Predicting organizational performance from motivation in Oromia Seed Enterprise Bale branch

Organizational performance hinges on employee motivation, a widely researched topic in organizational psychology. While the impact of motivation on productivity is established, research yields mixed results on the interplay between extrinsic and intrinsic motivation and their impact on performance. Studies in Ethiopia lack causal analysis and theoretical underpinning. This research addresses this gap by assessing the effect of extrinsic motivation on intrinsic motivation and organizational performance within the Oromia Seed Enterprise, Bale branch, using the lens of cognitive evaluation theory. The study is crucial because it uses a quantitative approach with causal analysis, filling a significant gap in Ethiopian organizational research. The findings will inform both organizational management and policymakers regarding the design of effective motivation systems in the Ethiopian context. This study also aims to determine whether the hypothesized undermining effect of extrinsic motivation on intrinsic motivation holds true within this specific organizational setting.

Numerous theories explain work motivation, including cognitive evaluation theory, which posits that intrinsic motivation leads to satisfaction, while extrinsic incentives might negatively affect intrinsically motivated individuals. Research findings on this interaction are mixed. Previous Ethiopian studies on motivation and employee performance primarily used descriptive analysis without theoretical underpinning and lacked causal explanations. This study aims to rectify these deficiencies by employing binary logistic regression and grounding its analysis in cognitive evaluation theory to explore the causal relationships among extrinsic motivation, intrinsic motivation, and organizational performance. The study will also investigate the possible undermining effect of extrinsic motivation on intrinsic motivation in explaining overall organizational performance, a question not adequately addressed in previous research.

This study employed an explanatory research design with a quantitative approach to investigate the causal relationships between extrinsic motivation, intrinsic motivation, and employee performance. A Likert scale questionnaire was used to collect primary data from all 119 employees (12 supervisors, 77 professional experts, and 30 supporting staff) of the Oromia Seed Enterprise, Bale branch, using a census sampling technique. Data analysis involved descriptive statistics (frequency, percentage, and mean), correlation analysis, and binary logistic regression analysis. The binary logistic regression model was specified as follows: P(Yi = 1) = 1/(1 + e^-(βX)), where P(Yi = 1) represents the probability of good organizational performance, and X represents the explanatory variables (intrinsic and extrinsic motivation). The model assessed the individual and interaction effects of intrinsic and extrinsic motivation on organizational performance. Before conducting the binary logistic regression, assumptions such as multicollinearity, binary outcome variable, residuals, and outliers were checked against standards. The reliability of variables was also assessed using Cronbach's alpha.

The study revealed that 59.4% of the respondents were male. A significant portion of the respondents (32%) had 8-15 years of service. The majority were first-degree holders (33.96%). The mean score for extrinsic motivation was 2.36, and for intrinsic motivation, it was 2.34, suggesting a moderate level of both. Organizational performance exhibited a grand mean score of 3.62. Correlation analysis showed a positive and moderate correlation between organizational performance and both extrinsic (r = 0.399, p < 0.01) and intrinsic (r = 0.418, p < 0.01) motivation. Binary logistic regression indicated that both extrinsic and intrinsic motivation significantly predicted organizational performance. Employees perceiving moderate levels of both types of motivation were less likely to contribute to poor organizational performance. However, the interaction effect between extrinsic and intrinsic motivation on organizational performance was not significant, suggesting no undermining effect of extrinsic motivation on intrinsic motivation. The model correctly classified 72.6% of cases, with a non-significant Hosmer-Lemeshow test (0.983), indicating a good model fit. Intrinsic and extrinsic motivation accounted for 36.5% of the variation in organizational performance.

The findings suggest that both extrinsic and intrinsic motivation are important drivers of organizational performance within the Oromia Seed Enterprise, Bale branch. The lack of a significant interaction effect contradicts the hypothesis that extrinsic rewards undermine intrinsic motivation. This supports research suggesting that extrinsic and intrinsic motivation can coexist and positively contribute to performance. The results are relevant to organizations in Ethiopia, which can utilize these findings to develop a practical motivation system encompassing both extrinsic and intrinsic factors. This research addresses the gap in existing Ethiopian literature by providing empirical evidence on the interplay of intrinsic and extrinsic motivation on performance, using a rigorous quantitative methodology.

This study empirically examined the impact of extrinsic and intrinsic motivation on organizational performance within the Oromia Seed Enterprise's Bale branch context. The results show that both types of motivation significantly predict organizational performance, with no significant interaction effect. This research contributes to the understanding of motivation in Ethiopian organizations and provides practical implications for managers and policymakers to develop effective motivation strategies. Future research could explore the moderating effects of other variables, such as autonomy, using more complex models like structural equation modeling or longitudinal designs to study the effects over time. Expanding the study to other Seed Enterprises across Ethiopia would enhance the generalizability of the findings.

The study is limited by its cross-sectional design, which prevents examining changes over time. The focus on a single branch of a single enterprise limits the generalizability of findings to other organizations. The reliance on self-reported data through questionnaires might be subject to biases. Future research could employ longitudinal studies, investigate a broader range of organizations, and incorporate multiple data collection methods for more robust results.