Yardstick International College

Master Business Administration (MBA) Post Graduate Program

Organizational Behavior and Development (MBA 612) Assignment 01

Organizational Behavior in Case of Commercial Bank of Ethiopia

Submitted To Prof. Belete Kebede

Made By:
Name ID No
Aytenew Abebe ……………………….………...MAO/1993/13

March, 2022
Gojjam
Ethiopia

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 Table of content
Content Page

Background of commercial bank of Ethiopia ………………....………………………………….1

Product and service …………………………………………………………………………….....1
Design and Structure
…...................................................................................................................2
Leadership style ………………………………………….…………………………………….....2
Culture …………………………………………………………………………………………....3
Work environment and Job satisfaction………………………………………………………......3
Reform and Change Management ……………….…………………………………………….....4
Conclusion…………………………………………………………………………………….......5
Reference ………………………………………………………………………………………....5

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 Background of commercial bank of Ethiopia
The history of the Commercial Bank of Ethiopia (CBE) dates back to the establishment of the
State Bank of Ethiopia in 1942 and it was legally established as a share company in 1963. CBE
merged with the privately owned Addis Ababa Bank in 1974. Since then, it has been playing
significant roles in the development of the country as financial intermediary. Currently CBE has
more than 31.4 million account holders and the number of Mobile and Internet Banking users
also reached more than 5.54 million as of June 30.2021 Active ATM card holders reached more
than 6.84 million. CBE combines a wide capital base with 37725 talented and committed
permanent employees and more than 22,000 outsourced jobs as of June 30, 2021. It was mainly
established to perform major banking services such as, accepting saving, demand and time
deposits; Providing short, medium and long term loans; buying and selling foreign exchanges;
buying and selling negotiable instruments and securities issued by the government, private
organizations or any other person; and engaging in other banking activities customarily
carried out by commercial banks.
Vision
To become world class commercial bank by the year 2025
Mission
We are committed to realize stakeholders’ values through enhanced financial intermediation
using the best professionals and technology.
Core values
Integrity, service excellence, professionalism, empowerment, learning organization, team work,
respect for diversity and corporate citizenship are the core value of commercial bank of Ethiopia.
Products and services
Commercial banks provide basic banking services and products to the general public, both individual
consumers and small to mid-sized businesses. These services include checking and savings accounts,
loans and mortgages, basic investment services such as CDs, as well as other services such as safe deposit
boxes.

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 Design and structure
Organizational design is actually a formal process of integrating people, information and
technology. Organizational structure is the formal authority, power and roles in an organization.
Organizational structure is an independent which has been widely examined, both in the field of
management or organization. The author stated that OS is the way the task or job sharing,
grouped and coordinated formally (Robbins, 2006). By looking at how the division of tasks or
jobs performed, grouped and coordinated there are six essential elements in designing
organizational structure , i.e. specialization, departmentalization, chain of command, span of
control, centralization and decentralization, as well as formalization. The current organizational
structure of the commercial bank of Ethiopia, with board of Management, consisting of ten
senior government officials, is the highest decision-making body of the commercial bank of
Ethiopia, and is responsible for issuing major policies of the Bank, approval of its strategic and
operational plans, and the close and regular monitoring of the Bank’s operations. The president
attends the regular meetings of the board of management as a non-voting member. The Executive
Management, consisting of the president and fourteen vice presidents, is responsible for the
operations of the Bank. The day-to-day operational activities are managed by the Management
Committee, comprised of three regional offices, 30 district directors and above 1793 branch
managers.
Leadership style
Leadership, as defined by Northouse (2004), is a process whereby an individual influence a
group of individuals to achieve a common goal. Leadership style is the way in which that
process is carried out. Performance is the accomplishment and execution of tasks. Leadership
style is a key determinant of the success or failure of any organization.
Organizational leadership culture commercial banks of Ethiopia by considering the general
information from Employees, Bank trailing materials and Practical assessment about the bank I
had the following finding about the Bank leadership Culture. Organizational leadership culture in
its positive attributes can provide many contributions in performances of the organization.
However, the current organizational leadership culture in the bank has weak to improve

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 accountability, Commitment to the organization in creating good working relationship
empowerment of staff and to enhance job satisfaction.
Cultures
Organization culture as an idea is the field at organizational studies and management which
describes the psychology, attitudes, experiences, belief and values (personal and cultural values)
of an organization. It was defined as the specific collection of values and norms that are shared
by people and groups in an organization and that controls the way they interact with each other
and with stakeholders outside the organization, (Melcurem, 2006:592)
The Commercial Bank of Ethiopia maintain good organizational culture with it employees by
retaining competent and motivated employees. In organization, culture has a dominant influence
on people’s behavior, and hence on their work attitude. By deliberately planning and consciously
setting up culture in an organization, management can lay the very basic foundation for success.
The Commercial Bank of Ethiopia is expectable to retain good organizational culture with its
employees by holding experienced and inspired employees. But, the Bank’s management has not
made an attentive and strategic effort to manage its culture in a well-coordinated way that brings
about organizational excellence. However, the bank has been multi-dimensional difficulties on
the part of the staffs at CBE. For example, the employees do not communicate with each other
capably and have less cooperation with each other; there is also a high load of tasks which may
lead them to be dissatisfied with their jobs.
Work environment and job satisfaction
An attractive and supportive work environment is critical to job satisfaction. Work environment have
numerous properties that may influence both physical and mental well-being. A quality work spot is
fundamental to keep workers on their various tasks and work effectively. A good workplace is checked by
such characteristics as competitive salary, trusting relationship between the employees and management,
equity and fairness for everyone, and a sensible work load with challenging yet achievable goals. A
composite of all these conditions makes the work station the best possible working conditions for
employees to work with high level of satisfaction. As a profit oriented organization, creating an enabling
environment for satisfied employees is a lead to requisite bottom lines. But, the work in environment in

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 commercial bank of Ethiopia there is no good working environment due to there is any trust relationship
between management and employee and the salary also less than from the industry.
Job satisfaction defined as an overall evaluation of the work for the company (Chetty & Phung,
2018).Job satisfaction can be viewed as a machine that brings a change in the internal
environment in the employee's performance and service quality required in the repair and
improvement services to customers. Employee satisfaction is an important thing but never
fulfilled at any time and is very difficult to calculate the employee satisfaction. Job satisfaction
in service organizations are very important variable. The employees who are satisfied are
employees who are motivated to convey his concern for others and serve the company better.
Reform and change management
Change management cannot be an ad hoc performance, but is a crucial skill for leaders and
managers. It should be a structured process of managing people, processes and technology in
response to the changing environment, so as to align business strategies with external changes
and keep competitive. Leaders should become role models and demonstrate what is expected
from employees in relation to the change. This is consistent with social learning theory and the
concept that people learn through observation of others.
Organizational Change management is an important aspect of the discipline management that
tries to ensure that a business or any organization of people and asset responds to the
environment in which it operates, (Van de Ven and Poole, 1995), by a conscious introduction of
new ways of thinking and operating that suit the demand of the changing world for better future.
Business environment across the globe has become increasingly volatile and constantly changing
in the last few decades. The banking industry has been the hardest hit of all, because it is central
to the globalization process that is on course. As a result commercial bank of Ethiopia
encourages adaptation and innovation in order to improve products and services, to meet new
pressures and demands. To achieve varied goals, managers need more than fragmentary ad-hoc
change programs dealing only with present challenges. They need change management methods
to prepare for upcoming organizational competitive difficulties. Managers must gain knowledge
on how to build and manage a human group that is proficient in foreseeing the new, capable of

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 changing its vision into technology, products, processes and services, willing and able to agree
with the new.

Conclusion

Commercial bank of Ethiopia is in the business of providing banking services to individuals,

small businesses and large organizations. Commercial banks provide basic banking services and
products to the general public, both individual consumers and small to mid-sized businesses . The current
organizational leadership culture in the bank has weak to improve accountability, Commitment
to the organization in creating good working relationship empowerment of staff and to enhance
job satisfaction. The bank maintain good organizational culture with it employees by retaining
competent and motivated employees. In organization, culture has a dominant influence on
people’s behavior, and hence on their work attitude. As a profit oriented organization, creating an
enabling environment for satisfied employees is a lead to requisite bottom lines. But, the work in
environment in commercial bank of Ethiopia there is no good working environment due to there is any
trust relationship between management and employee and the salary also less than from the industry.

Reference
Chetty, V. R. K., & Phung, S. P. (2018). Economics behind Education: Elements of Development
Outcomes through Political Involvement. Eurasian Journal of Analytical Chemistry, 13(6), 146–
157.
Melcurem. (2006).what is culture and change.
P. G. Northouse, (2004) “Leadership Theory and Practice,” 3rd Edition, Sage Publications, Inc.
Robbins SP. “Organizational Behavior”, 2006.

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 Van de Ven, A. & Poole, S. (1995): Explaining development and change in Organizations;
Academy of62.Management Review, 20 (3), pp. 510-540.

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