Dr Lisa Bradley

Associate Professor and (Acting) Head of School

School of Management

Queensland University of Technology

Why worry about retention? Work motivation theory

What motivates employees to work?What motivates them to work harder?

SO…What stops them leaving you? How do we retain high-performing

employees? Summary and recommendations

Turnover disrupts workplace productivity

Lost momentum, lost outputEmployees need to neglect their own work while covering

for missing co-workersIt takes time to incorporate new employees and get back

up to speed again It may anchor workplace productivity at a lower

levelOngoing lower levels of output and profitTurnover negatively impacts on the unit’s productivity

Costs of recruiting & training new staffDiversion of managerial attention and fundsAdjustment costs for new & old employees

Why do they leave? Higher pay offered elsewhere?

You need to pay the market rate– But they may be worth more elsewhere

• Talent ‘fit’ with the job requirements

You may need to pay more than the going rate– Employee may have firm-specific skills & knowledge

– to get a “better job”A ‘better job’ offered elsewhere?

What constitutes a ‘better job?’

It is one that the employee ‘gets more’ out

ofHigher level of ‘engagement’

Job satisfaction Job involvement motivation

Person-job fit Person-organisation fit

Work and Leisure are complementary

activities requiring a trade-offOnly 24 hours in a day

The employee’s work decision involves:Work timeWork intensityWork effort = Time x Intensity

Discretionary work effortMinimal work effortMaximal work effort

What motivates people to WANT to work (at all)? What makes them want to work beyond the

minimum?Discretionary work must be voluntaryGoing beyond the minimum required/expected

Organisational Citizenship Behaviour Contextual performance Extra-role performance

Answering these questions will solve the retention problem…if you also encourage them to want to do that for you

‘War’ for Talent

We compete for ‘star’ employees Stars combine high levels of task

performance with behaviours which are beyond expectations

Once we have them, we want to retain them

“Talented people are the scarce strategic resource of the 21st century”

(Hewitt, 2001:2)

Contextual - Task Performance

(Borman & Motowidlo, 1993; Van Scotter, Motowidlo & Cross, 2000)

PerformanceTask Contextual

Application of technical skills & knowledge

Support the organisation - psychological & social context

5 Elements- Volunteering

- Persisting with enthusiasm- Helping & cooperating with others

- Following rules & procedures, even when inconvenient- Endorsing, defending, supporting objectives of firm

What leads to motivation?

Good managementStrong leadership – upward influenceSocial interactionFun at workDecision-making autonomyWork is not too hard, but is challengingProtection from risk SecurityAbility to manage work and non-work activities

Issues for retention

Employee needs Work/life balance Justice perceptions

Leading to…. Engagement of employees

They want more incomeTo buy goods and services

They don’t enjoy their non-work timeLack of leisure activities, friends, lack of ‘leisure skills’

They enjoy the non-monetary aspects of workSocial networking, good managers, good co-workersTangible and intangible perquisites (perks) of work

They want to achieve success or specific targetsAchieving targets takes longer than not achieving them

Need for goods and services

Economic Orientation Need for leisure

Leisure Orientation Need for perquisites in the workplace

Perquisite Orientation Need to work

Work Orientation Need for achievement

Achievement Orientation

Having and enjoying goods and services

Economic Orientation

Having and enjoying their leisure (non-work) time Leisure Orientation

Having and enjoying perquisites at work Perquisite Orientation

Having the opportunity to work Work Orientation

Achieving targets and successAchievement Orientation

Defined as ‘the strength of preference for income’

This preference is derived from the strength of preference for goods and services (i.e. materialism)

Some strongly prefer material things, others less so… For some, income is related to productivity, which

for some is related to time spent working…Expectancy theory (Vroom, 1964)

It encompasses the preference for future incomeE.g. One might work harder to gain a promotion

Also encompasses the preference for financial securityE.g. One might work harder to build a bigger ‘nest egg’

Defined as ‘the attitude of an individual to leisure’

For simplicity, Leisure = Non-work The strength of preference for non-work time

Is derived from the strength of preference one has for Time spent by oneself, relaxing, sleeping Time spent with family Doing chores Participating in the community Involvement in sport and recreation, etc.

High and low preferences for leisure…Depend on your preferences for the above components

The income-leisure trade-off Only 24 hours in a day

Perquisite Orientation is defined as the

strength of preference for the non-monetary benefits associated with working

Perks are both tangible & intangible Physical things – office, car, location, etc. Social interaction with co-workers, fun at work, good

management/leadership, achievement, etc

Some perks are negative Irksome co-workers, traffic congestion, etc Net perks = Perks – Irks This is what we mean when we say ‘perquisites’

Defined as the individual’s attitude to work

per se Economists traditionally expect this is to be

negative; i.e. workers have an aversion to work. – theory X managers

Calvinistic ‘work ethic’An inner psychic need to work

Work itself gives satisfaction

Defined as the strength of one’s preference

for achieving desired results at workCompletion of projects on time, on budgetWinning formal or informal competitionsGaining market share, increased profitability, etc

Need for achievement has long been recognized as one aspect underlying people’s motivation to work

McClelland (1953)

Job satisfaction does not necessarily translate into higher productivity Hard to monitor employee performance

Monitoring and surveillance costs Group production hides individual performance

Free rider problem, shirking Recent evidence suggests we need to look at work

‘engagement’ rather than satisfaction Employees need to be motivated to PERFORM, as well as

kept happy Managers need to design jobs and workplaces that best

motivate employees to perform better And be happier while performing better Get more out of their job Higher engagement

WORK-LIFE BALANCE

Defined as a satisfactory level of involvement or “fit” between the multiple roles in one person’s life and how well someone is able to manage these competing demands (e.g., Tausig & Fenwick, 2001).

Employees who experience increased levels of stress due to a lack of balance between their work and non-work life, are: less productive less committed to, and less satisfied with their organisation and more likely to be absent or leave the organisation (Adams, King, & King, 1996; Boles, Howard & Donofrio, 2001; Frye &

Breaugh, 2004) The availability of even extensive work-life policies does

not necessarily result in widespread utilisation by employees

Work-life Culture

Work-life culture: “the shared assumptions, beliefs and values regarding the extent to which an organisation supports and values the integration of employees’ work and family lives” (Thompson, Beauvais & Lyness, 1999, p. 394)

Five aspects of the organisational environment – ‘work-life culture’ - have been identified as contributing to under-utilisation (McDonald, Brown and Bradley, 2005)

Policy-practice Gap

Of the 127 participants who indicated they wanted to use or increase use, reasons stated:Nature of their job (26)Unsupportive work area (25)High workloads (25)Lack of information (18)Financial reasons (12)Policies not offered or available (11)Technical problems (4)Length of service too short to be eligible (2)Would affect promotion opportunities (2)

Perceptions of the 5 day week

The five day week is fantastic. This is the way the whole industry should operate’

‘I wouldn’t be working on the job if it included a six day week’

‘A five day week is what I and my family now demand. I will not work six days again, even if it means changing to another industry.’

‘I was actually contemplating whether the construction industry was not for me. And I was becoming active in seeking other roles. And then the elimination of the Saturday work – really saved that. So if it wasn’t for that, probably wouldn’t be here at the moment. And, not only had I felt the change, and the huge benefit – my wife has as well. She immediately saw a totally different person on the weekend. So that was really positive. But now I’m much happier, much more energetic at work. So I concentrate for longer – well, for the entire time I am here. Whereas before there were times there that were non-productive. ‘ (salary staff)

Dimensions of Work-life Culture

1. Manager support – supportiveness of management

2. Career Consequences – negative consequences associated with work-life policy use

3. Time expectations – expectations of working hours (time and place)

4. Gender expectations – perceptions of gender roles and parenting in the workplace

5. Co-worker support – supportiveness of co-workers of work-life balance and use of work-life policies

Justice

Realistic Job PreviewLinks with needs and expectations

Psychological contract Selecting the right person

AbilityTraining

Perceptions of decision makingProcedural and distributive justice

Psychological contract

Overall set of expectations about what the individual will contribute to the organisation and vice-versa.

It is not written on paper, nor are all the terms explicitly negotiated.

Psychological contract

Individual contributionsknowledgeskillsabilitiesloyaltytime

Organisational contributionssense of fulfilmentjob securityfinancial rewardsmeaningfulness

Overall Recommendations

To retain employees, focus on:1. Meeting their needs

2. Ensuring their ability to manage their work and non-work lives

3. Try to maximise employee engagement

4. Deal with employees ‘justly’ How can we do this…..?

The workplace first (person-organisation fit)

Build in desirable non-monetary benefits Physical perquisites – office, car, parking, etc Good opportunities for work/life balance Intangible perquisites

– Good management and leadership– Workplace culture of achievement, fun, socialising

The job second (person-job fit)Pay enough money – meet the market

May be worth more to you than to other employers– Job-specific skills and tacit knowledge

What drives the individual? Cater to those needs by modifying the job to suit the person’s

individual preferences– Achievement? Perquisites?

Job Characteristics model:Job Dimensions

Skill variety: the degree to which a job requires a variety of different activities in carrying out the work, which involve the use of a number of different skills and talents of the employee

Task identity: The degree to which the job requires completion of a “whole” and identifiable piece of work - whether in the immediate organization or in the external environment

Job Dimensions (cont)

Task significance: the degree to which the job has a substantial impact on the lives or work of other people - org or environment

Autonomy:The degree to which the job provides substantial freedom, independence and discretion of the employee in scheduling the work and in determining the procedures to be used in carrying it out

Job Dimensions (cont)

Feedback from the job: the degree to which carrying out the work activities required by the job results in the employee obtaining direct and clear information about the effectiveness of his or her performance.

Have a supportive work-life balance culture

5 dimensions

1. Manager support

2. Career Consequences

3. Time expectations

4. Gender expectations

5. Co-worker support

Justice

People will compare themselves Ensure performance management

systems actually workIs performance under employee control?Is on-going feedback being given?

Don’t break the psychological contract

All of these should lead to greater employee

engagement Engaged employees lead to better individual

AND organisational outcomes Design your workplace culture to attract

and retain the kind of worker you want Productive, committed, happy, and loyal

Treat your good performers as the valuable resource they are – or someone else will.