Employee Commitment and Organizational Success - Case Study Example

Employee commitment and Organizational success Introduction The employee is an integral part and the most important factor in any organization. The employee performance and attitude counts in the long run in the success of any enterprise. This is simply verified if we visit two stores, one where the employees are cheerful and helpful and another where they are passive. We find that customer satisfaction increases where the employee takes interest in his work and is committed to his organization. The Hypothesis therefore focuses on this important issue. Today it is relevant because of the attrition rate and the job- hopping tendency of the employees and workforce. Therefore it is pertinent to research on what the factors that promote employee loyality and motivation are and how this is linked to the growth of the company. Changes are the order of the day and as expansion takes place and the management gets more and more complicated, it is necessary for a supervisory agency to exist within the organization to ensure that all the policies and visions of the company and all mandatory regulations, especially with regard to risk and performance safety is followed. Hypothesis The hypothesis therefore is that ‘Committed Employees cause the growth and success of an enterprise – Therefore every enterprise ought to remodel activities to create employee interest’ That is more employee interest in the work, it will result in more effective business. Literature and opinions What role does commitment play in an organization? To this we have various authors expressing a multitude of opinions. Comittment is very important and this is expressed by “Commitment binds the gap between an employee and an organization'. It can be said that commitment is a vital component in the employee - organization linkage. Commitment boosts the employees to work, perform, and retain his /her job. It is an important variable for understanding the work behaviour of employees in organization.”(1) With fierce competition building up at organizational levels it becomes very difficult for organisations to perform and perform well, if its employees are not committed to the organization. Previously in the past organisations used to serve employee faith by guaranteeing them job security. But during the course of time due to intensive competition 'hire and fire strategy' has been adopted by organisations which lead to job satisfaction. A general biasness prevailed and employees felt that they were the victims of false promises. Coetzee. (2005) Main aim of an organization is to earn profits. For maximizing profits it has to perform well. Employee commitment plays an important part in organizational growth and performance, in other words the success of the company depends on work commitment of employees. If employees are heartily committed to their work then success is assured. An organization is just like a family. Employer and employees are its family members. Therefore the most important duty is to protect the family by listening to employee demands and assuring them job security. In simple words, it is like 'look after the employees, the employees will look after your company'. Coetzee. (2005) Meyer & Allen's (1991) - 3 speaks of a component model of commitment. According to him There are 3 types, 1 Affective commitment, 2 Continuance commitment and normative commitment. Meyer & Allen, say that "these components are totally independent from each other. An employee/individual can be committed to an organization in an affective, continuance and normative sense, separately, simultaneously or at desired intensity levels." 'Maintaining employee commitment in current business environment is the most challenging task faced by modern organisations'. With no assurance of continued employment, workers now expect in other areas for instance they expect employers to demonstrate their commitment in respect to 1) Favourable working conditions 2) Maintain a balance between work and employment commitment outside the work place. Coetzee. (2005) The commitment of employee counts, accordingly “Of every million ideas for a high-tech business, it is estimated that only six become public companies. But adopting the right organizational model and employment practices can help improve those odds, according to a group of researchers at Stanford and MIT. according to Mary Kwak (2007) Putterill M.S.; Rohrer T.C. (1995) speaks of a employee organizational commitment process and a model. They have gathered data “gathered in a multi-division, labour-intensive garment manufacturer in New Zealand form the basis of the empirical element which underpins the study” the result and methodology are encouraging to this research. Steven M. Sommer (1996) did a research with Korean employees.” They comment that “As for the situational antecedents, except for management style, all the others were significantly related. Specifically, as organization size increased, commitment decreased; as the structure became more employee focused, commitment increased; and the more positive the organizational climate perceptions, the more the commitment. Although the exceptions need to be explained, this study provides beginning evidence that the theoretical constructs predicting the organizational commitment of employees may have cross-cultural validity.” Donna Deeprose (2006) says that one of the key factors that can help employee motivation is rewarding employees. She argues that by keeping the employee morale an organization can retain their best employees and recruit top new talent, Increase profits and create a situation where the employee gives peek performance. Pointing out the difficulty encountered she gives the opinion that "It makes sense intuitively that recognizing and rewarding employees for their superior performance leads to superior organizational performance. Most employers will tell you that optimal performance is what they expect to achieve with their rewards programs. However, when times are tough, it is not intuition that drives policy in most companies but rather bottom-line results. So, if you need a good reason to invest more creative effort and money in your rewards program or to convince your company to do so, you should forget intuition and look for evidence of hard numbers." A great role will have to be played by managers in rewarding their employees so that the employee feels motivated. The following are the concepts that are generally associated with this Topic. Employees have to be Inspired, their performance monitored, and they be guided to focus, take action, and get results. There ought to be a method of sustaining employee commitment and drive even as the organization keeps changing. E. Bruce Colligan, (2003) Organization of the Elizabethtown Water Company with a 500 employee base inducted a partner who suggested that investing in people is the biggest asset for the firm. The solution in steps was to “involve participants with a unified purpose who are collaborative and inclusive, linking people across the system to issues, actions and outcomes,” and “Accountability is distributed across participants and linked to personal performance goals and reviews” Changes are the order of the day and as expansion takes place and the management gets more and more complicated, it is necessary for a supervisory agency to exist within the organization to ensure that all the policies and visions of the company and all mandatory regulations, especially with regard to risk and performance safety is followed. There must be integrity in all operations to keep abreast with the changes being brought about by global concerns, and by competitors it is necessary to have specialist teams drawn from Human resource managers and also induct specialists in various aspects of the company’s activities into the team. This team can then foster employee good will. One important paradigm is that the employees have to be retrained to a positive frame of mind in such a manner that they easily absorb changes. Employee attrition commences with a change or work pressure. Managers and middle level executives are going to resent change, and therefore a systems approach and the team building activity is recommended in such cases. The Systems Approach allows “managers to interpret patterns and events in the workplace – i.e., by enabling managers to recognize the various parts of the organization, and, in particular, the interrelations of the parts”. The Team Building approach or is where the quality circles, best practices, and continuous improvement is plotted together with the emphasis on team work. By this system we propose we also seek to achieve the flattening or recreation of the hierarchy pyramid in the company we have to use both these methods to create the proposed change and implement it fully. We also consider the impact of this on all the concerned entities in the company. The stock holders fears and anxieties can be overcome when it is tabulated and presented to them the actual value of the stocks and shares that is likely to increase with the customer confidence level increasing with the implementation of the system. The first set of managers who are to convince, train and redeploy will be the current PMG group and the others proposed to be inducted into it. All managers are bound to resist change. A. J. Schuler, says that people resist change because the risk of changing is perceived to be greater than the risk of maintaining the status quo. People have relations with one another in a pattern they are not willing to change. The new activity will be without precedents and they may no t adapt to it easily, and there is a feeling of lack of competence. He also goes on to add that people when cornered into accepting something new or a change feel overloaded, and wait with trepidation over the outcome of the new innovation. They may also depend on their thought pattern suspect hidden agendas, and may feel they are threatened. Some times a loss of status and the changed peer relationship can cause stress. The most important aspect we have to look into is the a) Verifying key performance indicators b) Documenting new job roles c) Estimating the workload and resources for team members d) Hiring people for key requirements, and having a good rapport on a personal basis with employees. Robert H. Rouda & Mitchell E. Kusy, Jr. define changes in terms of size- large scale and in terms of time to change. They also say that it is important to consider the learning curve, shift in responsibility, and the dissatisfaction that is likely to result. It is advised to share the vision of change with all the persons in the organization and have a systems and information approach, both of which are the keystone of employee happiness. Therefore it is imperative to see the relations between employee happiness and the effect of it on the business. Methodology The method proposed for this research is to take up a list of ten companies of various segments, analyze the company policies, and then interact with the employees through a questionnaire that will elicit their commitment to work and then tabulate it and compare it with the financial results shown by the company and link the employee commitment to the fortunes of the company. A detailed questionnaire for the employer and employee will elicit information pertaining to their job interest’s misgivings, and desired changes. Questionnaire model For the Employer: Name of the company Owner’s name Brief history What policies do you follow toward employee satisfaction? Do your employees share your concerns in business? Do you discuss issues with them and do they contribute? Can you asses the effects their actions have in your business? More details. (This questionnaire was expanded to elicit data in a 1-10 scale so that it can be tabulated. For the Employee Name of the company Your name Brief work history What policies do want to be implemented employee satisfaction? Do you like your work and boss? Do you discuss issues with them ? Do you contribute? Can you asses the effects of your actions have in your business? What have you done to your personal improvement so that you will be benefited at the work place? Books you read ( ) Courses taken for improvement () Seminars etc. Rate your company and your boss. Will you quit from this job soon? How do you think you can improve this business? Evaluation process The answers to the questions itself will give us the amount of persons who are reacting to the questions as speculated in the hypothesis and the average of who are not. Compared with annual performance of the company, the percentage comparison of both output, and finding a correlation coefficient between both set of data will help us establish the veracity of the hypothesis. Accordingly the questionnaire was submitted to a cross section of 20 employees and 10 employers. This resulted in the following : Employer feedback total 10 employers Issues Agreeing Not agreeing a) Company welfare policies is a must Agreed 12 3 b) Discussing concerns with employees 4 6 c) Accepting employee views 3 7 d) Satisfied with employees and business 6 4 e) Concerned with welfare of employees 6 4 Total in average 5.2 4.8 Total mode count (a) 7, (d) & (e) C, & d Findings and interpretation (1) : The simple averages show that the employers who show genuine concern with the employees are on an average more in number but the average difference is very small. This shows us that there is a need for employers to change their attitude to the employees which will be the first step to create a satisfied and happy employee. The mode analysis suggests that employers who have a committed and welfare based attitude to the employees are more likely to have a mindset that can foster a better relationship. In the analysis of the employee feedback tabulated below we find that the employees tend to like the employers who have shown concern.   Employee questionnaire results Employees 20         Sl No Issues Have strong opinion Disagree with the question not important Not sure or don’t care Total a What policies do want to be implemented employee satisfaction? 12 2 6 20 b Do you like your work and boss? 9 6 5 20 c Do you discuss issues with them ? Do you contribute? 9 6 5 20 d Can you asses the effects of your actions have in your business? 12 6 2 20 e What have you done to your personal improvement \? 7 8 5 20 f Books you read ( ) Courses taken for improvement () Seminars etc. 6 14 0 20   On employers Positive Negative None   g Rate your company and your boss. 12 6 2 20 h Will you quit from this job soon? 7 6 7 20 i How do you think you can improve this business? 8 8 4 20               Average (a to f) 10.71428571 8.8571429 6.14286     Average (g to i) 11.75 10 8.25   Findings and interpretation (2): The simple averages of the two sets of data one dealing with employee attitude (a to f) show that the borderline between enthusiastic employees and those on the bored or don’t care segment is more. This is because of employer – employee relations not being in order. In comparison with the employer data we can see that firms are effective because of the small segment of committed employees shown in the second average (g- i) The committed employee make up the segment that delivers output to the maximum and like it was observed, 20% of people will be seen doing 70% of the work. We can now say that employers ought to ignore the fraction of employees who have the ‘I dont care’ attitude and work on rewarding committed employees and also bringing into the fold, the 3% of the employees who are concerned but are not taking initiatives. It is therefore clear that employee motivation is essential. General Analysis We learn from this analysis of the data obtained that there is a correlation between the mental state of the employee and the employer and the results of their work. In attempting to analyze the hypothesis, we have excluded employees who are new or have been working for less than three years. To avoid bias we have picked the companies which have been doing fairly well for the last 3 years and we have chosen employees who have worked for not less than 7 years in the concerns. We are able to establish the following results although each of the results could not be documented in this paper, generally we have on analysis of the questionnaire and the result of the interaction of the investigator found the following facts to be true in the case of employers, employees and concerns that have a better work culture: 1. We have to conclude that of the 10 employers 6 showed genuine concern for their employees and out of the 20 chosen employees the largest part of the sample that showed interest in the work and those who held key positions came from such companies. 2. We come to a conclusion that employees who are motivated to contribute to the organization tend to take their work more seriously and also aspire to learn and upgrade their skills. The questionnaire revealed that in the firms that showed more open and more freedom in the work had the greater number of employees who shared a common bond with the managers and hence took their work personally and found it fulfilling. 3. We also discover that there are two other types of employees one which forms a group which does not have any orientation to the work or do not care. It is impossible to therefore expect that such individuals can fit the concept under research. It is noted that they form a minority and this exception proves the rule. 4. The other half are employees whom the management can train with a little more care from the Employer feedback and matching it with the resultant employee feedback, we arrive at the following findings: Where the Company agreed that the welfare policies is a must ( 12) They also liked their boss (9) and felt that they are valuable (12) and have been striving to improve. In the similar cases there are employees who are willing to show more commitment but need to be led. The minority cannot be molded. Thus the position can be generalized as: a) In any organization there will be about 33% of employees who are committed to the organization (per average analysis) b) Sixty percent of the employees will flow along and have to be guided and the management will have to take steps to train and create interest and motivation in the work. c) About seven percent of the employees will tend to be on the wall and will not be concerned about the work or be interested. They are incorrigible elements. These findings have led the investigator to come to the following conclusions: Conclusion In the light of the above, it is possible to conclude that hypothesis correct. We have observed the data to show that concerned and motivating managers tend to get better output from the employee and the employee are of two types, those with inherent work loving attitude and those who need to be trained to love the work and then those utterly indifferent. Unfortunately the second and third categories will require long sessions of motivational training and conditioning. Rewards, recognition of the contribution of employees, treats, fun outings and perks can to a great extend succeed in converting the employees of the second order to the first fold. Additional responsibility and participation in policy making will keep the performing ones happy. Therefore we conclude that employee happiness, training and participation is a vital part of management process. We therefore conclude that the more concern a management shows in retaining the good will of sincere employees who will at all time be as we have shown about 33% of their strength, and must find ways to identify and train with all promotional policies the other 60% of the employees to take more interest in their work. This can be achieved by forming study groups, work related clubs, and theme parties honoring their slightest achievements. The employees who are motivated to contribute to the organization on their own must be given more responsibility and quicker incentives and promotions as a reward, and at the same time the management must take pains identify the two other types of employees and form a strategy to keep the disinterested ones from spreading derision among the passive but not concerned 60 %. The management must either weed out the troublesome employees or try to convert the maximum employees by better programs in the long run. These findings have led the investigator to come to the conclusion that the hypothesis is correct and therefore any organizational success can be a possibility only with employee interest and Comittment. Therefore the managers must work on the passive employees and make them take more interest in promoting the mission and values of the concern. Reference 1. Coetzee,M.(2005)EmployeeCommitment.Available:http://upetd.up.ac.za/thesis/available/etd-04132005-130646/unrestricte...((www.emeraldinsight.com/Insight/View Context Servlet? 0760060401. html/Emerald Full Text Articles/Published=Filename) 2. Coetzee,M.(2005)EmployeeCommitment.Available:http://upetd.up.ac.za/thesis/available/etd-04132005-1 130646/unrestricte...http://en.wikipedia.org/wiki/Organizational_commitment#column-one.11.1... (www.emeraldinsight.com/Insight/View Context Servlet? 0760060401. html/Emerald Full Text Articles/Published=Filename) 3. Donna Deeprose (2006) How to Recognize & Reward Employees: 150 Ways to Inspire Peak Performance, Second Edition Publisher: Amacom 4. E. Bruce Colligan, (2003) Midst of Transformational Change http://en.wikipedia.org/wiki/Organizational_commitment#column-one.11.1...(www.emeraldinsight.com/Insight/View Context Servlet? 0760060401. html/Emerald Full Text Articles/Published=Filename) 5. Mary Kwak (2007) http://sloanreview.mit.edu/smr/issue/2001/summer/1a/ 6. Putterill M.S.; Rohrer T.C. (1995) A causal model of employee commitment in a manufacturing setting International Journal of Manpower, Volume 16, Number 5, 1995 , pp. 56-69(14) Emerald Group Publishing Limited, http://www.ingentaconnect.com/content/mcb/016/1995/00000016/00000005/art00005 7. Steven M. Sommer Organizational Commitment Across Cultures: The Impact of Antecedents on Korean Employees n Human Relations, Vol. 49, No. 7, 977-993 (1996) © 1996 The Tavistock Institute Read More