Structural Investigation of the Relationship between Working Satisfaction and Employee Turnover

Transcription

1 Structural Investigation of the Relationship between Working Satisfaction and Employee Turnover Chen, Ying-Chang, Department of Hotel and Restaurant Management Ching Kuo Institute of Management and Health, Taiwan Wang,Wen Cheng, Department of Business Management, Hwa Hsia Institute of Technology, Taiwan Chu, Ying Chien, Department of Tourism and Leisure, National Penghu University, Taiwan ABSTRACT In this paper, researchers evaluate a model of working satisfaction in employee turnover, survey data were collected from 100 hotel employees in XinHua hotel. The article proposes human resource management features based on the analysis of the reasons for the brain drain in the hotel, policies accordingly. There were several main findings from our empirical analyses. (1) Providing career advancement opportunities is critical for retention. (2) A mentoring program can help decrease the employee turnover of the small- and- medium sized hotels. (3) High-quality communicating is valuable for hotel policy. (4) Pay and welfare also indicate significant position in Human Resource Management in the hospitality industry. The investigation of working satisfaction reflects the status of human resource in the hotels, through this, positive reactions can be made, and encouragement system can be adjusted, so that employees get more satisfaction, employee turnover is reduced and performance can be improved. Keywords: working satisfaction, hotel policy, employee turnover, XinHua hotel INTRODUCTION In face of an more and more competitive environment in the era of new knowledge economy, the role excellent employee play in an enterprise gains more weight and value than before and become the solution to a success of companies in today s hospitality industry. Employees in hotels are significant because they are mostly important to the development of the hotels; employees' attitudes and behaviors play a vital role in the quality of work. In this regard, employees are primarily responsible for providing a sustainable competitive advantage for the s hotels. Therefore, success in the hotels depends on managing and retaining employees. The hotels are generally more frequent flows of human resources. The hotels access to the human resources of high frequency compared to the other enterprises. The possibility of a brain drain in hotels is more than for other enterprises. At present, the hotels have become an important force in China's national economic development, but compared with larger enterprises, the overall weaker competitiveness of the hotels, particularly the employee turnover problem is more serious than other enterprises, to a certain extent; it has had a serious impact on the healthy and stable development of the hotels. Service quality in the hospitality industry is essential than manufacturing industry enterprises. The intensity of a larger work, in particular, some of the key positions in management and technical personnel to conduct regular is higher intensity of the work. If without remuneration or individuals development opportunities that they expected the outflow The Journal of Human Resource and Adult Learning Vol. 6, Num. 1, June

2 from the enterprise is easy. Because these people not only have the skills, but also management experience. They outflow from the enterprise, not only the commercial technological secrets away, but also customers being away. The hotels will suffer direct losses. It will increase the replacement human resource cost and affect the continuity and quality of the work, therefore also affect the stability of the serving staff. Thus, hotels managers should understand that the rational flow of talent is a basic characteristic of a market economy and does not fear the other talent flow. The key management personnel of the hotels should be intensifies efforts and incentive, avoiding wastage of human resources caused by excessive losses. LITERATURE REVIEW For decades, researcher and business people alike have realized that the first contact that employees have with an organization after being hired is crucial for their success in the workplace (Buchanan, 1974). The phenomena of employee turnover in the hotels are always being focused on by managers and the academics because employee s attitudes and behaviors play a vital role in the development of hotels. And this problem has many relationships with employees working satisfaction and corporation s encouragement. Locke (1969) point out the issue of employee satisfaction has been considered in numerous studies. Robbins and Coulter (1996) stated that employee satisfaction is an employee s general attitude towards his/her work, and when people speak of an employee s attitudes, they are likely to be referring to his/her employee satisfaction. The present study addresses working satisfaction from all organizational perspective. This research focus on how organizations can increase their workers' employability orientation, that is, their openness to adapt to changing work requirements through flexible and broader skills and a readiness to change tasks and jobs (Van Dam, 2004). Job satisfaction may arise from many different sources, including levels of role ambiguity, autonomy, quality of supervision, quality of social relationships, and level of support in the workplace. The satisfaction turnover relationship may also be moderated by other variables such as gender or mood. It is unclear how strong the job satisfaction turnover intention relationship should be given that it may depend on specific aspects of work in particular organizations, such as hotel or food and beverage industry (George & Jones, 1996). Working satisfaction can reduce absence and employee turnover, it also can reduce the rate of accidents. However, in the longer term, adverse effects such as loss of trained employees, unrealized productivity, and lowered morale often translate into lower financial gains than anticipated (Cascio, 2002). Van Dick et al. (2004) found evidence that organizational identification predicted turnover intention but the relationship was partially mediated by job satisfaction. Meyer and Allen (1997) suggest that the most variables include work experiences, socialization experiences, management practices, personal characteristics, and environmental conditions. These variables begin with work experiences, role states and psychological contracts, followed by affect, norm and cost related judgments. Pay can be a factor in decisions to stay or leave. Data suggest dissatisfaction with pay can be a key factor in turnovers. In the hotels, one of the most critical intangible costs is the loss of employee morale for those employees who choose to remain with the hotels. These results in the poor morale of employees who may be overworked, and can, in turn, affect the level of productivity efficiency. In this paper, researchers address this latter issue through empirical examination of the impact of turnover on operating performance. Employee turnover is particularly important in the hotels due to the high levels of productivity efficiency (Warren, 2002). 42 The Journal of Human Resource and Adult Learning Vol. 6, Num. 1, June 2010

3 Employee turnover in hotels has received substantial attention from both academics and managers. Much of this attention has been focused on understanding its causes. Implicit in this approach is the assumption that turnover is driven by certain identifiable characteristics of workers, tasks, firms, and markets, and that, by developing policies to address these characteristics, managers might reduce the occurrence of turnover in their respective organizations. Moreover, Van Vianen, Feij, Krausz, and Taris (2004) distinguished between two motives for turnover; push and pull. Push motives are related to dissatisfaction with one's current work situation, whereas pull refer to available opportunities to improve one's career opportunities on the external labor market. Nevertheless, the job satisfaction turnover relationship is not stable across different organizations, or that satisfaction may relate more closely to immediate or short term variables such as daily effort, rather than longer term variables such as turnover intention (Ajzen & Fishbein, 1977). The research may point out that there are some problems in the hotels in recent years on the employee turnover; generally speaking, employees leave the hotels for some common reasons, such as they are not satisfied with their positions of salary. Pavesic and Brymer (1990) confirmed dissatisfaction with income, mainly in relation to the number of hours worked, to be a primary reason for managers with hospitality administration degrees leaving the hospitality industry. Although the most significant reason is that they want to seize more space for position and trainings. There is unsuitable for the promotion and management system in hotels. Hotels have taken the employee satisfaction system in order to catch up with large scales. While hotels are not marketable enough to compete with other larger scales because of some systematically reasons. In this study, the XinHua hotel is very cooperative with us, and the management complies with our requirements. Therefore, this research is for the management of the hotel to find out the problems and to solve the problem. OBJECTIVES OF STUDY The purpose of this study is to undertake an empirical approach to investigate the potential relationship between the working satisfaction structure and the organization employee turnover. The primary objectives were defined as following: 1. To investigate what are the causes for the high employee turnover in the hotels. 2. To examine are what the consequences of the high employee turnover in hotels. 3. To study how the reduce turnover and increase employee retention in hotels. METHODOLOGY This research adopted a questionnaire approach by collecting data from current employees in XinHua hotel in Guangdong, China. The questions include items pertaining to the respondent s personal information (5 items), respondent s employee tenure in the company (2 items), respondent s opinion about employee loyalty (3 items) and employee satisfaction (1 item). Other questions asked the respondents to evaluate their level of importance of employee characteristics (12 items) and their perceived manifestation of these characteristics (11 items). To predict retention, respondents were also asked to indicate their level of satisfaction with their current supervisor, the effectiveness of company to remain good employee, their likelihood to find another job and their confidence. The last set of questions asked respondents to assess employment features that would cause dissatisfaction. The Journal of Human Resource and Adult Learning Vol. 6, Num. 1, June

4 The study introduces employee s working satisfaction and external, internal encouragement, private talking and questionnaire are carried through in the company XinHua hotel---male and female (100 respondents). The reason that employee turnover in the company is to be found based on the analysis of these investigation. Encouragement is managers key function, author gives some suggestions to the high layer managers in XinHua hotel---how to encourage people and hopefully the advice can be useful sometimes in other corporation also. The respondents of this research were employees of XinHua hotel. At that time of the study, approximately 100 of total employees worked in the small- and- medium sized enterprises. The questionnaires were distributed through managers of the small- and- medium sized enterprise. A total of 100questionnairs were distributed. The participants returned 40 questionnaires to yield a response rate of 40%. Before doing employee satisfaction investigation, two aspects should be taken into account: the XinHua hotel should be in a stable situation and everyone accepts that there will be an investigation. In the investigation it is not only important to know how the people feel about a specific aspect or if the score is high or low, but also how important the aspects is for them. The importance of an aspect for the people can be measured with two different methods: the direct method (asking with every question in the questionnaire how important this is for them) and the indirect method, which is a statistical method (correlation analysis) The employee satisfaction investigation consists of three phases as following: (1) Preparation. Many aspects have to be taken into account during preparation. To get valuable and reliable results, certain level of response is needed. One factor that influences the response is the anonymity. The anonymity of the employees must be guaranteed in the questionnaire. (2) Implementation. This phase consists of the way of distributing the questionnaires and the reporting of the results. Differences between the personal backgrounds and the organization and the result areas are made by analyzing the results to get more precise information. (3) Follow-up. After the results are analyzed you know how satisfied the employees are, the process of continually improving and changing begins. DATA ANALYSIS AND DISCUSSION The outcome of the statistical analysis of the questionnaire which is for further research of job satisfaction, and those data provide more detail information of some reasons and facts of employee turnover. By analyzing those aspects and reasons, this part will connect the facts with the academic theory before-mentioned and find out the practical actions for XinHua hotel on this problem. By analyzing those factors of impact on job satisfaction, it will show to the hotel that the management should treat employees with different methods in order to attract them in the hotel. And the motivation will be varied with specific circumstance. The questionnaires were distributed through managers of XinHua hotel. A total of 100 questionnaires were distributed. The participants returned 40 questionnaires to yield a response rate of 40%. Because the respondents need not to sign their names in the paper, so in my opinion the questionnaires is mainly their actual own ideas about their job. In the following I will present some data. The table 1 below points out that the structure of age, gender, marital status and educational background of the respondents. From table 3-1, the respondents participating in the study represented the age groups which between years old and had a median of years. There was nobody under 18 or elder than 48. The most prevailing age groups represented in the sample were: between The Journal of Human Resource and Adult Learning Vol. 6, Num. 1, June 2010

5 28 years (47.5%), between years (30%), between years (22.5%). A large proportion of the respondents were single (52.5%) and the rest were married (45%). Only one person was divorced (2.5%). Most of the respondents had a high school diploma (55%), college degree (22.5%), bachelor degree (7.5%) and no one had master degree. There were six respondents chose other, which means lower than high school diploma. The gender distribution between males and females is 65% and 35%. Gender Age marital status Education background Table 1: Demographic characteristics of the respondents Male: 65 Total: 100 N = 40 Female:35 Mean = 1.65 Under 18 : 0% 18-28: 47.5% 28-38: 30% 38-48: 22.5% Elder: 0% Single: 52.5 Married: 45 Divorced /separated: 2.5 High school: 55 College degree:22.5 Bachelor degree: 7.5 Master degree: 0 Other: 15 Std.dev.=0.483 Total: 100 N = 40 Mean = 2.75 Std.dev.=0.809 Total: 100 N = 40 Mean = 1.65 Std.dev.=0.555 Total: 100 N = 40 Mean = 1.65 Std.dev.=1.423 The main respondents are common staff in the hotel, and their job is mostly for front service, such as the waiter or waitress, cleaners, connecters, etc. It can call those people blue collars. Though there are few white collars in the respondents, they are not the majority. And the further information we get from the data is that more than half of them had high school diploma, a few got College degree, but less got Bachelor degree, there is nobody who had master degree or doctor degree. Generally speaking, those distributions comply with the general industry of hospitality, because hospitality is the service industry and require less professors or experts but need more common people who are willing to provide service to others. Consequently, the results of the structure of XinHua hotel are well-balanced. As for the marital status of the respondents, only several persons are divorced, the single is over half of the total, and the married is not fewer. Why do I list those characteristics in the questionnaire? The answer is that mine main object of this report is for study of job satisfaction of those employees. So in the first part, I introduce the demographic characteristics of the respondents, which will compare to the impact on the job satisfaction. The hotel industry is a service and people-oriented business. To be successful in a competitive market, it is important that hotel managers know how their employees feel at work and what they want. The amount of effort that an employee expends toward accomplishing the hotel s goals depends on whether the employee believes that this effort will lead to the satisfaction of his or her own needs and desires. So in this part we will discuss the job satisfaction in the questionnaire. Table 2 shows that female employees had 3.72 as average score of job satisfaction and male employees had The group of employees who were between years old had 3.94 as mean of job satisfaction, years old had 3.58 and years old had The single employees had 4.05 as mean of job satisfaction, married employees had 3.25 and employees who divorced had The respondents with a high school diploma had 3.90 on their job satisfaction, the respondents with a The Journal of Human Resource and Adult Learning Vol. 6, Num. 1, June

6 college degree had 3.22, and the respondents with a bachelor degree had Through the Std.dev, we can see how much distance among these 40 persons scores. The higher Std.dev is the longer distance exists between each person s score and the average score. Through the table 2, the Std.dev of female is which is the highest one of all. It means when those 35 women conducted the survey, there is a long distance between their score of job satisfaction. Table 2: Analysis of demographic effects on job satisfaction Mean Std. dev Gender Female Male Age Under 18 / / Elder 48 / / Marital status Single Married Divorced /separated 3.00 / Education background High school College degree Bachelor degree Master degree / / Other Employee satisfaction is the effect of how people feel about their job. Someone is satisfied about something because it is what they expected from it. Employee satisfaction deals not only with value addition but also with their expectations. It will account for the relationship between characteristics and job satisfaction. According to the anterior academician s investigation, degree of job satisfaction is measured in terms of frequency, and duration of absence. The results indicate that age among blue-collar workers was positively related to both of the variables. There was a positive relationship between overall job satisfaction and age. As to our questionnaires, the three reasons for the positive relationship are also examined, that is to say, older people seem to have a different relationship to authority than younger people; older people have higher needs to be directed and to accept orders, cognitive structures are different from those of younger people. From our study, the older people are easier satisfied than younger people, in respect that younger people are apt to seize new things and they are not experienced so they will have higher expectation, when actuality is not the same with their expectation they will not be satisfied with their jobs. Some samples states that overall job satisfaction is related to age with a U-shaped relationship, and explained that this relationship is due to the newness of the job. Satisfaction dropped when job expectations are not met. However, increasing maturity and work experience finally cause the employee to adjust his or her work expectations to more realistic level. When the new adjusted expectations are met, job satisfaction begins to rise. Job dissatisfaction was more prevalent among single workers. There is some research showed that married employees are more satisfied with their job than their unmarried employees. It may be that conscientious and satisfied employees are more likely to be married or that marriage changes employee s 46 The Journal of Human Resource and Adult Learning Vol. 6, Num. 1, June 2010

7 expectations of work. However, status other than single or married have rarely been studied. But in our study, the difference is not obvious. In certain sense, satisfaction is the happiness of mental needs. Degree of satisfaction depends on people s mental status. Maybe the divorced get less satisfaction with life so there is no exception for job. So the divorced have less job satisfaction compared to others. The single and the married have not great difference about this because of the nature of hospitality industry. In a word, while, the female and male has great difference in job satisfaction, generally speaking, the female are easier to meet than the male. The higher an employee s educational level, the more likely these were to be dissatisfaction. This was explained on the basis that employees with a higher educational background would expect more in terms of financial compensation, benefits, and supervision than the ones with a lower educational background. That is why many companies of our country prefer to employ those people with lower educational background. And as for the hospitality, there is no exception, so there are less people with master degree or doctor degree diploma. RESULTS In order to indicate potential strategies for reducing turnover and increasing satisfaction in the XinHua hotel, this present work was attempt to study current employees perception regarding to their employment experiences. According to the research result, the study could highlight some findings. Payments and benefits were considered as the most important category attributing to job satisfaction. However, the employees of XinHua hotel were not satisfied with their monetary rewards according to the gap between their level of importance and actual experiences. XinHua hotel may set up clear standards and criteria to offer the employees monetary rewards according to their work performance and contribution. XinHua hotel may also build up a benefit-share program which the employees could purchase the stock of company. Therefore, employees are going to becoming to stockholders which is really involved in the organization. I think with those actions to be taken, those problems will be solved. Although many costs associated with these suggestions may seem prohibitive, as well they may be, the XinHua hotel must evaluate the costs of current turnover, analyze the reasons for the individual organization, and develop strategies that in the long term are less costly than continued turnover. Some of these suggestions may not be so costly in comparison. Just a word of caution: Be fair and consistent in establishing compensation. Promote from within if possible. Attempt to avoid bringing new people on board at a higher rate than current employees. Policies to prevent discussion of wages simply do not work. Furthermore, such policies are in complete opposition of "open-door" communications. Maybe somebody will say that the first step is to hire smart persons, Hiring smart is the first step to developing a loyal, motivated workforce and keeping employee turnover rate at a minimum. Hiring the people that are a good "fit" with the culture of the hotel meaning that their values, principles, and goals clearly match those of the hotel and then training as necessary will go a long way toward ensuring employee loyalty and retention. Other factors, such as competitive compensation and creating an employee-friendly work environment also play a role. A study commissioned by a consulting firm among executives at the nation's 100 small- and- medium sized hotels found that, aside from salary, job applicants inquire just as frequently about corporate culture as they do other benefits. The implication is clear: The more enriching your work environment, the more likely you are to retain a staff of satisfied, productive employees. The Journal of Human Resource and Adult Learning Vol. 6, Num. 1, June

8 RECOMMENDATION The relationship between job satisfaction and job turnover has been considered, as we all know if we try to increasing job satisfaction, then we will reduce job turnover somehow partly. So in this part I will bring forward some strategies for increasing job satisfaction and I hope that will operate in reducing job turnover. As we know that employee turnover is a significant cost to organizations. Productivity is lost during the 45 to 60 days it takes to refill the position, plus the time it takes to train the new employee in their new job. The higher the turnover, the more pressure placed on recruiting. Several strategies for controlling employee turnover in the hotel are shown below. Firstly, a mentoring program can help decrease the employee turnover of the small- and- medium sized enterprises. A career ladder chart, even a simple one, can also help facilitate the career development discussion. Recognize and acknowledge the skills and abilities that the employee has gained since joining the organization which may make them eligible for the next advancement. Avoid the tendency to view the employee as only having those skills and abilities that they had when they were hired. If the employer's business situation is perceived to be unstable (relatively speaking - no company is perfectly stable anymore), employees may seek other employment opportunities that appear to offer more stability. Layoffs are costly in terms of employee morale (voluntary turnover usually increases sharply after a layoff because employees' sense of security is undermined or they may be angry at the organization for having a layoff, or choosing the wrong people to be laid off, etc.). Layoffs are also costly in terms of actual costs (the hotels typically provide severance pay and benefits after termination for a period of time equal to one week for each year of service). There's also an increased risk of wrongful termination lawsuits, but this can be mitigated by rigorous and objective layoff selection process and severance packages. Staffing planning is one way to reduce the need for layoffs. I don't believe that a reliable staffing planning system exists. Another way is to employ temporary or contract employees. With the growing volatility of the business environment, more and more hotels are using temporary employees. Likewise, the availability and quality of temporary employees is increasing. Temporary employment agencies, in an effort to attract the best candidates, are increasingly offering benefits. In the past benefits have only been offered to employees in "regular" positions. Other key factor is communicating for the company condition of the XinHua hotel to the workers and several aspects in the following parts: 1. high-quality communicating can assist provide a link between the employees' job and the success of the small- and- medium sized enterprise. It gives employees a sense of stability of the organization because the employees can see that someone is in charge and worrying about the big picture. Don't be afraid to communicate bad news, because no matter how bad it is, it is still going to be better than the rumor mill. It's best to communicate the state of the business on a regular basis such as quarterly or semi annually. A personal presentation from the head of the small- and- medium sized enterprise is best, but written communication can work too. In addition to the regularly scheduled employee communications, major business events, both good and bad, should be communicated to employees as they occur. 2. Pay attention to employee ideas and complaints is another important aspect of communication. Employees who do not feel be listened to will be de-motivated. A system of regularly scheduled one-on-one meetings between the employee and manager can help fill the need to be listened to. So 48 The Journal of Human Resource and Adult Learning Vol. 6, Num. 1, June 2010

9 can the Performance Management process. Listening to employees gives them a message that they are valued and provides them with a sense of control over their work situation. 3. Providing recognition to employees is a third aspect of communication. Types of recognition can range from a simple "thank you for a job well done," to a plaque, to financial incentives. Recognitions mean what employ do will be recognized by others especially the supervisors, and every one will be phrased when they contribute to their work, which will create a very comfortable work environment. In addition, providing career advancement opportunities is critical for retention, especially for those employees who are career oriented and are in the early or middle stages of their careers. Ensure that job openings are posted and that there are no barriers to transferring to new positions (such as inter-organizational rivalries, or unwillingness to release an employee from a particular project). Career development discussions should be held at least annually as part of the performance management process or whenever the employee requests it. An employee has to take the initiative and own their career development plan, but the small- and- medium sized enterprise should encourage its development. In hotel policy pay is overstated as a retention tool. The areas mentioned above are more important for retention than pay. That includes not only base and variable pay scales, but long-term incentive compensation, bonus and gain-sharing plans, benefit plans to address the health and welfare issues of the employees, and non-cash rewards and perks as well. To be competitive in today's labor market, most of the hotels find it necessary to offer a standard benefit package, including health, dental, and life insurance, vacation and leave policies, and investment and retirement plans. But what more could be done that would be cost effective toward creating an employee-oriented work environment? Creativity in compensation and benefits can make quite a difference to the welfare of the employee. Furthermore, the hotels should assess overall employee needs when addressing retention issues. If employee welfare is a genuine concern, what about child care? How much employee absenteeism is attributable to not having a dependable babysitter? Although the costs and liabilities involved in providing onsite day care can be prohibitive, perhaps a company could subsidize childcare in some manner. Sometimes, just negotiating rates for your employees with area childcare providers could be very helpful. Household chore assistance is another possibility that is being used by some hotels, considering other options such as alternative work schedules or flextime, or perhaps preventative health care and wellness programs such as fitness centre memberships as possible cost-effective benefits. Don't forget that perks or non-cash rewards to recognize exceptional performance can be critical. Service recognition, event tickets, trips, and public recognition can send strong messages to the public regarding company culture and values. Simply examine the issues and needs of your employees and try to develop creative programs to address these needs. REFERENCES Ajzen, I., & Fishbein, M. (1977). Attitude-behavior relations: A theoretical analysis and review of empirical research. Psychological Bulletin, 84, Buchanan, B. (1974). Building organizational commitment: The socialization of managers in work organizations, Administrative Science Quarterly, 19(4), Cascio, W. (2002). Responsible Restructuring: Creative and Profitable Alternatives to Layoffs, San Francisco: Berrett-Koehler. George, J. M., & Jones, G. R. (1996). The experience of work and turnover intentions: Interactive effects of value attainment, job satisfaction and positive mood. Journal of Applied Psychology, 81, The Journal of Human Resource and Adult Learning Vol. 6, Num. 1, June

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