Literature Review

The term job satisfaction describes a positive feeling about (a job, resulting from an evaluation of its
characteristics. A person with a high level of job satisfaction holds positive feeling about his or her job,
while a dissatisfy ed person holds negative feelings. In fact, the major job-satisfaction on facets are work
itself, pay advancement opportunities, supervision, coworkers (Robbins et al.,2009).

Employee satisfaction refers to [he degree to which the working environment meets the wishes and the
needs of the employees. It is related to work itself, working climate, behaviors of supervisors, coworker’s
management and other growth or development opportunities. Employee satisfaction can be defined as a
pleasurable or positive emotional l state resulting from the appraisal of one's job or experience (Locke,
1976).

According to social exchange theory (Wayne et aI.1997; and Flynn, 2005) when an employer offers
favorable working conditions to make its employees more satisfied, the employees, in tum, will try to
make more efforts and to be more committed towards the organization as a means of 32 reciprocities for
their employer, which leads to big service quality (Love man, 1998; Silvestro and Cross, 2000). Employee
satisfaction is an important goal for organizations to reach, as it has been shown that profitability,
productivity, employee retention and customer satisfaction are linked to employee satisfaction. Satisfied
and motivated employees create customer satisfaction and in tum positively influence organizational
performance (Hooi, 2007). Employees' satisfaction is directly related to quality management and
profitability in the service industry and their level of satisfaction leads to higher service quality as well as
customers' satisfaction.

Service quality and customer satisfaction eventually lead to financial gains. Employee satisfaction plays a
significant role in enhancing the operational performance of organizations (Organ, 1977; and Smith et aI.,
1983). Employees with high level of job satisfaction will appear to the customers as more balanced and
pleased with their environment, leading to positive influence on the level of customer satisfaction
(Homburg and Stock, 2004). On the other band, dissatisfied employees tend to show unpleasant emotions
to customers, reducing the level of customer satisfaction. There is a negative relationship between
employee turnover and employee satisfaction. Long-tenured employees develop personal relationship
with customers. These relationships are the foundation for a reinforcing cycle of positive interactions
between employees and customers (Heskett et aI.1997). Employees who develop relationships with
customers are likely to provide better services to their customers. And, customers who receive better
service usually express fewer complaints and thereby create fewer problems for employees of the
company. So, employees in turn react more favorably towards the customers. These reactions result in
better service which again leads to higher customer satisfaction. Employees ‘satisfaction is an essential
prerequisite for a healthy organizational environment. Factors related to job satisfaction are relevant to
the prevention of employee frustration and dissatisfaction. Highly satisfied employees tend to work
harder and put their best efforts, which will improve the performance of the banks. Satisfied employees
are more likely to work harder and provide better services via organizational citizenship behaviors.
Employees who are satisfied with their jobs tend to be more involved in their organizations and more
dedicated to delivering services with a high level of quality (Yoon and Suh, 2003). Luthans (1992)
mentioned five dimensions of employee satisfaction, which are salary, job characteristics, working
conditions, management politics and coworkers. Dmmmond and Stoddard (1991) listed the dimensions
of employee satisfaction as working conditions, pay, relationships with coworkers and supervisor,
organizational policies and the nature of the job itself. Kazemzadeh and Bashiri (2005) identified 10
dimensions of employee satisfaction as management and personnel relationship, relationship between
employees, employees' motivation, education, wage and salary, other welfare facilities, employees'
commitment, job promotion, performance and organizations systems and processes .Bodur (2002)
suggested that work content, age, gender, educational level, working conditions, location (rural or urban),
coworkers, salary and working hours are the factors related (Q job satisfaction. Herzberg (1964 and 1966)
provided two-factor theory for job satisfaction - hygiene factor (supervision, working conditions,
coworkers, pay, policies I procedures and job security) which leads to dissatisfaction; and motivation
factor (achievement, recognition, the work itself, responsibility, advancement and growth) which leads to
satisfaction. Sowmya and Panchanatham

33(20 11) conducted a study to identify the job satisfaction factors in the banks of Chennai. Five factors
were extracted during the study for job satisfaction in the banks of Chennai which included pay and
promotion, organization aspects, supervisor behavior, job and working condition, and coworker behavior.
Khalid and lrshad (20 10) found that the employees of the private sector banks were more satisfied with
pay as compared to the public-sector bank employees, whereas the employees of the public sector were
satisfied with job security as compared to the private sector bank employees.