Measuring the level of Employee Satisfaction

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Employee Satisfaction is the individual happiness that employees get from the fulfillment of their requirements and needs at work. The gratification of the employee can come from performing the work for which they have been employed for, from being treated fairly by employers or even just by having a friendly working environment and co-workers.

Blum and Naylor (1984), viewed employee satisfaction as being "the result of various attitudes the employee held towards his job towards related factors and towards life in general."

According to research made, (Anon 2006), the term employee satisfaction which is usually associated to being pleasure, comfort and happiness at work, is viewed from a different approach as "Fulfillment Satisfaction''. According to this article employee satisfaction, redefined as fulfillment satisfaction, is more than the traditional definition of an employee being comfortable with his work but instead is the combination of personal satisfaction of the employee as well as the satisfaction with groups around him, like for example satisfaction with the work, leadership and other relations.

DEFINITION OF MOTIVATION:

Motivation is a word that from the Latin word 'Movere', includes many other terms like, desires, wants, wishes, aims, goals, needs, drives, motives and incentives.

The motivational cycle consists mainly of needs, drives and incentives whereby needs are produced whenever people have a physiological or psychological imbalance and as a direction to ease the shortage in needs, drives are set up. As a result incentives are there, to ease needs and drives.

According to Westwood (1992:288), Motivation is an internal state experienced by the individual, while external factors including other people can also affect a person's motivational state. Motivation is developed within the individual and is unique to that individual.

In a motivational state, the individual experiences a desire, intention or pressure to act.

IMPORTANCE OF EMPLOYEE SATISFACTION:

One of the main importances for organizations to keep their employees' satisfied, is to enhance employee retention and reduce turnover. Retaining employees is important since it saves the organization from high financial cost which may be direct or indirect costs, prevents the organization from losing expertise and saves the organizational image. The cost of turnover, that is the percentage of employees leaving the organization and the cost of re-recruiting and providing training may be escaped if employees are satisfied. Moreover, the survival of certain companies depends highly on the critical skills of its employees, keeping them satisfied is elementary as if these types of employees leave, the time it will take to recruit and train new one, may lead the organization to suffer in the short term.

Secondly employees may be more motivated to work if they are being satisfied, as a result the organization may benefit from an increase in productivity where, employees may be more productive, reduce cost of production and the company may set better prices to customers. Moreover satisfied, competent and energized employees would be caring about the quality of the goods and services that they would be producing. Employees will produce and deliver greater value to customer thus leading to increase in customer satisfaction.

If customers are satisfied with products or services being offered to them this will enhance their satisfaction and loyalty towards the business. As a result satisfied employees may lead to satisfied customers and opportunities for the organization to expand or to increase sales if customers through indirect advertising, recommend other consumers to turn towards the organization for their purchase.

Finally employee satisfaction can also lead employees to be committed, more energetic and also improve their teamworking ability, which will enhance participation and involvement and provide employees with the satisfaction of playing a role in the work being done and they will also be able to share ideas and learn from their teamworkers.

INDICATORS OF EMPLOYEE SATISFACTION

Employees, often relate their satisfaction to characteristics like the work itself, the pay, promotion opportunities, supervision, and coworkers.

There are various indicators or criteria to evaluate the satisfaction of an employee, especially in the retail sector. The following criteria are used:

Job Satisfaction

Job satisfaction, not to be confused with employee satisfaction, can be described as being the result of employees' perception of how well their job is providing them with the many things that are important to them and opportunity to do interesting tasks, to learning and accept responsibility. Job satisfaction can be represented as being either an emotional response to a job situation or how well outcomes meet employees' set expectations.

Herzberg et al (1957) stated that the term job satisfaction is multidimensional and that "there can be satisfaction with the specific activities of the job; with the place and working conditions under which the job is performed or with other factors such as economic rewards, security or social prestige" (Topolosky 2000, p.14). Extensive research made by Turner and Lawrence (1965), revealed that other factors that can affect employees' satisfaction towards its work are; task variety, autonomy, feedback, identity and significance.

Pay, Compensation and Benefits

Wages and salaries are known to be a significant factor affecting satisfaction of employees not only in the retail sector but mostly in every sector. Money not only helps people to satisfy their basic needs but is also important in satisfying their upper-level needs. Most employees usually think that they are worth more than they get as revenue, as such the result of having a large gap between the amount they had expected and the amount they are getting, can lead to dissatisfaction and turnover. Locke (1969) stated that "satisfaction is determined by the simple difference between what the person wants and what he perceives he receives. The more his wants exceed what he receives, the greater his dissatisfaction", (as cited in Lawler, 1994, p.85).

Benefits are also important in this sector but not as influential as the monetary value, pay holds. This may be because employees do not really know what and how much they are receiving and the value of these benefits. According to research made by Henessey Jr. et al (1992), many studies showed that employees are unaware of the additional amount spent by employers in the contribution of benefits for them, one example may be that of the Hewitt associates (1985, Henessey Jr. et al 1992). Potential types of benefits in the retail sector might be medical insurance, vacation time, sick time and other benefits like part-time work, insurance or retirement benefits.

Studies made by Henessey Jr et al (1992) stated that organizations can use benefits as a defensive strategy against competitors and keep their level position from employees' point of view. Moreover according to Sutton (1985 and 1986), firms who provide higher level of insurance and retirement benefit have a lower rate of turnover.

Relationship with senior management

Employees especially in this sector do hold importance to the relationship they have with top management. Employees normally appreciate to be known by their employers, that the latter are aware of their personal work and performance, receive feedback, as these give them a greater sense of belonging to the organization. Since most people in this sector are normally at the lower level, they do not really get a chance to know or to communicate with the higher level, as such they cannot figure out clearly whether they are important to the organization or not and this in certain cases, these do affect their satisfaction.

Relationship with immediate superior

The relationship with immediate supervisors is one other important factor affecting employee satisfaction. In this field of retailing, there usually exists a middle level which is also referred as the supervisory level and acts as the intermediary level between the employees and senior management.

This level is very important as the supervisors are the one who act as leaders to the employees and can greatly affect their daily motivation and satisfaction. One way supervisors can affect employee satisfaction is through being employee focused that is by caring and taking into account the personal interest of the subordinates. This can be in the form like communicating with subordinates on personal basis as well as in an official way, asking about the health of the employee if the latter was ill or giving advice and support to the employee.

Another way by which supervisors affect an employee's satisfaction is by giving employees the chance to participate or influence in making decision about their own jobs. This participation concerning their own work usually is more important for employees, than participating in any other decision making.

Relationship with colleagues/co workers

Being in a team or a group with friendly, helpful and cooperative co-workers or team members is a humble source of satisfaction to individual employees. Members in a tight group are more likely to be those who will support, give comfort, advice and assistance whenever their team members require.

According to David Mc Clelland, an employee who has more friends and less enemies in a working team tend to be accepted by the other members of the group and has a greater sense of belonging and better satisfaction.

From recent research it has been stated that, where there is considerable interdependence among members of a group in order to do a job, there will be greater satisfaction and on the other hand if there is no good relations among the members of the group, the satisfaction of the members may be affected.

Promotions and Career development

There are different types of promotions and different types of rewards attached to them. For example getting the opportunity to climb the ladder and getting a higher position in the organization or having an increase in salary might be satisfying for some people and dissatisfying for others. Since in the recent years, organizations have been cutting down levels in their hierarchy and the accompanying empowerment strategies, employees in the retail tend to be more going for the type of promotion based on their performance, hours of work, overtime rather than being promoted based on experience.

THEORETICAL VIEWS OF EMPLOYEE SATISFACTION AND MOTIVATION

Employee satisfaction and work motivation are often considered to be the same thing. It should be noted that employee satisfaction is very distinctive from motivation, since employee satisfaction is concerned about employees' feelings towards their work and motivation is concerned with the behaviors employees tend to have in their work and which can positively or negatively affect their work.

Many theories of motivation however are used in explaining behaviors and partly in predicting what can be done to satisfy employees. According to Furnham (1992), employee satisfaction and motivation are often discussed side by side, since it is debatable that the degree to which an employee can be satisfied at work is due to the factors and situations that motivate him.

Some of the theories of motivation that are used for this report are namely; Maslow Hierarchy of Needs, Herzberg Two-Factor Theory, Equity Theory and Expectancy Theory

Maslow's Hierarchy of Needs

One of the theories that are mostly known is that of Maslow's theory hierarchy of needs. Maslow believed that normal people have five types of needs which can be set up in a hierarchical way. These needs are such in a way that those at the most bottom level must be satisfied before the next upper level can be met. Abraham Maslow believed that once a level is satisfied and it no longer motivates, the next higher level of need has to be activated in order for the person to be motivated.

Figure

Physiological needs found at the lowest part of the hierarchy, are those basic needs such as food, air, water, shelter and clothing that employees want to satisfy first. For employees to get motivated by higher level of needs, the basic needs have to be satisfied. This is possible when employers provide their employees with a salary that enable them to afford reasonable living conditions and meet their physiological needs.

After basic needs have been met, safety needs are activated whereby employees will seek safety both emotionally as well as physically. Types of safety that employees will consider to satisfy are, non-threatening, secure, predictable habitable environment.

The next upper level after safety needs have been satisfied, are the social needs which refers to individuals need to affiliate with other people, to be liked and accepted by colleagues and co-workers. People need to feel liked and integrated with their fellow friends at work.

The fourth level in the hierarchy is the need for self-esteem whereby employees' objective is to acquire respect and agreement of others. At this level, employees' ambitions are diverted towards achieving success, prestige and recognition by others who are at the same level. Types of employees expectations that would satisfy them at this level would be receiving awards, prizes etc.

At the self-actualization level, employees are at the highest of all their needs. At this level employees seek to self-fulfilled themselves, like working out to their full potential, their creativity and their desire to be one who is capable of doing anything. According to Furnham (1992), there are few jobs that actually have the scope of providing employees the opportunity to self-actualize.

Maslow separated the five levels of needs into two order level of needs. Physiological needs and safety needs are considered to be the lower-order needs and the social, self-esteem and self-actualization needs are considered to be of higher-order needs. The difference between the two types of needs is that lower-order needs are needs that can be satisfied by external factors whereas higher-order needs can be satisfied internally, by individuals.

Herzberg Two-Factor Theory

Herzberg et al (1959) came up with the theory that employees have two types of needs which are the hygiene and motivator needs. Individuals' hygiene needs also known as dissatisfiers which resemble Maslow's (1954) lower-order needs, are satisfied by external factors which are concerned with the environment of the job whereas the motivator needs also known as satisfiers relate more specifically to the job itself and its consequences.

In the retail context, hygiene needs can be for example the salary, the supervision, the relationship with coworkers, benefits, physical working conditions and examples of motivator needs can be employees' achievement, career advancement, responsibility or the work itself.

According to this theory, if the extrinsic factors that are required by hygiene needs, are favorable, satisfaction is not result but it is rather defined as a reduction or elimination in job dissatisfaction and motivator needs however when are met, can be said to lead to job satisfaction.

Equity Theory

The Equity theory developed by the psychologist J. Stacy Adams (1963), suggests that employees make social comparisons with others on the basis of their outputs and inputs as they perceive they are.

The inputs, in the context of employees in the retail sector are referred to the contribution of employees in their work, for example, the hours of work, their effort, their qualifications or ideas they brought in whereas outputs here refer to what workers believe they get out of their job like, pay, benefits or recognition.

This theory argues that employees will give good performance and get satisfaction where there will be equity in the ratio of their outputs and their inputs when compared to other employee's ratio.

According to research made by Chui (2000, cited Isen and Baron 1991), employees who supposed they were not being treated equitably as others, would normally express discontentment, frustration and anger.

Expectancy Theory

The expectancy theory from Vroom's is based on the three types of beliefs that employees have; namely, expectancy, instrumentality and valence. Expectancy is the belief that one's effort will give performance as result; instrumentality is the belief that the performance obtained will be rewarded and valence is the value that employees perceive, the rewards have.

It is considered that motivation is based on the multiplication of all of the three components; that is for example if performance and reward is high but the value of reward is low, this will result in low motivation. Thus for motivation to be high, expectancy, instrumentality and valence should be high.

Porter and Lawler expanded the expectancy theory by setting up a model. Porter and Lawler' model explained that the level of motivation of employees is not equal to their job performance but is rather another determinant that affects job performance.

Figure

According to this model, performance is a result of the combination of effort, clarity of what is expected and the skill required to do the job. The first expectancy in this model is that if an employee has the right perception of what needs to be done, has the skills, has the physical and mental abilities required and is enough motivated to exert the effort required, a good job performance can be expected.

The second expectancy here is that, given the job have been successfully accomplished rewards will follow. These rewards may be intrinsic such as job satisfaction or extrinsic like pay or recognition. However whether job performance will lead to intrinsic rewards depend on the job, whereas the relationship between extrinsic rewards and satisfaction will depend on the individual perceived equity.

RELATIONSHIP OF EMPLOYEE SATISFACTION AND CUSTOMER SATISFACTION

In the retail sector, service quality is gaining high importance and more and more organizations are concentrating on customer satisfaction and customer loyalty while less attention is given to employee satisfaction and commitment for employees that are directly connected to customer services, however it should be considered that according to studies made in the field of services, it has been shown that service quality is closely related to employee satisfaction (Cronin and Taylor, 1992; Oliver, 1993; Babakus et al., 2004).

Providing service of quality is considered to be a key strategy for success of companies in today's competitive environment (Parasuraman et al. 1985). According to Gronroos (1998), Service quality is usually defined as being the gap between the quality of service delivered by the organization and the expected service performance by employees. As per Zeithaml et al (1990), employee satisfaction is an imperative factor in determining service quality.

Eskildsen et al (2000) stated that various studies showed that satisfied employees are greatly motivated, have a better morale while doing their work and eventually perform more effectively and efficiently. According to research made by Reicher and Sasser (1990), it is stated that the greater the level of employee satisfaction, the greater the probability of getting customer satisfaction and the ability to withhold them.

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