Job Satisfaction as an Antecedent to Employee Engagement

Transcription

1 Job Satisfaction as an Antecedent to Employee Engagement Job Satisfaction as an Antecedent to Employee Engagement Susan Abraham Dr. Susan Abraham is Associate Professor, SCMS School of Technology and Management, Kottayam. Abstract In today s competitive environment, one way to retain people is to have fully engaged employees. A descriptive study was done to examine the effect of job satisfaction on employee engagement among 30 employees of a private insurance company at Cochin. A questionnaire consisting of Job satisfaction subscale and Gallup 12 of Employee engagement was used to collect data. Correlation results showed that Job satisfaction and Employee engagement are related. Regression results highlighted factors such as nature of the job, superior s recognition to one s work, team spirit, cooperation between departments, comparative benefits, equal and proper administration of company policies contributed to a moderate state of employee engagement. Independent samples t-test show that cooperation between departments varied with education. Implications of this research point at the role of managements in creating an environment that can sustain trust, cooperation, and creativity for employees to keep experiencing high level of satisfaction leading to engagement. Key words: Job satisfaction, Employee engagement, Talent strategy, Benefits, Recognition, Feedback. Introduction Human resources form the knowledge asset of an organisation. Along with products and services, these knowledge employees provide a source of competitive advantage to the organisation. Attracting, motivating and retaining them have been the constant endeavour of management. In this process, an effort is made to create an environment that supports employee s career aspiration. A meaningful job and career prospects can provide employees a sense of satisfaction. Satisfied employees create satisfied customers. In the long run, an environment is required to enhance the state of satisfaction to engagement. It has been reported by researchers that engaged employees create value to the organisation. The two concepts studied and presented in this paper are Job satisfaction and Employee engagement. Job satisfaction: Job satisfaction is defined as the extent to which employees like their work. Based on perceptions, an employee develops a positive or negative attitude towards their job and environment. (Ellickson, M, 2002). The more a person s work environment fulfills his or her needs, values or personal characteristics, the greater the degree of job satisfaction.

2 Susan Abraham Job satisfaction is defined as a pleasurable or positive emotional state resulting from the appraisal of one s job or job experiences (Locke & Henne, 1986). Factors influencing job satisfaction: According to the 2012 Employee Job Satisfaction Survey results published by SHRM, the factors that has the most influence are shown below. Exhibit 1: Factors of Job satisfaction (Source: 2012 Job satisfaction survey by SHRM) Rank Factor 1 Job security (63%) Opportunities to use skills and 2 abilities (62%) 3 Organisation s financial stability (55%) Relationship with immediate superior 3 (55%) 4 Compensation/pay (54%) Communication between employees 5 and senior management (53%) 5 Benefits (53%) 5 The work itself (53%) 6 Autonomy and independence (52%) Management s recognition of 7 employee job performance (49%) Feeling safe in the work environment 8 (48%) 9 Overall corporate culture (46%) Flexibility to balance life and work 10 issue (38%) 10 Relationship with co-workers (38%) The relationship between job satisfaction with employee engagement has been researched. Maylett and Riboldi (2008) have stated in their White paper that job satisfaction is a component in making an employee feel engaged. The other two components of employee engagement are motivation and effectiveness. Tiwari (2011) in a study has cited that Job satisfaction as an antecedent to employee engagement. Carl-Ann-Morgan cites Robinson (2004) and Penna (2007) in a study that both espouse a model of engagement which incorporates job satisfaction, feeling valued at work, communication and training & development as key influences on staff engagement and overall satisfaction at work. With these findings as a basis, employee engagement has been explained below. Employee engagement: According to Kahn (1990), employee engagement is the harnessing of organization members selves to their work roles; in engagement, people employ and express themselves physically, cognitively and emotionally during role performances. For psychological engagement, the two major dimensions are emotional and cognitive engagement. Emotional engagement means having good relations with superiors and peers and experiencing empathy for others. Those who are cognitively engaged are well aware of their mission and role in their work environment. According to Kahn (1990), an employee can experience engagement on any one of the dimensions at a point of time. This definition indicates that job satisfaction is related to the cognitive aspect of employee engagement. Harter, Schmidt and Hayes (2002) defines employee engagement as the individual s involvement and satisfaction with as well as enthusiasm for work. Employee engagement is defined as the degree to which workers feel job satisfaction and an emotional connection to the success of their business, resulting in improved productivity, innovation and retention. Engaged employees are dedicated to their role, will stay in the organisation for a long time, more productive, give better customer service 28 SIES Journal of Management, September 2012, Vol. 8(2)

3 Job Satisfaction as an Antecedent to Employee Engagement and in turn create greater profit in private sector organisations (Gallup, 2005). They take pride in their work and will put in extra time to get a task completed to a good standard, not for financial gain but out of a personal sense of commitment known as discretionary effort (Frank et al, 2004). To further explain the association of Job satisfaction with employee engagement, the results of 2012 Employee Job satisfaction and Engagement published by SHRM showing the conditions for Employee engagement is listed in the table below. Exhibit 2: Satisfaction with conditions of employee engagement (Source: 2012 Employee job satisfaction and engagement by SHRM) Rank Satisfaction with conditions of engagement 1 Relationship with coworkers (76%) 1 The work itself (76%) 2 Opportunities to use skills and abilities (74%) 3 Relationship with immediate superior (73%) 4 Contribution of work to organisation s business goals (71%) 5 Meaningfulness of job (69%) 5 Autonomy and independence (69%) 6 Variety of work (68%) 7 Organisation s financial stability (63%) 8 Overall corporate culture (60%) 9 Management recognition of employee job performance (57%) 10 Job specific training (55%) 11 Organisation s commitment to professional development (54%) 11 Communication between employees and senior management (54%) 12 Organisation s commitment to CSR (49%) 12 Networking (49%) 13 Career development opportunities (48%) 14 Career advancement opportunities (42%) A study of the table reveals that the conditions of employee engagement are related to the factors influencing job satisfaction in an organisation. Need for the study In the present competitive world, an employee s level of engagement and his quality of work are important to growth. So managers are always concerned with identifying ways to boost morale, increase productivity and gain competitive advantage. To support this view, Towers Perrin has found that companies with engaged employees boosted operating income by 19%. Watson Wyatt reported that companies with highly engaged employees experienced 26% higher employee productivity, lower turnover risk, greater ability to attract top talent, and 13% higher total returns to shareholders over the last five years. In the light of the above findings the management of the Private Insurance Company (the study organization) wanted to know the level of satisfaction among their employees and the extent of engagement among them so that further improvements could be made to the existing HR activities. Objectives of the study 1. To study the impact of job satisfaction on employee engagement among employees in the company. 2. To know whether the job satisfaction factors differs with education of employees. Methodology The present study to know the impact of job satisfaction factors on employee engagement was done in a Private Insurance company located in Cochin. The population for the study was 120 employees. For the purpose of the study 29

4 Susan Abraham 30 employees were selected using systematic sampling technique. A questionnaire was prepared with 25 statements on job satisfaction and Gallup 12 statements on employee engagement. The reliability (Alpha score) of job satisfaction scale was found to be 0.76 and the employee engagement scale as This questionnaire was used to collect primary data from 30 respondents through a survey. The data collected was subjected to correlation and regression analysis to satisfy the first objective of the study. An independent samples t-test was used to satisfy the second objective of the study. Based on the results suitable suggestions are given to improve employee engagement levels. Limitations The time allotted to conduct the study was seven days and hence a larger sample could not be selected. Certain factors such as Work environment and organisation culture were not considered for this study. Literature review The relationship between Job satisfaction and employee engagement have been studied and reported by many researchers. It has been explained that Job satisfaction can be an antecedent and a consequence of employee engagement. An attempt is made here to highlight a few of the studies to support the present study. Garg and Kumar (2012) have reported in their research paper that Job satisfaction is an important driver of Employee engagement. Their research was concerned with measuring employee engagement levels based on certain parameters such as i. a career path that offers opportunities for advancement, ii. fair pay and benefits, iii. the perception that organisation offers good value to customers, and iv. a satisfactory work environment, defined by a reasonable workload, good relations with immediate supervisor, effective internal communication, good relationship with colleagues, and smooth functioning organisational dynamics. It concluded that job satisfaction and compensation are two such important parameters that are the key drivers of employee engagement in an organisation. BlessingWhite (2011) have reported the engagement levels in India during the year According to the report 37% of the employees in India are engaged. Engagement levels in India vary across organizations, organization size, gender, workplace structure and functions. Younger employees were less engaged as compared to older and married employees. Employees in healthcare and chemicals had maximum engagement levels and least in banking and financial services. Among the drivers of engagement, Indian managers identified three factors of job satisfaction such as career development opportunities and training (28%), more opportunities to do what one does best (21%) and more challenging work (15%) as the most important contributors. Rana and Chhabra (2011) have cited in their article that Hewitt signaled a shift in focus from measuring employee satisfaction to measuring employee engagement. The change was based on the belief that measuring satisfaction did not necessarily lead to finding ways to motivate and retain employees. In this context, job satisfaction has been termed a passive state and engagement an active state. 30 SIES Journal of Management, September 2012, Vol. 8(2)

5 Job Satisfaction as an Antecedent to Employee Engagement The Towers Perrin (2003) study of engagement identified both emotions and nationality as core components. They found that emotional factors are linked to an individual s personal satisfaction and the sense of inspiration and affirmation they get from their work and from being part of their organization. In a study (Avery, D.R., Mckay, P.F., and Wilson, D. C., 2007), the interplay between satisfaction with older co-worker and employee engagement was analysed. Results showed that satisfaction with one s co-workers related significantly to engagement. Harter et al (2002) conducted a meta-analysis of studies previously conducted by the Gallup Organisation. The study examined aggregated employee job satisfaction sentiments and employee engagement, with the latter variable referring to individual s involvement with as well as enthusiasm for work. Based on 7939 business units in 36 organisations, the results showed positive and substantive correlation between employee satisfaction, engagement and business unit outcomes of productivity, profit, employee turnover, employee accidents and customer satisfaction Many studies aimed at identifying what contributes to satisfaction have revealed that situational context (eg. Supervisory support) as a cause of satisfaction and has argued that high performance work practices and a positive working climate foster employee satisfaction (Bowen & Ostroff, 2004; Wright, Dunford & Snell, 2001) Data Analysis Correlation and regression analysis has been used to find the impact of job satisfaction on employee engagement. Table 1: Table showing mean score of the Job satisfaction and Employee engagement of the respondents Variables Mean score Job satisfaction 4.01 Employee engagement 3.97 Source: Primary data According to the above Table 1, Job satisfaction among the respondents of the study was found to high (mean score = 4.01). But the employee engagement level was found to be moderate with the mean score of This shows that the respondents with high Job satisfaction may not be fully engaged in the organisation. To study the relationship between job satisfaction and employee engagement, correlation analysis was done and the results are given below. Correlation analysis: Table 2: Table showing correlation between Job satisfaction and Employee engagement Job satisfaction Employee engagement Job satisfaction ** Employee engagement 0.601** **Correlation is significant at the 0.01 level (2-tailed) Source: Primary data The above Table 2 indicates that Job Satisfaction 31

6 Susan Abraham is related with employee engagement with R value of (p< 0.01). This means that there is 60.1% relationship between job satisfaction and employee engagement. In order to know the impact of factors of Job satisfaction that have an influence on employee engagement, regression analysis was done and the results are given below. Regression analysis: Table 3: Table showing Regression between Factors of Job satisfaction and Employee engagement Dependent variable: Employee engagement Independent R 2 Beta t Sig F Sig variable Like the job Benefits Cooperation Team Company policies Recognition for performance Annual performance feedback Source: Primary data The above Table 3 shows that certain factors of job satisfaction have had an impact on employee engagement. The most important factor was the benefits offered to employees (Beta = 0.552, p < 0.05) that had an impact of 30.5% on employee engagement. In their compensation package, the respondents had a sizeable percentage as financial incentives associated with performance targets. The amount was commensurate with the targets of performance. The respondents were satisfied that these incentives were on par with that offered by competitor companies in the region. Fair treatment by the management invokes trust from the employees. Sound company policies and their proper implementation provided confidence to the respondents that they would not be discriminated. This was found in the form of extent of impact of 23% on employee engagement (Beta = 0.479, p < 0.05) Annual performance feedback had an impact of 22.4% on employee engagement (Beta = 0.473, p < 0.05). From the respondents it was understood that achievable performance targets are fixed and their performance is regularly reviewed by the superior who gives feedback and continuous guidance. This has given them a sense of satisfaction and assurance of growth opportunities in the future. The job itself has been a source of satisfaction for the employees. The job content is so designed to provide challenge to the employees which motivate them to utilize the existing talent to the maximum. The respondents have indicated that they like the job they do and this had an impact of 21.1% on employee engagement (Beta = 0.459, p < 0.05). Cooperation at work from other departments makes the employees efforts towards goal achievement more rewarding. The respondents opined that coworkers support was always available during crisis situations. Supportive co-workers had helped them in developing a feeling of belongingness to the organisation. This factor of co-operation has an impact of 15.9% on employee engagement (Beta = 0.399, p < 0.05). Similarly, the factor recognition from superior had an impact of 15.9% on employee 32 SIES Journal of Management, September 2012, Vol. 8(2)

7 Job Satisfaction as an Antecedent to Employee Engagement engagement (Beta = 0.399, p < 0.05). According to the respondents, superiors have shown trust on the employees potential. They provide timely feedback and appreciation for having achieved the targets in time. Many respondents have been recipients of rewards for exceptional performance. Teamwork among peers has had an impact of 15.7% on employee engagement (Beta = 0.396, p < 0.05). The nature of the respondents job is such that they work individually most of the time. Whenever a team is formed, every team member contributes to team goals. Peer support has contributed to employee satisfaction. The other factors such as training, long term welfare and salary had no influence on employee engagement in the present study. Independent samples t-test: Education as a variable influencing Job satisfaction has not been reported so far in previous research on Employee Engagement. As per the requirements of the study, an Independent samples t-test was done to find out if factors of Job satisfaction differed with education of respondents. Table 4: Table showing Mean values of Job satisfaction factors Factors of Job satisfaction Education N Mean Std. Deviation Like the job Graduate Post Graduate Benefits Graduate Post Graduate Cooperation Graduate Post Graduate Team Graduate Post Graduate Company policies Graduate Post Graduate Recognition for performance Graduate Post Graduate Annual performance feedback Source: Primary data Graduate Post Graduate Std. Error Mean

8 Susan Abraham Table 5: Table showing Independent Samples t-test for Factors of Job satisfaction Levene s Test for t-test for Equality of Means equality of Variances Factors of Job satisfaction F Sig. t df Sig. (2-tailed) Like the job Equal Benefits Equal Cooperation Equal Team Equal Company policies Equal Recognition for performance Equal Annual performance Equal feedback Source: Primary data The above Table 5 shows the results of the Independent samples t-test on variance in job satisfaction factors with education of the respondents. The p value of Levene s Test shows that the two variances did not differ significantly. The p values of the t test of all the job satisfaction factors except Cooperation are more than The mean values of the respondents for each of the job satisfaction factors did not differ significantly. From the table it can be concluded that there is no difference between the graduates and postgraduates in job satisfaction factors. In the case of the factor Cooperation, the p value of the t test is less than This means that the mean value of graduates (M = ) (Table 4) differs significantly from the mean value of post graduates (M = ) (Table 4). This difference is attributed to the positions occupied by these respondents. An observation into this aspect revealed that senior managers in various departments were postgraduates who were not often approached by the junior executives who were graduates. Implication: The study revealed that there exist high level of job satisfaction and moderate level of employee engagement. Job satisfaction has a moderate impact on employee engagement in the Private Insurance company studied. The results reinforced the need for the presence of supportive superiors who would recognize and guide their juniors at workplace. Company policies that are well written and implemented without bias is an important element in enhancing employee engagement. A challenging job which can utilize the unused potential of the employees can provide a sense of satisfaction to the employees that will lead to employee engagement. Suggestions: The study revealed that training, welfare and salary had no impact on employee engagement. The company management has to give importance to employee development and employee well being so that job satisfaction can be improved. 34 SIES Journal of Management, September 2012, Vol. 8(2)

9 Job Satisfaction as an Antecedent to Employee Engagement Since majority of the employees are in the middle age group, they may be facing problems of career plateau. At this point, short-term training programmes to enhance the skill level, new work methods can help these employees feel encouraged to continue in their work. The basic pay can be revised based on the complexity of the jobs in the current scenario. This can provide a sense of pride to the employees that their job is of importance to the organisation. The management can survey the industry to know the prevailing rates for all grades of employees. In addition to the above, two-way communication can be encouraged between the superiors and junior employees through regular meetings. This can iron out misunderstandings in the workplace. These meetings can also help clarify core values and goals of the organisation. The superiors can use performance feedback sessions to appreciate the achievements of their subordinates to boost their feeling of engagement. It will also help in strengthening the relationship between the superior and the subordinate during work. Conclusion Job satisfaction is an antecedent to employee engagement. Engaged employees perform exceptionally well in their job. The present study revealed that factors such as job, benefits, recognition, cooperation, fair treatment, sound company policies, team spirit and performance management system can enhance job satisfaction in employees which will lead to employee engagement. The present engagement levels can be maintained and enhanced when the management takes care of employee participation in developmental activities and monetary benefits. References yavery, D.R., McKay, P.F. & Wilson, D.C. (2007). Engaging the aging workforce: The relationship between perceived age similarity, satisfaction with co-workers, and employee engagement. Journal of Applied Psychology, 92, pp ybowen, D. E., & Ostroff, C. (2004). Understanding HRM-firm performance linkages: The role of strength of the HR system. Academy of Management Review, 29, pp ycarl-ann-morgan, White Paper: Understanding and Developing Your (People) Assets. publications/white-papers/employeesatisfaction/ ydecisionwise Inc, Whitepaper: The Three Essential Components of Employee Engagement, Maylett, Tracy M., and Riboldi, Juan M., (2008).. yellickson, M. (2002). Determinants of job satisfaction of municipal employees. Public Personnel Management, 31(3), pp yfrank, F.D., Finnegan, R.P. and Taylor, C.R. (2004) The race for talent: retaining and engaging workers in the 21st century, Human Resource Planning, (3), pp ygallup (2005) Employee engagement index survey, Gallup Management Journal ygarg, Anshul, and Kumar, Vinod.,(2012), A study of employee engagement in pharmaceutical sector, International Journal of Research in IT and Management, 2(5), pp yharter, James K., Schmidt, Frank L. & 35

10 Susan Abraham Hayes, Theodore L. (2002), Businessunit-level Relationship between Employee Satisfaction, Employee Engagement, and Business Outcomes: A Meta-analysis, Journal of Applied Psychology. 87(2), pp ykahn, W. A. (1990), An Exercise of Authority, Organizational Behavior Teaching Review, 4 (2), pp ylocke, E.A. & D. Henne (1986). Work motivation theories. In C.L. Cooper & I. Robertson (Eds.) International review of industrial and organizational psychology,. London: Wiley. pp yrana, Neeti, Dr. and Chhabra, Neeti Leekha, (2011), Employee Engagement: A primer for strategic human resource management, Asian Journal of Research in Business, Economics and Management, 1(2), pp. 16. ystrategic Human Resource Management, UK, Employee Job satisfaction and engagement survey 2012, ytiwari, Shashi, (2011), Employee Engagement - The Key to Organizational Success, ICOQM 10, June 28-30, pp ytowers Perrin (2003), Talent Report: New Realities in Today s Workforce. jsp?url=global/service-areas/research-andsurveys/employee-research/ee-engagement. htmandcountry=global ywright, P. M., Dunford, B. B., & Snell, S. A. (2001). Human resources and the resource-based view of the firm. Journal of Management, 18, pp yhttp:// reports/blessingwhite_2011_ee_report.pdf yhttp:// bwdaily/dnflash/content/may2009/ db _ htm 36 SIES Journal of Management, September 2012, Vol. 8(2)

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