MOTIVATION AND EMPLOYEE RETENTION: PERCEPTION OF STAFF OF FIRST ATLANTIC MERCHANT BANK

ABSTRACT

Retaining employees forms the basis for developing competitive advantage in any organization including banks. It is therefore imperative to consider employee retention role in the banking institutions. One factor that influences employee retention is motivation. This study primariliy assessed how financial and non-financial reward benefits motivate employeees at First Atlantic Merchant Bank with (FAMB) and how these in turn influence their employee retention. Specific objectives were to examine whether there are differences in fators which motivate managers and non-managers, the challenges of motivation and employee retention, and the effect of motivation and employee retention. Data was collected from both employees and management using purposive and imple random techniques. Data analysis was done by using descriptive statistics, Pearson correlation coefficient and independent sample test, and qualitative techniques. The outcome of the study shows that pay, fringe benefits, allowance, promotion, training and development and recognition. Again the study found that managers were found to be more motivated when given non-financial rewards whiles other staff members who are not managers were motivated by financial rewards. Further, the study found that the relationship between employee motivation and job retention was positive. From the human resource management perspective, the study recommends the use of both intrinsic and extrinsic factors to motivate employees, the need to achieve equityin in motivational sytems, and using different motivational packages by understanding individual psychologies regarding motivation.

CHAPTER ONE
INTRODUCTION
Background to the Study
The competitive business environment of the modern era has warranted the need to recruit and maintain a highly qualified manpower. Kassa (2015) contends that human capital has long been held to be a critical resource in most firms. One of the important and effective components of human resource management is employee’s motivation in order to maintain an effective workforce

.The literature on organizational motivation is elusive of a definite definition. For instance, Olubebe (2005) posits motivation as an internal arousal which directs and maintains achieving a set goal. Petri (1996) also define motivation as the forces acting on within a person to initiate and direct behavior.

According to Halepota (2005), these definitions put forward by Olubebe and Petri have not only stated the meaning of motivation but have also made inputs on the role of motivation to the worker. He further assets that the concept of motivation is abstract because different strategies produce different results at different times and there is no single strategy that can produce guaranteed favorable results at all times. There is usually the difficulty in ascertaining key motivational factors and as highlighted by Halepota, any universal application of a particular motivational factor may be misleading. Nevertheless, Chiang and Canter (2008) cite several motivational factors including reward, recognition from managers, challenging work, good working conditions, good work schedules, and job security. Similarly, Mak and Sockel (2001) note that strategies of motivation may range from lucrative compensation packages to involving employees in every sphere of the functioning of the organization.

Within the literature on organizations, motivation is not seen as an end in itself but as a means to an end. Motivation is seen as a predictor of such desirable organizational outcomes such as job satisfaction which invariably lead to employee retention. Chaminade’s definition of retention highlights the claim made that motivation can lead to job retention. Chaminade (2007) defines retention as a voluntary move by an organization to create an environment which engages employees for a long time. The definition of retention by Schuler and Jackson (2006) says that retention is seen as everything an employer does to encourage qualified and productive employees to continue working for the organization. This definition gives emphasis to the role of motivation in ensuring employee retention.

Mak and Sockel (2001) noted that retaining a healthy team of committed and productive employees is necessary to maintain corporate strategic advantage. For De Vos and Meganck (2009), talented people with varied competencies are very critical for the survival of an organization however that such people are difficult to maintain. This is because they attach more importance to their own career path than organizational loyalty which in turn can result in voluntary turnover making the organization lose employees that can impede achieve organizational goals easily.

Employee retention is very important to the success of all organizations. Unfortunately however, employee retention still constitutes a challenge to most organizations. Chew and Chan (2008) opined that retention of employees has become a primary challenge to most organizations worldwide. The authors attribute consequences such as the high cost of recruitment and selection, the possible loss of productivity during adjustment period, the probable loss of business opportunities, poor customer rapports among others to the problem of labour turnover. Mayfield and Mayfield (2008) following their study on employee retention in the United States also subscribe to the view that employee retention constitutes a challenge to organizations. The authors stated that the retention of valuable employees is one of the most significant issues confronting leaders in organizations.

The effects of employee retention have been demonstrated in Ghana across various sectors of the economy including the banking industry, which is the focus of this study. For instance, the Bank of Ghana annual report in 2005 revealed that there were several complaints by customers from the banking sector in the forms of unfair banking practices and poor customer service. In an empirical study on employee turnover in Ghana, Dwomoh and Korankye (2012) attributed the high level of customer complaints to the high rate of employee turnover in the banking sector. Amediku (2008) in an earlier study corroborated the claim of the high level of employee turnover in the banking industry by Dwomoh and Korankye (2012) Amediku (2008) observed that the period between 2001 and 2007 witnessed an average labour turnover rate of 5.35 percent in the banking sector in Ghana. Consequently, Dwomoh and Korankye advocate that banks in Ghana adopt measures to retain their key employees citing motivation as one of such measures.

The theoretical motivation for this study derives from the fact that motivational strategies may not be applicable to every work setting as espoused by Halepota (2005). More so the evidence provided by Dwomoh and Korankye (2012) in Ghana pertaining to the high incidence of customer complaints in the banking industry citing labour turnover as a causative factor partly serves as the motivation for this study. The choice of First Atlantic Merchant Bank (FAMB) for the study is also informed by Dwomoh and Korankye findings which had been corroborated by Amediku. Thus the FAMB is a banking firm and the rationale is to select a sampling unit from the banking industry which has been plagued by the problem of labour turnover.

Statement of the Problem
Employee motivation is widely citedin organizational literature as a factor that influences employee retention. In their study of the impact of motivation on employee retention in South Africa, Kekana et al. (2004) established that the reasons for emp[loyee turnover include lack of promotion, lack of opportunities for training and development, job insecurity, and lack of recognition of good performance.

Nyamekye (2012) in a study of the effect of motivation on job retention drawing on the experience of Standard Chartered Bank in Ghana found monetary benefits as a significant determinant of motivation among employees and that motivated employees show greater level of retention. In a related study, Asiamah (2011) in his study of motivation among the staff of the Ghana Internal Revenue Service found good manager relationship as a significant predictor of motivation among staff.

The findings of these studies lend credence to the contention by Lindner (1998) that in order to be effective, managers need to understand what motivates employees within the context of the roles they perform. Spector (2003) following his study on motivation in the United States provides a logical extension of Lindner’s position on motivation by asserting that a variety of factors motivate people at work; some are motivated with tangibles such as money and others are motivated with intangibles such as sense of achievement and recognition.

The aim of the current study therefore is to fill the gaps in the literature on employee motivation and job retention by examining what factors motivate employees to be retained at First Atlantic Merchant Bank in Ghana.

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Item Type: Ghanaian Project Material  |  Attribute: 61 pages  |  Chapters: 1-5
Format: MS Word  |  Price: GH110 ($20)  |  Delivery: Within 30Mins.
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