According to Smith, employees (human resource) are an important factor of production for any organization and also the most challenging to manage (85). This is because human resource management requires skillful handling of an individual’s skills, thoughts and emotions in order to increase productivity. Motivated employees are necessary if an organization is to survive and do so profitably (Smith 94). The concept of motivation has been defined by many contemporary authors. Kreitner has defined motivation as a psychological process (56). The process is said to give the purpose of a person’s behavior. Motivation has also been said to be the driving force behind the purpose and direction of a person’s behavior which drives such a person to want to achieve unsatisfied needs (Buford, Bedeian, and Lindner 31).
The main intention of the literature review is to highlight the various issues relevant to organizations today which are related to employee retention in regard to their motivation levels. It will seek to demonstrate how motivation can be used by management to engage employees in such a way that it will lead to higher job satisfaction thus improving overall business results. This review will also seek to highlight previous areas of study that are consistent with my current study, and how these studies may complement each other.
It has been previously highlighted that as an employee becomes distracted, both their Productivity and retention rates are greatly compromised. This distraction can be an effect of organizational changes such as downsizing or retrenchment, takeovers, mergers or acquisitions or even major corporate restructuring. This review looks into the finer details of motivation. That is, what are the efficient motivation factors? What role does the human resource department play in ensuring employee motivation is optimum? And finally how effective are the methods used by management in improving workers motivation?Buckingham and Coffman describewhat a vital role management and in this case the Human Resource Department plays in reaching out to employees and encouraging them to embrace their uniqueness and convert this into actual performance (23).
According to the two authors, in order for a manager to effectively motivate and retain employees, a manager would need to deal with each employee as an individual and addressing their employment needs as personal. The human resource department’s key role should therefore be to help their personnel find satisfaction in their work since satisfaction happens to be the major determinant in an employee’s decision to either stay or leave his current work place.
In direct relation to this study, Grant et al highlighted that in an environment of increased uncertainties, where the work environment is highly dynamic and volatile, human resource managers face major difficulties in motivating and retaining employees. This study will serve to show the reasons whyemployee motivation has become a challenge for the human resource department. One of the questions that require further research is what exactly qualifies as a motivating factor and to what extent of its effectiveness. Mak and Sockel relate motivation and retention and shed light on the factors of motivation and their effects on retention rate (32). For instance, previous research has shown that contrary to common belief, money does not qualify as one of the main reasons for employee departure from an organization.
Most employees will use a company’s rewarding system to evaluate whether the firm truly rewards people on a performance basis. It is therefore in very rare circumstances that salaries and benefits will influence an employee’s decision to leave. In a research conducted by Ali Dahmal Al-Aamri, they highlights that in a survey conducted by the Corporate Leadership Council discovered that although many employees join companies for motives such as better pay, employment benefits and career growth opportunities, they are more motivated and work hard towards the achievement of emotional benefits or satisfaction (89).
This previous research will therefore serve to show that monetary compensation though important cannot be used as the only factor of measuring and ensuring that employees are motivated. In addition to this very important factor of motivation, employers must be deliberate from the word go by hiring the right people for the right jobs. This serves to emphasize the point that employee retention level will depend partly on the people hired, their qualification for the assigned jobs and how well they are managed afterwards.
Forno and Merlone highlights costs related to employee turnover (56). This will go a long way in showing why it is essential for a company to keep its employees motivated. Some of these costs may not be so obvious and they include; lost productivity in terms of work put on hold until a replacement is hired; cost of overtime paid to existing employees or temporary help to get the work done prior to hiring of replacement; costs related to recruitment such as advertising and time and resources for hiring and training. It goes without saying that unexpected employee turnover can cause irreversible damages to a company.
Due to the rapidly changing work environment, it can be difficult for a firm to hire a replacement of equal capability with the employee who left. The time lapse between the hiring, training and actual replacement of an employee can make recovery by a firm practically impossible. This goes to emphasize that an organization must do all that is possible to keep uncontrolled employee departure in check.
There are two perspectives that can be used to determine the health condition of an organization. These are, the employees’ perspective, whereby an organization is said to be “healthy” when people are generally satisfied with the quality of their life at work. Most employees will feel satisfied at their place of work if they are empowered to make decisions that affect them, if they have been provide with adequate resources to meet clients’ needs and they are generally confident in the abilities of the management team. On the other hand, from an organization’sperspective, the organization is said to be “healthy” if it remains viable over time. Viability of an organization is usually measured in terms of its competitiveness, profitability, employee and customer satisfaction. A healthy organization is also one that is able to predict changes and adapts well to these changes.
Barbara states thatthe bottom line is that the role and conduct of the human resource manager will play the most significant part in an employee’s decision to stay or depart from any organization (4).Although an organization may provide its employees with a good pay, room for personal career advancement and recognition, if the people do not like their manager, they will leave.As a matter of fact, the primary reason for high employee turnover in most organizationsis dislike or lack of respect for immediate supervisors.
Companies should therefore take precaution against employee departure because when people leave the company, they take their value with them and in most cases straight to the organization’s competitors. This part of literature on the causes and outcomes of de-motivation have been discussed in-depth byBeecham and Sarah et al “Motivation in Software Engineering” (23).
Barbra in her journal has sighted that in the book by Buckingham and Coffman, it is believed that the most significant difference between an efficient human resource department and an inefficient one is that good human resource managers look insidethe company, and in particularat each individual to be able to determine the unique and specific needs of satisfaction for that individual (45).Buckingham and Coffman further explain that the ability of a manager to look inward is the easiest way to release employees’ unique talents and performance. A good manager will recognize that each person is motivated differently, and that these differences should be allowed to work together to create a synergy effect that will be beneficial to the whole organization instead of trying to grind the differences down.
Traditional management theory and practice focused on extrinsic motivators such as salaries, wage equities, pensions and bonuses. These are in themselves powerful motivators but on their own they are not sufficient. Leete and Laura will aid in developing of monetary compensation as a factor of motivation (56).
For their success, they must be coupled with intrinsic rewards in today’s working environment. In the past, it would buy compliance from workers with moneyand other tangible benefits. This cannot however work in the current economies as motivational issues have become more complex. In our current situation, employees value intrinsic rewards more than extrinsic ones. They feel more motivated in organizations that are able to provide a work-life balance. Therefore, for a firm to remain relevant in today’s competitive labor market, intrinsic motivation must be given priority over the extrinsic rewards. Though not ruling out the importance of extrinsic motivation factors, in the long run, employees will need intrinsic rewards in order to perform at their peak and organizations must recognize this in order to avoid unnecessary employee turnover.
Ali Dahmal, Al-Aamri. “Employee Motivating in Private Organization” 2010; features, Corporate Leadership Council. Employee retention—New strategies formanaging workforce stability and engagement. Corporate Executive Board, 1998. Web.
Barbara J. Kreisman. “Insights Into Employee Motivation, Commitment and Retention” 2002; Featured, Buckingham and Coffman, “First Break All the Rules”, even in the “best of times” SVP Gallup and author , 1999. Buford, J. A., Jr. Be your own boss. Journal of Extension, 1993. 31(1). Web.
Beecham, Sarah. et al. “Motivation in Software Engineering: A Systematic Literature Review.” Information and Software Technology 50 (2008): 860–878. Print.
Forno, Arianna. And Merlone, Ugo. “Incentives and individual motivation in supervised Work groups.” European Journal of Operational Research 207 (2010): 878–885. Print.
Grant, Adam. et al. “Impact and the Art of Motivation Maintenance: The Effects of Contact with Beneficiaries on Persistence Behavior.” Organizational Behavior and Human Decision Processes 103 (2007): 53–67. Print.
Journal of Extension 1 “Understanding Employee Motivation” 1998; Featured, Kreitner, R Management Boston: Houghton Mifflin Company, (1995). (6th ed.) Smith, G. P. In W. Tracey (ed.), Human resources management and development handbook, 1994. (2nd ed.).Electronic. Web.
Leete, Laura. “Wage Equity and Employee Motivation in Nonprofit and For-Profit Organizations.”Journal of Economic Behavior & Organization 43 (2000): 423– 446. Print.
Mak, Brenda. And Sockel, Hy. “A Confirmatory Factor Analysis of IS Employee Motivation and Retention.”Information & Management 38 (2001): 265-276. Web.