Effect of employee participation in budgeting planning on employee motivation in microfinance institution in Kericho County

Abstract

Budgetary participation is the involvement of all employees in the budgetary process and their inputs used to; influence setting of budgetary targets, assist in problem solving, promote information sharing among administrative levels and enhance performance leading increased employee motivation. The study sought to investigate the effect of employee participation in the budgetary planning on employee motivation in micro finance institutions in Kericho County. The study was anchored on stakeholder’s theory, motivation theory, theory of planned behavior and vroom’s expectancy theory. The research adopted a descriptive research design and was undertaken in Kericho County which is one of the counties created under the new Constitution of 2010. The target populations for the study was 1123 employees of Microfinance Institutions in Kericho County who were clerks, sales/marketers, accountants and tellers, where a sample size of 295 respondents was randomly sampled based on Yamane (1973) formula. Data collection instrument used was a structured questionnaire which was based on drop and pick basis. Both descriptive statistics and inferential statistics (correlation and regression analysis) was used in analyzing data with the help of Statistical Package for Social Sciences Version 24 (SPSS-24) and findings are presented mainly in form of tables while qualitative data was analyzed through narrations.