The effect of Human resource management practices on employee job satisfaction :A case atudy of Dashen Bank sc

Chapter: One
 Introduction

This chapter prsents the introduction part includes background of the study, statement of the problem, objectives of the study, significance of the
study, delimitation of the study, limitation of the study, organization of the study and definition of key terms.

[Link] of the study area

Firm operations must be well managed in today's dynamic world. In today's business world, having a well functioning human resource management
system is essential for any firm or corporation, regardless of its size or industry. Concerns about human resource management must be addressed
immediately in Ethiopian's banking sector, which is one of the fastest-growing in the country. The need for this service is increasing because these
institutions deal with a large number of customers and employees every day. It's all about making sure your workers are well-cared for. Human
resource management (HRM) is defined by Beardwell, Holden &Claydon (2004) as the philosophy, rules, procedures, and practices that govern HR
in a business. For an organization to be successful, strong and flexible human resources must come first.

Human resources management (HRM) is a method for using personnel to achieve an organization's objectives (Mondy and Noe, 2005). All of an
organization's operations and duties connected to recruiting and retaining a highly trained workforce are included in HRM, Denishi and Griffin assert.
Recruitment and selection, training and development, performance appraisal methods, compensation packages, workplace conditions, job design,
growth opportunity, job security, and non-financial rewards and appreciation are just some of the aspects of HRM that have an impact on employee
morale and job satisfaction. Human resources have a significant impact on an organization's performance. In today's commercial world, HRM is
highly regarded (Blake, 1995).Working for a company where people are happy with their jobs is critical to keeping them there and keeping them from
leaving for another one that offers higher pay or better benefits. When it comes to gauging employee satisfaction, HR strategies that foster a strong
sense of teamwork are critical. An organization's ability to perform at its best depends on its employees being happy in their jobs. In a business, it's
critical for both employees and bosses to understand this. People who are satisfied with their jobs have a sense of well-being that includes mental,
physical, financial, technological, and interpersonal stability. It encourages the employee to stay in the company for a long time to come.
HRM's major purpose is deliberate workforce development, which employs a mix of cultural, structural, and people tactics to gain a competitive edge
through the planned development of a dedicated and effective workforce (Storey, 2001). According to Beer and colleagues, any administrative
decisions and activities that have a direct impact on the organization's contact with its employees are considered part of HRM (1984).

Armstrong (2006) defines human resource management (HRM) as a comprehensive approach to the management, development, and management
of a company's human resources in which every step of the process is fully integrated into the overall management of the company. Schuler and
Jackson (1987) created the strategic model of HRM by integrating HR practices within a framework of competitive strategies. They claim that a
company's management plan has an impact on its employees' behavior. This strategic approach of human resource management has some flaws,
such as failing to consider the requirements of employees and neglecting to consider local laws, societal norms, and values (Legge, 1995:115;
Budhwar and Debrah, 2001: 500). In contrast to the "soft model" of HRM, which emphasizes employee commitment, Legge's strategic model refers
to this as the "hard HRM model."

In banking, customer-employee relationships are critical to the success of the business; therefore, banking HRM strategies must be given greater
emphasis. As a result of the banking industry in Ethiopia's lack of focus on human capital, there has been little research into HRM strategies and
practices. In today's competitive business world, employee performance is one of the most critical factors in a company's success (H. Khan &
Wisner, 2019; Sutduean, Sutduean, & Jermsittiparsert, 2019).Human resource management (HRM) must be the primary focus of any effort to raise
employee productivity (Kerdpitak & Jermsittiparsert, 2019, 2020). The influx and outflow of employees was previously unrecognized because firms
did not follow human resources standards (Noe, Hollenbeck, Gerhart, & Wright, 2017). In light of globalization, it is increasingly important for firms to
implement HR policies in order to maximize the productivity of their workforce. T&D helps workers perform better by providing both on- and off-the-
job training. Training allows employees to stay up-to-date on the newest developments in their field. When it comes to increasing productivity and
profitability, many manufacturing organizations use human resources management (HRM) rather than training and development (T&D), but this is a
mistake (Gan&Yusof, 2019). Employees are more motivated to perform at their best when they receive regular feedback on their work. Employees
are happier and more productive as a result of R&C and employee empowerment (Elnaga& Imran, 2013; Kampkötter.).
Many studies and research have been done on HRM practices, but very few of them have been done on the financial sector in Ethiopia , as we all
know. Banking activities are strongly reliant on relationships between employees and customers; as a result, HRM strategies that organize these
kinds of interactions in banks must be given considerably greater attention. There hasn't been much research on HRM strategies and practices in
Ethiopian because the banking industry here doesn't pay enough attention to the organization's most important asset: its people capital.

Commercial banks have a wide range of challenges, many of which have worsened since the global financial crisis began. Commercial banks'
financial performance has been negatively impacted as a result of weak portfolios, inadequate investments, insufficient liquidity, and more.
Underperformance of institutions' internal and external operations as a source of unmet customer needs Commercial banks have been unable to
secure their customers' and shareholders' capital for many years because of their inability to prevent hazards. Anxieties related to operations, loans
and liquidity have also harmed Nigeria's banking [Link] the previous few decades, the commercial banking sector has undergone a number of
changes. As financial markets around the world have grown and integrated, new opportunities and difficulties for commercial banks have arisen as a
result of regulatory changes, technological advancements in banking and information, and the widespread acceptance of the market economy in less
open economies. However, while these changes have given banks new opportunities, they have also increased the level of competition in the global
banking market as well,

A number of problems confront commercial banks, threatening their capacities and competitiveness, particularly since the onset of the global
monetary crisis. One result has been weak portfolio, bad investment, insufficient liquidity, and other negative effects on the financial performance of
various commercial banks. Customers' unmet needs as a result of these institutions' subpar internal and external operations For many years,
commercial banks have been unable to prevent dangers or protect their consumers and shareholders' capital Bank performance in Ethiopia was
also impacted by operational, credit, and liquidity issue.

As a result, commercial banks have forced to rethink their operations. Change must be anticipated and dealt with head-on by commercial banks.
They must also be able to create internal settings and adapt to external conditions. Most importantly, it must be met. Therefore, there is a greater
demand for employees that have distinguishing qualities and high levels of expertise that can't be replicated by the competition. To be competitive, a
business must have an efficient system for managing its employees, which is where human resources management (HRM) got its start. HRM
practices and policies include employee staffing, employee development, performance management, compensation management, and increasing
employee engagement in decision-making. In order to activate the role of HRM, banks must employ Human Resource Management Practices.
Human resource management (HRM) is tasked with helping businesses develop and maintain their most important asset—their employees—while
also providing them with the flexibility and adaptability they need to stay ahead of the competition. When it comes to an organization's overall
performance, an employee's behavior is regarded one component that has an impact and a role on it, even when other factors that contribute to its
success are also present (Saleh et al., 2020). Employee behavior is influenced by a variety of HRM practices that are different but linked. The HRMP
is used to measure the performance of each employee in the organization and to motivate and create competitiveness among the employees by
inspiring them and generating a sense of competition.
Employee management is an important part of running a successful business, and it's not just about raking in money. Organizations that have a well-
defined set of Human Resources Practices in place can easily execute this objective. In company, it is better to employ practices that are both legal
and ethically sound than to manage employees haphazardly. The most effective and efficient means of accomplishing any goal or job for a firm is the
result of the greatest human resources strategies. If these procedures are followed in accordance with the company's stated mission and objectives,
they can alleviate many of the problems that may arise with regard to its employees. It is significantly better for an organization to work together
toward a common objective and have a plan in place to get there, rather than working on their own (Taylor, 2014). Worker recruitment, training,
evaluation, and compensation are all components of HRM, as are issues related to employee relations,health, and safety on the job. It is proactive
and sees people as economic assets and liabilities that must be actively controlled. It is the process of acquiring, developing, motivating, and
retaining the best and most efficient workforce possible. In order to achieve the company's vision, mission, and goals, HR is the most important
resource. It has a direct impact on the effectiveness of the company and lowers the rate of employee turnover. Employees are the only ones capable
of increasing the company's output.
The most common HR practices in organizations are recruitment and selection, training and development, performance evaluation, monitoring and
evaluation of HR practices, compensation, health and safety concerns and welfare services despite the fact that few studies have been conducted in
Africa to demonstrate the effectiveness of HRM practices (Okpara, 2008). However, it is impossible to identify with certainty how much of what they
have learnt in academic human resource management can be applied in the third world or underdeveloped countries. We can no longer make
meaningful comparisons between countries since they are no longer homogeneous. Keep in mind that no two organizations are comparable, and
this is especially true when it comes to public enterprises and government agencies, which are more susceptible to changes in HR
[Link] are several theories of human resource management that are more theoretical than practical, and may only be used for
academic purposes in nations outside of Africa like China, Japan, and Australia. Human resource management is a major topic of discussion in third
world countries because of the unique circumstances in which they operate (Itika, 2011).

[Link] Statment
World become a globe where Economic environment is changing rapidly in changing of customer and investor need and demands are increasing of
product-market competition. And to meet successfully these environments organizations continually, need to improve their performance by reducing
costs, innovating products and processes and improving quality, productivity and speed to market. The people who change with the change of
organizations -human resources- are considered to be one of the most important resources of today’s firms. People and how they are achieved are
becoming more important because many other sources of competitive success are less powerful than they used to. Thus, it is important to on the
basis of these competitive advantage change is essential to develop a different setting of orientation for considering issues of human resource
management and strategy in Ethiopia as well.
Despite the fact that there are some previous studies conducted on the relationship between HRM practices and job satisfaction the findings were
mixed. For instance, Gürbüz (2009) examined the impact of HRM on job satisfaction and data was gathered from 480 blue collar employees of the
35 large firms of Istanbul, Turkey. Different variables were used which are empowerment, teamwork, Job rotation, participation and contingent
compensation. Empirical result showed that dominant variable for the job satisfaction of employees is participation of the employees in decision
making. Syed and Yah (2012) also examined the impact of high performance HRM practices on employee job satisfaction in China. They found that
empowerment, job rotation, employee participation, merit-based promotion and performance based pay and grievance handling procedures were
positively correlated with employee’s job satisfaction. In the same line, Asta and Zivile, (2011) examined the HRM linkage with organizational
commitment and job satisfaction. Empirical result indicated that skill enhancing, motivation enhancing, and engagement enhancing HRM practices
have a positive relation with effective human resource reaction i.e. job satisfaction.
Most studies examining the relationship between HRM practices and job satisfaction have been conducted mostly in developed countries like United
States, China, Turkey, Pakistan and United Kingdom (Steijn, 2004; Igbal et al., 2013; Syed & Yah 2012; Asta&Zivile, 2011; Javed et al., 2012;
Masoodul et al, 2013 and Adeel et al., 2011). The majority of work in HRM adopts the resource-based view perspective which tends to ignore
contextual variables, particularly competitive strategies, which influence employee satisfaction. Thus, additional studies in developing economies are
important and offer the potential to enhance our understanding of employee satisfaction (Frohlich and Dixon, 2001; Zhao et al., 2006).The scarcities
of such studies showing association between HRM practices &job satisfaction and also the role of HRM in the Ethiopian context makes it important
to further explore the critical role of HRM.

Despite the recognized importance of human resource management practices in enhancing employee job satisfaction, existing studies—both
globally and in Ethiopia—have predominantly focused on isolated HRM dimensions, thereby failing to provide a comprehensive understanding of
how various HRM practices collectively influence employee satisfaction. In the Ethiopian context, particularly within the banking sector, empirical
evidence remains scarce and fragmented, with little attention given to private commercial banks such as Dashen Bank.

Given the increasing competition and the need for improved service delivery in the banking sector, understanding the combined effect of multiple
HRM practices—such as recruitment and onboarding, training and development, compensation and benefits, promotion fairness, work environment,
employee engagement, and work-life balance—on employee job satisfaction is essential. However, no comprehensive study has systematically
examined these dimensions together within a single framework in the Ethiopian banking context.

Therefore, this study aims to fill this gap by investigating the effect of multidimensional HRM practices on employee job satisfaction, providing a more
holistic and context-specific understanding that can support evidence-based HR policies and practices in Dashen Bank and similar institutions

[Link] of the study

[Link] Objective

The grand objective of this study will be to examine the effect of Human Resource Management practices on employee job satisfaction in case
study of Dashen Bank sc.

[Link] Objectives.

The specific objectives of the study will be to:

[Link] assess the effect of recruitment and onboarding practices on employee job satisfaction.
[Link] evaluate the influence of promotion practices and perceived fairness on employee job satisfaction.

[Link] examine the impact of compensation and benefits on employee job satisfaction.

[Link] analyze the effect of training and development opportunities on employee job satisfaction.

[Link] investigate the influence of work environment and organizational culture on employee job satisfaction.

[Link] assess the effect of employee engagement and recognition on employee job satisfaction.

[Link] examine the impact of work-life balance and employee wellbeing on employee job satisfaction

[Link] Questions

[Link] do recruitment and onboarding practices influence employee job satisfaction?

[Link] do promotion practices and perceived fairness affect employee job satisfaction?

[Link] is the effect of compensation and benefits on employee job satisfaction?

[Link] does training and development impact employee job satisfaction?

[Link] do work environment and organizational culture influence employee job satisfaction?

[Link] is the role of employee engagement and recognition in enhancing job satisfaction?

[Link] does work-life balance and employee wellbeing affect job satisfaction?
1.5 Research Hypothesis

H₁: Recruitment and onboarding practices have a significant positive effect on employee job satisfaction.
H2: Promotion practices and perceived fairness have a significant positive effect on employee job satisfaction.

H3: Compensation and benefits have a significant positive effect on employee job satisfaction.

H4: Training and development opportunities have a significant positive effect on employee job satisfaction.

H5: Work environment and organizational culture have a significant positive effect on employee job satisfaction.

H6: Employee engagement and recognition have a significant positive effect on employee job satisfaction.

H7:Work-life balance and employee wellbeing have a significant positive effect on employee job satisfaction.

1.6 Significance of the study

This study is important for several reasons. First, it contributes to the existing knowledge in the field of Human Resource Management by examining
the combined effect of multiple human resource management practices on employee job satisfaction. While many previous studies have focused on
a single HR practice, this research integrates key dimensions such as recruitment and onboarding, promotion fairness, compensation and benefits,
training and development, work environment and culture, employee engagement and recognition, and work–life balance. Therefore, it provides a
more comprehensive and holistic understanding of HRM practice.

Second, the study has significant practical value for organizations, particularly for Dashen Bank S.C. and other similar institutions. The findings will
help managers and HR professionals identify which HR practices have the greatest impact on employee satisfaction, enabling them to improve
workplace policies, enhance employee motivation, and increase organizational performance and retention

Finally, this research fills an important gap in the Ethiopian context, where limited studies have comprehensively examined HRM practices and
employee job satisfaction together. It also serves as a foundation for future researchers who may want to expand or replicate the study in different
sectors or regions.

[Link] of the study