The Effects of Change Management Practices on Organizational Performance: The Case of Commercial Bank of Ethiopia, Addis Ababa MA. Thesis Mihereteselassie Birhanu October, 2015 ARBA MINCH, ETHIOPIA THE EFFECTS OF CHANGE MANAGEMENT PRACTICES ON ORGANIZATIONAL PERFORMANCE: THE CASE OF COMMERCIAL BANK OF ETHIOPIA, ADDIS ABABA Mihereteselassie Birhanu A THESIS SUBMITTED TO THE DEPARTMENT OF MANAGEMENT, INSTITUTE OF BUSINESS AND ECONOMICS, SCHOOL OF GRADUATE STUDIES ARBA MINCH UNIVERSITY IN PARTIAL FULL FILLMENT OF THE REQUIREMENTS OF THE DEGREE OF MASTERS OF ART IN BUSINESS ADMINSTRATION OCTOBER, 2015 ARBA MINCH DECLARATION I hereby declare that this MA thesis is my original work and has not been presented for a degree in any other university, and all sources of material used for this thesis have been duly acknowledged. Name: Mihereteselassie Birhanu Signature: _______________ Date: ___________________ SCHOOL OF GRADUATE STUDIES ARBA MINCH UNIVERSITY ADVISORS’ THESIS SUBMISSION APPROVAL SHEET This is to certify that the thesis entitled“ the effects of change management practices on organizational performance the case of commercial bank of Ethiopia, Addis Ababa,” submitted in partial fulfillment of the requirements for the degree of Master’s with specialization in Business |Administration , the Graduate Program of the Department of Management, and has been carried out by _Mihereteselassie Birhanu Id. No RMA/015/06, under my supervision. Therefore I recommend that the student has fulfilled the requirements and hence hereby can submit the thesis to the department for defense. _______________________ __________________ __________________ Principal Advisor Signature Date _______________________ __________________ __________________ Co-Advisor Signature Date _______________________ ___________________ __________________ Department Head Signature Date TABLE OF CONTENT CONTENTS PAGE List of Tables ................................................................................................................................. iv List of Figures ................................................................................................................................. v Abstract ......................................................................................................................................... vii CHAPTER ONE ............................................................................................................................. 1 Introduction ..................................................................................................................................... 1 1.1. Background of the Study ..................................................................................................... 1 1.2. Statement of the Problem ..................................................................................................... 4 1.3. Objectives of the study......................................................................................................... 4 1.4. Research Question ............................................................................................................... 5 1.5. Hypothesis............................................................................................................................ 5 1.6. Significance of the study ...................................................................................................... 5 1.7. Scope of the study ................................................................................................................ 6 1.8. Definition of Terms.............................................................................................................. 6 CHAPTER TWO ............................................................................................................................ 8 REVIEW OF RELATED LITERATURES .................................................................................... 8 2.1. Introduction .............................................................................................................................. 8 2.2. Meanings and concepts of change ........................................................................................... 8 2.3. Models for Understanding and Approaching change ............................................................ 10 2.4. Challenges of Change ............................................................................................................ 14 2.5. Practices of Managing Changes ............................................................................................. 14 2.6. The effects of change management Practices on the performance of an organization .......... 18 i 2.7. Organizational Culture and Employees’ motivation; Factors that affect Organizational Performance .................................................................................................................................. 19 2.8. Empirical Literature Review .................................................................................................. 20 CHAPTER THREE ...................................................................................................................... 23 RESEARCH DESIGN AND METHODOLOGY ........................................................................ 23 3.1. Design of the study ................................................................................................................ 23 3.2. Population and Sampling ....................................................................................................... 23 3.3. The pilot study ....................................................................................................................... 26 3.4. Data Collection Instruments .................................................................................................. 26 3.5. Conceptual Framework .......................................................................................................... 27 3.6. Validity and Reliability .......................................................................................................... 29 3.7. Data Collection Procedure ..................................................................................................... 29 3.8. Method of data analysis ......................................................................................................... 30 3.9. Data Compilation and Coding ............................................................................................... 30 Chapter Four ................................................................................................................................. 31 Data Analysis and Interpretation .................................................................................................. 31 4.1. Normality of the Raw Data .................................................................................................... 31 4.2. Demographic information of participants of the study .......................................................... 32 4.3. Analysis of Biographical Data ............................................................................................... 33 4.4. Correlation Analysis of the Variables in the Study ............................................................... 34 4.5. Change Management Practice and Organizational Performance ........................................... 35 4.6. Multiple regression ................................................................................................................ 36 4.7. Causal Relationship of the Variables Treated in the Study ................................................... 39 CHAPTER FIVE .......................................................................................................................... 44 ii SUMMARY, CONCLUSION AND RECOMMENDATION ..................................................... 44 5.1. Summary of the Study and Overview of Significant Findings .............................................. 44 5.3. Conclusions ............................................................................................................................ 46 5.3. Recommendations .................................................................................................................. 47 References ..................................................................................................................................... 48 iii LIST OF TABLES TABLES PAGE Table 1 : number of branches and employees in each district ...................................................... 24 Table 2 Sample branches selected from the four districts ............................................................ 25 Table 3: Reliability of the Instrument .......................................................................................... 29 Table 4: Descriptive statistics of the variables treated in the study .............................................. 32 Table 5: participants’ biographical information .......................................................................... 33 Table 6: Pearson correlation for the variables treated in the study ............................................... 34 Table 7: Regression analysis for organizational performance and components of variables ....... 37 Table 8: the new regression analysis for organizational performance and components of variables ......................................................................................................................................................