View
245
Download
0
Category
Preview:
Citation preview
PAY SATISFACTION, JOB SATISFACTION, ORGANIZATIONAL COMMITMENT, AND
TURNOVER INTENTION IN TAIWAN BANKING: STRUCTURAL EQUATION MODELING
Introduction to the Problem
High turnover rate
Cost
Knowledge
Customers
Taiwanese banking industry
Gaps
Conflicts between different theories and empirical studies
Different countries & cultures
21st century
Purpose of the Study
To explore the relationship and degrees among those factorsPay satisfaction’s roleTo discover the accurate ratio between pay raise and turnover intentionThe conflicts between different theories and results of empirical studies
Definition of TermsPay Satisfaction
Job Satisfaction Promotion Supervision Fringe Benefits Contingent Rewards Operating Procedures Coworkers Nature of Work Communication
Definition of Terms (cont.)
Organizational Commitment Affective Commitment Continuance Commitment Normative Commitment
Turnover Intention
Domestic Private Bank
Entry-Level Employee
Mid-Management
Literature ReviewLiterature Review
Theoretical Framework & Theoretical Framework & 2 Research Questions2 Research Questions
Hypothesized Models & Hypothesized Models & 24 Hypotheses 24 Hypotheses
Theoretical FrameworkTheoretical Framework
Turnover theory (Steers & Mowday, 19Turnover theory (Steers & Mowday, 1981)81)
Model of Pay SatisfactionModel of Pay Satisfaction (Lum, Kervi (Lum, Kervin, Clark, Reid, and Sirola, 1998)n, Clark, Reid, and Sirola, 1998)
JJob satisfaction theoryob satisfaction theory (Spector, 1997) (Spector, 1997) The three-component model of organiThe three-component model of organi
zational commitment (Allen & Meyer, 1zational commitment (Allen & Meyer, 1991) 991)
Theoretical Framework
Pay Satisfaction
Job Satisfaction
Organizational Commitment
TurnoverIntention
Promotion
Communication
Supervision
Nature of work
Coworkers
Operating Procedures
Fringe Benefits
Contingent RewardsAffective commitment
Continuance commitment
Normative commitment
Research QuestionsResearch Questions1.1. What are the socio-demographic What are the socio-demographic
characteristics of a sample of employees characteristics of a sample of employees in the Taiwanese banking industry?in the Taiwanese banking industry?
2.2. What are the degrees of pay satisfaction, What are the degrees of pay satisfaction, job satisfaction, organizational job satisfaction, organizational commitment, and turnover intention of a commitment, and turnover intention of a sample of employees in the Taiwanese sample of employees in the Taiwanese banking industry?banking industry?
Hypothesized ModelsHypothesized Models
Pay satisfaction, job satisfaction, Pay satisfaction, job satisfaction, organizational commitment, and organizational commitment, and turnover intention modelturnover intention model
Pay satisfaction’s sub-variables and Pay satisfaction’s sub-variables and turnover intention modelturnover intention model
Organizational commitment’s sub-Organizational commitment’s sub-variables and turnover intention variables and turnover intention modelmodel
Pay
S
atis
fact
ion
Em
ploy
ee
Tur
nove
r
Job
Sat
isfa
ctio
n
Org
aniz
atio
nal C
omm
itm
ent
H 2
H 3
Sup
ervi
sion
Com
mun
icat
ion
Nat
ure
of
wor
kC
owor
kers
Ope
rati
ng
Pro
cedu
res
H2a
H2b
H2c
H2d
H2e
H2f
H2g
H2h
Aff
ecti
ve
com
mit
men
tC
onti
nuan
ce
com
mit
men
tN
orm
ativ
e co
mm
itm
ent
H3b
H3c
Fri
nge
Ben
efit
s
Con
ting
ent
Rew
ards
Pro
mot
ion
Hypothesized pay satisfaction, job satisfaction, organizational commitment, and turnover model
H3a
H6, H6a, H6b
H5, H5a, H5b H4, H4a, H4b
H1, H1a
Pay Satisfaction
Turnover Intention
Job Satisfaction
Organizational Commitment
H1, H1a
H2H3
H4, H4a, H4bH5, H5a, H5b
H6, H6a, H6b
Hypothesized pay satisfaction, job satisfaction, organizational commitment, and turnover intention model
HypothesesHypotheses H1: Pay satisfaction has a negative H1: Pay satisfaction has a negative
relationship with employee turnover.relationship with employee turnover. H1a: The amount of extra money given H1a: The amount of extra money given
to employees can change specific to employees can change specific levels of employees’ turnover levels of employees’ turnover intention.intention.
H2: Job satisfaction has a negative H2: Job satisfaction has a negative relationship with employee turnover.relationship with employee turnover.
Hypotheses (cont.)Hypotheses (cont.) H3: Organizational commitment has a H3: Organizational commitment has a
negative relationship with employee negative relationship with employee turnover.turnover.
H4: Pay satisfaction has a positive H4: Pay satisfaction has a positive relationship with job satisfaction.relationship with job satisfaction.
H4a: Pay satisfaction is a mediator H4a: Pay satisfaction is a mediator between job satisfaction and between job satisfaction and employee turnover.employee turnover.
Hypotheses (cont.)Hypotheses (cont.) H4b: Job satisfaction is a mediator H4b: Job satisfaction is a mediator
between pay satisfaction and between pay satisfaction and employee turnover.employee turnover.
H5: Pay satisfaction has a positive H5: Pay satisfaction has a positive relationship with organizational relationship with organizational commitment.commitment.
H5a: Pay satisfaction is a mediator H5a: Pay satisfaction is a mediator between organizational commitment between organizational commitment and employee turnover.and employee turnover.
Hypotheses (cont.)Hypotheses (cont.)
H5b: Organizational commitment is a H5b: Organizational commitment is a mediator between pay satisfaction and mediator between pay satisfaction and employee turnover.employee turnover.
H6: Job satisfaction has a positive H6: Job satisfaction has a positive relationship with organizational relationship with organizational commitment. commitment.
H6a: Job satisfaction is a mediator H6a: Job satisfaction is a mediator between organizational commitment between organizational commitment and employee turnover.and employee turnover.
Hypotheses (cont.)Hypotheses (cont.)
H6b: Organizational commitment is a H6b: Organizational commitment is a mediator between job satisfaction and mediator between job satisfaction and employee turnover.employee turnover.
Fringe Benefits
Turnover Intention
Contingent Rewards
H2b
H2c
H2d
Coworkers
Nature of work
Communication
Supervision
Promotion
H2a
H2e
H2f
H2g
H2h
Operating Procedures
Hypothesized pay satisfaction’s sub-variables and turnover intention model
Hypotheses (cont.)Hypotheses (cont.) H2a: Promotion has a significant H2a: Promotion has a significant
relationship with employee turnover.relationship with employee turnover. H2b: Supervision has a significant H2b: Supervision has a significant
relationship with employee turnover.relationship with employee turnover. H2c: Fringe benefits have a significant H2c: Fringe benefits have a significant
relationship with employee turnover.relationship with employee turnover. H2d: Contingent rewards have a H2d: Contingent rewards have a
significant relationship with employee significant relationship with employee turnover.turnover.
Hypotheses (cont.)Hypotheses (cont.) H2e: Operating procedures have a H2e: Operating procedures have a
significant relationship with employee significant relationship with employee turnover.turnover.
H2f: Coworkers have a significant H2f: Coworkers have a significant relationship with employee turnover.relationship with employee turnover.
H2g: The nature of work has a significant H2g: The nature of work has a significant relationship with employee turnover.relationship with employee turnover.
H2h: Communication has a significant H2h: Communication has a significant relationship with employee turnover.relationship with employee turnover.
Continuance Commitmen
t
Turnover Intention
Normative Commitmen
t
Affective Commitmen
t
H3aH3b
H3c
Normative Commitmen
t
Hypothesized organizational commitment’s sub-variables and turnover intention model
Hypotheses (cont.)Hypotheses (cont.) H3a: Affective commitment has a H3a: Affective commitment has a
significant relationship with employee significant relationship with employee turnover.turnover.
H3b: Continuance commitment has a H3b: Continuance commitment has a significant relationship with employee significant relationship with employee turnover.turnover.
H3c: Normative commitment has a H3c: Normative commitment has a significant relationship with employee significant relationship with employee turnover.turnover.
MethodologyMethodologyResearch DesignResearch Design
Quantitative, Non-experimentQuantitative, Non-experimental studyal study
ExplanatoryExplanatory and Correlational and Correlational surveysurvey
MethodologyMethodologySampling PlanSampling Plan
Target Population (78,336)Target Population (78,336) Accessible Population Accessible Population
(46,157)(46,157) Probability and Two-stage Probability and Two-stage
Total Accessible Sampling Total Accessible Sampling PlanPlan
Questionnaire: 68 questions Questionnaire: 68 questions in 5 sections in 5 sections
MethodologyMethodologyInstrumentationInstrumentation
Pay SatisfactionPay Satisfaction Pay satisfaction measured by Pay satisfaction measured by
modified “pay” sub-dimensiomodified “pay” sub-dimension of Job Satisfaction Scale (Sn of Job Satisfaction Scale (Spector, 1985)pector, 1985)
4 items4 items
MethodologyMethodologyInstrumentation (cont.)Instrumentation (cont.)
Job SatisfactionJob Satisfaction Job satisfaction measured by Job satisfaction measured by
modified Job Satisfaction Scamodified Job Satisfaction Scale (Spector, 1985)le (Spector, 1985)
32 items32 items
MethodologyMethodologyInstrumentation (cont.)Instrumentation (cont.)
Organizational CommitmentOrganizational Commitment Organizational commitment Organizational commitment
measured by modified Three-measured by modified Three-Component Model (TCM) Component Model (TCM) Employee Commitment Employee Commitment SurveySurvey (Meyer, Allen, & Smith, (Meyer, Allen, & Smith, 19931993 ))
18 items18 items
MethodologyMethodologyInstrumentation (cont.)Instrumentation (cont.)
Turnover IntentionTurnover Intention Turnover intention measured by Turnover intention measured by
modified Turnover modified Turnover QuestionnaireQuestionnaire (Kim, Price, (Kim, Price, Mueller, & Watson, 1996)Mueller, & Watson, 1996)
4 items4 items
MethodologyMethodology Methods of Data AnalysisMethods of Data Analysis
EXCEL, SPSS 14.0, and AMOS EXCEL, SPSS 14.0, and AMOS 6.06.0
Descriptive statistics, Descriptive statistics, Confirmatory Factor Analysis, Confirmatory Factor Analysis, and Structural Equation and Structural Equation Modeling (SEM) Modeling (SEM)
MethodologyMethodology Methods of Data AnalysisMethods of Data Analysis (cont.) (cont.)
Descriptive statistics and Descriptive statistics and reliability scores calculated reliability scores calculated by SPSS 14.0, and structural by SPSS 14.0, and structural equation modeling (SEM) equation modeling (SEM) analysis used AMOS 6.0. analysis used AMOS 6.0.
MethodologyMethodology Methods of Data AnalysisMethods of Data Analysis (cont.) (cont.)
Confirmatory Factor AnalysisConfirmatory Factor Analysis Goodness-of-Fit CriteriaGoodness-of-Fit Criteria
Absolute Fit MeasuresAbsolute Fit MeasuresIncremental Fit MeasuresIncremental Fit MeasuresParsimonious Fit MeasuresParsimonious Fit Measures
Methodology Goodness-of-Fit Example
TurnoverIntention
PaySatisfaction
OrganizationalCommitment
JobSatisfaction
Affective
err11
Normative
err12
T04
err16
T03
err15
T02
err14
T01
err13
JSS01
err01
JSS02
err02
JSS03
err03
Promotion
err05
Supervision
err06
FringeBenefits
err07
Coworkers
err08
NatureofWork
err09
JSS04
err04
res2
res1
res4
Communication
err10
res3
Methodology Goodness-of-Fit Example (cont.)
Goodness-of-fit statistics ValuesDesired range of values for a good fit
Absolute fit measures
Chi-square test χ2 445.76(p<.001)
p>.05
Degrees of freedom df 98 ≥0
Chi-square/ degrees of freedom ratio χ2/df 4.55 2 to 5
Goodness-of-fit index GFI .87 >.90
Root mean square error of approximation RMSEA .10 <.08
Incremental fit measures
Adjusted goodness-of-fit index AGFI .82 >.90
Tucker-Lewis index TLI .83 >.90
Normed fit index NFI .83 >.90
Comparative fit index CFI .86 >.95
Parsimonious fit measures
Parsimonious normed fit index PNFI .68 >.50
Parsimonious goodness-of-fit index PGFI .63 >.50
Methodology Goodness-of-Fit Example
TurnoverIntention
PaySatisfaction
OrganizationalCommitment
JobSatisfaction
Affective
err11
.87
Normative
err12
.81
T04
err16
.84
T01
err13
.77
JSS01
err01
.63
JSS03
err03
.97
Promotion
err05
Supervision
err06
FringeBenefits
err07
.49
Coworkers
err08
.41
NatureofWork
err09
.81
-.01
res2
res1
res4
Communication
err10
.81
.29-1.12
.51 1.40
-.35
-.42
.67
.65
.83
.55.07res3
Methodology Goodness-of-Fit Example (cont.)
Goodness-of-fit statistics ValuesDesired range of values for a good fit
Absolute fit measures
Chi-square test χ2 134.57(p<.001)
p>.05
Degrees of freedom df 44 ≥0
Chi-square/ degrees of freedom ratio χ2/df 3.06 2 to 5
Goodness-of-fit index GFI .94 >.90
Root mean square error of approximation RMSEA .08 <.08
Incremental fit measures
Adjusted goodness-of-fit index AGFI .90 >.90
Tucker-Lewis index TLI .93 >.90
Normed fit index NFI .94 >.90
Comparative fit index CFI .96 >.95
Parsimonious fit measures
Parsimonious normed fit index PNFI .63 >.50
Parsimonious goodness-of-fit index PGFI .53 >.50
Results
1,704 surveys were distributed 392 responses were received Response rate was 23% 37 responses were invalid N = 355
Research Purposes, Hypotheses, and Results Research Purposes Hypotheses Results
The relationships among pay satisfaction, job satisfaction, organizational commitment, and turnover intention
1. Pay satisfaction has a negative relationship with turnover intention.
Rejected
2. Job satisfaction has a negative relationship with turnover intention.
Rejected
3. Organizational commitment has a negative relationship with turnover intention.
Supported
4. Pay satisfaction has a positive relationship with job satisfaction. Supported
4a. Pay satisfaction is a mediator between job satisfaction and turnover intention.
Rejected
4b. Job satisfaction is a mediator between pay satisfaction and turnover intention.
Rejected
5. Pay satisfaction has a positive relationship with organizational commitment.
Rejected
5a. Pay satisfaction is a mediator between organizational commitment and turnover intention.
Rejected
5b. Organizational commitment is a mediator between pay satisfaction and turnover intention.
Rejected
6. Job satisfaction has a positive relationship with organizational commitment.
Supported
6a. Job satisfaction is a mediator between organizational commitment and turnover intention.
Rejected
6b. Organizational commitment is a mediator between job satisfaction and turnover intention.
Supported
Pay Satisfaction
Job Satisfaction
Organizational Commitment
Turnover Intention
Research Purposes, Hypotheses, and Results
(cont.) Research Purposes Hypotheses Results
The relationships among pay satisfaction’s sub-variables and turnover intention
2a. Promotion has a significant relationship with turnover intention.Rejected
2b. Supervision has a significant relationship with turnover intention.Rejected
2c. Fringe benefits have a significant relationship with turnover intention. Rejected
2d. Contingent rewards have a significant relationship with turnover intention. N/A
2e. Operating procedures have a significant relationship with turnover intention. N/A
2f. Coworkers have a significant relationship with turnover intention.Rejected
2g. The nature of work has a significant relationship with turnover intention. Supported
2h. Communication has a significant relationship with turnover intention. Rejected
Turnover Intention
Operating Procedures
Coworkers
Nature of work
Communication
Promotion
Supervision
Fringe Benefits
Contingent Rewards
Research Purposes, Hypotheses, and Results
(cont.) Research Purposes Hypotheses Results
The relationships among organizational commitment’s sub-variables and turnover intention
3a. Affective commitment has a significant relationship with turnover intention.
Supported
3b. Continuance commitment has a significant relationship with turnover intention.
N/A
3c. Normative commitment has a significant relationship with turnover intention.
Supported
Turnover Intention
Normative Commitmen
t
Continuance Commitmen
tAffective Commitmen
t
Turnover Intention
Normative Commitmen
t
Affective Commitmen
t
Nature of work
Organizational Commitment
Job Satisfaction
Pay Satisfaction
Recommendations for Future Study
• Other factors
• Measurements
Pay Satisfaction
Job Satisfaction
Organizational Commitment
Turnover Intention
?
Job Performance
Empowerment
Leadership Styles
Pressure
Working Hours
Personality Traits
Non-Telecommuter
s
Enterprise Culture
Trust
Telecommuters
Burnout
Working Loads
Personal Situation
Socio-demographic
Characteristics
Training
Office Location
Working Status
Recommendations for Future Study (cont.)
• Different groups, industries, cultures, or countries.
• Turnover intention and the actual departure of an employee
Comments or Questions?
Recommended