It looks like you are using the default theme. I suspect you want to add the image as the header. This is discouraged as it can limit accessibility for those with visual impairment and search engine indexing.
You can accomplish this with Custom CSS, however. Specifically, you might add a background-image to header#headerNavigationContainer and adjust the positioning of h1.pkp_site_name.
There are some themes which also provide a more graphical header. See, for example, the Immersion theme:
If you are committed to modifying the templates directly (not recommended), you will find the templates for the default theme in lib/pkp/templates/frontend/