible rewards mostly of a financial nature such as pay raises, bonuses, and benefits,
givenemployee’s .They are called extrinsic because they are external to the work itself
and others control their size and whether or not they are granted. Intrinsic rewards are
psychological rewards that employees get from doing meaningful work and performing it
well, (Mahapatra,

12
 2009). Extrinsic rewards though significant, play a dominant role in organizations where work is
generally more routine and bureaucratic in nature. Pay is an important consideration for
most workers in accepting a job, and unfair pay can be a strong de -motivating factor. However,
after people have settled down in a job, extrinsic rewards are now less important, as day-
to-day motivation is more strongly driven by intrinsic rewards. (Ram and Prabhakar, 2011).
According to Armstrong (2010), recognition is an appreciation shown to individuals for their
achievements, either informally on a day to day basis or through formal arrangements. It can take
place quietly between managers and individuals in their teams or be visible celebrations of
success. Kahn (1990) reported that people vary in their engagement as a function of their
perceptions of the benefits they receive from a role. Saks (2006) states that sense of return on
investments can come from external rewards and recognition in addition to meaningful work.
Hence one might expect that employees ‘to be more engaged at work to the extent that
they perceive a greater amount of rewards and recognition for their role performances.
According to Social Exchange Theory, when employees receive rewards and recognition from
their organization, they will feel obliged to exercise a fair exchange, by responding with
higher levels of engagement, (Saks,
2006). Therefore, based on the literature reviewed and on the tenets of the social
exchange theory, the researcher makes the following hypothesis:
Hypothesis 2: Rewards & Recognition have a significant effect on Employee Engagement in
Banks in Ameya.

2.4.3. Organizational Justice

According to Greenberg (1987), organizational justice refers to the perception in the minds of
employees about the behaviors, decisions, procedures and actions of companies that they work
with and how this influences their work related behaviors. Organizational justice provides
descriptive view of understanding about how employees judge the actions of an organization is
fair or unbiased and ethical. Therefore, one cannot get objective evidence on
organizational justice since it is more likely judged in the minds of individuals about the
rightfulness of
Organizational actions. Colquitt (2001) further elaborated the organizational justice by providing
four dimensions, these are:

13
 ➢ Procedural justice – refers to the fairness and un-biasedness of organizational procedures and
their implementation throughout the organization (Cropanzanno et al., 2007).
➢ Distributive justice – concerns with the differentiated distribution or allocation of a
certain decision or outcome of action across employees based on the reality where each and every
employee is placed in the organization (Pilvinyte, 2013).
➢ Interactional justice – where employees perceive that the organization interacts with each and
every employees in a fairly manner. The required concern, consideration and kindness are
reserved in the course of interaction between organization and employees even at the time
when individuals might have advert effect because of organizational decisions (Pilvinyte,
2013).
➢ Informational justice – is related to how organizations provide certain information about
decision or actions are taken in a certain way to their employees. Justifying those actions/
decisions to employees in a logical, timely and evidence based way indicates the
existence of informational justice in an organization (Cropanzanno et al., 2007).
According to Saks (2006) when employees have high perceptions of justice in their organization,
they are more likely to feel obliged to also be fair in how they perform their roles through greater
levels of engagement. On the other hand, low perceptions of fairness are likely to cause
employees to withdraw and disengage themselves from their work roles. According to
Social Exchange Theory employees who have higher perceptions of organizational justice
are more likely to Reciprocate with greater organization engagement, (Saks, 2006). Therefore,
based on the literature reviewed and on the tenets of the social exchange theory; the researcher
makes the following hypothesis:
Hypothesis 3: perception of organizational Justice has a significant effect on Employee
Engagement in Banks in Ameya.

14
2.4.4. Perceived Organizational Support
Perceived organizational support is based on the “social exchange theory” where organizational
supports are expected to have a reciprocal effect on the achievement of organizational
goals through well motivated and respected employees. Employees who have perceived
that their organization recognizes their values and concerns about their needs are often
committed to meeting their obligations and work towards the success of organizational
goals (Usmani& Jamal, 2013). There are research outputs that indicate a positive,
significant and direct relationship between perceived organizational support and how
knowledge workers react in higher commitment and involvement on their duties (Liang &
Zhang, 2015). Therefore, based on the literature reviewed and on the tenets of the social
exchange theory; the researcher makes the following hypothesis:
Hypothesis 4: Perceived organizational support has a significant effect on Employee
engagement in Banks in Ameya.

2.5. Levels of Employee Engagement

The Blessing white (2013) research update presents the following five levels of Employee
Engagement
1. The Engaged: High contribution and high satisfaction. These employees are at the apex
where personal and organizational interests align. They contribute fully to the success of the
organization and find great satisfaction in their work. They are known for their
discretionary effort and commitment. When recruiters call, they cordially cut the
conversation short. Organizations need to keep them Engaged, because they can
transition over time to any of the three adjacent segments, a move that would likely
impact workforce morale and the bottom line.
2. Almost Engaged: Medium to high contribution and satisfaction. A critical group, these
employees are among the high performers and are reasonably satisfied with their job.
They may not have consistent “great days at work,” but they know what those days look like.
Organizations should invest in them for two reasons: They are highly employable
and more likely to be lured away; they have the shortest distance to travel to reach full
engagement, promising the biggest payoff.

15
3. Honeymooners& Hamsters: High satisfaction but low contribution Honeymooners is new to
the organization or their role and happy to be there. They have yet to find their stride or clearly
understand how they can best contribute. It should be a priority to move them out of this
temporary holding area to full alignment and productivity. Hamsters may be working hard, but
are in effect spinning their wheels, working on nonessential tasks, contributing little to the
success of the organization. Some may even be hiding out, curled up in their cedar shavings,
content with their position (“retired in place”). If organizations don’t deal with them, other
employees will have to work harder and may grow resentful.
4. Crash& Burners: High contribution but low satisfaction. Disillusioned and potentially
exhausted, these employees are top producers who aren’t achieving their personal
definition of success and satisfaction. They can be bitterly vocal that, executives are making
bad decisions or that colleagues are not pulling their weight. They may leave, but they are more
likely to take a breather and work less hard, slipping down the contribution scale to become
disengaged. When they do, they often bring down those around them.
5. The Disengaged: Low contribution and satisfaction. Most Disengaged employees didn’t start
out as bad apples. They still may not be. They are the most disconnected from
organizational priorities, often feel underutilized, and are clearly not getting what they
need from work. They’re likely to be skeptical, and can indulge in contagious negativity. If left
alone, the Disengaged are likely to collect a paycheck while complaining or looking for
their next job. If they can’t be coached or aligned to higher levels of engagement, their
exit benefits everyone, including them.

2.6. Outcomes of Employee Engagement

The great concern given to employee engagement is because of the association of
important employee and organization outcomes. Saks (2006) states that there is a reason
to expect employee engagement to be related to individuals attitudes, intentions &
behaviors i.e. Individuals who are more engaged are likely to be in more trusting and high
quality relation with their employer and will be more likely to report more positive attitudes and
intentions toward the organization. According to Halbesleben (2010), a study in which a
Meta-analysis of work
engagement was conducted it was found that engagement was positively associated with positive
outcomes at work, including a stronger relationship between dedications -an identification based
16
component of engagement and commitment. In addition, it was found that engagement
was related to higher commitment, health, performance, and lower turnover intentions.
According to Bhatla (2011) Employee Engagement has the following effect on the performance
of employees: it builds passion, commitment , Attracts more people like existing employees ,
Creates a sense of loyalty, Lowers attrition rate, Increases productivity and improves
morale, Provides a high- energy working environment, Improves overall organizational
effectiveness & Makes the employees effective brand ambassadors for the company. Markos
and Sridevi (2010) state that an engaged employee consistently demonstrates three
general behaviors which improve organizational performance
➢ Say: The employee advocates for the organization to coworkers and refers potential
employees and customers;
➢ Stay: The employee has an intense desire to be a member of the organization despite
opportunities to work elsewhere;
➢ Strive: The employee exerts extra time, effort and initiatives to contribute to the success of the
business
In summary it can be observed that employee engagement has both individual as well as
organizational outcomes therefore organizations need to give attention to it and create a
Conducive environment for it so that they can be able to reap the benefits associated with having
an engaged work force.

2.7. Employee Engagement Strategies

According to Markos and Sridevi (2010) In order to have engaged employees in
any organization, managers need to look at the following ten points. These points are referred to
as “tablets” because it is believed that they will cure employee disengagement diseases:
1. Start it on day one: Most organizations do have clear new talent acquisition strategies.
However, they lack employee retention strategies. Effective recruitment and
orientation programs are the first building blocks to be laid on the first day of the new employee.
Managers should be careful in pooling out the potential talent of the new employee
through effective
recruitment. The newly hired employee should be given both general orientation which is related
to the company mission, vision, values, policies and procedures and job-specific orientation such
as his/her job duties, and responsibilities, goals and current priorities of the department to which
17
the employee belongs in order to enable him/her to develop realistic job expectations and reduce
role conflict that might arise in the future. After the hiring decision is made, the manager has to
ensure role-talent fit when placing an employee in a certain position and exert all
managerial efforts needed to retain that talent in the organization.
2. Start it from the top: Employee engagement requires leadership commitment through
establishing clear mission, vision and values. Unless the people at the top believe in it, own it,
pass it down to managers and employees, and enhance their leadership, employee engagement
will never be more than just a “corporate fad” or “another HR thing”. Employee
engagement does not need lip-service rather dedicated heart and action-oriented
service from top management. It requires “Leading by Being example”
3. Enhance employee engagement through two-way communication: Managers should
promote two-way communication. Employees are not sets of pots to which you pour out your
ideas without giving them a chance to have a say on issues that matter to their job and life. Clear
and consistent communication of what is expected of them paves the way for engaged
workforce. Involve your people and always show respect to their input. Share power with your
employees through participative decision making so that they would feel sense of belongingness
thereby increasing their engagement in realizing it.

4. Give satisfactory opportunities for development and advancement: Encourage

independent thinking through giving them more job autonomy so that employees will
have a chance to make their own freedom of choosing their own best way of doing their job so
long as they are producing the expected result. Manage through results rather than trying to
manage all the processes by which that result is achieved.
5. Ensure that employees have everything they need to do their jobs: Managers are expected to
make sure that employees have all the resources such as physical or material, financial and
information resources in order to effectively do their job.
6. Give employee’s appropriate training: Help employees update themselves increasing their
knowledge and skills through giving appropriate trainings. Generally it is understood that when
employees get to know more about their job, their confidence increases there by being able to
work without much supervision from their immediate managers which in turn builds their self-
efficacy and commitment.

18
7. Have strong feedback system: Companies should develop a performance management system
which holds managers and employees accountable for the level of engagement they have shown.
Conducting regular survey of employee engagement level helps make out factors that
make employees engaged. After finalizing the survey, it is advisable to determine all the factors
that driving engagement in the organization, then narrow down the list of factors to focus on two
or three areas. It is important that organizations begin with a concentration on the factors that
will make the most difference to the employees and put energy around improving these areas as it
may be difficult to address all factors at once. Managers should be behind such survey results and
develop action-oriented plans that are specific, measurable, and accountable and time-
bound.
8. Incentives have a part to play: Managers should work out both financial and non-financial
benefits for employees who show more engagement in their jobs. Several management theories
have indicated that when employees get more pay, recognition and praise, they tend to
exert more effort into their job. There should be a clear link between performance and incentives
given to the employees.
9. Build a distinctive corporate culture: Companies should promote a strong work culture in
which the goals and values of managers are aligned across all work sections. Companies
that build a culture of mutual respect by keeping success stories alive will not only keep their
existing employees engaged but also they baptize the new incoming employees with this
contagious spirit of work culture.

10. Focus on top-performing employees: recently high performing organizations are focusing on
engaging their top performing employees. These organizations do what top performing
employees are asking for which in turn reduces the turnover of high performing employees and
as a result leads to top performance by the business.

2.8. Empirical Review

A number of empirical investigations have been made so far on the employee
engagement. Some of them are briefly presented as follows.
According to Saks (2006) results of the survey showed that the psychological conditions leading
to organization and job engagement, as well as the consequences of each, are different. The study
results also showed that perceived organization support predicted job and
19
 organization engagement; by comparison, particular job characteristics predicted individual job
engagement. The researchers concluded that procedural justice predicted organization
engagement and that job and organization engagement are both related to employee
attitudes, intentions, and behaviors. In particular, job and organization engagement predict job
satisfaction, commitment to the organization.
Ram and Prabhakar (2011) did a study on the role of employee engagement in work
Related outcomes on the hotel industry of Jordan. The study confirmed that the presence
of four dimensions i.e. perceived organizational support, perceived supervisor support, total
rewards, and perception of distributive justice contributes to employee engagement and in turn
influences the extent of job satisfaction, organizational commitment, intention to continue
with the employer and heightened responsibility toward work related issues.
Solomon and Sandhya (2010) investigated how organizational performance can
enhance employee engagement. The study recommended that organizations should work to
establish two- way communication and avail opportunities for personal development in
order to attain engagement of employees. According to the study result, in order to
ensure significant engagement of employees organizations are required to focus on ensuring
resources available to individuals at their duty, provide opportunities for personal development,
establish constructive feedback system and incentive mechanism to promote best performance
and work towards strong corporate culture.
Sendayekiros (2020) study on employee engagement in the commercial bank of Ethiopia find out
that job characteristics, organizational justice, leadership style and perceived organizational
support have a significant effect on employee engagement, the study also recommend that
provision of adequate autonomy and challenging assignment, paying attention to relationship and
organizational justice is vital in engaging employee to their work.

2.9. Conceptual frame work of the study

Based on the overall review of related literatures, the following conceptual framework in which
this specific study is governed will be developed. It consists of four independent variables
(job characteristics, rewards & recognition, perceived organizational support, perception
of organizational justice) & the dependent variable Employee Engagement included in the model
20
to see if they have a relationship with employee engagement. The conceptual frame work
oftheStudywill be depicted in the following diagram

DEPENDENT VARIABLES
INDEPENDENT VARIABLES

JOB CHARACTERSTICS

Reward and
RecognitionREXHJXRrec
Employee Engagement
Perceived organizational

Organizational Justice

Figure 2.1 conceptual model

2.10. Summary of Hypothesis
H1. High job characteristics have a significant effect on Employee Engagement in case of Banks
in Ameya
H2. Rewards & Recognition have a significant effect on Employee Engagement in case of Banks
in Ameya.
H3. Perception of organizational Justice has a significant effect on Employee Engagement
in case of Banks in Ameya.
H4. Perceived organizational support has a significant effect on Employee engagement in case of
Banks in Ameya.

Chapter Three

21
3. Research Methodology
Research methodology is a way to systematically solve the research problem. It Will be
understood as a science of studying how research is done scientifically ( C.R Kothari. 2004).To
do so; the research design, approach, methodology, data sources, sampling technique, sampling
size, data collection instrument, data analysis methods was be presented as follows.

3.1. Research Design

Prabhat.et.al (2015) defined research design as simply the framework or plan for a study that is
used as a guide in collecting and analyzing the data. It is “the arrangement of conditions for
collection and analysis of data in a manner that aims to combine relevance to the
research purpose with economy in procedure” (Kothari 2004). He added that Research design is
needed because it facilitates the smooth sailing of the various research operations, thereby
making research as efficient as possible yielding maximal information with minimal
expenditure of effort, time and money. Accordingly, the research design for this study
used descriptive research to describe the characteristics of the population, variables and
cross sectional field survey through which data is collected at one point in a time to analysis the
relationship between independent variables (Job characteristics, Reward and Recognition,
Organizational Justice, and Perceived Organizational Support) and the dependent variable
(Employee Engagement). In cross-sectional field surveys, independent and dependent
variables are measured at the same point in time using a single questionnaire (Anol,
2012). In addition the study was also correlational in design because there is intend to
establish the relationship between dependent and independent variable of the study.
Correlational research aims to ascertain if there is a significant association between two variables
(Reid, 1987).

3.2. Research Approach

There are two types of research approaches Quantitative and Qualitative approach in research,
where one of them is not better than the others, all of this depends on how the researcher want to
do a research of study (Kothari 2004 ). Qualitative approaches aim to address the ‘how’ and
‘why’ of an issue under concern and tend to use unstructured methods of data collection to full
explore the topic. On the other hand, quantitative approaches address the ‘what’ of the issue
under concern using systemic standardized approaches such as a survey. Since it is understood

22
that all types of data gathering techniques have their own limitations, to achieve
the aforementioned objectives, the study were adopted a purely quantitative research approach
(inferential type) where it can be use of a questionnaire provided predominantly descriptive and
qualified data. Quantitative approach is study involving analysis of data and information that are
descriptive in nature and qualified (Sekaran, 2003).
A quantitative approach is one in which the investigator primarily uses postpositive claims for
developing knowledge, i.e., cause and effect relationship between known variables of interest or
it employs strategies of inquiry such as experiments and surveys, and collect data
on predetermined instruments that yield statistics data (Creswell, 2003). So, quantitative research
approach was used in this study.

3.3. Research Method

A survey is a method of collecting data in which people are asked to answer a number of
questions (usually in the form of a questionnaire). According to Leary (2004) the major
advantages of questionnaires are that they can be administered to groups of people
simultaneously, and they are less costly and less time-consuming than other
measuring instruments. For this study, survey research method was used where the
Sakas (2006) standardized questionnaire is used to collect the information.

3.4. Data Sources

The study was conducted by using primary and secondary data sources in order to get adequate
data to analyze the subject in depth. The primary data sources were Professional Employees and
managers of Banks. The secondary data sources were Human Resource Documents of the Bank,
and related documents and studies of the Banks. Kothari (2004) indicts that the primary data are
those which are collected afresh and for the first time, and thus happen to be original in character.
The secondary data, on the other hand, are those which have already been collected by someone
else and which have already been passed through the statistical process.

3.5. Population and Sampling Technique

As noted by Kothari (2004), sampling techniques is the mechanism of selecting respondents in
technical way on the basis of researcher’s own issues. Survey can be census or sample survey. A
complete enumeration of all items in the population is known as a census inquiry (Kothari,2004).
He added that many a time it is not possible to examine every item in the population, in such a
cases there is no utility of census survey. However, it needs to be emphasized that when the
23
universe is a small one, it is no use resorting to a sample survey. So because of the small size of
the universe the researcher was used census survey.
The target population of the study was employees and managers of three Banks in Ameya city
administration which is Commercial Bank of Ethiopia (CBE) ameya , Wogagen Bank ameya
and Abyssinia Bank ameya branch which currently operate in City. According to managers
of the three Banks they have a population of: -

Table 3.1 Target population of the research

No. Name of the bank Number of employees Number of

managers

1 Commercial bank of Ethiopia 33 3

2 Abyssinia 8 3

3 Wogagen 7 2

Total 48 8

For the purpose of the study the researcher take the entire census (56) as part of the
survey.

3.6. Data Collection Instruments

A survey was a method of collecting data in which people are asked to answer a number of
questions usually in the form of questionnaire. The method of collecting data by mailing the
questionnaires to respondents is most extensively employed in various economic and business
surveys Kothari (2004). According to Leary (2004) the major advantages of questionnaires are
that they can be administered to groups of people simultaneously, and they are less costly and
less time-consuming than other measuring instruments. For this study, survey research method
was selected where the questionnaire used to collect the information.

24
The questions in the questionnaire was closed-ended or structured in order to ease the process of
analyzing the data from respondents; the questions were adapted from Saks (2006) previous
research papers. The questions was formed in a five point Likert scale which allows respondents
to indicate level of agreement with the statement provided (5=strongly agree, 4=agree, 3=neutral,
2=disagree and 1= strongly disagree).

3.7. Data Analysis Methods

Analysis of data is a process of inspecting, cleaning, transforming, and modeling data with the
goal of discovering useful information, suggesting conclusions (Prateek&Patil, 2014). Once
data was collected, it is necessary to employee statistical techniques to analyses the information,
as this study is quantitative in nature. Descriptive and inferential statistics were employed to
analysis the collected data by using SPSS version 20 software. From descriptive statistics: mean
and standard division was used to summarize and describe the response of participant and
variables. From inferential statistics correlation analysis (using Pearson’s correlation (r)), and
multiple linear regression analysis was employed to identify the relationship between & analyze
the effect of the selected variables on Employee Engagement. In employing regression analysis
assumption test also carried out using Multi-collinearity test (tolerance and VIF), linearity test,
Normality test and heteroscedasticity assumption test was employed to check whether there is a
bias in the model.

3.8. Model Specification

Model specification can be defined as the existence of formally stating a model. It shows the
explicit change of theory into mathematical equations and involves using all the available
relevant theory research and information and developing a theoretical model. Based on the
developed conceptual of the expressed study, figure one mathematically the relationship between
selected independent variable and dependent variable is expressed in the multiple regression
equation as follow:
Y= α + β1X1+ β2X2 + β3X3 + β4X4 + ε
Y= Dependent variable (Employee engagement)
α = constant
β = (Beta value) coefficient of slope of regression model
X1=Job characteristics

25
X2=Reward and recognition X3= Organizational justice X4=Organizational support ε= Error
term

3.9 Validity and Reliability Tests

Validity is that the extent, to which data accurately reflects what they are meant to reflect, i.e.,
The instrument measures what is supposed to measure? Validity is the most critical criterion and
indicates the degree, to which an instrument measures what it is supposed to measure (Kothari,
2004). Accordingly, the questionnaire was adapted from previous studies and researcher was
discuss with the advisor about the questionnaires before it was distributed in order to assure the
validity of the study. According to Kothari (2004), reliability refers to consistency, where
internal consistency involves correlating the responses to each question in the questionnaire with
those other questions in the questionnaire. It is important to make sure that the measuring
instrument, in this case Questionnaire, a reliable measuring instrument, which is it should give
same measurement when used repeatedly on unchanged subject or event. For this purpose,
Cronbach’s alpha was employed and computed using SPSS 20. As stated by Nunnaly (1978) the
closer the reliability coefficient to 1.00 is the better. In general, reliabilities less than 0.60 are
considered poor; those in the range of 0.60 to 0.80 are considered good and acceptable.
3.9. Ethical Considerations
An effort was made to consider some ethical matters. The researcher was ensured that the
respondents are aware of the objectives of the research and their contribution to its completion.
Furthermore, treating the respondents with respect and courtesy is another ethical issue which
was considered during the survey. Maximum efforts were exerted to make respondents feel at
ease and more likely to give honest responses to the questionnaire and ethical issues was also
carefully followed in the data analysis process.

3.10. Conclusion
In summary, this chapter presents a detailed description of the research methodology along with a
justification for the chosen design. This included an explanation of the theoretical perspective,
quantitative nature and chosen survey method of the research. Details of the sampling technique,
measurement scales, survey design, pre-testing the survey, establishing reliability and validity,
hypothesis testing, and ethical considerations have also been provided. The next chapter
discussed the results of the data analysis and hypothesis testing.

26
 Chapter Four

4. Data Analysis, Interpretation and Discussion

In this section the researcher attempt to analyses and interpret the date obtained. A total of 56
questionnaires were distributed to employees of Banks found in Ameya and 56 (100%)
useable questionnaires were obtained valid and used for further analysis. The data collected were
presented, analyzed and interpreted using SPSS software version 20 as follows.

4.1. Demographic Background of Respondents

Table 2 presents the demographic information of the respondents. As can be seen from the below
table item number one, male respondents took the biggest share of the survey population
considered under the study (n=52), which is 92.9% of the sample. The sample is consistent with
the distribution of males in the Banks as they constitute the biggest number from the
total employees of the banks.

Item number 2 shows that the age of the majority of the respondents was found between 25-34 is
36(64.3%), followed by those under 25 and 35-44, which cover 15(26.8%) and 5(8.9%)
respectively. This indicates that the sample is consistent with the distribution of young
employees in the banks as majority of the Banks employees are found to be young under the age
of forty four.

According to item number 3 of the above table, 98.2% of the respondents are found to be first
degree holders, followed by those possessing Master’s Degree (1.8%). This implies that majority
of the Banks employees are first degree holders this happened because positions equal to
and above professional post require a minimum of first degree qualification.

In addition, it was found that 71.4 % of the respondents have been working in the bank below 5
years followed by those of service year between 6 to 10 years, 11-15 years and above 16 years
constituted 17.9%, 5.4% and 5.4% respectively. This implies that most of the employees of the
Banks have an experience of less than 5 years which is a result of most of the employees of the

27
Banks being young & fresh graduates who just joined the bank with zero years of work
experience. Besides, customer service agents took the biggest share of professional employees

28
included in the study (60.7%) followed by officers (12.5 %), Auditor (12.5%) and
manager (10.7%). Customer service agents took the majority due to the increasing number
in the bank which is a result of the increasing number of customers in the bank & its effort to
provide quality service to customers.

Table 4.1 Demographic Background of Respondents

Sex
Frequency Percent Valid Cumulativ
Percen e
t Percent
Male 52 92.9 92.9 92.9
Female
Total 4 7.1 7.1 100.0

56 100.0 100.0

Age
under 25 15 26.8 26.8 26.8
25-34 36 64.3 64.3 91.1
35-44 5 8.9 8.9 100.0
Total 39 100.0 100.0

Level of Education

first degree 55 98.2 98.2 98.2

Masters 1 1.8 1.8 100.0
Total 56 100.0 100.0

Experience
1 to 5 years 40 71.4 71.4 71.4
6 to 10 years 10 17.9 17.9 89.3
11to 15 years 3 5.4 5.4 94.6
above 16 years 3 5.4 5.4 100.0
Total 56 100.0 100.0

29
 Job title
Customer services agent 34 60.7 60.7 60.7
Auditor 7 12.5 12.5 73.2
Cashier 2 3.6 3.6 76.8
Officer 7 12.5 12.5 89.3
Manager 6 10.7 10.7 100.0
Total 56 100.0 100.0

30
4.2. Reliability Test of the Survey

According to Kothari (2004), reliability refers to consistency, where internal consistency

involves correlating the responses to each question in the questionnaire with those other
questions in the questionnaire. Cronbach’s alpha test is employed in order to check whether or not
internal consistency of the survey questionnaire. Cronbach’s alpha is tested by checking
whether or not each of the observation is correlated and checking the variance of each score. As
stated by Nunnaly (1978) the closer the reliability coefficient to 1.00 is the better. In general,
reliabilities less than 0.60 are considered poor; those in the range of 0.60 to 0.80 are considered
good and acceptable. In this study, the result of reliability test reveal that all the
independent variables and dependent variable, met the above requirement by scoring the Alpha
value ranging
0.941 to 0.781 as shown in table 3 below.
Table 4.2 Alpha Coefficient

Alpha Coefficient
No Variables of the study Alpha Values No. of items
1 Job characteristics .900 7
2 Reward and Recognition .930 6
3 Organizational justice .852 8
4 Perceived organizational support .781 5
5 Employee engagement .821 8
6 Overall .941 34
Source: own survey 2023 SPSS 20

4.3. Descriptive Statistics of factor affecting employee engagement

Descriptive statistics was employed to examine the mean & standard deviation of the responses of
respondents with regards to the four factors affecting employee engagement (job
characteristics, rewards & recognition, organizational justice & organizational support). Mean
score < 3.39 was considered as low, the mean score from 3.40 - 3.79 was considered as moderate

31
 and mean score > 3.8 was considered as high as illustrated by comparison bases of mean of score
of five point Likert scale instrument (Zaidatol, 2009).

4.3.1. Job characteristics

Jobs that are high on the core job characteristics provide individuals with the room and incentive to
bring more of themselves into their work or to be more engaged (Kahn, 1992). This is based on
Hackman & Oldham’s (1980) as cited in Sake (2006), “job characteristics model and in
particular, the five core job characteristics (i.e. Skill variety, task identity, task significance,
autonomy, and feedback)”. The survey result shows that the respondents generally believe in the
existence of factors that indicate better job characteristics that enable them to be engaged in what
there are doing at their work station.

Table 4.3 Mean and Standard Deviation Results of Job Characteristics

Items N Mean Std.

Deviation
There is much autonomy in my job 56 3.75 .919
My job permit me to decide on my way to go about doing 56 3.71 1.124
the work
There is much variety in my job 56 3.68 .974
The jo require me to do many different things a t work, 56 3.61 .947
using a variety of my skills and talents
Managers or coworkers let me know how well am doing on 56 3.68 .993
my job
Doing the job itself provide me with information about my 56 3.43 .970
work performance
The actual work itself provides clues about how well I am 56 3.66 .85
doing aside from any feedback coworkers or supervisors
may provide.

32
Average 3.64 .7685
Source: own survey 2023, SPSS
20

As the table above shows, the mean for all of the detailed indicators under the Job
characteristics variable is higher than three which is a mid-level (moderate) count. It is
also shown that the variances of those response against the mean are minimal (below
0.5) which indicate that all respondents’ replay are close to each other. Result of
the descriptive analysis of job characteristics was found to be (Average M= 3.64, S.D =
0.768) which implies that respondents perceived the existence of moderate job characteristics in
Banks located in Ameya.

4.3.2. Reward and recognition

People vary in their engagement as a function of their perceptions of the benefits they receive
from a role (Kahn 1990). According to Sake (2006), a sense of return on investments can come
from external rewards and recognition in addition to meaningful work. Therefore, one
might expect that employees’ will be more likely to engage themselves at work to the extent
that they perceive a greater amount of rewards and recognition for their role performances.

Table 4.4: Mean & Standard Deviation Results of Reward and Recognition

N Mean Std.
Deviation
A pay raise ,job security, and a promotion available for me 56 3.131 .192
I get praise from my supervisor 56 2.961 .293
Training and development opportunities available for me 56 2.79 .967
More challenging work assignments available for me 56 3.001 .191
There is some form of public recognition( employee of 56 3.041 .095
the month)

33
 There is a reward or token of appreciation(lunch) 562.931.189

Average 2.97 .997

Source: own survey 2023, SPSS 20

As shown in Table above, reward and recognition was assessed by six measurement
items. According to the mean score of the items that describes reward and recognition, the
highest mean score was attained by the item “A pay raise, job security, and a promotion available
for me” (M
= 3.13 & SD = 1.192) and the lowest mean score was "Training and development opportunities
available for me"(M=2.79 and SD=.967). The average result (M=2.97 and SD=.997) indicates
that the majority of respondent that they are disagree with the items presented to assess reward
and recognition. This indicates that even though, reward and recognition is among the
most important dimensions of employee engagement, the Banks reward and recognition
practice is unsatisfied employee of the bank. Maslach et al., (2001) have also suggested that
while a lack of rewards and recognition can lead to burnout, appropriate recognition and reward
is important for engagement. In terms of SET, when employees receive rewards and
recognition from their organization, they feel more obliged to respond to higher levels of
engagement.

4.3.3. Perceived organizational justice

According to Greenberg (1987), organizational justice refers to the perception in the minds of
employees about the behaviors, decisions, procedures and actions of companies that they work
with and how this influences their work related behaviors. Organizational justice provides
descriptive view of understanding about how employees judge the actions of an organization is
fair or unbiased and ethical. Therefore, one cannot get objective evidence on
organizational justice since it is more likely judged in the minds of individuals about the
rightfulness of organizational actions.

33
Table 4.5 Mean & Standard Deviation Results of perceived organizational justice

N Mean Std.
Deviation
The outcomes i receive appropriate for the work have 56 3.821 .097
completed
My outcomes reflect what i have contributed to the 56 3.66 1.311
organization.
I have been able to express my views and feelings during those 56 2.80 .903
procedures
I have had influence over the outcomes arrived at those 56 3.14 .841
procedures
Those procedures have been applied consistently 56 3.43 .931
Those procedures have been free of bias 56 3.43 1.173
I have been able to appeal the outcomes arrived at by those 56 3.55 .989
procedures
Those procedures have upheld ethical and moral standards 563 .231 .009
Average 3.38 .729
Source: own survey 2023, SPSS 20

As indicted in the above table eight organizational justice relate questions were asked to
respondents and the finding reviles that the highest mean value score is " The outcomes I receive
appropriate for the work have completed"(M=3.82, SD=1.097) and the lowest mean value score
is" I have been able to express my views and feelings during those procedures"(M=2.80,
SD=.903). The average score of the eight items was (M=3.38, SD=.729) which implying that a
low level of organizational justice is perceived by employees of the Banks in Ameya.

34
4.3.4. Perceived organizational Support

Psychological safety, according to Kahn (1992), involves a sense of being able to show
and employ the self without negative consequences. An important aspect of safety stems from
the amount of care and support employees perceive to be provided by their organization as well
as by their direct supervisor. In fact, Kahn (1990) found that supportive and trusting interpersonal
relationships as well as supportive management promoted psychological safety. Supportive
environments allow members to experiment and to try new things and even fail without fear of
the consequences (Kahn, 1990).

Table 4.6 Mean & Standard Deviation Results of Perceived Organizational Support

N Mean Std.
Deviation
My organization is supportive of my goals and values 56 3.20 1.052
Help is available from my organization when i have a problem 56 3.50
1.128
My organization really cares about my well being 56 3.62 1.088
My organization shows great concern for me 56 3.07 .828
My organization cares about my opinions 56 3.00 .874
Average 3.27 .731

Source: own survey 2023, SPSS 20

As it can be seen in the Table 7 above, for Perceived organizational Support the highest mean
value from employee’s perception was attached to the item to addressed “My organization really
cares about my well-being” (M=3.62, and SD=1.088). An item with the least mean value was
related to the question referring to the “My organization cares about my opinions”
(M=3.00, SD=.874) and average score was (M=3.27, SD=.874) which indicated that they are low
level of support they received from their organizations. Thus it needs a great improvement,
because it also helps to create conducive working environment which in effect will
Improve the overall results of the organization.

35
4.3.5.Employee Engagement

According to Kahn (1990) people draw upon themselves to varying degrees while performing
work tasks and they can commit themselves physically, cognitively, and emotionally in
the various roles they perform. Or, they may choose to withdraw and disengage from
their work roles and work tasks. Results of Kahn’s study suggest that there are three
psychological conditions that shape how people perform their roles: - meaningfulness, safety, and
availability. Kahn’s identification of the three psychological conditions now serves as a
framework for the study of employee engagement

36
Table 4.7 Mean & Standard Deviation Results of Employee engagement

N Mean Std.

Deviation

I really throw myself into my job 56 4.02 .904

Time passes quickly when i perform my job 56 3.70 1.278

I stay unit the job is done 56 3.57 1.373

I get excited when i perform well on my job 56 3.77 1.221

Being a member of this organization is very captivating 56 3.61 1.139

One of the most exciting things for me is getting involved 56 3.48 1.09
with things Happening in this organization.

37
Being a member of this organization make me come alive 56 3.50 .934

I am highly engaged in this organization. 56 3.50 .874

Average 3.64 .742

Source: own survey 2023, SPSS 20

As shown in table above the dependent variable is assessed by the respondents through
eight indicators. The mean values of the entire indicators lie ranging from "I really throw myself
into my job" (M=4.02, SD=.904) to "One of the most exciting things for me is getting involved
with things Happening in this organization."(M=3.48, SD=1.095) and the average score
was( M=3.64, SD=.742) which shows that moderate level existence of employee
engagement in the organization.

4.4. Inferential Analysis

4.4.1. Correlation Analysis

Karl Pearson’s coefficient of correlation (or simple correlation) is the most widely used method
of measuring the degree of relationship between two variables; it allows assessing the strength
of the association between the variables of interest and used as a statistic that indicates the
degree to which two variables are related to one another (Kothari 2004). The correlation
coefficient the value of ‘r’ lies between ± 1. Positive values of r indicate positive correlation
between the two variables (i.e., changes in both variables take place in the statement direction),
whereas negative values of ‘r’ indicate negative correlation i.e., changes in the two variables
taking place in the opposite directions. A zero value of ‘r’ indicates that there is no
association between the two variables. When r = (+) 1, it indicates perfect positive correlation
and when it is (–) 1, it indicates perfect negative correlation, meaning thereby that variations in
independent variable (X) explain 100% of the variations in the dependent variable (Y).
Evans (1996) suggests for the absolute value of(r) as mentioned in (Beldjazia and Alatou,
2016): 0.00-0.19= “very weak”, 0.20-0.39= “weak”, 0.40-0.59= “moderate”, 0.60-0.79=
“strong” & 0.80-1.0= “very strong”. In addition, the p-value was used to indicate the
significance of the relationship.

38
Table 4.8 Correlation matrix of the independent variables & employee engagement

job Rewar Organ Organ Emplo

charac d& izatio izatio yee
teristi recog nal nal engag
cs nition justice suppo ement
rt
job characteristics Pearson correlation 1
Sig. (2-tailed)

Reward &recognition Pearson Correlation .402**1

Sig. (2-tailed) .002
Organizational justice Pearson Correlation .686**.381**1
Sig. (2-tailed) .000 .004
Organizational support Pearson Correlation .427**.457**.194 1
Sig. (2-tailed) .001 .000 .152
Employee engagement Pearson Correlation .675**.637**.620**.545**1
Sig. (2-tailed) .000 .000 .000 .000
**. Correlation is significant at the 0.01 level (2-tailed).
Source: own survey 2023 SPSS 20

As the finding indicates in above table that job characteristic variable has highest
correlation with employee engagement with (r=.675, p=.000), followed by reward and
recognition (r=.637, p=.000) and organizational justice (r=.620, p=.000. Comparatively the
least relationship was found between perceived organizational support and employee
engagement with (r= .545, p=.000).

The result of the study further indicts that job characteristics are positively and strongly
correlation with employee engagement with R-value of .675 at the 1 percent significance level
which means job autonomy, variety of job, jobs that seek skill and talent and feedback
have crucial rule in enhancing employee engagement. This is similar with the finding of Saks
(2006) in which job characteristics were found to predict job engagement. Indicating that in this
case employees whose jobs are designed to be using their skill set & whose work is significant in
the final outcome experienced stronger job engagement.

39
The survey result showed that rewards and recognition with R-value .637 at the 1 percent
significance level positive and strongly correlated with employee engagement which means a
pay raise, job security, training and development, challenging work assignment, public
recognition and reward of appreciation

is a vital role in enhancing employee engagement. On the other hand, organizational

Justice is positively and strongly correlated with employee engagement with R-value of .620 at
the 1 percent significance level. Organizational justice, indicated by distributive, procedural
and interactional justice practices is positive factor that can be used to alter the level of
engagement of employees. Perceived organizational support being given by the
organization has positive and moderate correlation with employee engagement with R-value of
.545 at the 1 percent significance level. The support given by the organization as perceived
by employees and explained in terms of caring about individual well-being, showing great
concern for individuals, respecting one’s opinions and supporting individual development
goals is positively correlated with engagement of employees.

4.4.2. Multiple Linear Regression Analysis

Multiple regression analysis is used to discover the relationship between one dependent variable
and a number of independent variables or predictors (Pallant, 2005). Multiple regression also
tells that how much of the variance in the dependent variable can be explained by independent
variables. According to Ballance (2004), the correct use of the multiple regression models
involves that several critical assumptions be satisfied in order to apply the model and establish
validity. Inferences and generalizations about the theory are only valid if the assumptions in an
analysis have been tested and fulfilled. Before running out multiple regression analysis, the
researcher has conducted the required preliminary assumptions that the data must meet to make
the analysis reliable and valid. Regression analysis was conducted to understand by how much
the combination of independent variables explains the dependent variable. Before regression
analysis was conducted, linearity, normality, multi-co-linearity and heteroscedasticity tests were
conducted to test regression assumptions. The results are presented as follows

40
4.4.2.1. Assumptions Test

4.4.2.1.1. Linearity Assumption Test

Linearity defines the dependent variable as a linear function of the predictor

(independent) variable (Balance, 2004). If the data are normally distributed then the data points
was be close to the diagonal line. Linearity assumption was tested by producing scatterplots of
the relationship between independent variable and the dependent variable. By visually looking at
the scatterplot produced by SPSS, the relationship between independent variable and the
dependent variable found to be linear as shown in the figure below.

Source: Own Survey, computed in SPSS 20, 2021

Figure 4 1 Linearity Assumption test

4.4.2.1.2. Normality Assumption Test

Normality is used to describe a symmetrical, bell-shaped curve, which has the greatest frequency
of scores around in the middle combined with smaller frequencies towards the extremes.

41
Normality test is used to determine whether the error term is normally distributed.
Therefore, normality test for the data used in this study were shown by the following histogram
can clearly see that error terms are normally distributed.

Source: Own Survey, computed in SPSS 20, 2021

Figure 4.1 2 Normality Assumption Test

4.4.2.1.3. Multi-co linearity

Multicollinearity refers to the situation in which the independent/predictor variables are highly
correlated with other. One major assumption that applies in multiple regression analysis was the
existence of a very high correlation between the independent variables of the study which
is termed as Multicollinearity (Burns, 2008). This may lead to the inconsistent effect, whereby th

42
regression model fits the data well, but none of the predictor variables has a significant effect in
predicting the dependent variable. To check for multicollinearity between these independent
variables, two common measures for assessing multicollinearity were utilized. These measures
include Tolerance and its inverse, the Variance Inflation Factor (VIF) (Allen & Bennett, 2012).
Independent variables with tolerance values <0.1, and VIF values >10 are suggested to be
multicollinearity (Gujarati, 2004). Upon inspection of the collinearity diagnostics (Table 10), the
Tolerance and VIF values of the independent variables were within the general thresholds
stipulated by Gujarati (2004).In addition the correlation coefficient indicates that there is
no more than 0.8 correlation between independent variables. It seems from these values that there
is no an issue of collinearity between the predictor variables; which means that the derived model
is likely to be unchanged by small changes in the measured variables. In another word,
these values give us some idea as to how accurate our regression model is and no concern with
biasing effect of collinearity.

Table 4.9 Result of Multi -collinearity test

Coefficients a
Model Collinearity Statistics
Tolerance VIF
1 (Constant)
job characteristics .439 2.279
Reward and recognition .701 1.426
Perceived organizational justice .491 2.036
Perceived organizational support .686 1.457
a. Dependent Variable: employee engagement
Source: own survey 2023, SPSS 20

4.4.2.1.3. Heteroscedasticity Assumption Test

The assumption of homoscedasticity refers to equal variance of errors across all levels of the
independent variables. This means that errors are spread out consistently between the variables.
This is evident when the variance around the regression line is the same for all values

43
of the predictor variable. If not, then the regression is heteroscedasticity. Heteroscedasticity
implies that
the variance of the disturbances is not constant across observations. Heteroscedasticity is
indicated when the scatter is not even; fan and butterfly shapes are common patterns of violation.
To assess heteroscedasticity, the researcher created a scatterplot using SPSS and found
that heteroscedasticity was a major problem except on organizational justice as shown in the
figure below.

Source: own survey 2023, SPSS 20

Figure 4.2 Homoscedasticity Assumption Test

44
4.4.2.2. Model Summary

As indicated in the below model summary table 11, The "R" column represents the value of R,
the multiple correlation coefficient. R value of 0.823 indicates very strong correlation between
dependent and independent variables; which shows a good level of prediction. The "R Square"
column represents the R2 value (also called the coefficient of determination), which is
the proportion of variance in the dependent variable that can be explained by the
independent variables. The R2=.677 shows that more than (67.7%) of the total variance in
the dependent variable has been explained by the model which indicates that the model
provides relatively adequate information about the subject matter. Hence, the other 32.3%
variations are described by the other independent variable that is not studied in this research.
Table 4.10 Model Summary

Model Summary b
R R Square Adjusted R Square Std. Error of the Estimate
Mo
del
1 .823a .677 .652 .43852
a. Predictors: (Constant), organizational support, organizational justice, reward and
recognition, job characteristics
b. Dependent Variable: employee engagement
Source: own survey, SPSS20, 2023

4.4.2.3. ANOVA Model Fit

ANOVA analysis is normally used to compare the mean scores of more than two variables. It is
also called analysis of variance because it compares the variance between variables and
tests whether the overall regression model is a good fit for the data (Pallant, 2005)

45
Table 4.11 ANOVA

ANOVA a
Model Sum of Df Mean F Sig.
Squares Square
1 Regression 20.550 4 5.137 26.715 .000b
Residual 9.807 51 .192
Total 30.357 55
a. Dependent Variable: employee engagement
b. Predictors: (Constant), organizational support, organizational justice, reward and
recognition, job characteristics
Source own survey, 2023, SPSS 20

F-test is used to test the impact of overall explanatory power of the whole model, or the joint
effect of all explanatory variables as a group. (i.e. testing the overall performance of the
regression coefficients). It measures the statistical significance of the entire regression equation
rather than of each individual coefficient as the t-test. As indicated in the above table the value of
F is 26.715 and p< 0.00 which indicates that the overall model was fit and there was statistically
significant association between the independent variables and employee’s engagement.

4.4.2.4. Regression Coefficients

The standardized coefficients are useful to know which of the different independent variables is
more important. They are used in comparison of impact of any independent variable on the
dependent variable. Hence, the strength of each independent (predictor) variable influence on the
criterion (dependent) variable can be inquired by standardized Beta coefficient. Therefore,
the regression coefficient explain the average amount of change in dependent variable that caused
by a unit of change in the independent variable

46
Table 4.12 Regression Coefficient

Model Unstandardized Standardized T Sig.

Coefficients Coefficients
B Std. Error Beta
(Constant) .293 .357 .823 .414
job characteristics .248 .116 .256
2.134 .038
Reward & recognition .239 .071 .321 3.374 .001
Organizational justice .281 .116 .276 2.429 .019
Organizational support .240 .098 .236 2.457 .017
a. Dependent Variable: employee engagement

Source: own survey 2023, SPSS 20

The standardized coefficients are useful to know which of the different independent variables is
more important. They are used in comparison of impact of any independent variable on
the dependent variable. Hence, the strength of each independent (predictor) variable influence on
the criterion (dependent) variable can be inquired by standardized Beta coefficient.
Therefore, the regression coefficient explain the average amount of change in dependent variable
that caused by a unit of change in the independent variable. Table 13 summarizes and helps to
understand which variable among the four independent variables is the most important in
explaining the variance in employee engagement. As it is indicated in the table above, the
standardized beta coefficient of reward and recognition (beta=0.321, p=.001) is the highest
among the rest of the variables revealing the largest contribution in explaining the variance of
the dependent variable followed by perceived organizational justice (Beta = 0.276, P=0.019), job
characteristics (Beta = 0.256, P=0.038) and perceived organizational support (Beta = 0.236,
p=0.017).

4.5. Hypothesis test

47
Hypothesis is simply an educated and testable guess about the answer to your research question.
A hypothesis is often described as an attempt by the researcher to explain the phenomenon of
interest. Those hypotheses are the researchers attempt to explain the phenomenon being studied,
and that explanation should involve a prediction about the variables being studied. These
predictions are then tested by gathering and analyzing data, and the hypotheses can either
besupported or refuted (falsified) on the basis of the data. Accordingly, the four hypotheses
which were developed earlier in chapter two were tested based on the regression coefficient data.

Hypothesis 1
H1: High job characteristics have a significant effect on Employee Engagement in case of Banks
in Ameya.

As shown from the above table 13, the regression coefficient result of job characteristics (β=0.256,
P<0.038) which shows that job characteristics is positive relationship with employee
engagement and significance at 5% confidence interval. The beta coefficient implies that if the
Banks change their job characteristics by 1 %, by keeping the other variables constant its
employee engagement would increase by 25.6%. Overall, the results of the beta value
suggest that employees who assigned to better Job characteristics are more likely to
reciprocate with greater levels of engagement to their organization . There for the study accept
the alternate hypothesis 1 that job characteristics have a significant effect on employee
engagement in Banks in Ameya. This finding is similar to results from previous studies, in which it
was discovered that employees who are provided with enriched and challenging jobs will feel
obliged to respond with higher levels of engagement (kahn, 1990, 1992; Maslach et al, 2001).

Hypothesis 2
H1: Rewards & Recognition have a significant effect on employee engagement in case of Banks
in Ameya.
Reward and recognition has, p-value significant at (p < 0.01), and the beta value is positive at
0.321. Therefore, reward and recognition has positive and significant effect on employee
engagement in Banks operating in Ameya. Here also the beta coefficient implies that if the
Banks change their Reward and Recognition by 1 %, by keeping the other variables constant its
Employee Engagement would increase by 32.1%. Therefore, reward and recognition had a

48
positive and significant effect on Employee Engagement. The result of this study is in line with
the findings by Kahn (1990) who reported that people vary in their engagement as a function of
their perceptions of the benefits they receive from a role i.e employees become more engaged at
work when they receive a greater amount of rewards and recognition for their role performances.
In addition the correlation coefficient (r=.637, p=000) indicates that reward and recognition and
employee engagement have strong and significant relationship. There for the study accept
the alternate hypothesis 2 that rewards & recognition have a significant effect on
Employee Engagement in Banks in Ameya.
Hypothesis 3
H3: Perception of organizational Justice has a significant effect on Employee Engagement
in case of Banks in Ameya. Organizational justice and employee engagement have strong and
significant relationship with correlation coefficient (r=.620 p=000). Organizational justice
has, p-value significant at (p <0.19), and the beta value is positive of 0.276. This statistic also
infers that if the bank increased its focus to organizational justice by (one) 1%, then its Employee
Engagement would increase by
27.6%. The results of the study are also supported by Ram and Prabhakar (2011) who confirmed
that organizational justice has a significant effect on employee engagement. This indicates in this
case when employees perceive their organization to be fair and consistent in how it implements
procedures & how it distributes rewards, the employees become more engaged. Therefore, the
study accepts the alternate hypothesis 3 that Organizational justice has positive and significant
effect on employee engagement in case of Banks in Ameya.

Hypothesis 4
H4: Perceived organizational support has a significant effect on Employee engagement in case of
Banks in Ameya.
Perceive organizational support have positive and significant relationship with
employee engagement with value of (beta 0.236, p 0.17). The result is significant at 5%
level of significance. Thus, proposed hypothesis was accepted. In this case the beta coefficient
describes that keeping the other variables constant, in this model a one (1) % change in
the overall Perceived organizational Support, the consequence would be an increase
in Employee Engagement by 23.6 %. The correlation coefficient (r=.545, p=.000) also

49
 indicates that, the predictor is statistically significant at less than five percent level of
significance. Therefore the study accepts the alternate hypothesis 4 perceived organizational
support has a significant effect on Employee engagement in case of banks in ameya
.

4.6. Summary of Hypothesis test

In the following table hypothesis summarized using Beta and correlation coefficient values.

Table 4.13 Summary of Hypothesis

No Hypothesis Test Result

1 High job characteristics have a significant (β=.256,P=.038) H1= accepted
effect on Employee Engagement in case of (r=.675, p=.000)
Banks in Ameya.
2 Rewards & Recognition have a significant (β=.321,r=.001) H1=accepted
effect on Employee Engagement in case of (r=.637, p=.000)
Banks in Ameya.
3 Perception of organizational Justice has (β=.276,p=0.19) H1=accepted
a significant effect on Employee Engagement (r=.620, p=.000)
in case of Banks in Ameya.
4 Perceived organizational support has a (β=.236, p=.017) H1= accept
significant effect on Employee engagement in case (r=.545, p=.000)
of Banks in Ameya.

50
 Chapter Five

5. Summary of finding, Conclusion and Recommendation

The study tried to examine the factor that affect employee engagement in case of Banks
in Ameya by identifying the key determinates, namely job characteristics, reward and
recognition, perceive organizational justice and perceived organizational support
which influence employee engagement. The findings provide valuable insights into the social
factors that influence employee engagement. This chapter presents summery of finding,
conclusion based on the finding and recommendation for the Banks on areas that need
improvement, limitation and implication for future research.

5.1. Summary of finding

✓Related to the demographic characteristics the result specify that majority of the
employees 52(92.8%) were male. Regarding their age level majority of them was young
between 25-35 years of age. Regarding educational level majority of the employees were
first degree holder. Moreover, the result indicates that majority 40(71.4%) of the
employees have less than five years of work experience in the Banks.
✓The entire questionnaires were reliable and acceptable with Cronbach's Alpha result
0.941.
✓The first research question, Do job characteristics have an effect on
employee engagement, was addressed and tested by H1. The results of the
descriptive statistics (M=3.64, S.D=.7685) indicts that respondent perceive the existence
of job characteristics in Banks. The correlation result indicates that there is a
moderate positive relationship between job characteristics & employee engagement in
case of Banks in Ameya (r=
0.675, p=0.00) and regression result (β =0.256, P=0.038) indicts that job characteristics
have positive and significant effect on employee engagement at 5% confidence interval.

51
✓The second research question, Do reward and recognition have an effect on
employee

engagement was addressed and tested by H2. The results of the descriptive
statistics (M=2.97, S.D=0.997) indicts that respondent perceive that there is low level of
reward and recognition in Banks. The correlation result also indicates that there is
a strong
positive relationship between reward and recognition & employee engagement in case of
Banks in Ameya (r= .637, p=0.00) and regression result (β =.321, P=0.001) indicts that
reward and recognition have positive and significant effect on employee engagement.
✓The third research question, Does perception of organizational justice have an effect on
employee engagement was tested by H3. As the descriptive statistics result revealed that
respondent perceive moderate level existence of organizational justice in Banks (M=3.38,
P=.729). The result of correlation also indicate that positive and strong relationship

between organizational justice and employee engagement at (r=.620, p=.000). In addition

the regression result reveals that organizational justice is positive and significant effect on
employee engagement by scoring (β= .276, p=0.019).

✓The fourth research question, Does perceived organizational support have an effect
on
employee engagement. The result of descriptive statistics (M=3.27, S.D=.731)
indicts respondent perceives there is low level existence of organizational support
in case of Banks in Ameya. Organizational support and employee engagement have
also
positive and moderate relationship (r=0.545, p=.000). The regression result also indicts

that positive and significant effect on employee engagement (β= .236, p=.017).

✓The result shows that the model teste is significant at (p=.000) with the R square 0.677.
This value indicates that 67.7 % of variance in Employee Engagement is attributed to the
four independent variables entered into the regression. The remaining 32.3 % of
the variance in employee engagement may attribute to other factors.

52
5.2. Conclusion
In general, this study looked at factors affecting employee engagement in Banking
industry, particularly Banks operating in Ameya. The employee engagement dimensions that
were included in this research are job characteristics, rewards & recognition, organizational
justice and organizational support. Based on the finding the independent variables job
characteristics exists strongly, organizational justice exists slightly moderate but reward and
recognition and organizational support low level of existence in case of Banks in
Ameya. Based on standardized beta coefficient value reward and recognition,
organizational justice, Job characteristics, and organizational support have relation and
effect in enabling employee
engagement respectively high to low. Based on the evidence of the R square value
obtained
67.7% of the variance on employee engagement can be predicted by the independent variables.
So the four independent variables as a cumulative have a positive and significant effect
on employee engagement.

5.3. Recommendations

Based on the findings and conclusions of this research, recommendations are pointed out in order
to further enhance efforts being made to strengthen employee engagement within the Banks in
Ameya.

Because of job characteristics were found to be the significant predictor of

employee engagement, it should focus on designing variety of jobs, giving autonomy in
their work, developing relationship, decrease the probability of workers being bored and
combine different tasks in a job which would enable employees to engage and in turn to
gain result and achievement in the Banks.
Reward and recognition were found to be one of the factors affecting employee
engagement & they were perceived to be low, the Banks could employ various
mechanisms to enhance engagement such as recognition, appreciation, providing training
& development opportunities, career advancement & promotion opportunities is among
the factors because today’s market trend, employees not only interested at the

53
 benefits entitlement and compensation packages offered by the company but they
also seek for overall organizational incentive plans.
Organizational justice was also found to significantly effect on the level of
employee engagement, the Banks needs to work more on it & could employ mechanisms
such as allowing employee to express their view and fillings, applying procedures
consistently and free of bias, creating mechanism to appeal to create an atmosphere
of fairness & increase employee’s perception of fairness in the Banks.

Giving a great concern on support system is vital to engage employee through giving care
and concern for employee of the banks, be supportive of goals and values of employee and
helping employee when they face problem so as to increase the engagement level for the
greater result. The Banks should ascertain engagement levels of their employees in
order to identify
gaps and take appropriate measures to bridge gaps.

5.4. Limitations

Although this study contributes in identifying factors that affects employee engagement, it has its
own limitations such as: Cross-sectional whereby data were collected at a single point in time
and respondents completed the survey independent of the researcher. This may cause causality
and common method bias, it use only quantitative approach, only identified four factors to test,
small area covered in the research, the result of the study showed organizational support negative
effect on employee engagement.

5.5. Implication for future research

The results of this study suggest that employee engagement is a meaningful construct that
is worthy of future research. The researcher suggest that future researcher should have
to incorporate and test other independent factors that affect employee engagement, should cover
large areas and sample in the research, should use both quantitative and qualitative approach to
get more understanding in the area.

54
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59
 School of online post graduate

Name : NATNAEL GETAHUN DUGO

Address: Email: natnaelgetahun5@gmail.comphone: 0912939425

Dear Respondent:

I would like to express my earnest appreciation for your generous time, honest and prompt
response.

Objective of the questionnaire

This questionnaire is designed to collect data about “Factors Affecting Employee Engagement in
Banks inAmeya. The information that you provide me with this questionnaire will be used as
primary data in my research. This research is to be evaluated in terms of its contribution in
understanding the factors affecting employee Engagement at Banks in Ameya and its
contribution to improvement in this area. As a result, the effectiveness of the research is highly
dependent on your contribution of providing accurate & reliable data. Information gathered will
be treated with utmost confidentiality and will not be used for any other purpose i.e. the secrecy
of the information you provide is strictly protected.

Please note that participation in this research is entirely voluntary

i
Section I: Demographic profile

INSTRUCTIONS: This part of the questionnaire asks you’re personal and job related
information. Please respond to each question by circling the choice that represents your personal
profile.

1. Sex 1) Male 2) Female

2. Age 1) Under 25 2) 25-34 3) 35-44 4) 45-54 5) 55 and above
3. Level of Education 1) Diploma 2) First Degree 3) Masters 4) PHD and above
4. Work experience in the Bank: 1) Up to 5 years 2) 6 to 10 years 3) 11 to 15 years 4) over
16 years
5. Job title / Position 1) Customer service agent 2) Auditor 3) Cashier 4) Officer 5) Expert
Section II: Factors affecting employee engagement

INSTRUCTIONS: The following statements are designed to assess the impact of four variables
on Employee Engagement in your bank. Please indicate your level of agreement/disagreement
with each of the statements by putting (√) mark inside the box

1 2 3 4 5

Disagre
Strongl
No

Neutra
1. Job Characteristics

Strongl
Agree
e
y

l
6 There is much autonomy in my job

y
7 My job permit me to decide on my way how to go about
doing the work
8 There is much variety in my job.
9 The job require me to do many different things at work,
Using a variety of my skills and talents.
10 Managers or co-workers let me know how well I am
Doing on my job.
11 Doing the job itself provide me with information about
My work performance.
12 The actual work itself provides clues about how well I am doing –
aside from any “feedback” coworkers or supervisors may provide.

ii
 12345

Neutra
Disagre
Strongl

Strongl
Agree
No
2. Rewards and Recognition

y
l
e
13 A pay raise, Job security, and a promotion available for me

14 I get Praise from my supervisor.

15 Training and development opportunities available for me.
16 More challenging work assignments available for me.
17 There is some form of public recognition (e.g. employee
Of the month).
18 There is a reward or token of appreciation (e.g. lunch).
3. Organizational
justice
19 The outcomes I receive appropriate for the work I have
completed.
20 My outcomes reflect what I have contributed to the organization
21 I have been able to express my views and feelings during those
procedures.
22 I have had influence over the outcomes arrived at by those
procedures.
23 Those procedures have been applied consistently.
24 Those procedures have been free of bias.
25 I Have been able to appeal the outcomes arrived at by those
procedures.
26 Those procedures have upheld ethical and moral standards
4. Perceived organizational
support
27 My organization is supportive of my goals and values.
28 Help is available from my organization when I have a Problem
29 My organization really cares about my well- being
30 My organization shows great concern for me.

3
31 My organization cares about my opinions.
5. Employee engagement
32 I really “throw” myself into my job.
33 Time passes quickly when I perform my job
34 I stay until the job is done
35 I get excited when I perform well on my job
36 Being a member of this organization is very captivating.
37 One of the most exciting things for me is getting involved with
things happening in this organization.
38 Being a member of this organization make me come “alive.”
39 I am highly engaged in this organizatio

4
5