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Prepared By:
Worku Desalegn
ID: 606/08/
Addis Ababa, Ethiopia
September, 2017
Project Term paper for the course
fulfillment of:
Organizational Behavior
(MBAES-613)
LEADSTAR COLLEGE OF MANAGEMENT
AND LEADERSHIP
Faculty of Business and Leadership
Graduate Department of Business Administration
Contents: page
- Introduction……………………………………………………………………….………………. 1.1.Back Ground of the Organization………………………….…………………………....... 1.2. Back Ground Of The Study……………………………………………………………….... 1.3.Objective Of The Study …………………………………………………………..….…....... 1.3.1. General Objective ……………………………………………………………….….. 1.3.2. Specific Objective ……………………………………………………….................. 1.4.Statement of the problem………………………………………………………..…………...
- Theoretical Framework…………………………………………………………..………...…… 2.1.Employee Engagement concept……………………………………………………………. 2.2.Models of Employee Engagement……………………...……………………..………....... 2.2.1. Robinson & Penna Model of engagement.………………………………………. 2.2.2. Khan’s Model of engagement.…………………………………………………..... 2.2.3. Job-Demand-Resources Model of engagement………………………..………. 2.2.4. Model of antecedents and consequences of employee engagement………….. 2.3.Employee Disengagement concept……………………………………………………….. 2.4.Reasons why people disengage………………………………………………………….... 2.5.Impacts of Disengagement…………………………………………………………………. 2.6.Measures to improve employee engagement…………………………………….……… 2.7.Conclusion………………………………………………………………………………….... 2.8.Recommendations………………………………………………………………………..….. References:
Acronyms:
CBB : Construction and Business Bank CBE : Commercial Bank of Ethiopia CSR : Corporate Social Responsibility CN : Commercial Nominees
o Speak Negative about the organization to coworkers, potential employees and customers o They strong Heat management members of the organization o They do not give extra and hid effort to contribute to the organization's success.
Watching what was happening, I could only guess at how long people with such a working attitude are able to do their job without complaints from the superiors. Employee’s activity is the major factor for the successes and failure of any organization. Without workforce, productivity, service delivery and finally profitability of any organization declines. CN is a service rendering company engaged in the businesses of: Payment of Pension Benefit, Provident and Employees Benefits Funds Administration, Private Trust Fund Administration, Share Dealing Activities, Salary Payment Services, Real Estate and Property Administration, Money Transfer Services, Compensation payments and disbursements, Collection of varieties of bills and taxes and Effecting of various payments on behalf of third parties. The vision and the Mission of Commercial Nominees is:
Vision Our vision is to become a leading company in outsourced asset and service management in Ethiopia by the year 2020.
Mission statement
We are dedicated to provide an excellent service to our customers in outsourced asset and service management using our rich experience, well trained and motivated employees in order to create value to our stakeholders. It's over 50 years of experience coupled with highly qualified and dedicated staff, uniquely places Commercial Nominees as reputable company in Ethiopia that offers valuable services efficiently to the entire satisfaction of its customers.
Most companies in Ethiopia including Commercial Nominees p.l.c engaged themselves on activities like on resource mobilization. As stated above to achieve this activates the employees play a great role. Commercial nominees’ p.l.c provides the employees with both intrinsic and extrinsic motivation towards their achievement there is an ongoing debit on the effect of motivators on employee’s engagement. As long as we concentrate on this two factors hard work from employees and money from the employer we will not be able to solve this difficult problem.
Instead, we need to raise our sights above the rudimentary aspects of the employee/ employer relationship and look at what each party needs on a higher level. While paycheck is important even more engaging rewards include human connection, peer recognition, self-expression, a stimulating career path, personal growth, sense of community and other intrinsic incentives. It is critical that workers satisfactorily meet. The demands of their respective job descriptions for the company to survive; however, an organization can only thrive when its people also offer their creativity, optimistic attitudes, belief in the missions and other higher contributions.
To improve this situation someone either the employee or management has to make the first move, the manager must look at the list of things that are deeply important to employees, and find ways to engage them through those means, and also the employees are expected to get a better understanding of what the company need from them in the way of higher value, and start playing a more meaningful role, so on this term paper we will see the root causes of employees disengagement , consequences and possible measures the organization must take to avoid the issue.
1.2 objectives and questions of the paper
The main object of this paper is the phenomenon of employee disengagement, its root cause and consequences in Commercial Nominees p.lc. The empirical target of the study is the behavior of employees in the context of their level of engagement to the organization where they work. The aim of the study is to understand and describe why employees become disengaged, and what an organization might do in order to improve the employee engagement and not to lose talented workers.
The basic questions are:
- What is the Importance of Employee Engagement?
- Why do employees disengage?
- Why and how would an organization improve the employee engagement level?
known and established concepts, for example, organizational commitment and organizational citizenship behavior (OCB) (Robinson et al. 2004). Most commonly, employee engagement was identified as emotional and intellectual commitment to the organization (Baumruk 2004; Wellins and Concelman 2005). Other definitions were associated with the amount of discretionary effort demonstrated by employees in their jobs (Towers Perrin 2003).
According to Wildermuth and Pauken (2008a, p. 123), the term “engagement” has its roots in role theory, particularly in the work of Erving Goffman (1961), who defined engagement as the “spontaneous involvement in the role” and “visible investment of attention and muscular effort”. Later, William Kahn provided the first formal definition of employee engagement as "the harnessing of organization members' selves to their work roles; in engagement, people employ and express themselves physically, cognitively, and emotionally during role performances." Kahn (1990).
In 1993, Schmidt et al. proposed a bridge between the pre-existing concept of 'job satisfaction' and employee engagement with the definition: "an employee's involvement with, commitment to, and satisfaction with work. Employee engagement is a part of employee retention." This definition integrates the classic constructs of job satisfaction (Smith et al., 1969), and organizational commitment (Meyer & Allen, 1991).
Defining employee engagement remains problematic. In their review of the literature in 2011, Shuck and Wollard,identify four main sub-concepts within the term:
- "Needs satisfying" approach, in which engagement is the expression of one's preferred self in task behaviors.
- "Burnout antithesis" approach, in which energy, involvement, efficacy are presented as the opposites of established "burnout" constructs: exhaustion, cynicism and lack of accomplishment.
- Satisfaction-engagement approach, in which engagement is a more technical version of job satisfaction, evidenced by Gallup's own Q12 engagement survey.
- The multidimensional approach, in which a clear distinction is maintained between job and organizational engagement, usually with the primary focus on antecedents and consequents to role performance rather than organizational identification.
It is necessary to make a distinction between engagement and several related constructs, such as organizational commitment and organizational citizenship behavior (OCB). Engagement contains the elements of both commitment and OCB, but there is not a perfect match. Engagement has a two-way nature and the extent to which engaged workers are expected to have an element of business awareness; neither commitment nor OCB reflect these aspects.(Robinson et al. 2004, p. 8)
Utilizing high-involvement practices showed superior performance. In addition, workers in the high-involvement plants showed more positive attitudes, including trust, organizational commitment and intrinsic enjoyment of the work.
Employees with the highest level of commitment perform 20% better and are 87% less likely to leave the organization, which indicates that engagement is linked to organizational performance.
In a study of professional service firms, offices with engaged employees were up to 43% more productive. Job satisfaction is also linked to productivity.
2.2. Models of employee engagement
Staff Engagement
In recent years, research has shown that employers want employees that will do their best at work, even "go the extra mile", and employees want good work, jobs that are worthwhile and "turn them on". With this shift, there has been an increasing focus on staff satisfaction as a component of staff engagement.
Engagement is a combination of commitment to the organisation and its values, plus a willingness to help out colleagues (organisational citizenship). It goes beyond job satisfaction and is not simply motivation. Engagement is something the employee has to offer: it cannot be 'required' as part of the employment contract. There are many individual and organisational factors that determine whether employees become engaged, and to what extent they become
Figure 1 - Robinson et al (2004) Model of the Drivers of Employee Engagement
Penna's model (2007) adopts a similar position. This model indicates that staffs are seeking to find "meaning" at work. Penna defines "meaning" as fulfillment from the job. Fulfillment comes from the employee being valued and appreciated, having a sense of belonging to the organisation, and feeling as though they are making a contribution, and is congruent with the underlying theoretical framework of Robinson.
Penna's model is also remarkably similar to both Maslow's Hierarchy of Needs, and Herzberg's theory, with "hygiene" factors at the base of the triangle and "satisfiers" towards the top. As an organisation successfully meets each of these engagement factors, Penna states that the
organisation becomes more attractive to new potential employees and becomes more engaging to its existing staff.
According to Saks (2006, p. 602), researchers have done little in the modeling of engagement though there are two main research streams in this area. The first stream concerns the studies of Kahn (1990); later his findings and model of engagement were empirically tested by May, Gilson, and Harter (2004). The second stream is represented by researchers of burnout, who developed a model of job engagement as the positive antithesis of burnout. Afterwards, Saks
(2006) also offered as an alternative, to refer to the social exchange theory (SET) and developed his own model of employee engagement, which was also tested.
Models of employee engagement help in understanding what factors have an influence on employee engagement and can predict it, and also to identify the consequences of the phenomenon. Next, closer look will be given to three models of engagement: Kahn’s model diagnosed by May et al. (2004), the Job Demand-Resources (JD-R) model (Bakker and Demerouti 2008), and the model of the antecedents and consequences of employee engagement (Saks 2006).
2.2.2 Kahn’s model of engagement
During two of Kahn’s qualitative studies (1990), he examined the psychological conditions of personal engagement and disengagement at work. Kahn interviewed employees of two different organizations about their moments of engagement and disengagement. The researcher stated that there are three psychological conditions that people experience at work, particularly, meaningfulness, safety, and availability. These psychological conditions are linked to personal engagement or disengagement. According to Kahn (ibid, p. 703), employees in each work situation unconsciously ask themselves three questions:
(1) How meaningful is it for me to bring myself into this performance?
(2) How safe is it to do so? And
(3) How available am I to do so?
Accessibility of physical, emotional and cognitive workers resources is a positive predictor of psychological availability. Participation in outside activities is a negative predictor of psychological availability. The findings of Kahn (1990) and May et al. (2004) described engagement from the psychological point of view and identified the main factors that influence its level. 2.2.3 The Job Demand-Resources model of work engagement The Job Demand-Resources model of work engagement Bakker and Demerouti (2008) reviewed qualitative and quantitative studies on work engagement in order to identify its antecedents and consequences. Basing on findings of previous studies they developed an overall model of work engagement that can be used in today’s workplace. The Job Demand-Resources (JD-R) model of work engagement is presented in Figure 3
Figure 2 The JD-R model of work engagement (Bakker & Demerouti 2008, p. 218)
Job demands Work pressure Emotional demands Mental demands Physical demands etc
Job resources Autonomy Performance feedback Social support Supervisory coaching Etc
Work engagement Vigor Dedication Absorption etc
Performance In-role performance Extra-role Creativity Financial turn over
Personal resources Optimism Self-efficacy Resilience Self-esteem Etc
Authors of the model stated that the main predictors of engagement are job resources (autonomy, performance feedback, supervisory coaching, etc.) and personal resources (optimism, self-efficacy, self-esteem, etc.).Predictors of engagement can take effect independently or be combined with other factors. When job demands are high, these resources have a positive impact on work engagement, which, in turn, has a positive influence on job performance. Engaged employees provide better performance. Therefore, they are able to generate their own resources, which over time facilitate engagement development and create a positive gain spiral. (Ibid) 2.2.4 The model of the antecedents and consequences of employee engagement Saks did a study that aimed to test a model of the antecedents and consequences of job and organization engagements (Figure 3). The model was developed based on principles of SET as mentioned above.
Figure 3 A model of the antecedents and consequences of employee engagement (Saks 2006, p.604) Results of tests done by Saks (ibid, p. 613) showed that: There is a distinction between the constructs of job engagement and organization engagement. Support provided by an organization is a positive predictor of both job and organization engagement. Job characteristics considerably predict job engagement.
Antecedent Job characteristics Perceived organizational support Perceived supervisor support Rewards & recognition Procedural justice Distributive justice
Consequences Job satisfaction Organizational commitment Intention to quit Organizational citizen ship Behavior
Employeeengagement Job engagement Organizationengagement
Disengaged employees are usually unhappy at work and actively express this feeling. The negative influence of such workers constantly affects other people in the team and destroys achievements of engaged workmates (Gallup 2006).
Disengaged employees are disconnected from their jobs, tend to be significantly less efficient and less loyal to their organizations; they are less satisfied with their personal lives, experience more stress and insecurity about their job than their co-workers (Gallup 2001).
Protection from the effects of employee disengagement is to stop it by identifying and eliminating its causes
2.4. Reasons why people disengage
The issue of disengaged employees is sweeping across the business world and touching nearly every industry. An increasing number of employees are showing up to as a means to earn a check and clock out, it is apparent that the desire to do quality work is diminishing.
The main thing is identifying how this happen? Why are employees disengaging from their job? What can you do to avoid or solve the issue in your company?
While the cause of disengagement may vary based on several factors, here are the most common reasons employees are disengaged from their job:
Unclear expectations: -employees are likely disengaged if they are expected to do a job different from what they signed up for. A solid job description will provide assurance for the employee that their understanding of position aligns with what is actually expected of them. Lack of resources: - insure employees have the right tools to do their jobs, communicate them what resources they could use to be more efficient in their position? Employees may be discouraged if there aren’t able to do their job because they lack the necessary tools. Input and strength are not valued: - employees want to know they are a part of the team not just a pawn that simply does the actions they are told. Allowing them to invest in the company and take ownership of specific tasks will increase their commitment and level of engagement.
Under recognized and under paid: - two of the most motivating factors are money and recognitions. If an employee feels as if they are never recognized or not paid enough for what they are doing, they are likely to allow the quality of their work slip or find another where they will be recognized and paid for the work they perform. In the dark: -employees disengaged when they don’t have enough information to discern what the big picture is; they want to know how they are contributing to the success of the company. According to legend, an engaged janitorial employee at NASA, when asked what he was doing, is said to have replied "I'm helping to put a man on the Moon".
Formal evaluation is not valuable:- evaluation is a great time for employees to learn how they are doing in their position. To add more impact to evaluation make sure you cover both the positive things they are doing as well as what they could be doing better. Environmental: - grew up listening others complaining about their job and adopt the same mentality. They grew up thinking jobs are not enjoyable. Organizational causes: - such as restructuring of the company and connected to it, transformational changes, company’s culture with inadequate norms, traditions, policies and practices (unethical actions, sexual harassment, racial discrimination, unreasonable enforcement of authority, etc.), bad working conditions, poor management and leadership, overgrown bureaucracy, lack of resources, low standards and acceptance of poor performance, work complexity, etc.;
Findings of Unpublished Saratoga Institute research showed that initiators of People’s disengagement at work were aligned with reasons of final decisions to quit the organization. According to the research results, employees quit because of insufficient leadership characteristics (35 %), organizational environment (49 %), and job characteristics (11 %). Only five percent from the reasons of leaving were unavoidable and included retirement, birth of a child, family issues, and so on. (Branham 2005, p. 24)
Negative comments about leadership included complaints about lack of supervisor respect for employees, carelessness, lack of support, poor leadership skills, favoritism, incompetence, unresponsiveness, and inconsistency. Poor sides of organizational environment included limited career growth, inadequate compensation and benefits, excessive workloads, lack of recognition,
By examining the effects of disengagement on both the worker and company, it is possible to conclude that this phenomenon can cause significant harm to the business. The only way to get
2.6. Measures to improve employee’s engagement level
As employee engagement is connected to employees‟ health, organizational performance, customer satisfaction, and innovations, organizations need to do their best in fostering employee engagement. The approach of employee engagement improvement and HR practices that are shown to affect the employee engagement level will be discussed.
2.6.1 Employee engagement improvement as a systematic approach
According to LG Improvement and Development, for improving the employee engagement level, organizations need to develop and use systematically an approach that includes several important stages. The first stage concerns all preliminary work before the implementation of engagement initiatives. The organization should define the meaning of employee engagement for itself, determine key areas for focusing, estimate costs and potential payback of engagement initiatives, and gain the support from senior leaders. During the next stage, management chooses the approach to understanding engagement, undertakes research, conducts a key driver analysis connecting results of research to key performance indicators, and identifies the areas of good practices. The third stage includes the development of a central action plan to improve employee engagement and preparatory work with managers on their further actions. The following stage is the implementation of the action plan. The progress should be monitored by management. The final stage of the process is evaluation of the progress. Managers should analyze the results in order to understand whether or not implemented strategies have been successful. (Ibid)
2.6.2 Human resource practices and engagement
Organizations that want to foster employee engagement should carefully choose combinations of different HR practices. There is no clear list of activities that have been considered to encourage high engagement; different researchers, mostly HR consultants, provide different areas for focusing and possible actions to improve the employee engagement level. The following practices have been mentioned most often:
Learning, development and training
According to Wellins et al. (2005, p. 14), employee willingness to develop and learn promotes innovation and creativity in the workforce. Managers need to work with employees finding out their strengths and needs for development, and provide opportunities for improving skills and capabilities. Talent development and training result in greater worker loyalty to the organization (Taylor 2004, according to Frank et al. 2004, p. 20). Mercer LLC (2007) stated that opportunities for development may enhance employee engagement.
Assessment and recognition
According to Mercer LLC (2007, p. 7), recognition of the individual and team performance and their contribution makes employees feel appreciated and valued by the organization; competitive pay and bonuses together with nonmonetary rewards support engagement. Wellins et al. (2005, p. 15) stated that in the context of employee engagement, support and recognition can also mean that the worker’s ideas are listened to and responded to; performance feedback is one more essential practice, because it plays the role of motivator for action encouraging and reinforcing employees for a job well done.
Building confidence and trust in leadership
Feelings of trust and confidence in leadership are important matters in the context of employee engagement. Strong leaders have a clear vision of the organizational goals and objectives and do their best to help staff to achieve them (CIPD 2006). Consistency between the leader‟s word s and actions plays a great role in building trust and engagement; fair leadership, effective management and a strong sense of connection with an organization gives people feelings of pride, optimism and certainty about what they do, how they do it and who they do it for (Towers Perrin 2003).
Promotion of two-way communication
The two-way communication program is a part of the environment of mutual trust, accountability and responsibility; it puts emphasis on the goals of the organization and the roles that employees should play (Towers Perrin 2003). According to CIPD (2006, p. 14), managers need to pay maximum attention to communication issues; offering to people opportunities “to feed their
