Employees are the assets of the company. This statement seems to be very attractive for the employees working for different organization. However, practical implementation of this statement is not as simple as the statement itself. Considering the employees an important factor and treating them like an asset is not very easy, but the most necessary factors for the growth and success of any organization. 21st century has brought several huge and dramatic changes in the business world all across the globe. The changing consumer behaviors and demands have forced the organization to focus on the customer’s satisfaction along with the product development and enhancement. Not long ago in the past century the organizations were more focused towards the production and little attention towards the customer’s satisfaction. Most part of the market was driven by the large organizations where they used to develop the products according the available technology and where the most profit was available. (Kreitner, 1995) Earning profit is still the primary focus of the organizations, but now the customer’s satisfaction is also gained consideration by the organizations. The concept of loyalty from the customers has given importance to the customer satisfaction as this is the only way to gain the loyalty. Gain customer’s loyalty is aimed to develop a long term profitable relationship with the customers as it is rightly said that it is very hard and costly to get a new customer than retaining the existing one. So, in order to retain the existing customers, organizations are focused to give quality products with quality support to them.
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Motivating the employees is closely related to the customer’s satisfaction. If the employee is not motivated and is not satisfied with the job he/she is performing then he will not be able to serve the customer with full devotion and honesty (Lindner, 1998). Customer’s satisfaction is very much dependent on customer services staff. The organizations which are involved in the service industry are very keen to focus on their customer services level by motivating their customer services staff as it directly affects the customer’s satisfaction level positively or negatively. In this context the retail industry of United Kingdome is very competitive and the most important parameter for success of the organizations is to maintain low turnover of the employees. Employee turnover always increases with the increased dissatisfaction among the employees. Organizations in UK retail industry have now recognized that the employees are the most important stakeholder in delivering the service to the customers. Meanwhile, the current economic conditions organizations are forced to drill down their operating costs and the employees are the first who usually have to face this negative impact in most organizations (Sparks, Leigh, Burt, Steve L., 2003). But the organizations also understand the fact the high employee turnover will not let them to sustain their competitive advantage and they will not be able to serve their customers affectively. Generally it has been observed that if the store managers are allowed to handle the grievances issues of the staff members it can reduce the employee turnover rate, but at the mean time organizations also have to assure that no discretion is done at the workplace on the part of the store managers (Lindner, 1998).
Employing over 470,000 people and operating in more than 29 countries, Tesco is the second largest retailer of the world and largest retailer of UK market. The company believes that you should treat the people in way in which you want to be treated (Colliers, 2009). The culture of the organization is developed in such a way that the managers shows very good gestures to their subordinates and do not show their illogical bossy attitude. A culture of team work, mutual coordination, respect, trust, supporting, listening to others and simple gestures such as saying thanks to each other is prevailing inside the organization (O’Reilly, 2009). This helps to develop a friendly and flexible work environment where the employees are free to express their views and respect each other whether on a lower or upper rank. Sharing experience and knowledge is encouraged in the company. Senior managers are encouraged to spend some time on the floor so that they can have a good coordination and understanding with the lower staff and also they can understand their problems or issues by experiencing themselves. Discrimination on the basis of racism, age, gender and other factors is highly discouraged in the organization and there are several strict company policies which totally discourage this act (Colliers, 2009).
1.2 Rational of the Study
In 1985, an internal communication study was conducted at Tesco and the results showed that the behavioral issues of employees with the customers are negatively affecting the efforts for the growth of the company in a highly competitive market. These results were not positive for the company’s growth, so management taken immediate steps to identify the causes of the negative behavior of the staff members in order to resolve their issues and problems (Sparks, Leigh, Burt, Steve L., 2003). Tesco took several steps to motivate the staff members especially who are associated with customer services and empowered the employees so that they are able to address the problems of the customers immediately and also removed lengthy procedures related to customer services. Staff members were empowered in such way that they were able to replace the products or reimburse on the spot without referring to the supervisor or manager. This helped to increase the satisfaction level of the customer and also to develop positivity in the company’s relationship with the customer. These changes brought very fruitful results for the company as the quality of services increased and also the satisfaction level of the customers also increased. Even today, the company has given a sense of “ownership” to its employees. For the short-term survival and long-term growth it is very important that proper HR practices should be prevailing within the company especially the HR practices that Tesco has been using within their organization would be very interesting to understand.
Apparently it seems that pay could be the major factor for enhancing the employee motivation, but this is not applicable in all the cases. Research studies shows that people are motivated with different factors such as rise in salary, recognition, rise in designation, extra vacations etc. This research study will be very important for the other retailer and even for the organizations involved in the service industry who are finding difficulties in motivating their employees. The outcome of this research study will definitely help the organizations to reduce the high employee turnover rate.
1.3 Research Aims and Objectives
Tesco’s customer services have been the role model for UK retail industry. This is because the company very intelligently motivates its employees which raise the customer’s satisfaction level. The knowledge on this subject is widely available, but is fragmented. This research study will allow identifying and understanding the human resource techniques used by the company for employee motivation. With an aim of understanding the contribution of the motivation level of employees towards the satisfaction level of the customers, following objectives of the study are set:
To review the existing literature on the techniques used by retail sector for employee motivation
To conduct a survey to gauge the motivation level of the employees
To conduct interviews from the store managers asking about the techniques used by them for employee motivation
To evaluate the contribution of employee motivation towards customer satisfaction
It has been very tough for the high street retailers to sustain in this competitive market and to maintain the reasonable profit margins. Due to economic recession and increasing competition in the market the profit margins are very much dependent on the customer base or market share of the company. Market share is very much dependent on customer’s satisfaction and it relates to the motivation level of the employees. However, the employers in the UK retail industry are having a very tough time in marinating their staff’s motivation level. This cannot be neglected as well because employees play a very important role at the shop floor. Studies suggests that motivated staff members stays for longer period of time with the organization and are better performers than the staff who are not motivated (Weener, 2006). Regardless of the capabilities, experience, knowledge and skills an employee who is not motivated will not deliver his/her best in to the job he is asked to do. In order to get the maximum output form the employees it is very important that they are kept motivated.
Due to poor economic conditions and less trading activities organizations in UK retail sector are also following cost cutting techniques and hence the employee motivation activities have dropped down. Retail sector has compromised and stared to believe that motivation activities are very much costly, but in actual it is not the case as low cost motivation activities can also boost up the morale and motivation level of the team at higher side.
Employees leave their job when they become unhappy with their job and in the retail sector employee turnover even for the big brand names such as Tesco, has been increased and this is not a positive sign as high employee turnover increases the cost of the company. Companies are putting their brand reputation and customer’s satisfaction level at stake by not following the motivation activities in the organization. Employee become unhappy with his/her job if the career opportunities are not there, training programs are not followed and most common less pay. Career paths and growth are the way to make an employee feel that he is the part of the organization (Weener, 2006). This also helps to keep an employee focused as he/she knows that the efforts he/she is putting in to the job will not be wasted and will be accounted for his career growth. Retaining the employees has been the low priority of the organizations that are in the UK retail sector, which has to be focused in order to gain the customer satisfaction.
Several research studies reveal the fact the salary is not the only measure which keeps the employee motivated (Kreitner, 1995). There are many other factors involved such as recognitions, employer willingness to listen, behavior of coworkers, behavior of supervisors, workload, vocational policies etc. In this regard the behavior of the manager or concerned supervisor is very important as it has been observed that the managers who listens to their team members and respond to their queries affectively and promptly, they are much more motivated than the others. Employee involvement in daily routine decision and empowerment are some of the other factors which also help to increase the motivation level of the employees.
Many other options are available in literature and also are in practice by many renowned organizations, but is the fact that motivation cannot be enforced rather it can only come from within. Getting people to work is a very tactful thing and employee motivation is one of those tactics. Herzberg theory is one of them which suggest that understanding the employee’s attitude is the only way to increase their motivation level. His theory suggests that the key motivators are recognition, achievement, career advancement and the work itself (Sullivan, 1989).
Retailers such as Wal-Mart demonstrate that the people in the company make the difference in all that they did. This creates a spirit of teamwork and this only a few retail companies can boast of (Sullivan, 1989). The ability to motivate is a rare gift but effective in team building. Every company in the retail sector wishes to say that their people are friendly, enthusiastic, and loyal and have good work ethics. For effective team building, hiring and promoting the right people is necessary. It is not merely the experience and the educational background of the candidate that matters. He must have happy disposition and all the requirements have to be communicated to the candidate at the time of recruitment.
Performance appraisals influence the motivation level of employees. It is believed that bureaucracy still influences current attitude and the managers are not a homogenous group (Terpstra, 1979). Managers tend to rely more on third-party complains than on direct interrogation of the employee concerned. This needs investigation at Tesco to determine to what extent performance appraisals influence the motivation and attitude of the employees.
The above literature reveals the fact that in order to have a motivated staff the characteristics of both the employee and the employer are important. At the time of recruitment the manger should select the right person so that the process of motivation starts at the time of recruitment and not after. If the person is not selected for the right job then he/she will never be highly motivated by remaining on that job (Terpstra, 1979). The employees who have direct interaction with the customers at the shop floor should be motivated highly as their behavior will directly affect the customer. If an employee is motivated then he/she will treat the customer is a very good way by showing good gestures, by interacting with him nicely, by helping him making the decision from lot of choices available at shop floor etc. But if the employee is not motivated then he will not do any of the above thing even if he is forced to do so he will perform it with bad heart and will not be able to impress the customer or may be do not treat the customer nicely which can have a devastating effect on the company’s reputation (Sullivan, 1989). Based on the literature review the research methodology for the research study will be designed.
3.1 Framework – Attitude Theory
This research study is related to the attitude of the employees towards their job in the case company. Job satisfaction is directly affected by the motivation level of the employees, so this study will use the attitude theory as the framework of research (Gitlin, 1998). Following the attitude theory will allow to identify that how the employee’s attitude reflects when managers try to motivate him/her by using different techniques (Yin, 2003). This will also help to identify that how employees respond to the customers with different level of motivation. This research study will reveal that how the Tesco’s motivation strategies have influenced on the attitudes the employees and what affect it has made on customer’s satisfaction. A wide range of journals and articles contains several journals and articles related to motivation and employee satisfaction as well as customer satisfaction. Different search engines such as Google, AltaVista and Yahoo will be used to search widely available literature on the relevant topic. Reliable sources will be used to collect data that will assure the reliability of the information.
3.2 Research Approach
Research approach refers to the methods of research that the researcher adapts during his/her research. There are many research methods available but most widely used are qualitative and quantitative research methods. Both research methods carry their own importance and have several advantages as well as disadvantages (Yin, 2003). Many renowned researchers suggest that the mix of both he research methods should be used in order to have useful research results. This research study is aimed to collect the data regarding the Tesco’s strategies to motivate their employees so the inductive or the qualitative method of research is chosen. Under this method data will be collected by using different instruments from different stakeholders such as customer, employees, and managers.
Under qualitative research methods a case study approach will be adapted by focusing on the strategies of one case company. For this purpose Tesco has been selected as case company and its human resource strategies regarding motivation of the employees will be evaluated. A case study approach is ideal as it provides holistic, in-depth investigation. Data will be collected from different stakeholders by using different instruments. Different viewpoints of different personnel will be compared in order to verify the authenticity of different version of data. Case studies permit empirical investigations which is essential for this study. Detailed knowledge about a particular case can be collected.
3.3 Data collection
For research study data collection is very important part as in this it should be made sure that accurate data is collected form the relevant sources otherwise the results of the research study will be useless. There are two types of data i.e. Primary Data and Secondary Data. Primary data refers to that data which is the base line of the research study (Saunders, M., Lewis, P. & Thornhill, A., 2006). The results of the research study are extracted from the analysis and evaluation of the primary data. On the other hand the secondary data is the supporting data which gives a review of the existing studies and relevant theories to support the research results extracted from primary data.
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For this research study research data will be collected from different techniques and using different instruments. Survey questionnaires will be distributed to the staff members working at Tesco stores. Data collected from these questionnaires will reveal different factors such as satisfaction level from pay, from supervisor’s attitude, company policies etc. and that will ultimately help to find out the motivation level of these employees. Some interviews will also be taken from these staff members in order to cover those employees who are unable to express their feelings through survey questionnaire. At different days of the week some customers of Tesco will also be approached at different stores and those will be interviewed in order to understand their satisfaction level form the services of the company.
Thirdly, the managers would be interviewed to determine how they try to change the attitude of the employees and motivate them. It is important to investigate what Tesco has been using while recruitment of new people at their stores. This requires interviews of the managers as well as the staff. They would be questioned on their approach, on the training and career growth, on the group cohesiveness, their efforts towards team development, their approach in the recruitment process and their overall motivation strategy. Data thus collected from three different groups through four mechanisms would help to gain an insight on how different categories of people function.
Summarizing the above discussion, the data will be collected as follows:
Staff Members – Using questionnaires and interviewing the focus group
Customers of Tesco – Short interviews during the shopping at shop floor
Store Managers – Detailed individual interviews
Efforts would be put in in order to extract the required information i.e. the morale level of the employees and how they feel about their employer. Questions apart from job satisfaction and motivation such as mutual trust and respect would also be asked from the employees of the company. These questions will try to cover all the possible aspects which can affect the motivation level of the employees directly or indirectly.
Sampling for the collection of primary data will not be followed and questionnaires will be distributed among the staff members of Tesco as much as possible. It is because to collect the maximum questionnaires filled so that the research result may come more accurate and authentic. For the purpose of interviews at least 3 people will be chosen. These respondents may increase depending on the availability and access to the concerned store managers/supervisors.
For the evaluation the customer’s satisfaction level the interviews will be conducted form customers as well. This will be done randomly as in different holidays, special occasions such as Christmas. For this purpose at least three random customers will be interviewed and will be asked several questions which will also include open ended and close ended questions. These interviews will help to find the attitude of the supervisors, staff members and even the managers of the Tesco store form the customers on different occasions.
3.5 Data analysis
For sorting out the relevant data form the wide literature review, data reduction procedures will be used and to the analysis of the empirical data which would be collected from the interviews and surveys will be done through software i.e. SPSS.
On the topic motivation for the employees and customer satisfaction a wide literature is available in the form of books, journals, publications, articles, peer reviews etc. and can easily be accessed from the libraries of form online resources. As far as the interviews and surveys are concerned, the respondents will be informed prior to the interviews and surveys. The purpose and the reason of the questions to be asked will be elaborated to all the respondents and there will be no video and audio recording of the interviews. Furthermore, the responses of the interviewees will be kept highly confidential. For the survey forms a drop box would be made available at different Tesco stores and the respondents will not have to write their names or other information which shows their identity. This will allow getting the fair and actual responses of the staff members. Prior permission and appointment for the interviews from the store respective managers and also the organization will be taken.
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