INTRODUCTION TO QUALITY OF WORK LIFE

2.1 Introduction
In This chapter the necessary theoretical framework for developing proper

perspectives of the subject has been provided. The covered areas are the evaluation and

the concept of quality of work life(QWL), QWL's dimensions and principles, how to

measure QWL , The benefits of QWL for organizations and individuals, , practices,

tools and techniques, and performance of quality, As well as benefits and challenges of

adopting lean supply chain management. At the end of this chapter is illustrated the

outline of the theories and previous studies.

Quality of Work Life (QWL) is a relatively new concept which is defined as the overall

quality of an individual's working life. QWL is sometimes considered as a sub-concept

of the broad concept of quality of life, which refers to the overall quality of an

individual’s life. Quality of life includes factors such as income, health, social

relationships, and other factors such as happiness and fulfillment. QWL being the main

subject of the present study meaning, definition, scope of the QWL, and QWL in the

Indian context, etc., have been discussed in this chapter. Quality of work life parameters

which are adopted by the researcher has been discussed at the end of the chapter

In this chapter explains some concepts that are relevant to the thesis. The

covered areas are supply chain concept, supply chain management, lean concept,

lean supply chain management concept, lean principles, practices, tools and

techniques, and performance of quality, As well as benefits and challenges of

adopting lean supply chain management. At the end of this chapter is illustrated

the outline of the theories and previous studies.

2.2 Evolution of Quality of Work Life (QWL)

1
 The Quality of Work Life refers to all the organizational inputs that aim at the

employees 'satisfaction and enhancing organizational effectiveness. Walton (1973)

attributed the evolution of Quality of Work Life to various phases in history. Legislation

enacted in early 20th century to protect employees from risks inherent in job and to

eliminate hazardous working conditions, followed by the unionization movement in the

1930s and 1940s were the initial steps. Emphasis was on ‘job security, due process at

the work place and economic gains for the worker’. The 1950s and the 1960s saw the

development of different theories by psychologists proposing a positive relationship

between morale and productivity, and the possibility that improved human relations that

would lead to enhancement of productivity. Attempts at reforms to acquire equal

employment opportunity and job enrichment schemes also were introduced. During

1970’s, the idea of QWL was evolved, according to Walton, as a broader concept than

the earlier developments, and something that includes the values, human needs and

aspirations.

An international conference was held at Arden House, New York in 1972. It dealt in

detail with the practice and theory of democratization of work place. In this conference

the term “Quality of Working Life’ was introduced, and the International Council for

Quality of Working Life (ICQWL) was formed to facilitate research on and action for

Quality of Working Life. During 1972 to 1980 the concern for QWL gained

momentum, and assumed the proportion of a movement. Some of the members of

ICQWL wanted to hold another International Conference, during the 1980s. In Canada,

QWL researches were gaining attention; and a weekend meeting was organized in

Toronto in 1980 to discuss ICQWL’s proposal. The first open International Conference

was organized in Toronto in August 1981 on Quality of Work Life. A large number of

managers, union representatives and academicians, attended the conference. Jenkins

2
(1981) observed that the Toronto conference demonstrated that the Quality of Working

Life is becoming an important issue of the ongoing organizational reality to enhance the

Quality of Work Life of employees.

2.3 The quality of work life concept

The QWL is a multi-dimensional concept that has been defined by scholars in

variety ways showing discrepancy on its constructs as well as components (Levine et

al., 1984; Mirvis and Lawler, 1984; Taylor, 1978; Walton, 1975). Some studies

associate the concept of QWL with employee’s well-being (Lawler, 1982), conditions

of work life (Elizur and Shye, 1990), income sufficiency, profit sharing, employee

autonomy, social interaction, employee satisfaction, employee involvement,

advancement and work relations (Mohan and Kanta, 2013). Walton (1975) highlighted

eight dimensions of QWL, (1) Adequate and fair compensation, (2) Safe and healthy

working conditions, (3) Immediate opportunity to use and develop human capacities, (4)

Opportunity for continued growth and security, (5) Social integration in the work

organization (6) Constitutionalism in the work organization (7) Work and total life

space and (8) Social relevance of work life.

3
 Exploring the underlying structure of QWL, Taylor (1978) proposed additional

items to integrate what society and employer think significant concerning QWL. As

well by means of a step by step method, Levine et al. (1984) suggested seven important

drivers for QWL, (1) The degree to which superiors treat employees with respect and

have self-reliance in their talents, (2) Diversity in daily work schedule, (3) Challenge of

work, (4) Present work leads to future work opportunities, (5) Self-esteem, (6) Extent to

which life outside of work influences life at work and (7) The extent to which work

accomplished by employees contributes to society.

Martel and Dupuis (2006) argued that a model of QWL consists of a complex set o f

organizational interventions and a type of work life by employees. According to

Carayon (1997), QWL is as a complex interaction of work systematic elements

including individual task, organizational factors, environment, tools and technology.

On the other hand, Duyan (2013) emphasized the importance of human

considerations linking QWL to employee’s mental, physical, psychological and spiritual

needs. Also, Newstrom and Davis (1986) pointed out to QWL as the degree to which

employees can meet and satisfy their essential personal needs through work. Davis

(1983) defined the QWL as the quality of interactions between employees, work

environment, economic factors and technology.

Similarly, Hian and Einstein (1990) argued that QWL includes such factors as

employee experience, autonomous work groups, work rewarding environment and

organizational involvement. Other researchers identified the key concepts captured in

QWL as reward and compensation systems; benefit sharing, employees’ growth, work

relations and opportunity for better participations (Robbins, 1989; Havlovic, 1991; Wan

and Chan, 2013). Sasser (1997) measured the QWL by examining the feelings of

4
employees towards work environment including job satisfaction and interpersonal

interactions.

Islam and Siengthai (2009) defined QWL as the favorable condition and

environment of employees with regard to benefit, welfare and management attitudes. In

this sense, QWL includes components related to health and wellbeing, job security, job

satisfaction, competence development and the balance between work and non-work life

(Rethinam and Ismail, 2007). Danna and Griffin (1999) suggested that the dimensions

of QWL should be beyond intrinsic factors of pay and reward to include dimensions

connected to wellbeing such as clarity of goals, appraisal, recognition and personal

development. Hackman and Oldham (1976) emphasized the importance of

psychological growth as an essential dimension of QWL including skill variety, task

identity, task significance, autonomy and feedback.

The above review reveals that QWL is a broad multidimensional concept

encompassing different approaches and models reflecting a large number of inter-

related organizational and human dimensions (Rethinam and Ismail, 2007). Despite this

complexity it can be inferred that the concept of QWL revolves around the wellbeing of

employees and that its dimensions in general, include employee’s satisfaction with

physical and psychological factors related to work and daily life. The QWL in this sense

reflects the interaction between employees and work environment. The perception of

quality of work life can be referred to as the favorableness or un-favorableness of a job

environment for people (Davis, 1983).

2.4 Components/ Dimensions of Quality of Work Life (QWL)

In this section a detailed description of major components of quality of work life

(QWL) according to various researches is given.

5
2.4.1 Adequate and Fair Compensation
The compensation for work is always a fundamental driving force behind work so as to

earn a living for one self and family (Walton, 1973; Nirenberg, 1993). Stein (1983)

identified compensation as being one of five important components of QWL, although

its categorical classification is somewhat different to Walton and Orpen. Similarly, Reid

(1992) in a study on clothing workers confirmed Walton’s proposition that

compensation plays a critical role in determining the quality of work life (QWL).

2.4.2 Safe and Healthy Working Conditions

It has been found that safe and healthy work conditions have a significant impact on

quality of work life (QWL) of employees (Walton 1973, Rousseau 1978, Nirenberg

1993). The employees should not be exposed to such working conditions that can

adversely affect their physical and mental health resulting into a low level of quality of

work life (QWL) of concerned employees (Orpen, 1981).

2.4.3 Opportunity to use and develop competencies

The structural approach proposed by Herman and Hulin (1972) and Loscocco (1990)

explains the necessity of jobs to contain variety as a component of quality of work life

(QWL). It is stated that employees’ perception of the quality of work life (QWL)

depends upon the extent to which jobs allow them not only to use but also to develop

their competencies (Hackman and Oldham, 1980).

2.4.4 Opportunity for continued growth

The component of opportunity for continued growth is considered as a major motivator

of employees working at any position or in any sector. This also relates to the idea of

6
professional learning as a means for career development or succession possibilities for

the employees in any organization (Walton, 1975, Bertrand, 1992).

2.4.5 Work and total life space

In work life literature the concept of work life is often coupled with the word balance,

employees should be able to experience work and personal lives in an integrated form

(Williams, 2000, Rapport et al., 2002). Kotze (2005) asserts that work family balance

enhances an individual’s QWL, as involvement in multiple roles protects individuals

from the effects of negative experiences in any one role.

2.4.6 Organizational Climate

Organizational climate can be defined as the patterns of social interactions which

characterize any organization, Walton (1973) and Orpen (1981) have identified five

factors, namely, supportiveness, tolerance, equality, mobility and identification as

essential for these interactions to have beneficial outcomes for employees. The

communication channel and organizational atmosphere based on fairness and equity

play a crucial role in QWL of any employee (Sharma, 1989; Srivastava, 1996).

2.4.7 Stress control and employee burn out

Stress control is most important for employees to work efficiently as continuous high

level of stress leads to employee burnout which results into absenteeism and employee

turnover. The incidence of high stress level and employee burnout reflects in a low

quality of work life (QWL) of employees (Rethinam and Ismail, 2008).

2.4.8 Constitutionalism in the work organization

This component of quality of work life (QWL) is concerned with what rights employees

should enjoy, whether they exercise them or not, whether the organization has set

7
formal procedures to protects the individual worker from arbitrary and capricious

actions by employers. (Walton , 1975; Orpen, 1981).

2.4.9 Job security

Many organizations tend to employ workers on the basis of short or fixed term

contracts rather than long term contracts to minimize employee costs, the uncertainty

regarding task performance leading to a lower quality of work life (Sverke, et al., 2006).

2.4.10 Supervisor and Colleague support

According to Michie and Williams (2003), poor supervisor support, long hours of

work, and work overload factors are associated with psychological ill health. On the

other hand, a good supervisor can also help one to use one’s resources better and

manage one’s workload (Hawkins and Shohet, 2000). Social support colleagues refer to

instrumental and emotional support provided by colleagues (Van Der Doef and Maes,

1999).

2.4.11 Social relevance of work

The employees who feel that their organization is acting in a socially responsible

manner, in terms of its products and services, will tend to value their work and careers

more highly, which in turn is likely to enhance the self esteem and well being leading to

a higher quality of work life (QWL) (Walton, 1975; Orpen, 1981).

2.4.12 Recognition for achievement

This component of QWL is defined by Kotze (2008) as the recognition for

achievements of the employees by management, colleagues and subordinates as

feedback is closely related to task significance of employees. Hackman and Oldham

(1979) suggested that feedback is a critical factor in reducing absenteeism and

employee turnover.

8
2.4.13 Autonomy
The job should be designed in such a manner that it affords the employee a degree of

independence and discretion (Orpen, 1981). Similarly, Newell (2002) opined that QWL

involves providing employees with greater responsibility and autonomy. A lot of

empirical results and theories about occupational stress have regarded job autonomy to

be crucial for the health of employees (Jenkins, 1991; Karasek, 1998).

2.4.14 Role clarity

When the individual employee does not do certain tasks as the employer expects, stress

develops which results into low quality of work life (QWL) of concerned employees

(Pollard, 2001). Tubre and Collins (2000) observed that the clarity with which

individuals perceive their work roles is linked to several important organizational

outcomes including job performance, organizational commitment and job satisfaction.

2.4.15 Creativity and innovation

Creativity is the prerequisite for an organization’s innovation, effectiveness and long-

term survival (Oldham, 2002; Shalley et. al., 2004). The creativity and innovation at

work is crucial for genuine psychological growth of the employees which can be

achieved through new or novel exposure to the employees (Orpen, 1981, Warr, 1994).

2.4.16 Well formulated and established goals

It is most important to have a clear direction that specifies workers’ purpose and orients

them towards their objectives to be achieved in a given time period as deadlines and

time pressures are important regulators (Nordqvist, Hovmark and Zika-Viktorsson,

2004). The activities and tasks are given a certain time frame as absence of time

pressure can lead to indifference towards completion of given task (Gevers, Van Eerde

and Rutte, 2001).

9
2.4.17 Meaningfulness and significance of work
Thomas (2000) identified the four critical intrinsic reward motivators in a job, namely,

sense of meaning and purpose, sense of choice, sense of competence and sense of

progress. Chalofsky (2003) believed that quality of work life (QWL) is higher in

workers having duties and tasks that are meaningful to him and to others in the

organization.

2.4.18 Identification with and enjoyment of work

Every employee wants to identify itself with its job profile so as to enjoy its work life

which invariably leads to better quality of work life (QWL) of employees. The work

becomes meaningful for employees primarily by skill variety, task identity and task

significance among others (Hackman and Oldham, 1980).

2.5 The principle of quality of work life

Herrick and Maccoby (1975) have identified four basic Principles which result in

humanization of work and improve the QWL, the principles are:

 The Principle of Equity

 principle of Security

 The Principle of Individualization

 The Principle of Democracy

2.5.1 The principle of Security: One of the preconditions of humanization of work is

that work should be free from anxiety, fear, and the loss of future employment. Such

safe and secured working conditions help to foster skills, ideas and confidence of

employees.

2.5.2 The Principle of Equity: This implies fair reward for effort made by the working

people. Profit sharing between the owner and workers and equity among workers are

10
the examples of following the principle of equity. This also reflects humanization of

work.

2.5.3 The Principle of Individualization: This refers to freedom and autonomy to

workers so as to encourage them to develop themselves to their utmost competence.

Such a process generates the ownership feeling among workers towards their jobs.

2.5.4 The Principle of Democracy: The principle of democracy implies right to

personal privacy, freedom of speech, and equitable treatment. Besides these, ongoing

participative management in business organizations symbolizes the principle of

democracy.

All these above principles help humanization of work that leads towards developing

sense of belonging, commitment and engagement for the job and organization through

better QWL.

2.6 Measurement/ assessment of Quality of Work Life

According to Kotze (2005) diversity in the definition of QWL generates widespread

disagreement about its measurement and interpretation. The point of view from which

the construct is defined will determine which determinants/ dimensions are relevant in

its evaluation. This will then also have an effect on the way in which research on QWL

will be approached, as well as the selection of appropriate data gathering instruments.

While working with their own definitions of QWL, researchers have decided on who

would constitute an appropriate survey population. Subsequently, many scientific

instruments and tools have been developed. Ellis (2002) (Kotze, 2005) is of the opinion

that the approach taken to QWL measurement varies along a continuum from

completely quantitative to completely qualitative methodologies, with many variations

between.

11
 Since a dominant theme of much of QWL research is the assumption that

individuals’ experiences of satisfaction or dissatisfaction define the quality of their work

life (Wilcock & Wright, 1991) (Kotze, 2005), many QWL surveys typically measure the

job-related perceptions and attitudes of individuals such as job satisfaction, job

involvement, work commitment, and organizational commitment, of which job

satisfaction is studied most often (Kerce & Booth-Kewley, 1993) (Kotze, 2005). This

approach measures the overall job satisfaction an individual is experiencing, or specific

facets of job satisfaction such as pay, benefits, working conditions, changes for

advancement, job security, co workers, physical resources and equipment, chances to

develop skills, supervision, opportunity for personal growth and development.

Gattinker and Howg (1990), Looij and Benders (1995) and Abo-Znadh (1999)

(Kotze, 2005) is of the opinion that those who approach QWL from a socio technical

systems theory (STS) perspective usually reduce the measurement of QWL to work

content and job characteristics and the consequences that these have on internal labour

relations. Characteristics such as skill variety, task identity, task significance, autonomy,

speed of working and feedback are evaluated. Job characteristics measures differ from

job satisfaction measures in that the former scales are primarily descriptive rather than

evaluative. Therefore, instead of assessing respondents’ reactions to their jobs, items

assess the extent to which various characteristics are descriptive of their jobs.

According to Kerce and Booth-Kewley (1993) (Kotze, 2005), a QWL survey is

distinguished from other standard surveys of employee satisfaction in that it is more

comprehensive. A QWL survey should include, at a minimum, the measure of overall

job satisfaction, job characteristics and job involvement. It might also include a

dispositional measure, thus allowing individual dispositional characteristics such as

differences in abilities, values, expectations, personality, perceptions and needs to be

12
considered as a moderating variable (Coetzee, 2004; Cloete & Stuart, 2004; Annandale,

Pienaar & Scholtz, 2004) (in Kotze, 2005). According to Looij and Benders (1995)

(Kotze, 2005) subjective opinions such as perceptions held by an individual employee

may play an important role in his/ her decision to enter, stay with or even leave an

organization. It seems as if a long -standing debate has been centered on this question of

whether personal factors or structural factors (job characteristics) are the principal

determinants of perceived QWL.

The basic assumption of the dispositional approach is that personal attributes such as

dispositional tendencies, are the primary influence on QWL, while the structural

approach assumes that situational variables, such as characteristics of the job, have the

greatest effect on QWL (Kerce & Booth-Kewley, 1993) (Kotze, 2005). Advocates of

the dispositional position argue that individuals tend to be consistent in their job

attitudes over time and that enduring dispositional attributes exert as strong an influence

on job attitudes as objective job characteristics. According to Kotze (2005) it is

therefore suggested that dispositional variables probably have a greater impact and are

more relevant for managers seeking to improve the QWL of their workers.

In the structural approach, high QWL is defined by the existence of a certain set of

organizational conditions and practices. High QWL is assumed to occur when jobs are

enriched, supervision is democratic, employees are involved in their jobs and the work

environment is safe. According to Kerce and Booth-Kewley (1993) (Kotze, 2005) a

third approach, based on expectancy theories, suggests the possibility that individuals

come to the work place with different goals and needs that they seek to fulfill through

work as well as different perceptions of job characteristics.

13
 Although individuals’ particular needs, values and dispositions shape their work

attitudes, this approach recognize that a single, pervasive need structure cannot be

assumed. Differences in needs are therefore assumed to account for variation in work

attitudes among employees in the same jobs.

Those in favor of a more integrated approach, focus on the interaction of structural

and personal influences, with QWL determined by the degree to which the full range of

human needs are met (Kotze, 2005). This approach acknowledges aspects such as

democratic decision-making and enriched jobs are not desirable or important to

everyone. Individuals bring different needs to the workplace and are likely to

experience the extent that these needs are satisfied (Kerce & Booth-Kewley, 1993)

(Kotze, 2005). Therefore some researchers make use of the discrepancy theory of

satisfaction to explain their results (Wilcock & Wright, 1991; Rice, Pierce, Moyer &

McFarlin, 1991) (Kotze, 2005).

Brooks and Gawel (2001) (Kotze, 2005) see the goals of QWL surveys as the study

of workplace experiences, the work itself, and the world of work, in order to suggest

aspects of the workplace or work that could be modified so that the employees and the

organization reach their goals simultaneously. Lewis, Brazil, Krueger, Lohfeld and

Tjam (2001) (Kotze, 2005) measure QWL in terms of extrinsic, intrinsic or prior traits.

Extrinsic traits are salaries and other tangible benefits. Intrinsic traits include skill

levels, authority and challenge, while prior traits are those of the individuals involved,

such as their gender or employment status.

In terms of the development and construction of measuring instruments, some

researchers base their development of their QWL survey instruments on general topic

areas of QWL, as identified through a literature review, for example, co-worker and

14
supervisor support, team work and communications, staff training and development and

compensation and benefits (Lewis et al. 2001; Hausman, Nebeker, McCreary &

Donaldson Jr, 2001; Consodine & Callus, 2002) (Kotze, 2005).

Others base the construction of their questionnaires on specific theoretical models

such as occupational stress models or need satisfaction and spillover theories (Brooks &

Gawel, 2001; Van der Doef & Maes, 1999; Sirgy et al., 2001) (Kotze, 2005). Often

researchers design questionnaires by borrowing and combining items from different

questionnaires, for example, job satisfaction, job characteristics, work involvement,

work stress, wellness at work and other questionnaires (Cohen, Chang, Ledford (Jr)

1997; Peletier, Coutu & Lamonde, 1995; Carayon, Hoonakker, Marchand & Schwarz,

2003) (Kotze, 2005). Many other measures are being used to determine QWL, including

the Michigan Quality of Work Program which measures various work related concerns

(Seashore, Lawler, Mirvis & Cammann, 1983) (Kotze, 2005) and the Michigan

Organizational Assessment Questionnaire (MOAQ) for measurement of group

processes, supervisor behaviours, etcetera (Kerce & BoothKewley, 1993) (Kotze,

2005).

According to Carayon (1997) (Kotze, 2005), diary studies can be powerful in the

examination of terms of technological stressors and certain temporal issues. Diary

studies ask people to keep track of work-related events on a frequent basis. The

frequency of measurement varies from hourly to daily to weekly, and can be used to

examine fluctuations of work stressors.

Based on two leading models in occupational stress research, the Job Demand

Control-Support model and the Michigan model, a comprehensive quality of work

questionnaire, was constructed, namely the Leiden Quality of Work Questionnaire.

15
 The factor structure of this questionnaire was assessed and cross-validated in two sub

samples of 2000 men and women from a large sample of the Dutch working population.

The questionnaire was constructed to assess work characteristics from two

influential occupational stress models, the Job Demand Control Support model (Johnson

& Hall, 1988; Johnson, 1989; Karasek & Theorell, 1990) and the Michigan model

(Caplan, Cobb, French, van Harrison & Pinneau, 1975).

This questionnaire measures the key components of the Job Demand-Control-

Support model, namely, psychological demands, skill discretion, decision authority and

social support from supervisor and coworkers. Furthermore, this questionnaire measures

physical exertion, hazardous conditions and toxic exposure, job insecurity and the

outcome variable of job satisfaction.

Items from the Questionnaire for Organizational Stress, version Doetinchem

(Bergers, Marcelissen & de Wolff, 1986), which assess the key concepts of the

Michigan model, were included in the item pool. This questionnaire includes items on

the following work stressors: overload, role ambiguity, responsibility, conflicting of

role, restrict place, lack of decision authority and lack of meaningfulness of the

insecurity.

Besides items on these work stressors, items on the moderators, support from

supervisor and support from co workers and the outcome variable, lack of job

satisfaction, were included. Items were derived from the Wellness at Work-interview

content and organization of work (Maes, Kittel, Scholten & Verhoeven, 1989), a

quantitative version of the Wellness at Work- method.

From the above-mentioned, it is evident that many attempts have been made to

measure QWL. Definitions of what criteria are relevant differ from the point of view of
16
 individuals, organizations, or society at large. Needless to say, the measures to be

included in a QWL index are not without controversy. In addition, there remain

significant methodological challenges to overcome in constructing robust measures can

operationalize the indicators effectively (Consodine & Callus, 2002) (Kotze, 2005).

2.7 Benefits of quality of work life

Quality of work life program when adopted and executed effectively will result in

following benefits

2.7.1Organizational benefits from QWL

 Productivity and performance: Quality of work life program like flex work

schedules, alternative work schedule part time appointments, compressed work week

etc. reduces labor turnover and work place tardiness. Quality of work life program also

improves employee morale, job satisfaction and commitment to the organizational

goals as their personal work priorities are supported by the management, thus QWL

programs ensure that the employees are more committed towards their job and perform

well on jobs which in turn enhances organizational Productivity and performance.

 Absenteeism and turnover: People who are highly involved in their jobs are less likely

to quit their jobs or be absent (Kerce & Booth-Kewley, 1993). Motivation and

satisfaction of needs have consistently been shown to be associated with job

involvement and organizational commitment as well as attendance and low turnover

(Kerce & Booth-Kewley, 1993). Attendance has also been found to be related to the

degree of congruence between workers‟ needs and the characteristics of the jobs

(Furnham, 1991). QWL programs improve the physical and psychological health of the

employees, there by bringing down the absenteeism rate.

 Stress and its impact on QWL: Instability of employment, rapid change of demands

and intensification of work pressure are widely prevalent consequences of economic

17
 globalization and technological change leads to stressful experience at work can

adversely affect physical and mental health. So measures of QWL to help the

employees relieve from the stress and enhances the employee satisfaction. Employees

can balance their work life and personal life better this results in stress reduction.

Individual benefits from QWL

QWL programs help the employees to balance their work life and personal life better.

Individual benefits from improved QWL are as below

 Work climate: QWL implies that the work conditions are favorable and that

management caters for all the needs of the people. The workplace can also provide

conditions and relationships that increase wellbeing and mental health, through greater

autonomy on the job, social support from colleagues and greater income (Greenhaus &

Powell, 2006).

 Positive attitudes: Employees who enjoy their work and feel happy make a very

positive judgment about their quality of work life. This enjoyment and or happiness, is

the outcome of cognitive and affective evaluations of the flow experience (Diener,

2000). When employees are intrinsically motivated, they will continuously be

interested in the work they are involved in, therefore being fascinated by the tasks they

perform.

18
 Self-actualization: According to Maslow (1954), is the desire to become more and

more from what one is to anything that one is capable of becoming, thus QWL

programs ensures the opportunity for the employees to develop by providing career

development skills, promotion and career progress which intern contribute significantly

to subjective well-being.

2.7 The Concept of Employee Engagement

The term employee engagement was firstly used by the human resource

practitioners and business firm, but in academic community the concept was rarely

discussed. Kahn (1990) was the first academic researcher to define the concept of

employee engagement. According to Kahn (1990) employee engagement is the level

of commitment and involvement of the employees towards their organization and its

values; While Perrin (2003) defined engagement “as willingness or enthusiasm that the

employee holds to spend optional effort towards the job.” In a study about antecedent

and consequences of employee engagement, Saks (2006) defines employee

engagement as the extent to which an individual is attentive and absorbed in the

performance of his/her roles. It is the positive feeling that employees have towards

their jobs and also the motivation and effort they put into it.

Bakkar and Scheufeli, (2008) have defined the term employee engagement that “it is

a psychological state where employees feel a vested interest in the organization’s

success and perform to a high standard that may exceed the stated requirements of the

job.” An engaged employee is aware of business context and works with colleagues to

improve performance within the job for the benefits of the organization (Sharma &

Anupama, 2010). It is a positive attitude held by the employees towards the

organization and its values. The organization must work to develop and nurture

19
engagement, which requires a two-way relationship between employer and employee

(Robinson, Perryman, & Hayday, 2004).

Apart from this, Baig (2010) argued that employee engagement is concerned with

the individual contribution under healthy working conditions, promote individual

development, encourage mutual confidence and understanding between the employer

and the employee and between the employees themselves. According to Mortimer (as

cited in CIPD, 2009), employee engagement is a combination of commitment to the

organization, its values and a willingness to help their colleagues. Zinger (2010) defines

that “employee engagement is the art and science of engaging people in authentic and

recognized connections to strategy, roles, performance, organization, community,

relationship, customers, development, energy and transform the work connections into

final results.” Rashid, Asad, and Ashraf (2011) have highlighted that engagement is

the capacity of the employees to work honestly, obligation and aspiration enduring in a

business. While Wilson (2009) elucidates that an engaged employee is that who is fully

energetic, emotionally connected with the organization in achieving the goals. Thus

employee engagement is a barometer that determines the association of a person with

the organization (Vazirani, 2007).

Bhatla (2011) has explained that the engagement is all about having a psychological

commitment toward the assigned task, which is clearly reflected in his/her dedication

towards the work. Mani (2011) has noted that an engaged employee is fully aware with

the business environment and works with the help of other employees to improve the

performance within the job for the benefits of the organization. Engaged employees put

their all efforts and enthusiasm towards their work and also care about the future of the

organization (Mani, 2011; Sundaray, 2011). By making the employees involved in

organization’s business, the HR manager will have to motivate them to contribute in the

20
business and productivity success and at the same time, it increases their sense of well-

being (Swarnalatha & Sureshkrishna, 2013). Employee engagement and job satisfaction

play an important role in increasing the morale of the employees. The managers have to

play active role in building satisfaction among the employees and make them engaged

in their work. While Cattermole and Johnson, (2014) opine that employee engagement

is a workplace approach designed to ensure that employees are committed to business,

its values and goals.

Chandhok and Bhavet, (2014) perceived engagement as a passion and commitment

of the willingness to devote oneself and expand one’s discretionary effort to contribute

towards achieving the goals and objectives of the organization as a whole. Thus

employee engagement is the extent to which employees think, feel and act in ways that

represent high levels of commitment to their organization.

Kahn (1990) says that in engagement, people employ and express themselves

physically, cognitively and emotionally during their role performances. The ideas of

each and every employee differs from each other and every employee should be given

freedom to express their views and thought. This kind of activity increases the morale of

the employees, hence the employees are motivated and engaged towards their work and

increases the productivity of the organization. He further describes that lack of

connection with the organization, emotional absence, passive and incomplete role

causes disengagement among the workers. In the views of Robinson, Perryman, and

Hayday (2004) employee engagement is closely related with feeling and perception of

the employees and the key driver of the employee engagement are effective leadership

by the top management, two way communications among the workers of the

organization, well designed human resource policies and organizational development of

employees.

21
 Anand (2011) opines that employee engagement plays a crucial role in the hotel

because it affects everything from retention and productivity to profitability and safety.

There is an intrinsic link between employee engagement, customer loyalty and

profitability. Kahn (1992) has highlighted that fully engaged employee's lead to the

success of the organization. There are many dimensions which makes the employees

engaged towards their job. These are continuity in the organization, connected with

other staff members, integrated and focused in their job. Saradha and Patrick, (2011)

have discussed that employee engagement activities significantly improve the overall

performance of an organization. It is a technique for the successful functioning of the

organization and improvement in performance of the employees.

2.8 Drivers of employee engagement

Previously in this chapter, time has been taken to look at the different definitions,

explanations and points of view on engagement by different organizations,

consultancies and academics. One thing is certain: the concept of employee engagement

is ambiguous and still lacks a universally accepted definition; however, Kahn’s (1990)

view has been influential across the studies of engagement.

Robinson et al. (2004) established substantial differences in the views of authors and

actual descriptions of engagement and what drives engagement. They argued, “There is

no easy answer as far as engagement is concerned. In addition, it is unlikely to find one

particular approach or certain drivers that induce engagement, since employee

engagement and its drivers may possibly differ in every organization, and job itself”

(Robinson, 2007). Additionally, “there is ‘no definitive all‐purpose list of engagement

drivers (CIPD, 2007). Ketter (2008), adding to the debate, suggesting that, due to

numerous studies that have been carried out on employee engagement, there are over 26

different drivers of engagement. O’Neal and Gebauer (2006) suggested that employee

22
engagement drivers or definitions vary globally, depending on the country, culture and

organization. Hence, engagement is likely to be prejudiced by many interconnected

factors. However, several studies have been carried out, with each itemizing different

drivers or different measurements of engagement. This section will attempt to review

most of the engagement drivers identified across different studies, to give more in-depth

knowledge on the engagement construct.

Most notable amongst the studies is the Gallup Q12 questionnaire of engagement.

Gallup, potentially the most prominent firm associated with employee engagement,

characterized engaged employees as “those who work with enthusiasm and feel a

philosophical connection to their organization and job, along with innovative mind-set

to move the organization forward” (Gallup, 2006). This definition views engagement as

employees being passionate about their organization and having a strong bond with the

organization, not because of the monetary value attached, but for the sole purpose of

achieving organizational goals. Gallup developed the Gallup Q12 instrument, known as

Q12 Meta-Analysis. A meta-analysis is a “statistical integration of data accumulated

across many studies” (Gallup, 2006). Gallup researchers established 12 key

expectations to which, they argued, form the foundation of strong feelings of employee

engagement. These sets of questions, according to Gallup, are basic questions that every

engaged employee should be able to answer yes to. So far, 1.5 million employees have

participated in the Q12 instrument (Robinson et al., 2004). The questions are

summarized below.

1. Do you know what is expected of you at work?

2. Do you have the materials and equipment to do your work right?

3. At work, do you have the opportunity to do what you do best every day?

23
 4. In the last seven days, have you received recognition or praise for doing good

work?

5. Does your supervisor, or someone at work, seem to care about you as a person?

6. Is there someone at work who encourages your development? At work, do your

opinions seem to count?

7. Does the mission/purpose of your company make you feel your job is

important?

8. Are your associates (fellow employees) committed to doing quality work?

9. Do you have a best friend at work?

10. In the last six months, has someone at work talked to you about your progress?

11. In the last year, have you had opportunities to learn and grow?

Another set of engagement drivers was developed by Siddhanta and Roy (2011).

Their findings were presented at the International Conference on People Management.

The drivers developed in their study were on the basis of 12 major studies conducted by

research firms, such as Gallup, Towers Perrin, Blessing White, The Corporate

Leadership Council and others. The drivers include:

 Trust and integrity: According to Siddhanta and Roy (2011), employees tend to

communicate better with managers and organisations that are honest, trustworthy and

go by their word. Such managers make employees more engaged in their jobs. This idea

is also supported by Cleland et al. (2008), who indicate that employees trust managers

who listen, encourage development, open communication, make time, respect

individuals, encourage employees and are just and fair in providing feedback for their

24
 employees. This view can be argued to be similar to one of Sak’s (2006) engagement

models (perceived organizational and supervisor support). Sak argued that organizations

and supervisors that encourage and support their employees are likely to have a more

engaged workforce.

 Nature of the job: Siddhanta and Roy (2011) highlighted ‘nature of the job’ as one of

the drivers of engagement. They claimed that for employees to be fully engaged, the job

should be challenging enough to motivate them. Similarly Cleland et al. (2008)

identified ‘work’ as a driver of engagement. They argued that for employees to be

engaged, the job should be challenging, have clear goals and accountability; there

should be freedom to act, purpose and meaning, important work and resources

available. This is also consistent with Kahn’s (1990) idea of psychological

meaningfulness of a job as an engagement factor.

 Career growth opportunities: : Siddhanta and Roy (2011) study suggested that

organizations that lay more emphasis on employees’ development and career path are

likely to have more engaged employees than their counterparts.

 Pride: The study also found that an establishment with a good reputation instills

admiration in their employees, thereby increasing their level of input in the

organization.

 Co-workers: The survey also found that good working relationships between employees

could enhance engagement. Relationships with colleagues significantly increase

employee engagement levels. Effectual and confident relationships between managers

and co-workers are important if employees are to be engaged (Cleland et al., 1999)

Another study was carried out by Towers Watson in May 2012. Towers Watson is a

principal global service company that assists organizations in improving performance

25
 through efficient people, risk and monetary management. The study identified five top

drivers, which they argued characterize engagement;

 Leadership: According to Towers perrin (2009), leadership is an effective tool in

growing business. Hence, a capable and motivated leader will not only drive the

business forward, but also find suitable ways of making employees work beyond their

required role. Morgan (2004) supported the argument by suggesting that certain

characteristics possessed by managers can be critical for employees to be engaged, in

particular, a high-quality communication structure. In addition, Macey and Schneider

(2008) stated that “bad leadership and management policies can have a negative impact

on engagement behaviors'”.

 Stress, balance and workload: Engaged employees know how to manage stress and have

a flexible work arrangement, i.e. a healthy balance between work and personal life.

They also believed that for employees to be engaged in their jobs, the organization must

make sure the employees understand the organizational business goals, steps they need

to take to achieve those goals and how their jobs contribute to achieving those goals.

 Supervisors: Additionally, they argued that organizations must employ the supervisor’s

knowledge on how to manage employees, how to assign tasks suited for all employees’

skills, and employ supervisors that will act in a dependable manner, be consistent with

their words and, most importantly, treat employees with respect.

 Organization's image: Besides the above mentioned drivers, the organizational image

was also argued to boost engagement. Further review suggests that organizations must

strive to build a brand name that is highly regarded by the general public, and display

honesty and integrity when dealing with employees and business activities with the

general public. This act can, to a large extent, propel the employees to be engaged.

26
 In agreement with most of the already mentioned drivers, the Institute of

Employment Studies in a survey carried out with the NHS, identified more drivers they

believe propel an employee to be fully engaged. Their findings suggest that the

strongest driver of employee engagement is ‘involvement in decision making’. The

extent to which employees are able to voice their ideas, views and values, and have

managers listen to such contribution, is a strong way for employees to be more engaged

(Robinson et al., 2004).

The opportunity for development in their jobs also increases the employee

engagement level (Robinson et al., 2004). Furthermore, the degrees to which

organizations are concerned for their employees’ wellbeing. They also pointed out that,

for engagement to be achieved, the managers will have to play an important role in

fostering an employee’s sense of involvement and values.

The study also found that other drivers of engagement are attached to the sense of

feeling valued. However, it is also important to note that some of the drivers identified

in their studies have been recognized to boost other concepts, like motivation.

Aon Hewitt is a leading research consultancy that specializes in global business

consulting and talent management. The firm carried out a survey on engagement and its

drivers and came up with factors they attribute to boosting engagement in employees.

Aon Hewitt’s global engagement research was carried out between 2008 and 2011. It

included 6.7 million employees and represents more than 2,900 organizations. The

engagement drivers identified are:

 Quality of life: Quality of life is a factor that makes the employees feel relaxed. For

example, physical work environment and the employees’ work-life balance,

27
 Company practices that drive engagement according to Aon survey include policy and

practices, performance management, brand alignment, company reputation and

diversity,

 Rewards: This includes pay, benefits and recognition,

 Opportunities include, career development, training and development.

 People that influence engagement include senior management, managers, colleagues,

valued people and customers.

This analysis describes the employment understanding of what has changed, and

what engages the current workforce. By identifying these drivers, employers can be

aware of how to meet the needs of their employees and it highlights the specific areas of

enhancement that have a major impact on engagement and production results (Aon

Hewitt, 2012). The drivers highlighted in the Aon Hewitt survey differ from the IES

(2003) survey, although both studies recognized reward as a source of engagement. This

heightened the argument that engagement is yet to have a consensus or an accepted

definition or drivers. The diagram below represents the above survey.

FIG 2.1 AON DRIVERS OF EMPLOYEE ENGAGEMENT

28
 This diagram represents what drives employees to be engaged at work (Aon Hewitt, 2012)

The Wyatt Watson survey, carried out in 2008, revealed a few engagement drivers

which include communication, compensation and benefit, customer focus, strategic

direction and leadership .

 Communication: According to the Wyatt Watson (2008, p. 5), “communication is a

principal predictor of firm performance as well as a driver of engagement around the

world”. They suggested that organizations that encourage engagement via

communication give their workforce straight answers to questions and concerns,

institute dialogues among senior management and all employees, and act on employee

contributions and concerns .

 Compensation and benefits: Their study symbolizes a strong driver of engagement. This

dimension encompasses far more than just pay levels. The Wyatt Watson studies

indicate how linking pay to performance, maintaining peer pay equity, communicating

the value of total compensation and ensuring satisfaction with benefits all drive

engagement .

 Strategic direction and leadership: Strategic direction and leadership are key drivers of

engagement. Employees need to have confidence in the future and to understand and

trust what senior leadership is doing to make their organization successful .

They also indicated that organizations with strong customer focus make customer

satisfaction a top priority, base decisions on what is best for customers and hold

employees accountable for customer service (Hewitt, 2012)

29
 In a different study, MacLeod and Clarke, (2009) wrote a report for Chartered

Institute of Personnel and Development (CIPD) on the main drivers of employee

engagement. Their report summarized employee engagement drivers as :

 Engaging leadership: They argued that leadership is an important aspect in engaging

employees. A good leader “ensures a strong, clear, and unambiguous organizational

culture that gives employees a line of sight between their profession and the image and

aims of the organization”. Such leaders are tactical, anticipatory, proactive and

employee focused. They provide an understandable strategic picture of where the

organization is going and why, in a way that gives workers information and an in-depth

view of their own job (MacLeod & Clarke, 2009, p. 75) .

 Engaging managers: Managers drive the organization forward on a day-to-day basis.

They are critical and offer transparency about what is required from employees and

plays an important part in giving appreciation, feedback, coaching and training. They

also indulge in treating people as individuals, with justice, equality and respect, and

with a concern for employee well-being. They also make certain that work is planned

resourcefully and effectively. In companies that do this well, managers treat people as

individuals. Standard Chartered Retail Bank is a good example of the tasks managers

engage in. The manager’s duty is summarized as “Know me, focus me, and value me”

(MacLeod & Clarke, 2009, p. 75). Finally, the CIPD (2007) also added that managers

who are fair and visibly committed to the organization tend to increase engagement in

employees more than their counterparts .

 Employee voice: Another factor identified by McLeod and Clark is employees feeling

confident to air their views and be listened to, both in relation to how to do their work

and in decision-making within their own department, by means of jointly sharing

problems and challenges, and the commitment to arrive at solutions. In organizations

30
 that practice the above policy, there is a stable, liberated flow of information and ideas

with transparency across the organization. This entails having an administrator who is

willing to pay attention to employees, who is not fearful of the division of labor

(MacLeod & Clarke, 2009, p. 75 .(

 Organizational lives the values: “A conviction amongst employees that the business

functions with the right ideals, and that good behavioral norms are adhered to, which

leads to trust and a sense of integrity”. For organizations that practice this, ideals and

behaviors are united, providing honesty, reliability and confidence in employees. Any

problem between these creates mistrust and cynicism (MacLeod & Clarke, 2009)

 Organizational purpose: Organizational aims and goals are a very important area in

engaging employees; in particular, the morality attached to the organization's mission

may have a differentiating effect on engagement. An investigation by Holbeche and

Springett (2004) on how employees experience a sense of meaning at work, found that

an organization's purpose/mission that centers strongly on customers is more likely to

engage staff than those focused on shareholders, profits, or a mix of stakeholder needs;

however, it is crucial that there is a comprehensible line of sight to this purpose in

people’s day jobs if the motivational effect is to be achieved (MacLeod & Clarke, 2009)

Engagement and engagement drivers have been mostly studied by organizations and

consulting firms, creating a hole in the academic analysis of the concept; however, from

the engagement drivers above, one can notice that the construct engagement is very

broad and can have many drivers. Adding voice to the argument was Shaw (2005) who

pointed out that “it’s arguably unfeasible to justly measure in a survey all the actions

behind engagement”, due to the fact that, “there are potentially thousands of different

individual actions, attitudes, and processes that might affect engagement” (Dicke, et al

2007).Furthermore, it is also important to note that some of the engagement drivers

31
identified by these studies have been also associated with other constructs; for example

,Herberg (1959) identified recognition as a driver of job satisfaction, as well as

colleagues at work. Communication has also been highlighted as a driver of motivation.

In addition, Greenberg and Baron, (2003) identified communication as a driver of

commitment. However, employee engagement has gone a little further, identifying

customer focus, strategic leadership, opportunities, trust and integrity, making the

construct more of a three-way construct, i.e. between the organization, the employees

and the customer .

Saks (2006) is one of the few academics to study employee engagement. His

research on engagement itemized five factors as the basis for employee engagement.

These are:

 Job characteristics: This could also be termed meaningfulness of a job as Kahn,

(1990) portrays it.

 Perceived organizational support.

 Perceived supervisor support.

 Rewards and recognitions.

 Procedural justice and distributive justice .

Excluding procedural and distributive justice, other elements have also been

recognized by other studies as drivers of engagement .

This study intends to incorporate some of Saks’ (2006) framework of engagement,

as well as Kahn’s (1990) psychological conditions in measuring and predicting

engagement drivers in the banking sector of Nigeria.

Another survey was carried out by Mollnaro and David (2005) of The Banff Centre;

six factors were itemized as predictors of employee engagement :

32
 Successful organization: Every employee wants to be associated with success and,

consequently, want to be part of a winning organization. The phrase ‘winning

organization’ could mean the organization is financially successful or that it is

renowned as a leader amongst customers, or the organization is ambitious, has a bright

vision, core purpose and has a well-planned business stratagem in place (Mollnaro &

David, 2005) .

 Working for admired leaders: “Accepted leaders” is one of the most significant

nonmonetary drivers of employee engagement (Mollnaro & David, 2005).

Organizations that have a strong network of admired leaders create the conditions for

high engagement (Mollnaro & David, 2005).

 Having positive working relationships: Employees value functioning relationships with

highly talented and proficient colleagues. As a result, organizations that can provide

adequate qualified employees are likely to drive employee engagement high .

 Recognition and appreciation: Recognition is an additional vital driver of employee

engagement and it has also been identified as a driver of job satisfaction (Herberg,

1959). Recognition could be “monetary rewards and compensation, but it also can refer

to the appreciation and direct feedback that employees receive from managers”

(Mollnaro & David, 2005). This recognition and appreciation demonstrates that

employees are valued and respected and that their contributions are acknowledged by

the organization. Robinson et al. (2013) demonstrated that ‘feeling valued and involved

is one of the major employee engagement drivers’. Recognition also means that leaders

notice the often unnoticed things that employees do to make their organizations

successful (Mollnaro & David, 2005).

 Living a balanced life: According to Mollnaro and David (2005), organizations with

cultures that value work-life balance and aid workers to achieve it, will be rewarded

33
 with extremely engaged employees. Work-life balance does not mean that employees

are not loyal or committed to their organizations; it means that employees want to lead

whole lives, not lives solely centered on work (Mollnaro & David, 2005) .

 Doing meaningful work: Like Kahn (1990) and other related employee engagement

studies, Mallnaro and David also identified meaningful work in their studies as one of

the tools that drives engagement. Meaningful work “is often work that makes a

difference or has an impact to the organization .”

Employees often desire to see how their work affects the organization's vision and

strategy. They also want to know that the organization's customers are ‘touched’ by

their work (Mollnaro & David, 2005). Similarly, in the only study to empirically test

Kahn’s (1990) model, May et al. (2004) found that meaningfulness, safety and

availability were considerably correlated to engagement. Holbeche and Springett (2003,

cited in Truss et al. 2008, p. 5) argued “people’s perceptions of ‘meaning’ with regard

to the workplace are clearly simultaneous to their levels of engagement and, ultimately,

their performance”. They argue that employees actively seek meaning through their

work and, unless organizations try to provide a sense of meaning, employees are likely

to quit.

2.9 Barriers of Employee Engagement

Researchers have observed that there are certain barriers which inhibit employee

engagement. Hauck (2011) reported that improper performance appraisal and lack of

skills in the managers are barriers of employee engagement. Sales Benchmark Index

(2014) has candidly discussed that income inequality; job insecurity and work life

imbalance are major barriers of employee engagement. The typical pay for performance

policy is also a barrier of employee engagement (Hauck, 2011). Other key barriers of

employee engagement may be as follows:

34
 • Poor leadership and ineffective management of manpower in the organization

is major cause of turnover or absenteeism of employees. Hauck (2011) has

reported that employees do not leave organization they leave their managers.

• Unhealthy working environment within the organization.

• Improper communication or lack of proper communication also contributes to

a negative work environment in the organization.

• Lack of cooperation among the employees and employer also.

• Lack of support from the employers or organization

2.10 Measuring Employee Engagement

Engagement looks at how much people want to exert extra effort and will engage in

the discretionary behaviors that contribute to business success. Although data is still

gathered on processes and practices, the focus is on the difference these practices make

to employees (Weatherly, 2003). Engagement surveys generally provide more than19

usable information to inform change. Because the surveys help identify the practices

that drive engagement, they help link activities and output. The following section

outlines steps involved in measuring employee engagement.

The employer must listen to his employees and remember that this is a continuous

process. The information employee’s supply will provide direction. This is the only way

to identify their specific concerns. When leaders listen, employees respond by becoming

more engaged. This results in increased productivity and employee retention. Engaged

employees are much more likely to be satisfied in their positions, remain with the

company, be promoted, and strive for higher levels of performance.

Employee engagement needs to be measured at regular intervals in order to track its

contribution to the success of the organization. But measuring the engagement

(feedback through surveys) without planning how to handle the result can lead

35
employees to disengage. It is therefore not enough to feel the pulse; the action plan is

just as essential.

Employee engagement satisfaction surveys determine the current level of employee

engagement. A well-administered satisfaction survey will let us know at what level of

engagement the employees are operating. Customizable employee surveys focus on a

starting point towards the efforts to optimize employee engagement. The key to

successful employee satisfaction surveys is to pay close attention to the feedback from

the staff. It is important that employee engagement is not viewed as a onetime action.

Employee engagement should be a continuous process of measuring, analyzing,

defining and implementing.

2.11 Consequences of Employee Engagement

Employee engagement has positive consequences on the organization (Saks, 2006).

Some of the consequences are as follows:

2.11.1 Job Satisfaction: According to Wang (as cited in Davis, 1981) job satisfaction is

the feeling of happiness or unhappiness experienced by employees working in an

organization. According to Clifford (as cited in Wright & Davis, 2003) job satisfaction

is “the representation of employees and their work environment by comparing what

they expect to receive versus what actually employees received.” Employee engagement

is directly related with the job satisfaction. If an employee is engaged towards the work,

definitely he/she will be fully satisfied with the job. Basbous (2011) said an engaged

employee is a satisfied employee. Therefore it is very important for the organization to

make their employees engaged by providing various financial and non financial

incentives and assign the task according to their area of interest. This will make the

employee more appreciative of his job and satisfied with his career.

36
2.11.2 Organizational Commitment

Employee engagement is positively related to organizational commitment.

Commitment refers to a person’s attitude and attachment towards their organization

(Saks, 2006). An engaged employee is fully committed towards the job as well as

organizational goals and objectives and gives complete loyalty to the organization

(Kumar & Swetha, 2011).

2.11.3 Intention to Quit

According to Clifford (as cited in Kacmar, Carlson, & Brymer, 1999) intention to quit is

the degree to which employees are considering leaving the organization. Intention to

quit includes basically the reasons why employees are going to quit the job and what

factors made the employee leave the organization. The engaged employees do not

frequently quit the job, but stay in the organization for longer period of time (Swetha &

Kumar, 2011).

2.11.4 Organizational Citizenship Behavior

According to Rasheed, Khan, and Ramzan (2013) employee engagement is also

positively related with the organizational citizenship behavior. It is concerned with

voluntary and informal behaviors that can help co-workers and the organization.

Clifford (as cited in Organ, 1988) defined organizational citizenship behavior “an

individual behavior that is voluntary and not tied directly to any reward or recognition

system that promotes the effectiveness of the organization.” Engaged employee

performs the work politely and helps in making effective and sound working

environment in the organization

2.12 Economic Issues in Healthcare

Employees of hospitals engage in the delivery of health care. Health care has become

a Competitive business.33 In the U.S., 17% of the Gross Domestic Product (GDP) is

37
spent on health care.34 seniors spend up to 40% of their income directly on their

health35 Competition means that today's hospitals must focus on being the provider of

choice, and providing superior services.

One way to provide superior services is to ensure that employees are treated as

partners in the health care delivery process. Historically, health care administrators have

not always considered employee satisfaction when it has assessed the organization's

competitive edge. Only since 2008 have health care administrators worried about how

employee satisfaction can impact the satisfaction of Employee Engagement/Job

Satisfaction and Retentionpatients.36 To be a provider of choice patients must be

satisfied with services received. Patient satisfaction is impacted by employee

satisfaction.

Another competition issue that hospitals face is being able to recruit top talent for

meeting the demand for quality patient care.37 There are an insufficient number of new

health care graduates entering the medical workforce to meet the demands for hospitals.

Not only do hospitals need to recruit this talent, but they need to retain these individuals

for the long term.

In addition to the inadequate supply, health administrators also need to worry about

employee retention or turnover. Personnel costs are a major expense in any hospital

budget, with nurses as the largest percent of employees. The nursing turnover rate is

21.3% ,with even higher rates in the critical care areas. Although the nursing shortage

has slowed over the past few years related to the recent recession, it is anticipated that

the nursing shortage will reach a significant level in the U. S. in 2020.38

Turnover in personnel is expensive. A 2004 study by Press Ganey Associates, Inc.

showed that between 3.4% and 5.6% of a hospital's operating budget can be spent on

38
employee turnover. When hospital employees leave an institution, 21% of the turnover

costs are related to separation expenses, temporary replacement costs, and expenses

related to recruiting, hiring and employee orientation. The remaining 79% of the cost

related to turnover is due to loss in productivity.23 In 2010 it was reported that the

national operating margin was 5.5% and in Michigan the average is 2.8%. Employee

turnover can have a marked impact on that thin margin.39

The physical environment of a hospital can have an impact on employee turnover. In

2000, the Center of Health Design implemented the Pebble Project. Using an evidenced

based design this project helped hospitals address turnover, improve quality and

promote patient safety. They studied the clinical and financial advantages of designing a

building that "embraces the environment of healing on improving patient outcome,

reducing staff turnover, improving community relations and increasing Employee

Engagement/Job Satisfaction and Retentioncontributions".40 Two Hospitals in

Michigan participated in the Pebble Project. Both Bronson Methodist

Hospital and Karmanos Cancer Institute had design features and policies that improved

patient satisfaction, decreased turnover, reduced medical errors and decreased costs.29

Some hospitals are looking to improve their financial outcome by not only improving

the patient and staff environment, but also by looking at alternative ways to deliver

higher quality patient care.

Forum for People Performance states, "While some improvements in care quality can be

reached through investments in technology and infrastructure, the most dramatic

improvements are achieved through people (2)."24 Hospitals have also found that

employee engagement and satisfaction does relate to patient satisfaction. Health care

employees that are not satisfied in the workplace can negatively impact the quality of

39
care and adversely affect patient satisfaction.23 Engaged hospital employees create a

positive patient experience and disengaged hospital employees tend to create a negative

patient experience.25 A dissatisfied patient talks to more friends and family about the

negative experience, as compared to a person with a positive patient experience.

40