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Employee Satisfaction and Commitment. Why Worry About Employee Attitudes?. Note: Numbers in table are corrected correlations. Individual Differences in Employee Satisfaction. Important Findings Consistency across jobs Consistency across time - PowerPoint PPT Presentation
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© 2013 Cengage Learning
1
Employee Satisfaction and Commitment
© 2013 Cengage Learning
2
Why Worry About Employee Attitudes?
Outcome Satisfaction Commitment
Absenteeism -.23 -.23
Turnover -.22 -.23
Lateness -.11 -.29
Organizational citizenship .24 .25
Counterproductive behavior -.37 -.36
Performance .30
Commitment .59
Note: Numbers in table are corrected correlations
© 2013 Cengage Learning
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Individual Differences in Employee Satisfaction
• Important Findings– Consistency across jobs
– Consistency across time
– Relationship between life satisfaction and job satisfaction
• Why?– Genetic predispositions
– Core self-evaluations• self-esteem• self-efficacy• internal locus of control• optimism/positive affectivity
© 2013 Cengage Learning
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Types of Organizational Commitment
• Affective commitment
• Continuance commitment
• Normative commitment
© 2013 Cengage Learning
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Core Self-EvaluationJudge and Bono (2001) Meta-Analysis
Corrected Correlations With
Core-Evaluation Trait Satisfaction Performance
Self-esteem .26 .26
Self-efficacy .45 .23
Internal locus of control .32 .22
Emotional stability .24 .19
© 2013 Cengage Learning
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PersonalityMeta-Analysis Results
Corrected Correlations With
Personality Trait Satisfaction Performance Turnover
Openness .02 .06 .10
Conscientiousness .26 .24 -.22
Extraversion .25 .09 -.04
Agreeableness .17 .12 -.27
Stability .29 .15 -.20
© 2013 Cengage Learning
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Your Predisposition to be Satisfied
• Interest Inventory• Life Satisfaction Measure• Core Self-Evaluation
– self-esteem
– locus of control
– affectivity
• Job Satisfaction History
© 2013 Cengage Learning
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International Differences in Job SatisfactionSousa-Poza and Sousa-Poza (2000)
• 5.69 Denmark• 5.66 Cyprus• 5.47 Switzerland• 5.45 Israel• 5.43 Netherlands• 5.40 Spain• 5.34 United States• 5.27 New Zealand• 5.24 Sweden• 5.22 Norway• 5.18 Italy
• 5.17 Germany• 5.17 Portugal• 5.13 Great Britain• 5.13 Czech Republic• 5.09 France• 5.05 Bulgaria• 4.95 Slovenia• 4.87 Japan• 4.86 Russia• 4.82 Hungary
© 2013 Cengage Learning
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Dirty Jobs
© 2013 Cengage Learning
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Discrepancy Theories
• Have the employee’s expectations been met?– Realistic job previews (RJPs)
• Is the employee a good fit?– Vocation– Job– Organization– Coworkers and supervisor
• Have the employee’s needs, values and wants been met?– Maslow’s Needs Hierarchy– ERG Theory– Two-factor Theory
© 2013 Cengage Learning
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Person-Organization FitKristof-Brown et al. (2005) Meta-Analysis
Employee fit with
Attitude or Behavior Organization Group Supervisor Job
Satisfaction .44 .31 .44 .56
Commitment .51 .19 .09 .47
Performance .07 .19 .18 .20
Turnover - .14 - .08
Turnover intent - .35 - .46
Absenteeism - .05
© 2013 Cengage Learning
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Basic Biological Needs
Maslow’s Need Hierarchy
Safety Needs
Social Needs
Ego Needs
Self-Actualization Needs
© 2013 Cengage Learning
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Discrepancy TheoriesERG Theory
• Growth
• Relatedness
• Existence
© 2013 Cengage Learning
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Discrepancy TheoriesTwo-Factor Theory
• Motivators– responsibility
– challenge
– job control
• Hygiene factors– pay
– benefits
– coworkers
© 2013 Cengage Learning
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Job Facets
• Are the tasks enjoyable?• Do the employees enjoy
working with their supervisors and coworkers?
• Are coworkers outwardly unhappy
© 2013 Cengage Learning
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Are Rewards And Resources Given Equitably?
• Equity Theory• Components
– inputs
– outputs
– input/output ratio
• Possible Situations– underpayment
– overpayment
– equal payment
© 2013 Cengage Learning
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Organizational Justice
• Distributive justice• Procedural justice• Interactional justice
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Correlations with Perceptions of JusticeColquitt, Conlon, Wesson, Porter, and Ng (2001)
Outcome Procedural
Justice
Distributive Justice
Job satisfaction .62 .56
Organizational commitment .57 .51
Trust .61 .51
Withdrawal - .46 - .50
Performance .36 .15
Negative employee reactions - .31 - .30
© 2013 Cengage Learning
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Is There a Chance for Growth and Challenge?
• Enriched jobs– Variety of skills needed
– Employee completes entire task
– Tasks have meaning
– Employee has input/control
– employee receives feedback
• Methods– Job rotation
– Job enlargement
– Job enrichment
© 2013 Cengage Learning
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Increasing Job Satisfaction
• Hire “Satisfied” Employees• Eliminate Dissatisfiers• Express appreciation and provide proper feedback• Increase opportunities to socialize• Hold special events and friendly competitions• Increase humor• Have surprises• Assign the right tasks to the right people
© 2013 Cengage Learning
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Hire “Satisfied Employees”
• Test for Satisfaction Potential– Interest inventory
– Core self-evaluation
– Satisfaction history
• Provide a realistic job preview• Look for person-organization fit
© 2013 Cengage Learning
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Eliminate Dissatisfiers
• Interpersonal conflict– Peers
– Supervisors
– Customers
• Inequity• Low pay• Job security• Poor working conditions• Work schedule issues
© 2013 Cengage Learning
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Hold Special Events and Friendly Competitions
• Casual or spirit days• Increase socialization
through parties, picnics, and socials
• Hold fun contests• Celebrate birthdays and
special occasions• Encourage humor
© 2013 Cengage Learning
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Express Appreciation and Provide Proper Feedback
• Liberal use of praise and thanks
• Positive feedback• Service and performance
awards• _________________• _________________• _________________
© 2013 Cengage Learning
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Increase Opportunities to Socialize
• Picnics• Lunches• _______________• _______________• _______________• _______________• _______________
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Hold Special Events and Friendly Competitions
• Casual days• Company logo day• ________________• ________________• ________________• ________________
© 2013 Cengage Learning
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Increase Humor
• Bulletin boards with humor• Attach cartoons to boring
memos• ________________• ________________• ________________
© 2013 Cengage Learning
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Have Surprises
• Order lunch for everyone• Let everyone leave an
hour early• __________________• __________________• __________________• __________________
© 2013 Cengage Learning
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Assign the Right Tasks to the Right People
• People have different interests
• People have different skills
© 2013 Cengage Learning
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Dream Jobs
© 2013 Cengage Learning
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Measuring Job Satisfaction
• Faces Scale• Job Descriptive Index (JDI)• Minnesota Satisfaction
Questionnaire• Job in General Scale• Nagy Satisfaction Scale• Custom designed inventories
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Measuring Commitment
• Allen and Myer Survey• Organizational Commitment Questionnaire• Organizational Commitment Scale
© 2013 Cengage Learning
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© 2013 Cengage Learning
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Year Cost of Absenteeism
U. S. Absenteeism Rate
CCH Survey BNA Survey
2007 2.30
2006 2.50
2005 $660 2.30
2004 $610 2.40 1.40
2003 $645 1.90 1.60
2002 $789 2.10 1.60
2001 $755 2.20 1.70
2000 $610 2.10 1.70
1998 $757 3.25 1.60
1996 $603 2.80 1.60
© 2013 Cengage Learning
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International Differences – Nutreco (2000)
Country Absenteeism Rate (%)
Canada 1.6
Ireland 1.9
Poland 2.3
Chile 2.7
United Kingdom 3.2
Spain 3.8
France 4.0
Belgium 6.3
Norway 7.2
Netherlands 7.8
© 2013 Cengage Learning
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Reason for Missing Work (CCH Survey)
Year Illness Stress Personal Needs
Family Issues
Sense of Entitlement
2007 34 13 18 22 13
2006 35 12 18 24 11
2005 35 12 18 21 14
2004 38 11 18 23 10
2003 36 11 18 22 13
2002 33 12 21 24 10
2000 40 5 20 21 14
1998 20 16 24 21 19
1996 28 11 20 26 15
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Actual Employee Excuses for Missing Work • I was sprayed by a skunk. • I tripped over my dog and was knocked unconscious. • My bus broke down and was held up by robbers. • I was arrested as a result of mistaken identity. • I forgot to come back to work after lunch. • I couldn’t find my shoes. • I hurt myself bowling. • I was spit on by a venomous snake. • I totaled my wife’s jeep in a collision with a cow. • A hitman was looking for me. • My curlers burned my hair and I had to go to the hairdresser • I eloped. • My cat unplugged my alarm clock. • I had to be there for my husband’s grand jury trial. • I had to ship my grandmother’s bones to India. (note: she had passed away 20
years ago)
Source: 2004 CareerBuilder.Com Survey
© 2013 Cengage Learning
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Why Employees Are Absent
• No consequences for attending or missing work
• Illness and personal problems
• Individual differences• Unique events
© 2013 Cengage Learning
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Increasing Attendance by Having Consequences for Missing Work
• Rewards for Attending– Financial incentives
• Well pay• Games• Financial bonuses
– Paid Time-off Programs
– Recognition programs
• Discipline for Not Attending• Clear Policy and Record Keeping
© 2013 Cengage Learning
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Increasing Attendance by Reducing Employee Stress
• Overload• Conflict
– peers
– supervisors
• Boredom• Safety Issues
© 2013 Cengage Learning
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Increasing Attendance by Reducing Illness
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Types of Wellness ProgramsSHRM 2011 Survey
Wellness Program % Offering
Employee assistance program 75
Provide wellness information 75
Health screening programs 42
Smoking cessation program 36
Weight loss program 30
On-site fitness center 24
Stress reduction programs 12
© 2013 Cengage Learning
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CCH Absence Control SurveysAbsence Control
MethodPercent Using Effectiveness Rating
2003 2005 2007 2003 2005 2007
Disciplinary action 96 90 89 3.3 3.4 3.4
Performance appraisal 84 79 82 2.9 3.0 2.9
Verification of illness 75 76 74 2.9 3.2 3.2
Paid leave bank 59 67 60 3.6 3.5 3.6
Personal recognition 62 66 57 2.5 2.6 2.6
No-fault systems 62 63 59 3.0 3.0 2.9
Bonus programs 52 57 51 3.1 3.3 3.3
Buy-back programs 548 58 53 3.3 3.5 3.4
© 2013 Cengage Learning
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© 2013 Cengage Learning
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Why Do Employees Leave?
• Unavoidable Reasons– school ends
– job transfer
– illness
– family issues
• Advancement– more responsibility
– better pay
• Unmet Needs
• Escape From– people
• management
• coworkers
• customers
– working conditions
– stress
• Unmet Expectations– organization
– job
– career
© 2013 Cengage Learning
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Why Are Your Employees Leaving?
• Exit Interviews
• Attitude Surveys
• Salary Surveys– pay
– benefits
– time off
© 2013 Cengage Learning
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The Cost of TurnoverVisible Costs Per Hire
• Advertising charges• Agency fees• Referral bonuses• Staff time & benefits
– processing applications
– interviewing
• Overhead
• Travel Costs– staff
– applicants
• Relocation Costs• Miscellaneous Costs
© 2013 Cengage Learning
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The Cost of TurnoverHidden Costs
• Loss of Productivity– employee leaving
– other employees
– vacant position
– new employee (1 year)
• Inefficiency• Overtime• Training Costs
© 2013 Cengage Learning
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Estimating the Cost of Turnover• Industry Norms
– rate is 1.4% per month– cost is 1.5 times salary
• Custom Statistics– www.advantagehiring.com/calculators/calc_turnover.shtml– www.uwex.edu/ces/cced/publicat/turn.html
© 2013 Cengage Learning
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Financial Savings From Turnover Reduction
• Last Year– 5 employees leave
each month (60 per year)
– Average salary is $20,000
– Cost of turnover is 60 * $20,000 * 1.5 = $1,800,000
• This Year– 4 employees leave each
month (48 per year)
– Average salary is $20,000
– Cost of turnover is 48 * $20,000 * 1.5 = $1,440,000
– $360,000 saved through reduced turnover
© 2013 Cengage Learning
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Reducing TurnoverCompensation Issues
• Match the market
• Use job evaluation to ensure internal equity
• Offer retention/tenure bonuses (stay for pay)
© 2013 Cengage Learning
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Increasing Salary and Benefits Will only work if:
• Employees are leaving due to low compensation or benefits
• The turnover rate is high• The salary increase will be a
meaningful amount
© 2013 Cengage Learning
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Reducing TurnoverSelection Issues
• Conduct realistic job previews• Look for person-organization fit• Study predictors of people who leave
© 2013 Cengage Learning
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Reducing TurnoverOrganizational Issues
• Provide training• Show appreciation• Mediate conflicts• Meet employee needs
– safety
– social
– growth
© 2013 Cengage Learning
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Strategic Use of Benefits to Attract and Retain Applicants
• By Providing– Health care for
domestic partners
– Daycare benefits
– Meal benefits
– Paid time-off
– Flexible schedules
– Tuition/books
• You Can Attract/Retain– Gay employees
– Dual career families and parents on public assistance
– Students and retirees
– Young people
– Homemakers/parents
– Students
© 2013 Cengage Learning
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Applied Case Study: Reducing Turnover at Bubba Gump Shrimp
© 2013 Cengage Learning
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Focus on EthicsOrganizational Commitment
© 2013 Cengage Learning
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What Do You Think?• Do you think that incentives are a form of bribery? If so,
do you think it’s unethical for companies to do this?• What would keep you at a company for a longer period?
Would incentives such as an Attendance Reward Program or end of the year bonuses make a difference in whether you left a job?
• Do you think that using such incentives is a way for leaders to ignore what they should be doing to make things better for the employees?
• What are some other ethical dilemmas that might occur by offering incentives to increase commitment or job satisfaction?