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Effect of Motivation on Employee Performance

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Chapter 1

INTRODUCTION

1.1 Background of the Study

In today's competitive world, employee is an important asset to every organisation. An organisation cannot progress without employees. However, the success of an organisation depends on how the management utilise their workers' capabilities in achieving organisation goals and objectives. Employees need to be inspired as well as motivated to perform well and perform efficiently. According to Smith (n.d.), employees who like where they work will help the company make more money. Sears conducted an 800-store survey that showed the impact of employee attitudes on the bottom line. When employee attitudes improved by 5%, customer satisfactionjumped 1.3%, consequently increasing revenue by one-half a percentage point. Seeking ways to motivate and build worker morale pays dividends to any business or organization. The motivated worker is more committed to the job and to the customer. This shows that happy employees performed well which increases the quality and quantity of their work.

Long time ago, employees were considered as merely an input to the production of good and services. However as time goes by, this way of thinking has changed as many studies has been done on the employees' behaviour and job performance. An employee's performance may affect the production of the company, from the quality to the quantity of the products and services. This is why the management must identify the factors affecting their worker's performance. A high performance workforce is the most important foundation for organisation's success no matter how big or how small the organisation is.

Job performance is the ability and skill that an employee possesses in performing the job required by the employer. The level of performance by the employee is going to affect the organisation's goal and productivity. Besides, employees' performance may also be affected by the management of the company, the job itself or even the employee's own behaviour. Good job performance provides great achievement to the organisation, harmony in the workplace and also employees' self-accomplishment. Thus, to have a good workforce and good employee performance, organisation must firstly identify and understand the factors which affect the employees' job performance in achieving company's goal.

1.2 Research Problem

For centuries, individuals have questioned and performed research on the factors affecting employees' job performance and yet the answers may vary from one another. Some researcher said that employees' performance is influenced by their pay and some said they are not. Employees are an organisation's important asset which is why good performance by the employees is essential in producing good job quality and productivity. Employees are the ones who are running the organisation on behalf of the company. They have the responsibilities to perform well for the company in order to achieve organisation goal and compete with other organisations in the same industry.

Employees are the one who plan, manage, organise and run the business activities of an organisation. This means that poor employees' job performance may reduce the quality of services and productivity which will eventually slow down the operation of the organisation and lead to wastage of resources such as money and time. Organisations may find ways to solve the problem by terminating poorly performed employees or even choose to ignore it which may lead to unsuccessful business or bankruptcy. By choosing to terminate underperformed employee could not solve the problem as time is needed to hire new employee and extra cost will be incurred for training new employee.

Management should find ways that inspires their workers to perform well in order to achieve organisation's goal and in order to fully utilise their resources. Management believes that by paying employees more (increase of wages), employees will tend to perform better. Perhaps it might be true according to some researcher. However, there are also recent studies that have shown that employees' motivations are not solely affected by pay. Thus, this research is carried out to investigate the factors that affect employees' performance. This research will attempt to evaluate the effect of four variables which are motivation, job commitment, job design and work environment.

1.3 Research Objectives

The reason for this research is:

  1. To investigate if motivation has the significant affect on employees' job performance.
  2. To investigate if job commitment has the significant affect on employees' job performance.
  3. To investigate if job design has the significant affect on employees' job performance.
  4. To investigate if work environment has the significant affect on employees' job performance. Job design is techniques that are use in the job design exercise are such as job enlargement, job enrichment, job rotation and job simplification.

The work environment or working place which an employee performs in, can affect his or her performance. Work environment can be divided into two categories which are physical environment and social environment. The physical environment includes safe working place with ample resources and equipment such as comfortable chair, lighting and etc whereas the social environment includes people that the employees are working with in the organisation such as working colleagues or subordinates, supervisors and etc.

1.4 Scope of the Study

This empirical study consists of dependent and independent variables. The dependent variable is employees' job performance whereas the independent variables consist of factors that affect employees' job performance such as motivation (pay, benefits, rewards, etc), job commitment, job design and work environment. The population for this study take into account the employees working in the manufacturing companies in Penang and is randomly selected by using convenience sampling method. Questionnaires will be distributed to 150 employees. Questionnaires will then be collected back and data will be analysed using the regression testing that is use to test the effects of the independent variables onto the dependent variables.

1.5 Significance of Study

It is definite that every organisation no matter how big or small in size the company is in the whole wide world needs people or employees to operate and manage their company. The significance of this study is to investigate the four factors' relationship with employees' job performance, as employees' job performance is important in producing good job quality and maximum productivity. This study is also essential to find out the influences of the four factors to the organisations.

An organisation is considered dead and cannot operate without workers. Well performed employees may lead the organisation to success and earn competitive advantage over competitors while poor performed employees may lead company to failure and even bankruptcy. Besides poorly performed workers causes insufficiency in productivity which indirectly waste company resources. It might also cause company to be defeated by its rival. Therefore this study will help managers and employees to understand better the problem affecting their performance and reduce the negative effects to the company.

Chapter 2

LITERATURE RREVIEW

2.1 Introduction

These days, the business world is becoming more challenging than ever. This increases the management's awareness that good job performance is the key success to the organisation. To have well-performed employees, various ways or techniques should be conducted to manipulate human's nature and needs to produce desired behaviours and well performance. For that reason, the first thing the management should do is to understand human (employees') needs and wants.

Employee job performance is the ability of employees to perform effectively in their job required and they need to have understanding of complete and up-to-date job description for their position. Besides that, they also need to be aware of the job performance requirements and standard that they are expected to meet. Supervisors or the management of the organisation should then review their employees' job description and performance requirements. Job performance can be reviewed in terms of overall efficiency in the job or in terms of specific components that the job compromises. The purpose of performance standards is to communicate expectations. Some supervisors prefer to make them as specific as possible, and some prefer to use them as talking points with the specificity defined in the discussion (University Human Resource Services, 2005).

In general employees and supervisors use the performance assessment annually to sum up an overall review of how the job has been done over the previous 12 months, to identify whether organisational goals have been met, to identify areas which require additional efforts, and lastly to identify the achievement and development goals for the forthcoming year. Performance reviews typically take place annually, but can be scheduled more frequently. Performance review processes vary depending on whether your appointment is as classified or professional staff. For classified staff covered by a labour contract, the contract establishes the performance review process requirements (University of Washington, 2007).

People who are joining the workplace today are not only looking for jobs that earn money, but are also looking for more opportunities such as self-development. They are willing to put more effort on their job when their own needs, goals, expectation and desires are met. For that reason, the management of the organisation have to find out the factors affecting the employees' performance and come up with techniques to improve employees' job performance. Management must also make sure that employees' goals are in line with organisation's objectives. As the world become more competitive, organisations around the world are also alerted by the need to compete effectively against each other. In order to do so, organisations need to prepare themselves by making sure the people in their organisation are able to perform well and compete competently. Job performance will be the key success for organisation as it enables employees to work at their best and maximize their contribution to the organisation.

2.2 History of Research on Job Performance

According to Hersen (2004), “job performance is a complex, multidimensional construct that can be defined and assessed in varying ways. Job performance can be defined (and assessed) in terms of quantifiable outcomes of work behaviours (e.g., amount of sales measured in dollars, productivity level, number of academic journal publications, number of lines of computer code written) and in terms of behavioural dimensions (work-related communication, decision making, attention to detail) that are less quantifiable”.

Employees' job performance also stands for the level ability of every employee to work efficiently (in terms of quantity and quality) in their job as required or expected by their employers. The employee's job performance is then evaluated by the employer, supervisors or the people in charge. The job performance can be evaluated in terms of effectiveness all together in the job and in terms of particular components that the job compromises. The employees' performances will show the personalities, knowledge and experiences of themselves. Each employee's performance level is different as each individual has different capability and behaviour. Employee's poor level of performance may be affected by many factors which include motivation, job commitment, job design and the work environment of the organisation.

Historically, many researchers have attempted to study the factors affecting job performance but it is not as simple as one may think and the answer may vary from one another. Buchanan (n.d.), who has done a study on the relation of job satisfaction and performance, pointed out in her study that “the relationship between job satisfaction and performance is an issue of continuing debate and controversy. One view, associated with the early human relation's approach, is that satisfaction leads to performance. An alternative view is that performance leads to satisfaction”.

She also mentioned that many researchers tend to relate job satisfaction and job performance in a specific fashion, which is a happy worker, is a good worker. Job satisfaction is defined as "the extent to which people like (satisfaction) or dislike (dissatisfaction) their jobs" (Spector, 1997). This definition suggests job satisfaction is a general or global affective reaction that individuals hold about their job (Williams, 2004). Job satisfaction is usually linked with motivation, but the nature of this relationship is not clear. Satisfaction is not the same as motivation.

Several numbers of studies has found that there is only a limited amount of relationship between employees' satisfaction and their job performance. For example, it was found by Brayfield and Crockett (1955) that there is only a minimal relationship between job performance and job satisfaction (Judge et al., 2001). The increased of job satisfaction does not necessarily mean increased of employees' job performance. If the goals of the organisation are not aligned with the goals of employees, then employees are not effectively working towards the mission of the organisation.

Therefore, Buchanan concluded in her study that each employee's performance is normally determined by motivation, ability, and the work environment. The motivation factor is the desire of the employee to do the job; ability is the capability of the employee to do the job and lastly the work environment which is the tools, materials and information that is needed by the employee to do the job required.

2.3 Past Research on Motivation Affecting Job Performance

In the past, employees' job performance are traditionally been looked at in terms of ‘motivation'. Many researchers have come out with a conclusion that employees' levels of performance are influenced by the motivation factor. Examples of researchers are like Maslow (1954), who developed ‘the hierarchy of needs' or Hezberg (1966), who developed the idea of ‘hygiene factors', such as pay and conditions which, if not ‘right' in the eyes of the employee, act as de-motivators. There is also the work of McClelland who argued that people struggled to fulfil needs of power or influence and social interaction, amongst others. All these ideas have uses in the management of the poor performer. Sometimes, however; they seem to be too complex to use on a day-to-day basis and are more suited to giving the manager a theoretical understanding rather than a useful tool (Proud, n.d.).

From the theory of motivation such as Maslow's hierarchy of needs,modern leaders, executive managers or supervisors findmeans of motivation for the purposesof employees' performance and workforce management. Motivation is always view as an important issue in the business world. This is because motivation is vital in every organisation as it will affect the productivity of the organisation. When the employees in an organisation are unmotivated, the productivity of that organisation will be decreased whereas compared to an organisation which have motivated employees the labour turnover will be lower and production will be higher.

According to Dev (n.d.), “A Gallup organisation study indicated that companies with positive employee attitudes are 50 percent more likely to achieve customer loyalty, and 44 percent more likely to achieve above-average profits. Additionally, the study finds firms that measure in the top quartile with regard to employee engagement averaged 24 percent higher profitability, 29 percent greater revenue and 10 percent less employee turnover than businesses in the bottom quartile. The evidence is clear. Better people management practices produce better business results.”

According to Bartol & Martin (1998), “motivation is defined as the force that energises behaviour, gives direction to behaviour, and underlies the tendency to persist. This definition recognises that in order to achieve goals, individual must be sufficiently stimulated and energetic , must have a clear focus on what is to be achieved, and must be willing to commit their energy for a long enough period of time to realise their aim”.

Thus, motivated behaviours are performed and controlled voluntarily by the employees themselves whereas supervisors or managers only act as the motivator to encourage employees to increase their level of job performance. Many people who are not motivated keep their performance to an acceptable level by expending only 20% to 30% of their ability whereas managers who know how to motivate their employees can achieve 80% to 90% ability levels and consequently higher levels of performance (Geoff, n.d.).

Motivation comes in many different forms. It can be in a simple form like praise by the supervisors or managers, in the form of monetary (increase in pay), rewards, promotion, job security and etc. These factors are important because it will affect the employees' level of job performance. Hence it is truly essential that managers and supervisors of an organisation knows how to motivate its employees in performing well and achieving organisation goals.

According to Wagner (n.d.), “Abraham Maslow first introduced his concept of a hierarchy of needs in his 1943 paper, ‘A Theory of Human Motivation'. This hierarchy suggests that people are motivated to fulfil basic needs before moving on to other needs”. Maslow's hierarchy of needs is most often displayed as a pyramid, with lowest levels of the pyramid made up of the most basic needs and more complex needs are at the top of the pyramid. The basis of Maslow's theory is that human beings are motivated by unsatisfied needs, and that certain lower needs need to be satisfied before higher needs can be satisfied. A satisfied need is not a motivator as the most influential employee need is the one that has not been satisfied.

From the Maslow's hierarchy of needs, management should understand and identify what their employees need and then satisfy them from the lowest to the highest level. Physiological needs are needs which are at the bottom of the pyramid, are the most essential needs to human living. In the workforce, organisation helps employees to satisfy their needs by giving them basic salary.

Safety needs are security needs that include the needs for shelter from the environment and health insurance. In the organization context, employees express their security needs as a desire for job security with fringe benefits. The management should provide employees with safe working environment with ample tools and resources. These will be the factor that helps employees to perform well.

Social needs are needs related to the need for friendship, love and sense of belonging. At the workplace, these needs include having good relationship with colleagues, superiors or etc. When employees enjoy working closely with each other, it may result in positive behaviour at work which will also result in better employee performances. The management can also help to satisfy employees' social needs by showing direct concern for them.

Esteem needs are the needs of self-respect, respect or recognition from others and a sense of personal achievement. When these needs are satisfied, the person feels self-confident and valuable as a person in the world (Simons et al., 1987). In the organisation, the management can fulfil employees' esteem needs by showing their appreciation through promotion, rewards, recognition and etc.

Self-actualisation needs are place at the highest level of the pyramid. These needs are associated to personal growth, self-fulfilment and the realisation of one's full potential. In this stage, the management can help the employees by giving them tasks that challenges their own intelligence. All the elements in the Maslow's hierarchy of needs are the motivator for employees to perform well in their job. A motivated employee is usually someone with clearly defined goals who takes action which he or she expects to achieve. Besides that, motivated employees will be likely to put in more effort towards the organisation objectives and goals.

A leader that recognises employee efforts and helps employees achieve and grow can help improve motivation which therefore increases job performance. According to Hong et al. (1995), Vroom maintained in his expectation theory that everyone works in expectation of some rewards (both spiritual and material), and welfare is one of them. In other words, the degree of reward influences the quality and quantity of work, and in turn productivity. So it is important for management to explore how to give the stimulus (welfare) in order to promote work motivation and performance.

Image. Relationship between the type of employee benefit and impact on job performance

However, there are some researchers that found out that motivation has limited relationship with employees' job performance. They do not believe that money (salary and bonuses) is a good motivator. McNamara (n.d.), who did a research on employee motivation, said that “certain things like money, a nice office and job security can help people from becoming less motivated, but they usually don't help people to become more motivated. A key goal for the company is to understand the motivations of each of their employees”.

Another researcher, Urichuck (n.d.), stated that “organisations could provide employee motivation through a bonus in the form of money at the end of a period. For sure they will be glad and grateful. They may even perform better, but what are their expectations at the end of the next period will be more money. External employee motivation is temporary and it is never lasting. Money is an external employee motivator. It's an incentive that once acquired, leads to expectations for more, bigger or better. Nevertheless the employees will not even realise that the company is facing a crisis. They will want a bonus at least equal to what they got last year, but preferably more, not less”.

According to him, there is a survey on thousands of workers around the world that uses compared rankings by supervisors and employees on employee motivating factors. The typical supervisory group ranked the factors in the following order; high wages, job security, promotion in the organisation, good working conditions, interesting work, personal loyalty of supervisor, tactful discipline, full appreciation of work done, help on personal problems, and feeling of being in on things. However, when employees were given the same exercise and asked what affects their morale and employee motivation the most, their answers followed this pattern; full appreciation of work done, feeling of being in on things, help on personal problems, job security, high wages, interesting work, promotion in the organization, personal loyalty of supervisor, good working conditions, and tactful discipline.

Note that the top three employee motivating factors marked by the employees are the last three felt to be important for them by their supervisors (Urichuck, n.d.). As a result, this research shows that motivation through the form of money, has limited amount of relationship with employees' job performance while recognition is the most influential motivator that affects employees' job performance.

2.4 Past Research on Job Commitment Affecting Job Performance

Job commitment is the willingness of the employee's to be devoted in completing the job assigned to them at minimum level of commitment or exceeding the amount that is required. The level of employee commitment to their job is often the key determinant of whether the employee performs as expected or exceeding the expectations. The level of employee commitment may affect employees' job performance. Committed employees often performed well and results in company's success and increase of productivity level. Besides job commitment includes the level of employee involvement and employee loyalty to the organisation.

Simpson (n.d.), who did a research on building employee commitment for business success, stated that “the indication of lack of employee commitment could be an indication of a company on the way to becoming another business failure. The workplace is changing dramatically and demands for the highest quality of product and service is increasing. To remain competitive in the face of these pressures, employee commitment is crucial. The two keys to success in today's environment of increasing competition and rapid change are an absolute passion for, and dedication to, excellence in customer service and the effective and enlightened management of our workforce. The employees' commitment will lead to achieving desired standards in customer service and high job performance. Without employee commitment, there can be no improvement in any area of business activity. In the absence of good management, employees will simply treat their work as a job; a 9am to 5pm routine without any desire to accomplish any more than is necessary to remain employed. It does not take many uncommitted employees to prevent a business from prospering and thereby ceding a big advantage to its competitors”.

Another researcher, Fink (1992), asserted that although there are many factors that affect employee's performance, the key factor of employee's performance is affected by employee's job commitment. He defines commitment as an attitude that develops from a process called identification, which occurs when one experiences something, someone, or some idea as an extension of oneself. While all research on commitment treats it only in terms of identification with organisation, that is, its goals, values, and mission, on the other hand, he focuses on three-dimensional concept including identification with the work itself and with co-workers. He is sure that these are equally important because they can have powerful effects upon employee performance. As basis of his research he makes an interactive model that proposes: good management practices result in an effective reward system and employee commitment, an effective reward system results in enhanced employee commitment and employee performance, and employee commitment results in enhanced employee performance.

As a result of his research in two companies, who has 418 and 430 employees, respectively, he found that there was significant correlation between employee performance ratings and commitment score in all categories, and also the correlation between performance and commitment for managers and operational employees grouped separately were significant in all categories. The higher the level of employee commitment to work; co-worker, and organisation, the higher the level of the performance will be.

Based on Sutanto‘s (1999) findings, instead of concluding that job commitment only has significant affect on job performance, he has found that “there is also a positive and significant relationship between commitment to supervisors and performance. He also stated that employees' commitment to supervisors have become a good predictor to performance rather than commitment to organisations”.

After conducting a larger project to all 1,803 members of May 1993 graduating class of large north-western university, Becker (1992), has found that commitment to supervisors was positively related to performance. “Further, internalization of supervisors' and organizations' values was associated with performance but identification with these foci (targets) was not. A number of theorists and researchers have begun to view employee commitment as having multiple foci and bases. Foci commitments are the individuals and group to whom an employee is attached”. Thus, in order to increase employees' performance, the study suggest that managers should focus on creating employees' commitment to supervisors rather than creating employees' commitment to the organisation.

On the other hand, Cohen's (1999) research supported the important status of job involvement as an antecedent to organisational commitment. Specifically, Cohen argued that those individuals with high levels of job involvement, which stem from positive experiences on-the-job (Witt, 1993), make attributions for these experiences to the organisation. Thus, having previously received benefits from the organisation and being obligated by the norm of reciprocity (Gouldner, 1960) to repay them, high job involvement employees feel compelled to reciprocate in some form. This increased affective commitment (i.e. where employees adopt the company's goals as their own and, therefore, desire to remain with the organisation to help it achieve its goals; Meyer and Allen, 1984; Mowday et al., 1979) and later was found to reduce turnover intentions, absence behaviour, and/or turnover, as well as increased job performance.

Tough many researchers have confirmed that employees' commitment result in high job performance, nevertheless some past researchers have also found that job commitment or involvement has limited affect on employees' job performance. According to Rotenberry and Moberg (2007), “research finding a significant impact of job involvement on employee performance has met limited success (e.g. Brown, 1996; Brown and Leigh, 1996; Diefendorff et al., 2006 and Vroom, 1962)”.

Diefendorff et al. (2002) stated that “research has been limited for two reasons. Specifically, they asserted that past studies had predominantly used inferior measures of job involvement, which led to their insignificant findings. In addition, Diefendorff et al. (2002) argued that the performance domain assessed in those previous studies needed to be expanded in order to ascertain job involvement's true impact on performance at work. The researchers tested the validity of these propositions, but called for additional research in the area paying particular attention to theory development regarding the job involvement-performance relationship”.

2.5 Past Research on Job Design Affecting Job Performance

Job design is the method of arranging various work elements in forming a job that suit the employees. Job design identifies what work must be performed to be precise, the content of the job, how it will be performed, where it is to be performed and the competencies required by the person who will perform it. Job design also facilitates the achievement of organizational goals and performance of the work the job was established to accomplish (Sharon, 1998). Job design is also important to avoid employees' dissatisfaction. The design of the job must follow the organisation's and employee's requirement including the health and safety requirement. Besides, job design implementation includes methods such as job enlargement, job rotation, job enrichment and job simplification.

The first, job enlargement, can be used to increase motivation by giving employee's more and varied tasks. Tasks that reduce the amount of specialization required by the employee, as well as, extending the length of time he or she has to complete them. The second, job rotation, allows an employee to work in different departments or jobs in an organization to gain better insight into operations. This, in itself, does not modify or redesigns the employee's job, but allows the opportunity to increase his/her skills and knowledge about other jobs. Job enrichment, the third method, allows the employee to take on some responsibilities normally delegated to management. The risk here is that the employee would be transferred too much responsibility and autonomy in the planning and control aspects of the job. Done right, however, the newfound control would invigorate the employee to work more effectively and thus increased its performance. Lastly, work simplification is the analysis of a job's most basic components to restructure or redesign them to make the job more efficient (Encarnación, n.d.).

In general, job design plays an important role in maximising employees' performance and productivity. The way the job is designed may influence employees' motivation to perform well. For example, an employee may feel bored from performing repetitive and mechanistic jobs and this may lead to decline of productivity level. In addition, inefficiency of productivity, absenteeism, decrease of sales and poor morale of employees are also indications of poor job design. These show that management needs to find various means of motivational elements in designing jobs that will increase employees' performance.

Throughout the exercise of job design, managers can indirectly influence their employees' job performance. Besides, well-designed jobs that matches employees' personalities can help the company to achieve its goals efficiently which can save time and cost. According to Erven (n.d.), “Job design starts with determining the duties, tasks and activities for each job. The process of determining the content of jobs is called job analysis. The content of jobs, job descriptions, hiring, orientation and training are all built on what is learned from job analysis. Job analysis requires efficient collection of data about existing jobs and needs that new jobs are to address. Managers have the responsibility of designing jobs. If they ignore this responsibility, employees will design their own jobs. Not surprisingly, the jobs designed by employees are more likely to be attuned to employee experiences and preferences than to the goals of the business”.

Some researchers have proposed in their study that job design has a significant effect on employee performance. According to Garg and Rastogi (2006), “In the present paper, it is proposed that a well-defined job would enhance motivation, satisfaction and performance of the employees. Thus, job design takes on special importance in today's human resource management. It is essential to design jobs so that stress can be reduced, motivation can be enhanced, and satisfaction of employees and their performance can be improved so that organisations can effectively compete in the global marketplace”. Employees will also be thankful and prone to appreciate their management's effort in designing jobs that suits them besides providing them the opportunity to perform well in their jobs. They will see these as the benefits for them to achieve self and organization's goal.

Employees' job performance can be improved when their job provides them opportunity to make their own decision about how and when to carry out certain tasks. Furthermore, job design takes into account reasonable performance measurement that enables employees to evaluate themselves which will eventually lead to better work results. According to Steers and Porter, a job design which incorporates meaningful feedback, ability utilization, and considerable autonomy results in the highest performance levels. Farris found that involvement in technical work, influence on work goals, and variety were significantly and positively related to measures of job performance over a two and one-half year longitudinal study. Hackman et al. determined that people working in relatively complex jobs were most apt to have high performance records. Many other researchers report that expanded job dimensions can raise performance levels (Anderson, 1984).

Nevertheless, some researchers have discovered that job design particularly job enrichment, has limited impact on employee performance. Job enrichment increases the level of employees' responsibilities by giving them additional authority, autonomy, and control over the way the job is done. Orpen (1979), who did an empirical study on the effect of job enrichment on employee performance, has gain several results and responses from the clerical employees in a federal agency.

Orpen has found that there is only little significant affect of job enrichment on job performance but job enrichment has cause significant increase on job satisfaction. First, the clerical employees were randomly separated to either an enriched or unenriched working condition. In the enriched condition, a systematic attempt was made to increase the extent to which the jobs of the employees possessed each of the dimensions of skill variety, task identity, task significance, autonomy, and feedback. In the unenriched condition, the employees performed their original duties and tasks. After a 6-month experimental period, the effect of enrichment was examined. The results showed that:

(1) Employees in the enriched condition perceived their jobs as more enriched than before;

(2) Job enrichment caused significant increases in employee job satisfaction, job involvement, and internal motivation;

(3) Job enrichment led to significant decreases in absenteeism and turnover; but

(4) Job enrichment had little impact on performance, whether assessed by superiors' ratings or by actual output.

These findings, which are described in terms of the Hackman-Oldham theory of job design, are regarded as suggestive evidence that enrichment can cause substantial improvements in employee attitudes, but that these benefits may not lead to greater productivity. It is argued that in order to explain the effect of enrichment on performance, it is necessary to consider other factors besides the psychological states produced by jobs which are seen to have certain characteristics.

2.6 Past Research on Work Environment Affecting Job Performance

Employees' performance can be affected by the workplace or work environment that they perform their jobs in. The impact of work environment may affect their ability to carry out the job they are required to complete and thus it will ultimately affect organisation's goals and productivity. The Workplace Health and Safety Act 1995 (2008), defines a workplace as any place where work is, or is to be, performed by a worker, or a person conducting a business or undertaking. This definition includes places commonly recognised as workplaces, such as shops, factories, construction sites, hospitals, farms, rural properties and in this study, manufacturing companies.

The work environment is divided into two parts, which are the physical environment and the social environment. Physical environment includes safe and comfortable working place with ample supporting equipments, resources and tools while social environment includes relationship with other people in the place of work (such as co-workers and supervisors). All these factors may influence employee's job performance. In order for employees to do well, the management must be able to provide to their needs to ensure the business is a success and in achieving company's goal.

2.6.1 Physical Environment

Everyone wants to feel good in the workplace in order to work effectively. The working condition of an organisation reflects much on how the employees would perform. Various disruptions in workflow, unsafe workplace as well as extra workload (which cause stress) may negatively pressure the employees and thus influence employees' performance. It is essential for the management of an organisation to provide comfortable and safe workplace with even temperature, good lighting to avoid eyestrain, ample technological tools such as computer, ergonomically designed furniture and office systems. Creating such a pleasant environment will have a positive effect on employees' state of mind as organisations which are lack of resources will cause unnecessary frustrations from employees. Discontented and stressed employees tend to perform poorly.

Study on the effects of work environment on employee job performance done by Manning (n.d.), shows that the work environment can have an impact on an individual's ability to work safely, competently and in compliance with operational performance targets. Manning says that it is important to attend to the work space availability (work station available to employees in the manufacturing area for carrying out inspection and documentation), light intensity (the amount and type of light for employees to carry out visual inspection activities), weather or temperature (the area which employees work in should not be too cold or too hot), ventilation or humidity (the work environment must not contain poor quality of air that could cause fatigue and reduction in performance), noise or vibration (the need to wear ear protection so that it will not affect an employee's performance and safety), odour, dust or other emissions (must be controlled and assessed to ensure employees' safety and health) and premises hygiene or welfare facilities (staff facilities, toilets, washrooms, canteens, coffee making facilities must be appropriate and maintained in a hygienic, clean and state).These fine physical surroundings have a great effect on the employees' psychological well-being which contribute to the increase of job performance.

A different researcher who has conducted a research on a theoretical model o f workspace stress has found out that the physical work environment has significant affect on job performance. Vischer (2007) stated that “One area of research that has begun to answer the question on what are the elements in the physical workspace that can be identified as affecting fit or misfit between a person and the environment at work is ergonomics. Initially developed for military and manufacturing processes, ergonomics researchers now apply their assessment tools to office furniture and equipment to protect workers from long-term muscular or nerve injury due to poor bodily positioning or muscle use. The ergonomic approach studies tools and equipment as well as workspace features as extensions of the human body. Those ergonomic features most frequently studied in workspace include lighting and day lighting, noise and noise control, and office furniture and spatial layouts in offices”.

Research indicates that these environmental factors have the greatest influence on workers' performance (Brill et al., 1985 and Vischer, 1989). Studies have tended to focus on the height and density of workstation partitions, the amount and accessibility of file and work storage, and furniture dimensions such as work surfaces as being these elements of furniture and spatial layout which have the most effect not only on the satisfaction of individual workers but on the performance of teams. One study indicated that the additional investment in ergonomic tables and chairs for workers yielded a 5-month payback in terms of increased productivity (Miles, 2000).

2.6.2 Social Environment

According to Reitz (1977), “the social environment of a workplace can affect the behaviour of the people in the organisation (such as supervisors, peer-group, and subordinates)”. It is important that the employees have positive relationship with their colleagues and supervisors as happy employees are likely to perform well in their job. The Gallup Management Journal (2006) has found out that supervisors and co-workers play a crucial role in worker's performance. The GMJ surveyed U.S. employees to probe their perceptions of how happiness and well-being in the organisation affect their job performance.

Gallup researchers examined employee responses to see which factors differed most strongly among engaged employees (27% of respondents) and those who were not engaged (59%) or actively disengaged (14%). Engaged employees are the ones that work with passion and feel a profound connection to their company. They drive innovation and move organisation forward. Not-engaged employees are essentially “checked out”. They are sleepwalking through their workday, putting time, but not energy or passion into their work. The actively disengaged employees are not just unhappy at work, but they are also busy acting out their unhappiness. Everyday, these workers undermine what their engaged co-workers accomplish.

When respondents were asked to respond to the statement "My supervisor focuses on my strengths or positive characteristics," 77% of engaged workers strongly agreed with the statement. Just 23% of not-engaged and a scant 4% of actively disengaged workers strongly agreed that their supervisor focused on their strengths or positive characteristics. Interestingly, not one engaged worker disagreed with this statement. When survey respondents were asked how they would characterize their interactions with their co-workers, 86% of engaged employees said their interactions with co-workers were always positive or mostly positive. The findings for less engaged workers showed significantly different results: 72% of not-engaged workers characterized these interactions as always or mostly positive, compared to just 45% of actively disengaged workers. These findings indicate that a positive relationship with the supervisor and co-workers has an important effect on the employees' well-being as well as engagement and thus it affects the job performance of the employees. These findings also suggest that people with higher levels of job engagement enjoy substantially more positive interactions with their co-workers than do their less engaged counterparts.

Another study on the effect of work environment on job performance which is known as the Hawthorne studies, were conducted by Elton Mayo and other researchers (Roethlisberger and Dickson), where they examine the influence of environmental variable on a group of production workers. Elton Mayo was the founder of the Human Relations Movement and of Industrial Sociology. According to Franke and Kaul (1978), “individual behaviours may be altered because they know they are being studied was demonstrated in a research project (1927 - 1932) of the Hawthorne Plant of the Western Electric Company in Cicero, Illinois. This is called the Hawthorne Effect. The Hawthorne studies was started out by examining the physical and environmental influences of the workplace (e.g. brightness of lights, humidity) and later, moved into the psychological aspects (e.g. breaks, group pressure, working hours, managerial leadership). The ideas that this team developed about the social dynamics of groups in the work setting had lasting influence on the collection of data, labour-management relations, and informal interaction among factory employees.

The major finding of the study was that almost regardless of the experimental manipulation employed, the production of the workers seemed to improve. One reasonable conclusion is that the workers were pleased to receive attention from the researchers who expressed an interest in them. The second conclusion showed that the workers had developed good relationships among each other and had been allowed to set their own work patterns. The case of relationship had made for a much more pleasant working environment for the employees. This is the reason the social relationships between the workers and their employers are important to increase their job performance.

Mayo (1933) came to the following conclusions (on job performance) as a result of the Hawthorne studies:

* The aptitudes of individuals are imperfect predictors of job performance. Although they give some indication of the physical and mental potential of the individual, the amount produced is strongly influenced by social factors.

* Informal organization affects productivity. The Hawthorne researchers discovered a group life among the workers.

The studies also showed that the relations that supervisors develop with workers tend to influence the manner in which the workers carry out directives.

* Work-group norms affect productivity.

The Hawthorne researchers were not the first to recognize that work groups tend to arrive at norms of what is "a fair day's work," however, they provided the best systematic description and interpretation of this phenomenon.

* The workplace is a social system.

The Hawthorne researchers came to view the workplace as a social system made up of interdependent parts.

These showed that the performance of the employees is affected by the social environment where interaction among the workers and supervisors are essential. Enhanced performance by the employees depends on management sensitivity to, and manipulation of, the ‘human relations' of production.

2.7 Summary

Many relating studies on employees' job performance has been highlighted and presented in this chapter. The main purpose of this research was to examine the effects of both internal and external factors (motivation, job commitment, job design and work environment) on employees' performance. A number of theories such as Maslow's Hierarchy of Needs and Hawthorne Studies has also been use to support this study. Varieties of past studies that have been taken from journals, textbooks and internets have proven that indeed those pre-determined factors have influence on job performance while some researchers have also found out that there are limited amount of relationship, or no relationship between those factors and employees' job performance. Therefore, survey will be conducted to find the real result. Management must pay much attention on the factors that influence the employees' performance as sufficient attention on employees will lead to company's success.

2.8 Critique of Key Studies

Responses of respondents are unpredictable and may vary from one another as studies are done in different countries and involves different respondents from different culture. Some respondents might not be fully committed in the research and simply answer the survey questions. Result from the past research might be affected because of this.

Chapter 3

THEORETICAL FRAMEWORK AND

RESEARCH METHODOLOGY

3.0 Introduction

In this chapter, the methodology used to conduct this study will be presented. The discussions include the theoretical framework of the research, the variables and hypothesis statement, research approach, research design, data collection procedures and proposed questionnaires. This chapter also focuses on how the data collection will be undertaken in order to present findings in Chapter 4.

3.1 Theoretical Framework

This study is attempted to examine the pre-determined factors that affect the employees' job performance. As mentioned in the previous chapters, the independent variables considered are motivation, job design, job commitment and work environment whereas the dependent variable is employee job performance. The study will be conducted on employees who work in the manufacturing companies in Penang, Malaysia.

3.2 Statement of Hypothesis

Based on the relationships of the variables shown in the theoretical framework in figure 3.1, several hypotheses were developed and tested to complete the study. These hypotheses were based on known facts and are used as a basis for reasoning on further investigation on the study. The hypotheses derived from the research are as follow:

Set 1

H0: Motivation does not have a significant positive effect on employee job performance.

H1: Motivation has a significant positive effect on employee job performance.

Set 2

H0: Job commitment does not have a significant effect on employee job performance.

H1: Job commitment has a significant effect on employee job performance.

Set 3

H0: Job design does not have a significant effect on employee job performance.

H1: Job design has a significant effect on employee job performance.

Set 4

H0: Work environment does not have a significant positive effect on employee job performance.

H1: Work environment has a significant positive effect on employee job performance.

Table 3.1: Hypotheses Statements

3.3 Research Approach

This research is basically about the factors influencing the job performance of employees. Therefore the most appropriate research approach is by using the survey of questionnaires. This method was chosen as it was the easiest as well as the fastest way to gain respondent's feedback. It provides more privacy and comfort for the respondents which will lead them to be more willing to participate. Survey of questionnaires is one of the quantitative research methods which is use to obtain primary data. Primary data collected from employees in manufacturing industry in Penang will expose an in-depth truth relating to the research. Once the primary data has been collected, it must be analysed in a readable and understandable form so that it would not confuse people.

3.4 Research Design

3.4.1 Nature of Research

The nature of this research is to analyse the impact of the independent variables (motivation, job commitment, job design, and work environment) on the dependent variable (job performance).

3.4.2 Population and Sample

The population of this research is the employees working in the manufacturing industry in Penang. The respondents are to be focus on the lower and middle working group of employees. Companies where the employees work in are selected through convenient sampling method. Then a sample size of 150 respondents is selected randomly from employees who work in manufacturing companies in Penang and questionnaires are distributed to them.

3.4.3 Scale of Measurement

Section A of the questionnaire is designed to acquire information on personal demographic of the respondents. The demographic variables are measured by using nominal scale questions. For section B and section C, interval scale questions are used to indicate respondents' agreement or disagreement with a series of statement related to the variables studied using five point scales. The statements in these two sections are designed to test the attitudes ad thoughts of the respondents.

The rating scales are as below:

Strongly Disagree

= 1

Disagree

= 2

Neutral

= 3

Agree

= 4

Strongly Agree

= 5

3.4.4 The Structure of Questionnaire

The questionnaire is designed for the purpose of data gathering according to the variables studied. The set of questionnaires designed will only be close-ended questions. Questions in Section A were designed to gather information on the personal demographics of the employees such as age, gender, race, education level, income level, length of service and job position. In Section B, questions are designed to gather information regarding the dependent variable which is the employee job performance. Whereas Section C consist of questions related to the four independent variables, namely motivation, job commitment, job design, and work environment. Questions that will be created based on the variables are stated below:

Variable Name

Question Number

Variable Type

Job performance

Question 1-5

Dependent Variable

Motivation

Question 6-10

Independent Variable

Job Commitment

Question 11-15

Independent Variable

Job Design

Question 15-20

Independent Variable

Work Environment

Question 21-25

Independent Variable

Table 3.2: Table of Questions Number and Types of Questions

3.5 Administration of the Questionnaires

The questionnaires were administered by distributing it to the employees working in the manufacturing companies. A total number of 150 sets of questionnaires are distributed to them with the help of friends and family. The types of respondents differ in the sense of different age, race, gender, education background and job positions. The respondents are required to answer all the questions contained in the questionnaire.

3.6 Statistical Methods

Through the distribution of questionnaires to the respondents, raw data will be collected. These raw data (also known as primary data) are sorted and processed before it can be use as information to get the results needed for this research. To analyse the data collected, a statistical method will be used. This method is known as the regression analysis where the reading of R-square, T-test, and the reading of coefficient are used to test the research. The regression analysis is a statistic technique that is used to examine the effects of independent variables onto the dependent variable.

3.7 Summary

The research is done according to the theoretical framework where it shows the impact of the independent variables (motivation, job commitment, job design, and work environment) onto the dependent variable (job performance). All the variables were analysed using the survey of questionnaires distributed to the employees working in the manufacturing companies in Penang. Through the analysis of data, hypotheses were then tested to gain final results on this study.

Chapter 4

RESULT DISCUSSION AND CONCLUSION

4.0 Introduction

This chapter focuses on the results that are acquired through the statistical data analysis and discusses the results of this research as well as conclusion based on the findings. Regression analysis is used to test the proposed hypotheses model. In addition, the implication of these results, limitation of research and recommendation for future research are also discussed in this chapter.

4.1 Overview of Data Gathered

A total number of 150 questionnaires were distributed to the respondents who are randomly selected from the manufacturing companies in Penang. However, only 140 sets or 93% of the questionnaires are used in this study as 5% of the questionnaires were not returned while 2% of it was incomplete or spoilt. The details of the response rates are shown in the Table 4.1 below:

Distributed

Returned

Spoilt

Used or Analysis

150

143

3

140

100%

95%

2%

93%

Table 4.1: The Response Rate of the Employees in Manufacturing Companies.

Subsequently, testing methods such as regression analysis were used to analyse the data.

4.2 Data presentation

Frequency distributions were gained for all the demographic data or classification variables. The table 4.2 below summarizes all the demographic data of respondents, namely age, gender, race, level of education, job position, income level and number of years worked in current company.

Variables

Categories

Frequency

Percentage

(%)

Age

Less than 20 years

21 - 30 years

31 - 40 years

41 - 50 years

Above 51 years

21

42

52

17

8

15.0

30.0

37.1

12.1

5.7

Gender

Male

Female

79

61

56.4

43.6

Race

Chinese

Malay

Indian

Others

38

67

24

11

27.1

47.9

17.1

7.9

Level of Education

PMR / SRP / LCE

SPM / MCE

STPM / HSC

Diploma/Advanced Diploma

Degree

Master

42

61

13

9

11

4

30.0

43.6

9.3

6.4

7.9

2.9

Job Position

Operator / General Worker

Technician / Line Leader

Clerical

Supervisor / Manager

Engineer/Officer/Administrator

28

46

19

28

19

20.0

32.9

13.6

20.0

13.6

Income Level

Below RM1000

RM1001 - RM2000

RM2001 - RM3000

RM3001 and above

12

58

41

29

8.6

41.4

29.3

20.7

Number of Years Worked in Company

Less than 1 year

1 - 3 years

4 - 6 years

7 - 9 years

10 years and above

26

41

31

21

21

18.6

29.3

22.1

15.0

15.0

Table 4.2: Demographic profile of respondents (Sample Size, n=140)

It can been seen form the table that 15.0% of the respondents were less than 20 years old while 30.0% of them were aged between 21 to 30 years old. Majority of the respondents, 37.1%, were 31 years old to 40 years old whereas only 5.7% of respondents were above 51 years old. This is because most people around 50 and above are retiring and resting at home. Out of the 140 respondents, 56.4% of them were male and 43.6% were female. Most male work in the manufacturing company as technician whereas the females work as operator.

A mass number of employees in the manufacturing companies in Penang are Malays, which is shown in the table with the amount of 47.9%, followed by Chinese employees 27.1%, Indians 17.1% and lastly, other races with only 7.9%. For the education level, most of the respondents 43.6% were SPM graduates, 30% studies till PMR level or less, 9.3% were STPM holders, 6.4% studied Diploma or Advanced Diploma, 7.9% were degree holders and 2.9% have Master.

Most respondents with only SPM certification or lower level of studies worked as operator or general worker and line leader or technician in the manufacturing company. This is the reason that causes the job position of the respondents to be 32.9% technicians or line leaders and 20% of respondents were operators or general workers. 7% of the respondents were clerical, 20% were supervisor or manager and 13.6% were engineers, officers or administrator.

For the income level, 8.6% of respondents earned below RM1000, 41.4% earned between RM1001 to RM2000, 29.3% earned between RM2001 to RM3000 and lastly, 20.7% earned more than RM3001 per month. 18.6% of the total respondents worked for less than a year in their current company, 29.3% of them worked for as long as 1 year to 3 years, 22.1% of them worked for 4 years to 6 years, 15% of respondents worked for 7 years to 9 years and 15% also worked for 10 years and above. The overall frequency results can be seen in the Appendix.

4.3 Results of Regression Analysis

The regression analysis is a statistic technique that is used to examine the effects of several independent variables onto the dependent variable. Usually, researcher seeks to ascertain the causal effect of one variable upon another. For example the effects of a price increase upon demand, or the effect of changes in the money supply upon the inflation rate (Sykes, n.d.). The regression analysis was used in this research to investigate whether motivation, job design, job commitment, and work environment have significant effect on the job performance of the employees in manufacturing companies in Penang.

The result of this analysis will determine the results of the hypotheses developed in the previous chapter. The Table 4.3 shows the results of the regression analysis.

Variables

t

Sig.

Constant

5.995

0.000

X1 - Motivation

2.325

0.022

X2 - Job Commitment

1.407

0.162

X3 - Job Design

0.776

0.439

X4 - Work environment

2.282

0.024

y = 2.221 + 0.227x1 + 0.133x2 + 0.051x3 + 0.168x4

y = Job Performance

x1 = Motivation

x2 = Job Commitment

x3 = Job Design

x4 = Work Environment

R-square = 0.208

Table 4.3: Results of Regression Analysis - Dependent and Independent Variables

According to Layfield (2003), R-square is a mathematical term describing how much variation is being explained by the x. The R-square for this study is 0.208 which shows that motivation, job commitment, job design and work environment can explain 20.8% variations of the employees' job performance in the manufacturing companies in Penang. The R-square of this research is weak as the variables used are not significant to one a


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