Importance of Employee Satisfaction and Retention in Organizations

Human resource management is one of the most crucial aspects of any organization. The people involved in any business can make or break a business. Therefore it is imperative that organizations put efforts in ensuring employee satisfaction and employee retention (Armstrong & Taylor, 2014). This becomes even more important due to increasing competition in the business world. Every leading firm is on the lookout for the best employees. Employee poaching is a recurring phenomenon. Hence companies are putting efforts to ensure that their employees are happy with their workplace and have long term goals for the same.

In order to achieve a high level of employee retention and satisfaction, it is most crucial that organizations provide employees with a clear job design, lucrative incentives, opportunistic work environment, positive culture and extensive job security (Hendry, 2012). These factors would eventually lead to employees being happy and content at their work place. This would not only lead to increased employee satisfaction and improved performance but would also assist in building long term positive associations with the employees.

This report throws light on the major issue directly impacting many Australian organizations today. The issue is that of a lack of job design and job security offered by businesses to their employees. This is adversely impacting both the employee as well as the business (Boxall & Purcell, 2011). How these two factors have a vast impact on the employment cycle of an individual as well on the business development as a whole is explained below. The report also throws light on a few recommendations that can be adopted by the organizations today in order to ensure higher employee satisfaction, improved performance and effective retention of employees.

Job security is simply a kind of an assurance that the employee will keep his or her job and will not face the risk of being unemployed (Bratton & Gold, 2012). When an organization offers job security to its employees, it becomes the organization’s responsibility to fulfill this promise. If for any reason, the employee needs to leave the job or the employer wishes to terminate the tenure of the employee, a notice period of a fixed duration is given in advance. This is important because, if the employee has been removed, then he or she can look for another job rather than remaining unemployed.

Job security plays a vital role in employee satisfaction. When an organization offers job security to its employees, the organization tries to showcase its trust in the employee (Snell & Bohlander, 2010. This leads to a very healthy relationship between the employer and employee. Most people spend over 10 hours at work. A person’s work life has a direct impact on his goals, ambitions, lifestyle and even personal life. Therefore, it is crucial that an employee is happy and content with his place of work. This satisfaction comes when the employee feels secured about his future in the organization. With this security, it becomes easier for the employee to set long term goals and targets for himself with respect to the organization.

Factors Contributing to Employee Satisfaction and Retention

Job design refers to the specification, contents and method of the job that an employee is supposed to achieve once he or she is recruited within the organization (Buller & McEvoy, 2012). Job design for any employee entails the exact expectations and requirements that the employee must fulfill. This clarity leads to improved employee performance and hence enhances the chances of employee retention in the workplace. A clearly defined job role also leads to employee satisfaction. On the other hand, a vaguely defined job description of an employee will lead to frustration within the employee and hamper growth (Salvendy, 2012).

Therefore it is recommended that the employee must be clearly explained his duties and responsibilities within the firm before joining the organization. This clear communication can enable both the parties to take an honest and effective decision regarding the job (Danish & Usman, 2010). The job design of an employee also entails his or her relationships with the rest of the firm. This would specify the hierarchy of the organization as well as exactly where does the employee fit in this hierarchy. Stable and improved relationships within the firm, if specified at the beginning of the tenure avoid conflicts and reduces chances of miscommunication within the organization. The next part of the report lays emphasis on what can go wrong if the job of an employee is poorly designed and the implications of lack of job security within the business.

The idea of designing a job is to clarify exactly what an employee is expected to do. The job design is inclusive of the goals that the employee is expected to achieve, the roles and responsibilities that the employee is expected to fulfill and the relationships within the organization that will directly or indirectly impact employee’s working environment. However, if any job across different organizations is poorly defined, it can have adverse impacts on the employee as well as the business as a whole (Tan & Waheed, 2011). Few such implications of a poor job design are given as below.

A poorly defined job will lead to a lack of clarity between the employer and the employee. It will be difficult for the employee to understand what is expected from him on a day to day basis. On the other hand, the employer would find it difficult to evaluate the performance of any employee if the job design at the time of recruiting is poorly designed (Lazaroiu, 2015). This would make it difficult for the employee to understand what is expected out of him and would lead to an unclear performance from his end.

Poor Job Design and Its Impact on Employees and Organizations

When the expectations and the goals of an employee are not clearly defined, it is natural for the employee to feel dissatisfied with the job that he is enrolled with. Every employee has a set of personal and professional goals that he or she wishes to accomplish. These goals include both long term and short term goals. However, if the job design of the employee is not clearly defined then it will be even more difficult for the employee to work efficiently towards fulfilling these goals which will make the employee unsatisfied (Kompaso & Sridevi, 2010). Every day when an employee reaches office, it is important that the employee is well aware of the tasks that are supposed to be accomplished in the day. However, if the organization has failed to define the role of the employee clearly then it makes it difficult for him to plan his day, week or month in advance which leads to a lack of clarity and hence frustration.

When the job of employees is not clearly defined, it is difficult to evaluate the performance of employees. Businesses find it difficult to judge how the employees have performed due to the absence of clarity in the expectations employees were supposed to fulfill (Cameron, 2010). Effective performance management systems in the workplace help establishing a transparent communication system and assists in providing feedback to employees. This in turn helps them grow and improve their performance. Therefore, lack of a job design makes it harder for employers to judge and evaluate the performance of employees.

Once the employee is not clear about the job that is expected out of him or her, it is impossible for the employee to deliver a good performance. For any employee to be able to connect well with the goals of the organization and put efforts in fulfilling those goals, it is important that the employee is clear about what goals is he expected to meet and what expectations is he expected to fulfill (Griffin & Moorhead, 2011). If this clarity is missing, then it is increasingly difficult for any employee to deliver a good performance which is in line with the organizational goals.

Simply put, job security is the assurance given to employees that they get to keep the job. Which means the employees do no risk being unemployed without reason or advanced notice about the same. Job security is crucial part in the life of every employee. In an ideal scenario, this job security is aimed at helping the organization as well as the employee (Aziri, 2011). The employee cannot leave the organization without an advance notice and similarly the organization cannot fire an employee without appropriate justification or advanced information. However, it is seen that the job security is becoming rare and this is becoming a leading cause of dissatisfaction in the employees. The adverse implications of a lack of job security are as below.

Job Insecurity and Its Adverse Impacts on Employee Performance and Retention

When organizations do not offer job security to their employees, then employees work in a consistent fear of being unemployed, which largely hampers their productivity. It is difficult for the employees to trust their employers and that makes it difficult for them to trust the organization. This fear hampers employee growth and leads to a failure in establishing fruitful and long term relationships between employers and employees.

Poaching of employees refers to the process of employees of one firm getting lured by competing firms. This is also known as employee raiding and often happens due to high demand of performing and competent employees (Bakker & Demerouti, 2014). Every organization must put efforts in reducing the chances of their employees being poached and this is why it is essential that organizations create a working environment of trust to reduce the chances of their employees being poached. In such a scenario, job security plays a vital role and bounds the employee from shifting jobs frequently at the sight of a more lucrative offer.

Every employee has certain long term goals and certain short term goals. At the same time, organizations as well have long term as well as short term goals. When organizations do not provide job security to their employees, at some level, the employees feel restricted to plan a longer term future with the firm. This makes it difficult for employees to align their personal goals with the long term goals of the business (Johns, 2010). Such a scenario hampers employee performance and restricts the employees from delivering their best keeping the longer term success and growth of the business.

The fear of losing their jobs makes employees consistently on an active lookout for new jobs. Employees do not refrain from speaking to potential employees and at the same time they are unable to deliver their 100% in the workplace. Employees find it difficult to plan a long term future with the firm and hence their performance is adversely impacted by a lack of job security.

Job security and job design are important aspects of an employee’s tenure with respect to any organization that he or she is associated with. Both the employee as well as the organization face sever implications when either of the two or both these aspects remain unfulfilled. A lack of job security will affect the will of the employee to perform better while a poor job design will make it difficult for an employee to understand the performance that is expected from him or her. Therefore, it is imperative that organizations must focus on enhancing employee satisfaction and designing their job roles explicitly as well as create a better working environment for them by offering them security of their jobs. The following steps taken by the business would assist the firm is reducing the extent of job insecurity and poor job design.

Recommendations for Enhancing Employee Satisfaction and Retention

First and foremost, before even deciding to hire any employee, it is imperative that the organization’s decision makers sit together and clearly define the job role that would be expected from the employee. The expectations must be clearly set at the time of the interview itself. This creates transparency from between both the organization as well as the employee (Pato, 2013). The job role design must include the goals that the employee is supposed to fulfill, the target he or she is expected to achieve, the relationships within the firm that are expected to impact the employee as well as the list of criteria upon which the employee would be evaluated.

Setting clear roles makes it easy for the employees to remain prepared and they can hence enables them to clearly set their personal targets accordingly. A clear job role will leave no confusion about the performance expected from the employee thereby reducing the chance of a conflict within the firm. The organizations must therefore put efforts in ensuring that the job design of every employee is clearly established. At the same point of time, the employees must also make sure that all their queries, doubts and confusions are clear before joining and that they are absolutely clear about what is expected of them in the business.

For some reason, if the firm cannot guarantee a long term job safety, the firm must at least make sure that the short term tenure of the employee is fruitful, productive and helps the employee to grow in their professional careers. It is important the organizations create a positive environment which enhances the willingness of employees to stay with the firm for a longer duration (Dobre, 2013).

Incentives and bonuses offered to employees for their performance is a great way of letting employees know that their hard work and efforts are valued by the company. The biggest issue with a lack of job security is the reduced trust of the employees in the firm. However by offering incentives, bonuses and other financial or nonfinancial benefits to the employees, the organization as a whole can build trust and positivity surrounding the employee performance, making them believe that their efforts and performances are valued and respected.

Setting clear daily, weekly, monthly, quarterly or annual targets for the employees of the business enables the organization to gauge the performance of the business as well as it develops clarity in the minds of the employees and they can continue to put efforts in the same direction (Pervin, 2015). This goal setting approach must be conducted by the direct seniors of employees as they are ideally best aware of the employee’s capabilities, strengths and weaknesses. Goal setting theory has proved to be a major source of motivation for employees as it allows the employees to challenge themselves and improve as well as develop themselves significantly (Locke & Latham, 2013).

Conclusion

Communication in an organization is crucial and highly critical. Communication is required between different members of the organization. A clear and transparent communication procedure must be encouraged in the environment to ensure that employees feel free to discuss and address the issues they face in the business (Shockley-Zalabak, 2014).

Organization’s top management could adopt an open door policy wherein the leaders of the business leave their door open to signify that they are always available for their employees. This policy helps in establishing trust and leads to a transparent communication between different members of the firm (Argenti, 2015). An honest communication leads to a positive environment which encourages employees to work harder and build a positive connect with the firm.

In order to further encourage employees to remain with the firm, it is essential that the business paves way for the employee’s professional growth and development. This is possible when employees are given honest and transparent feedbacks at frequent intervals of time (Baker, Perreault, Reid & Blanchard, 2013). An effective feedback system in place would assist the employee in understand his or her abilities and drawbacks, which would be a major source of help in the longer run. A genuine feedback giving environment leads to the employee believing that his or her personal and professional growth and development is possible in his current working environment.

A 360 degree feedback structure allows the employees to receive feedback from their peers, seniors and juniors. This then leads to a clear understanding about the personal areas of improvement for the employee as well as helps them highlight their strengths and put them to efficient use. An organization that has successfully implemented the 360 degree feedback structure has an environment of positivity and learning (Richardson, 2010). This in turn helps in employee retention and satisfaction.

Conclusion

Human resource management forms an essential part of any organization. The human resources of the firm form its greatest assets and hence organizations must put efforts in attaining, satisfying and retaining them in the business. There are many aspects which are important for effective human resource management in the firm. However, the two important functions by the department are discussed in the report. These two include the job design as well as job security of the employees.

Job design clarifies the roles and responsibilities expected from the employee. And this is essential to make sure that organizational responsibilities are fulfilled and goals are accomplished (Jones & Jones, 2010). Job security on the other hand is the faith or a promise that the organization makes with the employee that the employee would have security of a job and would not be rendered jobless or unemployed without an advance notice or a valid reasons.

Both these aspects are seen diminishing in various leading companies of Australia. This is effectively ruining the job market as well as the work environment of various companies that operate in the country. This is why it is imperative that necessary steps are urgently taken to rectify the situation. Due to the increasing demand of competent employees, it is becoming increasingly important for businesses to put efforts in retaining employees and ensuring their growth and development by offering them a positive work environment to work in. Such efforts are bound to increase employee retention as well as employee satisfaction which will lead to the growth of both the employee and the organization in the longer run and would create a win-win situation for both.

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