Organizational Commitment and Its Relationship with Organizational Performance - Essay Example

The Phenomenon of Organizational Commitment and its Relationship with Organizational Performance By Management 22nd September, The Phenomenon of Organizational Commitment and its Relationship with Organizational Performance Theory Organizational commitment is an important part of organization behavior. Due to the importance of organizational commitment in the field of organization behavior and human resource, a vast number of researches have been carried out. The purpose of these researches is to find out relationships between organizational commitment and employees behavior in the workplace. Most of the studies conducted on organizational commitment were focused on the relationship of organizational commitment and employees’ behavior, job satisfaction, and job tenure. Researchers have also studied various outcomes of organizational commitment. The most widely studied outcomes include employee retention, attendance, organizational citizenship, and job performance (Angle and Perry, 1981). Organizational commitment has become one of the major concerns of human resource these days. The enhancement of employees performance is issue for both profit and non-profit organizations. Non-profit organizations usually find it difficult to deal with this issue because of their inability to provide their employees with competitive compensations and benefits (Riveros andTsai,2011). One of the important objectives of an organizations human resource team is to keep employees motivated. It is because employees motivation results in commitment which in turn improves their performance and declines their desire to leave the organization. In order to achieve these results, organizations can devise a positive reward system. The purpose of this reward system is to retain employees. A positive reward system may include financial as well as non-financial rewards but mostly, non-financial rewards are proved effective to retain employees (Riveros and Tsai, 2011). Organizational commitment is a topic which has been studied by several authors. Nevertheless, the most important contribution was made by Modway, Steers and Porter (1979) in the form of Organizational Commitment Questionnaire. In order to fathom the importance of organizational commitment, it is important to clarify the concept (Riveros and Tsai, 2011). According to Colarelli and Bishop (1990), organizational commitment involves commitment to an organization as well as organizational goals. Allen and Meyer also proposed a measurement of organizational commitment in 1990. According to them, there are three components of organizational commitment including affective, continuance, and normative. The affective components include employees emotional attachment and their identification with the organization. The continuance component involves the cost associated with leaving the organization as perceived by employees. The normative component engrosses the feeling of obligation of employees to remain associated with the organization. These components depend on various precursors. The affective commitment is a result of psychological factors. Employees who feel comfortable in their organizations and in their work roles do not desire to switch their jobs. The continuance commitment to the organization occurs when employees have invested in the organization or when they have fewer alternatives. The normative commitment is a result of employees familial, cultural, and social experiences (Allen and Meyer, 1990). Committed employees help an organization increasing the overall performance because they focus on achieving the organizations goal. Additionally, committed employees are more satisfied with their jobs therefore they always take initiatives which are good for the organization. According to Sutanto (1999), the relationship between organizational commitment and employees performance is alleged. According to him, commitment to supervisors is a better predictor of employee performance as compared to organizational commitment (Sutanto, 1999). The avalanche of change in todays age of uncertainty has made several organizations unsuccessful. The commitment of employees towards their organizations is directly related to their job satisfaction. As long as employees are satisfied with their jobs, they will not leave the organization. However, as soon as they turn out to be dissatisfied, they will start looking for other alternatives (Bateman& Stasser, 1984). According to Clegg (1983), commitment to organization is negatively related to absenteeism and turnover. It implies that employees are likely to engage in absenteeism and turnover if they are not committed to their firms. It occurs when employees are dissatisfied with their jobs. The stronger organization commitment among employees can result in less turnover and absenteeism which can therefore increase the productivity of employees (Schuler & Jackson, 1996). Findings The findings of various researches will help us better understand organizational commitment and its relationship with employees performance. According to Fink (1992), commitment is a result of identification. This idea has also been coined by different researchers but Fink has focused on a three-dimensional concept. According to other researches, commitment involves identification of employees with their organization as well as organizational goals. However, according to Finks three-dimensional concept, commitment involves identification of employees with their organization, their work, and their co-workers. According to Fink (1992), these three factors are equally important in developing a sense of commitment among employees. Based on his findings, Fink has also proposed an interactive model. According to Finks model, good management practices of an organization help in devising an effective reward system and encouraging employee commitment. This effective reward system is also the cause of improved performance and enhanced commitment of employees. Finks model also proposes that organizational commitment results in the improved performance of employees. Fink has also found that the increased level of employee performance is directly related to the higher level of commitment to work, coworker and organization. Benkhoff (1997) conducted a study in order to analyze the relationship between organizational commitment and employees’ performance. Her research was based on a postal survey in high street banks in Germany. In order to gather data, questionnaires were distributed among 340 employees in 41 branches. She analyzed the relationship between organizational commitment and employees’ performance in terms of sales target met and change profits. From her study, Benkhoff found that commitment of employees was related to the financial success of branches. Creating Organizational Commitment Undoubtedly, committed employees are a competitive organization for an organization. The global business environment is changing very rapidly. In order to survive in this environment, organizations need to be competitive. The current global business environment is marked by total uncertainty. There exists an intensified global competition among organizations. The corporate giants such as Toyota Motor Manufacturing, Ben & Jerry’s, Federal Express, IBM, Delta Airlines, and others have survived successfully in this fierce global competition because they have realized the importance of human resource. The managers of these organizations have realized that in today’s rapidly changing world, machines and patents are not the only source of competitive advantage but in order to gain an edge over competitors, it is imperative to retain employees (Dessler, 1993). In order to enhance employees’ performance and to improve the overall performance of an organization, it is necessary to create commitment. There are various ways through which commitment can be created and enhanced. Employees’ commitment to supervisors can be increased through training, socialization, team building, and leadership. When managers act as role models for their subordinates, employees feel a sense of identification towards them (Sutanto, 1999). Socialization in an organization also results in increasing employees’ commitment. Due to socialization, employees in an organization are willing to work long hours. Socialization also results in decreasing absenteeism and turnover (Schuler & Jackson, 1996). It has also been found through various researches that commitment of employees to their organization also depends on their relationship with coworkers. In order to improve relations among employees, team building is effective. When working in a team, employees get the chance of improving their work interactions by interacting with other members of the organization (George & Jones, 1996). Dessler (1993) has proposed a ‘commitment wheel’ to explain organization commitment and employees’ performance. Accorder to Dessler, organizational commitment is an all-encompassing program. Organizational commitment involves people-first values, double-talk, communion, transcendental mediation, value-based hiring, securitizing, hard-side rewards, and actualizing. According to Dessler, organizational commitment is not possible unless the top management in organization trusts and respects it people. In order to encourage commitment, it is crucial to foster two-way communication. Communion involves a feeling of belongingness among employees in an organization. An amalgamation of all these factors in an organization boosts dedication and satisfaction among employees. This satisfaction and contentment among employees encourage long term commitment with the organization. Transcendental mediation involves communicating ideologies, missions, and values with employees (Dessler, 1993). Value-based hiring can also help an organization create commitment among employees. There are several factors considered by organizations when hiring employees. Along with expertise, knowledge, prowess and other factors, it is also important to analyze whether the values of employees are compatible with those of the firms. Identifying employees’ values and matching them with organization values must be an important part of the screening process. When provided with job security, employees find it difficult to leave their firms. It implies that firms can effectively increase the level of commitment among their employees by doing their level best to provide employees with job security. For many employees, money is no doubt the best incentive. By offering competitive packages and incentives, firms can not only attract more employees but also increase their level of commitment. Managers can also increase employee commitment by allowing employees to become what they want to be. It can be done by providing equal opportunities to all employees. When employees are provided with an opportunity to use their skills freely, they develop a sense of dedication. It does not only improve their performance but also enhance organization commitment (Dessler, 1993). Conclusion and Recommendations On the basis of all theories and findings, it can be concluded that there exists a relation between organization commitment and employees performance. However, commitment does not only involve identification with the organization but also with supervisors, coworkers and work itself. Committed employees are invaluable assets of an organization. Therefore it is necessary for managers to try there level best to retain employees. Organizations should promote socialization and team work to help employees improve their relationships with others. Employees must be provided with a fair and competitive compensation system which prevents them from finding and considering other alternatives. It has also been found through studies that the level of commitment in profit organizations is more as compared to non-profit organizations. It is because of the reason that non-profit organizations find it difficult to offer competitive packages and incentives to their employees. Organizations where employees are allowed to utilize their skills freely have the higher level of commitment among employees as compared to organizations who do not encourage free utilizations of skills. Therefore, it is recommended to encourage employees to utilize their skills freely. When employees utilize their skills freely without any hindrance, their proficiencies are increased. It has also been found that employees’ satisfaction is also related to organization commitment. Employees who are satisfied with their job as well as the organization are more committed as compared to employees who are dissatisfied. References Allen, N. & Meyer, J.P. (1990). The measurement and antecedents of affective, continuance and normative commitment to the organization. Journal of Occupational Psychology, 63(1), 1-18. Retrieved from http://web.ebscohost.com/ehost/ Angle, H. L., & Perry, J. L. (1981). An empirical assessment of organization commitment and organizational effectiveness. Administrative Science Quarterly, 26, 1-13. Bateman, T. S., & Strasser, S. 1984. A longitudinal analysis of the antecedents of the organizational commitment. Academy of Management Journal, 27: 95-112. Benkhoff, B. 1997. Ignoring commitment is costly: New approaches establish the missing link between commitment and performance. Human Relations, 50(6): 701-726. Clegg, C. W. 1983. Psychology of employees’ lateness, absence, and turnover: A methodological critique and an empirical study. Journal of Applied Psychology, 68:88-101 Dessler, G. 1993. Winning commitment, New York: McGraw-Hill, Inc Fink, S. L. 1992. High commitment workplaces. New York: Quorum Books George, J. M., & Jones, G. R. 1996. Understanding and managing organizational behavior. California: Addison-Wesley Publishing Company, Inc. Riveros, M. A & Tsai, T. (2011). Career Commitment and Organizational Commitment in for-Profit and non-Profit Sectors, International Journal of Emerging Sciences, 1(3), 324-340 Sutanto, M. E. 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