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MANAGEMENT 15

Employee turnover intentions, job satisfaction and organizational commitment

Table of Contents

4List of figures

5Outline

61.0 Introduction

61.0 Introduction

62.0 Literature review

62.1 Job satisfaction

72.2 Employee turnover intentions

72.3 Organizational commitment

72.4 Conceptual framework

83.0 Methodology

94.0 Results and discussion

94.1 Results

104.2 Discussion

105.0 Conclusion and recommendations

115.1 Implications of this study

115.2 Limitation of the study

12References

14Appendices

14Appendix I: Descriptive statistics table

15Appendix II: Mean and Standard Deviation

15Appendix III: Reliability analysis table

15Appendix IV: Correlations

16Appendix V: Regression table

16Appendix VI: Hypothesis testing

List of figures

Figure 1: conceptual framework of the study 8

Outline

Introduction: Provides the background, problem statement, purpose, and objectives of the study

Literature review: Secondary research of the variables; organizational commitment, job satisfaction and employee turnover intentions as well as its conceptual framework

Methodology: Gives the research design, data collection and data analysis

Results and discussion: Provides the findings of the study then discusses the results against some known authorities in this management field

Conclusion: Wrap up of the findings and the quick view on what the study achieved

Implications and limitations: Provides the use and relevance of the study alongside some limitations associated with the study.

1.0 Introduction

Contemporary work environment is experiencing turbulence as employees dissatisfied with work conditions, remuneration and growth opportunities exit to join other organizations. Job satisfaction increases organizational outcomes such as low absenteeism, turnover, and high work performance (Reily, 2006). Although several studies have demonstrated the existence of a relationship between employee turnover, job satisfaction and organizational commitment, they have narrowly concentrated on the three variables and establish their correlations (Pfeffer, 2007; Allen & Griffith, 1999; Gustafson, 2002).

Most of the studies on employee turnover have been done in the manufacturing industry with little attention to the service industry, especially, hotel industry (Liu et al. 2010; McCarthy et al. 2007; Rizwan et al. 2013). This shows that there is need to investigate the relationship between employee turnover, job satisfaction and organizational commitment in determining hotel performance. The aim of the study is to investigate the relationship between job satisfaction, employee turnover and organizational commitment in the hospitality industry.

Research questions of the study are;

  1. To establish a relationship between employee turnover intention and job satisfaction

  2. To determine the relationship between employee job satisfaction and organizational commitment

2.0 Literature review

2.1 Job satisfaction

Reily (2006) defined job satisfaction as the attitude and individual’s perception towards work and pay. Employees who are happy are enthusiastic of their work, and are able to commit more of their energies in achieving organizational goals and objectives. Employees, when properly trained are not only able to work smart but also show higher levels of competence and capability (Testa, 2001). On the other hand, dissatisfied employees express aloofness, discontent and intentions to leave the organization. Mathieu and Zajac (1990) describe organizational commitment as a positive response to working conditions and the attachment towards an organization. Medina (2012) found that organizational culture moderated the relationship between job satisfaction and turnover intentions which was inversely correlated. Saeed et al. (2014) sampled 200 employees and in the survey used line regression to establish that job satisfaction negatively influences turnover intentions.

2.2 Employee turnover intentions

Saeed et al. (2014) note that turnover is the rate of exit at which employees are dismissed or choose to exit the organization. High employee turnover is necessitated by low job satisfaction and organizational commitment. Employees can choose to voluntarily leave the organization or on involuntary basis be fired from the organization (Testa, 2001). Mbah and Ikemefuna (2012) in an empirical study of Total Nigeria PLC administered 300 questionnaires to employees in the survey study. The study found that employee turnover intention was reduced by high job satisfaction. According to Expectancy theory, Vroom (1964) posits that employees exit the organization owing to incompetence to gain individual benefits and negative job performance. With high job performance, employees get satisfied and choose to remain longer in the organization. Organizations intend to compete and create competitive edge over rivals through industrious, hardworking and innovative employees.

2.3 Organizational commitment

Susskind et al (2000) describes organizational commitment as the willingness to participate in the events and activities of the organization. While completing job-related roles can be linked to failure or performance, organizations demand efficiency, good leadership skills, time management and organizational skills. Iqbal et al. (2014) studied four public educational institutions in Pakistan using non-probability sampling of 200 respondents. The study found that there is a relationship between employee turnover intention and job satisfaction, organizational commitment and leadership support. Shurbagi and Zahari (2013) also conducted a quantitative survey of 227 employees of National Oil Corporation in Libya, and found that organizational commitment, specifically affective commitment, was positively related to job satisfaction. Owing to the huge costs of replacing employees, turnover has negative consequences on the organization. This is because the firm will incur extra expense on selection and recruitment as well as training for required skills and competencies.

2.4 Conceptual framework

The study has three variables; organizational commitment, employee turnover intentions and job satisfaction. Independent variables are organizational commitment, employee turnover intentions while the dependent variable is job satisfaction as shown in the figure below.

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Figure 1: Conceptual framework of the study

3.0 Methodology

This study involved quantitative and qualitative research methods. This mixed method approach ensures that diverse opinions and thoughts are captured in the study which brings in more reliable results and errors. According to Lakshman et al (2000), quantitative methods can be measured, and has credibility over the unmeasurable parameters. However, the extent of consequences, events and severity cannot be determined by quantitative methods alone which requires the use of qualitative analysis. In this investigation, 200 employees of Hilton Hotel Chain in United Kingdom were administered with questionnaires. The questionnaires were self-administered to the employees after an agreement with the hotel management on the best time to complete the survey.

Despite questionnaires being easy and convenient to administer, they do not capture the opinions and thoughts of respondents in detail. Interview schedules provide the details and capacity to further probe the respondents for additional information. Convenience sampling was used in the various departments of the hotels; customer care, culinary services, accommodation, marketing and finance. Similarly, managers were notified on the upcoming survey so as to give opportunity to employees to respond. The managers were sent e-mail invitations and reminders to inform employees to participate in the survey. To ensure reliability of the data collection instruments, they were piloted to the students from the business management department at the university. The study also liaised with the lecturers and tutorial assistant to ensure validity of the questions. The instruments were designed in a way to respond to the three research objectives and hypotheses (see Appendix VI).

Hypotheses;

H1: There is no relationship between employee turnover and job satisfaction

H2: There is no relationship between job satisfaction and organizational commitment

The study used descriptive, correlation and regression measures. Descriptive statistics employ measures of central tendency, dispersion and distribution such as percentages, mean, standard deviation and kurtosis or skewness. Correlation measures attempt to relate the strength and direction of variables involved in the study. On the other hand, regression determines how a number of independent variables influence one dependent variable in an equation.

4.0 Results and discussion

4.1 Results

The study administered 200 questionnaires of which 160 were returned. Of the 160, 14 questionnaires were rejected due to insufficient data making the total number of valid questionnaires to be 146. The return rate was 80 percent which was sufficient for reliable results. The data was analyzed using descriptive, correlation and regression methods. As shown in the table 1 (Appendix I), majority of the respondents 42 (28.6%) were less than 25 years of age. This was closely followed by 38 (26.02%) number of respondents who were between 36 and 45 years. On educational attainment, 61(41.78%) of the respondents had a college certificate and was followed by 46(35.51%) who had a bachelor degree certificate. Almost respondents who indicated that they were single 61(41.8%) were equal to those who are married 60(41.1%), followed by a distant third of those who indicated they were divorced 15(23.8%). On income levels, 53(36.1%) of the respondents had income ranging between £1001and £1600. A significant other 36(24.7%) had income of over than £16001 per month. On work experience, most of the respondents had worked between 1 and 12 years representing 112(88%) of the respondent population. Most of the respondents 53(36.3%) were drawn from culinary services followed by accommodation at 34(23.3%) of the respondents.

Respondents said that they were satisfied with most aspects of job satisfaction such as co-worker satisfaction, rewards, benefits supervision and operating procedure. Their means and standard deviation were organizational commitment (µ=3.92; SD=1.16); job satisfaction (µ=4.06; SD=0.984) and employee turnover (µ=2.42; SD=1.13) as shown in Appendix II. According to Sekaran (2005), Cronbach’s alpha (α) is used to test reliability of the instrument. Suitable values are considered between 0.6 and 0.8. The reliability of coefficients of the variables were; affective commitment (α=0.851); continuance commitment (α=0.784); job satisfaction (α=0.669) and employee turnover intentions (α=0.919). Pearson correlations were also used to establish the relationships between the variables. At p<0.01, organizational commitment had the highest positive relationship with the five facets of job satisfaction (r=0.584**). On the other hand, job satisfaction showed a negative relationship to employee turnover intentions (r=-0.564**, p=0.000) at p<0.01 (See Appendix IV).

To test hypothesis, regression statistics was used. Job satisfaction showed negative relationship with employee turnover intentions (β=-.523; p=0.000). This confirms the first hypothesis H1. Yet, H2 was supported because at (β=.433; p=0.000), there was a strong and positive relationship between organizational commitment and job satisfaction (see Appendix V). The regression results showed that the model fits the data. Similarly, 31 percent of job satisfaction and organizational commitment explains the variability in employee turnover intentions at p=0.001.

4.2 Discussion

From the results above, all the hypotheses were supported; H1 and H3 and H2. This shows that employee turnover intentions have negative association with job satisfaction. On the other hand, organizational commitment showed strong negative relationship with employee turnover intentions. This hypothesis was supported. Also, organizational commitment was positively correlated with job satisfaction, and the hypothesis was supported. When employee are happy and derive pleasure from their work, they do not show any intentions to exit the organization. This is also true of their commitment to their organizations owing rewards, benefits, work conditions and other motivations that satisfy the employee. These findings are consistent with those of Yousef (2000); Hu et al (2009) and Chen and Fransesco (2000) who showed that job satisfaction was positively correlation to organizational commitment. On the contrary, they found a negative relationship between organizational commitment and employee turnover. In any case, workers who show not commitment or interest in the organization are likely to exit. Yet, there are other employees who do not have intentions to leave the organization but are not enthusiastic enough to bring the required productivity. It also shows that organizational commitment has a role in reducing employee turnover. The correlation also showed that organizational commitment has a strong and positive correlation with job satisfaction. This was not consistent with the findings of Shurbagi and Zahari (2013) who found no relationship between organizational commitment and job satisfaction. On the other hand, organizational commitment had a strong correlation with job satisfaction. Similarly, employee turnover intentions showed a negative correlation with job satisfaction. Earlier mentioned, job satisfaction in form of better pay, working conditions, healthy relationship among co-workers and management, and employee engagement has a way of making employees to stick with the organization. As shown in the regression results, turnover intentions and job satisfaction have negative correlation. This is because organizations that try to reduce differences between compensation of employees have higher chances of reducing turnover of employees.

5.0 Conclusion and recommendations

The study found that job satisfaction is positively correlated to organizational commitment. However, there is a negative correlation between job satisfaction and employee turnover intentions. The study also found that organizational commitment has a negative association with employee turnover intentions. The management of Hilton hotel chain can find the results from descriptive, correlation, and regression statistics to be evidence on how employees can lead to organizational productivity.

The study recommends that;

  1. Managers should employees are satisfied and well remunerated in order to show commitment to work and little intentions to exit.

  2. Regular training and skill development is required for employees to be satisfied

  3. Work environment and conditions should be made suitable for employee productivity

  4. Better remuneration and work study should undertaken to ensure work correspond to the pay

  5. Work/life balance for each employee be effected

5.1 Implications of this study

This study is crucial to the management of Hilton hotels to ensure that as a service organization, employees are important. Employees determine the satisfaction of customers and their interests should be well secured. By studying the relationships between satisfaction and turnover intentions, it is possible to understand why the best and competent employees leave the organization for other firms.

5.2 Limitation of the study

This study focused on one line of companies in the larger services sector. The current trends in telecommunications and off-shoring may show different results. Again, the sample size of 200 may be inadequate to generalize the findings to the hospitality sector as a whole. However, the results still indicate consistency with previous studies and provide relevance to the current studies on organizational performance.

References

Allen, D.G. & Griffith, R.W. (1999) Job performance and turnover: a review and integrative multi-route model. Human Resource Management Review, Vol. 9, pp. 525-48.

Chen, Z.X. & Francesco., A. M. (2000). Employee demography, organizational commitment, and turnover intentions in China: do cultural differences matter? Human Relations, Vol. 53, No. 6, pp 869-887

Gustafson, C. M. (2002) Staff turnover: Retention. International Journal of Contemporary Hospitality Management, Vol. 14, No.3, pp 106-110.

Hu, Y. J., Yang, F. Y., and Islam, M., (2009). Leadership behavior, satisfaction, and the balanced scorecard approach: An empirical investigation of the manager-employee relationship at retail institutions in Taiwan. International Journal of Commerce and Management, Vol. 20, No. 4, pp 339-356.

Iqbal, S., Ehsan, S., Rizwan, M., & Noreen, M. (2014) The impact of organizational commitment, job satisfaction, job stress and leadership support on turnover intention in educational institutes. International Journal of Human Resource Studies, Vol. 4, No. 2, pp 181-193.

Lakshman, M., Sinha, L., Biswas, M., Charles, M. & Arora, N.K. (2000) Quantitative vs qualitative research methods. The Indian Journal of Pediatrics, Vol. 67, No. 5, pp 369-377.

Liu, B.C., Liu, J.X., & Hu, J.(2010). Person-organization fit, Job satisfaction and turnover intention: A empirical study in the Chinese Public Sector. Social behavior and Personality, Vol. 38, No. 5, pp 615-626.

Mathieu, J.E. & Zajac, D.M. (1990) A review and meta-analysis of the antecedents, correlates, and consequences of organizational commitment. Psychological Bulletin, Vol. 108 No. 2, pp. 171-94

McCarthy, G., Tyrrell, M.P., & Lehane, E. (2007) Intention to ‘leave’ or ‘stay’ in nursing. Journal of Nursing Management, Vol. 15, pp 248–255.

Mbah, S.E. & Ikemefuna, C.O. (2012). Job Satisfaction and Employees’ Turnover Intentions in total Nigeria plc. in Lagos State. International Journal of Humanities and Social Science, Vol. 2 No. 14, pp 275-286.

Medina, E. (2012) Job Satisfaction and Employee Turnover Intention: What does Organizational Culture Have To Do With it? Columbia University.

Pfeffer, J. (2007) Human Resources from an Organizational Behavior Perspective: Some Paradoxes Explained. The Journal of Economic Perspectives, Vol. 21, No. 4. pp. 115 134

Reily, D. (2006) Turnover intention. The mediation effect of job satisfaction, affective commitment and continuance commitment. Master thesis, University of Waikato.

Rizwan, M., Shahid, M., Shafiq, H., Tabassum, S., Bari, R. & Umer, J. (2013) Impact of Psychological Factors on Employee Turnover Intentions. International Journal of Research in Commerce, Economics and Management, Vol. 3, No. 3, pp 63-69.

Saeed, I., Waseem, M., Sikander, S., & Rizwan, M.(2014) The relationship of Turnover intention with job satisfaction, job performance, Leader member exchange, Emotional intelligence and organizational commitment. International Journal of Learning & Development, Vol. 4, No. 2, pp 242-254.

Shurbagi, A.M. & Zahari, I.B. (2013) The Relationship between Organizational Commitment and Job Satisfaction in National Oil Corporation of Libya. 2nd International Conference on Business, Economics, and Behavioral Sciences (ICBEBS’2013) Dec. 20-21, 2013 Bali (Indonesia).

Sekaran, U. (2005) Research methods for business with SPSS 13.0 set. John Wiley and Sons.

Susskind, A.M., Borchgrevink, C.P., Kacmar, K.M. & Brymer, R.A. (2000) Customer service Employees behavioral intentions and attitudes: an examination of construct validity and a path model. International Journal of Hospitality Management, Vol. 19 No. 1, pp. 53-77.

Testa, M.R. (2001) Organizational commitment, job satisfaction, and effort in the service environment. The Journal of Psychology, Vol. 135 No. 2, pp. 226-36.

Vroom, V.H. (1964) Work and Motivation, Wiley, New York, NY.

YousefD.A. (2000) Organizational commitment and job satisfaction as predictors of attitudes toward organizational change in a non-Western setting. Personnel Review, Vol. 29, No. 5, pp. 567-592.

Appendices

Appendix I: Descriptive statistics table

Contents

Frequency

Percent (%)

Less than 25 years

26-35 years

36-45 years

46-55 years

Over 55 years

Education Attainment

Primary school

High school

Bachelors

Marital status

Divorced

Less than £500pm

£501-1000

£1001-1600

Over £1601

Work experience

Less than 1 year

1-5 years

6-12 years

13-20 years

Over 20 years

Department

Customer care

Culinary services

Accommodation

Marketing

Valid=146

Appendix II: Mean and Standard Deviation

Std. Deviation

Job Satisfaction

Org. Commitment

Turnover Intention

Valid N (listwise)

Appendix III: Reliability analysis table

Variables and dimensions

N of Items

Cronbach’s alpha (α)

Affective commitment

Continuance commitment

Job satisfaction

Employee Turnover intentions

Appendix IV: Correlations

Satisfaction

Commitment

Turnover Intention

Satisfaction

Pearson Correlation

Sig. (2-tailed)

Org. Commitment

Pearson Correlation

Sig. (2-tailed)

Turnover Intention

Pearson Correlation

Sig. (2-tailed)

**. Correlation is significant at the 0.01 level (2-tailed).

Appendix V: Regression table

Coefficientsa

Unstandardized Coefficients

Standardized Coefficients

Std. Error

(Constant)

Commitment

Turnover Intention

a. Dependent Variable: Job Satisfaction

Model Summaryb

Adjusted R Square

Std. Error of the Estimate

Change Statistics

Durbin-Watson

R Square Change

Sig. F Change

a. Predictors: (Constant), Commitment, Satisfaction

b. Dependent Variable: Turnover Intention

Appendix VI: Hypothesis testing

Hypothesis

Model variables

Estimate

Emp Turnover_Job sat

Supported

Org.Comt_Job Sat

Supported