Employee Engagement in Sainsburys Supermarkets - Dissertation Example

Employee Engagement in Sainsbury’s Supermarkets Introduction Auschwitz survivor Victor Frankl wrote that “Mans search for meaning is the primary motivation in his life…” (1984, p. 121). While modern business organizations are a far cry from concentration camps, employees may feel just as trapped as inmates in one. Fankl’s words are just as relevant now as they were then: man’s life is a search for relevance, and it is in the search that he engages in activities that he feels bring him closer to an answer. People who are driven by a sense of purpose at what they do seek to achieve a two-fold mission: to find personal meaning in what they do, and to do so in a way that provides meaning to the society in which they live. For employees, the immediate social context is the workplace. A worker’s toil provides value to the business, but unless such work is likewise meaningful to him on a profoundly personal level, then the purpose for which he undertakes the work is lacking, and it will only be a matter of time before he feels the urge to move on to other ventures. When employees are provided with a personal motivation to work with the company, this is called “employee engagement”. Employee engagement has also been defined as “a positive, fulfilling, work-related state of mind that is characterized by vigor, dedication and absorption” (Schaufeli et al., 2002, p. 74). 2. Background of the study Since 2008, the world had been plunged into an economic crisis that has eroded wealth, shut down firms, and eradicated employment and livelihood. Firms still operating struggle to reduce costs and preserve margins, but in many cases it calls for the cut-down of what is often the most expensive cost in the budget – manpower expenses. Views therefore conflict on the implications of human resources development during critical times. Some believe that HR programs should be suspended until better times, because it is a luxury that a company in crisis cannot afford. On the other hand, others feel that it is during an economic downturn that people should be made to feel that they are valued, because it is these same people, with their skills and expertise, that will give the firm a jump start in the advent of the coming recovery. This has fuelled a continuing debate among HR professionals and business managers (Hebert & Lederman, 2010). Precisely what is employee engagement in practical terms, and how is it actualized in a service industry? Services provides an interesting context, because the product exists in real-time, it is produced at the same time it is sold, and it could not be stocked or inventoried. The direct contact between customer and employee makes employee engagement a highly critical factor in the product delivery, and ultimately the company’s profitability. How is employee engagement undertaken, and how determinative is it of the firm’s performance during a bearish economy? Among the firms in the UK services sector that has been cited for its employee engagement program, it is the Sainsbury’s Supermarket chain that stands out for its successful track record. This study shall thus focus upon the HR policies and best practices of this chain of stores, and how it motivates its employees to perform effectively amidst a difficult and challenging economic environment. This research shall provide additional academic literature on employee engagement and its relevance in the 2008-2010 economic crisis. It shall also seek to provide relevant information to practitioners and HR professionals information concerning the application of employee engagement in a service industry. 3. Review of relevant literature The Nature of Employee Engagement Increasingly, employees have been faced with more, and more exacting, demands by their employers in the workplace. As a result, employee health and satisfaction have suffered as work life has proceeded to encroach upon personal and family life. Employee health and satisfaction have begun to deteriorate, fostering an escalating cynicism and mistrust by the employee against the firm. In return, corporations have given little in return, rendering most jobs staid and frustrating, something employees would have resigned from long ago were it not for the paycheck (Cartwright & Holmes, 2006). According to Flade (2003), more than 80% of the workforce in the UK have expressed a lack of commitment to their jobs, resulting in an untapped reservoir of potential energy that organizations could, with the proper approach, tap to improve productivity while fostering greater employee satisfaction. When employees are unhappy about their jobs, their disinterest and apathy become a hindrance to their smooth and competent performance on the job, and may impact negatively on the firm’s productivity and profitability. It is for this reason that employee engagement, has been developed as a tool for the proper and productive motivation of employees. Kennedy and Daim (2010) state that employee engagement is taken by many to signify the “management of discretionary effort”. Employees are so situated that they would choose to act in furtherance of their organization’s goals, because their own goals are identified with it. Engaged employees feel a complete involvement in their work and are enthusiastic in the performance of their duties (Kennedy and Daim, 2010, p. 3). They feel passionate about their work, attend to it with drive and innovation, and are of the conviction that their contribution is important in advancing the company (Roche, 2005). Gerbauer (2006) reiterates the definition of employee engagement forwarded by Towers Perrin, as “workers’ willingness and ability to contribute to a company’s success, the extent to which employees put discretionary effort into their work.” Fundamentals of engagement in motivation theory Engagement theory is anchored on motivational theory that forms part of the body of knowledge under organizational human behaviour. The following diagram shows a depiction of what is probably the most popular motivational theories, Maslow’s Theory of the Hierarchy of Needs. Maslow’s hierarchy of needs (Source: Kennedy & Daim, 2010) In 1943, Abraham Maslow formulated this theory by which he conceptualized the needs of employees as being classified into categories based on the type of need a particular benefit addresses. The most basic need – those pertaining to food, clothing and shelter, and things considered necessary for survival, occupy the lowest, broadest tier. Succeeding categories of needs form progressively narrowing tiers as one goes higher in the pyramid. The defining principle behind Maslow’s theory is that progressively higher levels in the pyramid moves from physical needs to social and then psychological needs. Maslow contends that before one could begin to experience satisfaction in one level, he must first satisfy his needs for the previous or lower level, supposedly the baser needs. At the top is self-actualization needs; thus, Maslow is saying that motivation to seek satisfaction of one’s loftiest needs and expirations could not be attains unless one first adequately meets the physiological and social needs. Maslow’s theory does not appear to fall foursquare with the realities of human experiences. There are many instances when intellectuals aspire for self expression through their artwork or creative writing, despite going hungry and being financially needy. There are countless examples of persons aspiring to help others materially when they themselves are just borderline adequate materially. These are examples of people aspiring towards the higher calling despite lacking in the physiological needs. On the other hand, Frederick Irving Herzberg’s theory does not rely on any hierarchy. The foregoing diagram shows two basic kinds of factors, the hygiene and motivator factors. Each type of factor causes an individual to react differently to either its satsifaciton or deprivation. Hygiene factors are those elements an employee would expect to receive in his employment. Their presence at work, therefore, does not increase satisfaction, because they wer supposed to be present in the first place. Their absence, however, would cause profound employee dissatisfaction and demotivation, because that would be tantamount to the a breach in the psychological contract. Motivator factors, on the other hand, are not normally expected, and so their absence in the workplace is not a cause for dissatisfaction or demotivation. Should they be provided, however, then such provides a powerful source of positive motivation and satisfaction. Unlike Maslow’s theory, Herzeberg’s theory allows for the simultaneous satisfaction of different classes of needs, which are not seen to abide by a hierarchy; at any one time, there are a number of factors that will influence the employee’s behaviour for either the better or the worse. The following table lists a number of hygiene and motivator factors: Sources of dissatisfaction and satisfaction in Herzberg’s two-factor theory Relationship between engagement and burn-out Employee engagement is more importantly assessed from the perspective of the negative factors it seeks to alleviate. “Engagement is couched the opposite to burnout” (Freeney & Tiernan, 2009, p. 1557). Where employee engagement may seem too abstract to comprehend, its opposite concept, burnout, is an all-too familiar phenomenon to many the consequences are easier to imagine. The absence of engagement may thus be conceptualized as the presence of burnout. “Burnout is a psychological response to stressors on the job” (Karatepe & Olugbade, 2009, p. 504). Factors that are seen to be contributory to burnout are deemed barriers to effective employee engagement. Such barriers include work overload, insufficient reward and lack of appreciation by management of the efforts exerted by the employee. Burnout also results from the feeling that employees are allowed little control over their work situation, despite being required to carry the burden of great responsibility. Empirical studies also state lack of fairness, absence of community, and incongruent values as barriers to employee engagement. Lack of fairness refers to the insufficiency or total lack of the necessary facilities and equipment that support employees in accomplishing their tasks. It is a sign that the employer has no concern for his employees’ welfare, because does not take the pains to provide for them the very things necessary for them to do their job. Absence of community refers to the absence of the feeling of belonging. Oftentimes, employees find themselves in the crossfire of company politics and enmity between rival managers or company officers. Much as in a home when animosity exists between parents, internal strife and personal conflicts in the workplace detract from the community atmosphere and is counter-productive to the collective effort. Naturally, where higher officers cannot themselves identify with the company, neither could employees be expected to identify with the firm’s goals and mission (Karatepe & Olugbade, 2009). Finally, incongruent values between the nature of the work and management’s priorities is also a major barrier to employee engagement and cause of employee burnout. Incongruent values are manifested by a gross discrepancy that is perceived to exist between management’s actions and the demands of the work. For instance, a school’s values are related to its altruistic mission and dedication to the formation of young minds; however, the school principal or department chairman may be recommending text books for mandatory use because he/she may be benefiting from a commission agreement with the publisher, which becomes the overriding reason for the choice or required book purchases rather than the quality of the book itself. Such incongruence detracts from the sense of commitment to duty employees feel for their jobs on the basis of the bad example shown by their superiors in the workplace (Karatepe & Olugbade, 2009). Elements and metrics of engagement There are certain components of workforce engagement that have been determined by empirical data to be significant to the success of an employee engagement effort. Hundley et al. (2005) has categorized these into three areas of emphasis: Area of emphasis Workforce engagement component Strategic issues Effective senior leadership Reputation management Ethics, diversity, and safety Stakeholder input Core HR processes Workforce selection Organizational orientation Rewards and recognition Work/life balance Operational components Performance management Tools and technology Opportunities for advancement Daily satisfaction In the course of the data gathering for this study, the assessment of effectiveness of employee engagement shall follow the above components as paradigm for inquity. According to Hyvönen & Feldt (2009), contents of young managers’ work-related goals have the potential to contribute to the understanding of individual differences in occupational well-being. Seven work-related content categories were found to be significant, namely: (1) competence goals, (2) progression goals; (3) well-being goals; (4) job change goals; (5) job security goals; (6) organizational goals; and (7) financial goals. There are certain fundamental needs that employees expect should be fulfilled when entering into an employment contract. Kaliprasad (2006) enumerate these in the order of their importance as the following, based on empirical study: Rank Need 1 Pay 2 Job security 3 Nice co-workers 4 Recognition and credit for work well done 5 A meaningful job 6 Opportunities for promotions/advancement 7 Comfortable, safe and attractive working conditions 8 Competent and fair leadership 9 Reasonable order and directions Without further elaboration, it may be safe to say that every employee would tend to look forward to a job which is able to deliver on all the above conditions, but in case of economic contractions where all nine could not be provided, at least those high up in the ranking should be extended by the employer as priorities. Another factor to consider, as to its relationship and relevance to employee engagement, is customer satisfaction. Customer satisfaction has a positive and significant impact on financial performance, but employee satisfaction has no direct significant impact on financial performance. There is and indirect relationship between employee satisfaction and financial performance, which is mediated by customer satisfaction (Chi & Gursoy, 2009) Bipolar dimensions that help define burnout and engagement are dubbed “energy” and “identification”. On the energy continuum, the extremes are emotional exhaustion on the burnout end, and vigor in the engagement end, while along the identification continuum, the burnout condition is defined as cynicism on the one extreme, while engagement is defined by dedication located on the opposite extreme (González-Romá, et al., 2006). In another study it was discovered that job resources and work engagement are mutually and reciprocally associated, and so are work engagement and personal initiative. Over time, personal initiative has a positive impact on work-unit innovativeness. (Hakanen, et al., 2008) It is common in modern organizations for employees to show initiative and be innovative, for which organizations need to arrange working conditions that provide sufficient motivation and energizing resources (Schaufeli & Salanova, 2006). Results of a study on determinants of elements of energy and motivation show that trait competitiveness significantly influenced vigor, dedication and absorption, while self-efficacy influenced only absorption. Trait competitiveness refers to the “enjoyment of interpersonal competition and the desire to win and be better than others” (Brown et al., 1998, p. 90). On the page following is a description of the size and degree of engaged personnel: Employee Engagement (Paradise, 2008) The above data was replicated in a study by Kennedy and Daim (2010) which drew up the following model of engagement criteria (second level) and alternatives (base level). The diagram provides a set of relationships between particular elements and their general criteria. Engagement and retention HRM pathway (Kennedy & Daim, 2010. p. 7) Background information on Sainsbury’s Supermarkets In order to appreciate and gain insight into effects of the practical application of employee engagement in a service country, this study shall focus upon one company that has been cited multiple times, by civil society, consumer groups, business circles, and government agencies, for the success of their employee engagement measures in their human resources development program. In 1869, J Sainsbury plc was founded, and in the 140 years since then the firm comprises 502 supermarkets and 290 convenience stores. It has joint ownership of Sainsbury’s Bank with the financial giant Lloyds Banking Group, and has established two other property joint ventures with Land Securities Group PLC and The British Land Company PLC. Through its stores, it now serves more than 18 million customers every week, claiming a 16 per cent market share of supermarket retail sales. The larger stores offer some 30,000 products, including complementary non-food products and services (for instance, the company has an internet-based home delivery shopping service – certainly of vital help to the elderly and shut-in – that is able to access a remarkable 88 percent of all UK households (J Sainsbury plc, 2009). From the company’s annual report, it is already evident that the company’s leadership has imbibed a mindset that makes engagement not only possible, but intrinsic in the firm’s operations. Rather than calling them employees, labor or manpower, as is common with other companies, J Sainsbury unapologetically calls them colleagues as a matter-of-course: “The Group employs around 150,000 colleagues who are critical to the success of our business” (J Sainsbury plc, 2009, p. 22). More than just “talking the talk” about engagement, the company’s top officers and shareholders “walk the walk” beginning at the top and ensuring emulation down the line. The company conducts regular reviews of its employment policies and other such steps to maintain relevancy, and regularly (and automatically) rewards its well-performing colleagues with salary increases. Because such increases are market-aligned, the policy is capable of being carried out into the long term without undue impairment to the company, and the colleague is immediately benefited with the added value created for the company, much as shareholders rewarded with dividends when the company profits. It also conveys to the colleagues that their individual efforts do not escape the notice of the top management, who then show their appreciation by conveying rewards to them upon the company’s volition. Performance bonuses are likewise aligned under a set of common principles, based on the attainment of set targets for profit and sales growth, product availability, and an element for individual performance (J Sainsbury plc, 2009). There are also provisions for health and safety, operational policies for fair and equal treatment, employment of disadvantaged persons, and colleague participation. The company, as a matter of policy, commits to work with each individual to “maximize their potential in the context of their own personal circumstances” (J Sainsbury plc, 2009, p. 28). Colleagues are furthermore encouraged to own shares in the company, and as of 2009 some 45,000 colleagues are shareholders either directly, or through either the Commitment Shares Plan Trust or the Sainsbury’s Share Purchase Plan Trust. The company’s commitment to its “colleagues” goes beyond the standard procedures. For instance, J Sainsbury plc have in place a “whistle blowing” procedure that enables colleagues and suppliers to raise problems concerning possible improprieties within the company, and ensures full confidentiality. The company also has established a Serious Fraud Committee to address serious incidents violating fraud policy, oversee case management, and ascertain that appropriate measures are imposed. Finally, the company has embarked on a new programmed dubbed “You Can,” which involves the active collaboration of the company with several organizations that seek to promote inclusion within the workplace. Some of these external organizations are the Local Employment Partnerships, The Employers’ Forum on Disability (where the company is a Gold member), the Shaw Trust, Remploy and Mencap. Not only is the company willing to relate to its colleagues, but to foster open collaboration with external groups that would tend to look out for their welfare and fair treatment. 4. Research question and objectives. From the foregoing background and survey of related literature, this study deems it worthwhile to investigate how employee engagement may be implemented in the service industry in the UK, during the current economic recession that began in 2008. The inquiry shall seek solutions to the following research questions: 1. What are the particulars of the employee engagement thrust of Sainsbury’s Supermarkets? a. What is the rationale and purpose of the employee engagement program? b. What are the various features of the program? c. Which workers are benefited by the employee engagement program? 2. What are the effects of the employee engagement program? a. How well do these effects serve the interest of the firm? b. How well do these effects serve the interest of the employee? 3. How could the employee engagement program be further improved? It is expected that with the answers to the above questions that will guide the research, the following objectives will be attained at the end of the research study: 1. To gain an understanding of how employee engagement is practiced in a firm in the service industry 2. To determine the effectiveness of the employee engagement program towards contributing to the attainment of the firm’s strategic mission 3. To determine the effectiveness of the employee engagement program as a tool in advancing the employees’ personal goals 4. To provide recommendations for the adoption and improvement of employee engagement in the services industry 5. Research design and methodology A research design is defined as “the plan and structure of the investigation used to obtain evidence to answer research questions” (Macmillan & Schumacher, 1997, p. 33); also it is defines as the “strategy…for undertaking a systematic exploration of the phenomenon of interest” (Marshall & Rossman, 1999, p. 62. “Research design refers to the structure of an enquiry: it is a logical matter rather than a logistic one;” it allows us to ensure that the evidence collated enables the testing of theories or the arrival at conclusions as unambiguously as possible (NYU, n.d.) The research study proposed is a qualitative study, necessitating the specification of research questions that are of a constructivist perspective (Creswell, 2003). For the purpose of this study, the research design shall follow the deductive approach. It shall proceed from the general theories on motivation and employee engagement. The study shall examine employ the case study method, since a single service-oriented firm (Sainsbury’s Supermarkets) shall be the subject of investigation. Data shall be gathered concerning the company from documents and evidence existing in the public domain, pursuant to the open-source methodology of research into social phenomena, among which employee engagement may be counted. In order to assure reliability of the findings, the study shall utilize triangulation of data, source, and data-gathering methods, for which purpose a survey shall be conducted among personnel in the subject firm. The questionnaire is considered the better form for collecting data in this survey, because it shall solicit individual perceptions among the firm’s workers concerning employee engagement, then try to determine of a consensus exists for the phenomenon being investigated. Two types of primary data shall be gathered through the survey – both qualitative and quantitative data. Quantitative data will be gathered from the close-ended questions of the survey, while qualitative data will be gathered from open-ended essay questions in the survey and spot interview to be conducted among the respondents. The research strategy shall also make use of secondary data that may be found in verifiable and trustworthy sources over the Internet and other sources belonging to the realm of the public domain. The time horizon shall be cross-sectional, inasmuch as longitudinal (time series) data is not available for this study. Ethical issues This research is committed to abide by the best standards of academic integrity and honesty. From its inception to its conclusion, the conduct of the study shall comply with ethical and moral principles for the handling of intellectual property rights. The study delves on the opinions and perceptions of people employed in a firm that is the subject of inquiry. The researcher thus guarantees to the respondents complete confidentiality about their identity and individual responses, and under no circumstances release the identity of particular persons acting as respondents to the questionnaire in this study. The research shall also be conducted in full compliance and awareness of the local customs, standards laws, and regulations. Timescale The anticipated time duration for the research process, as far as may be foreseen, is as follows: PLEASE REVISE THIS: CYCLE 1 (in number of weeks) 1 – 3 Construct research proposal; draw up questionnaires, secure permission 4 – 5 Submit proposal to university approval board 6 Literature review & collecting data from various sources 7 – 9 Compiling and formatting the data in sequence 15 – 17 Implement findings from cycle 1 CYCLE 2 17 – 20 Prepare draft report 21 – 26 Discussion based on survey findings 27 – 30 Completion of dissertation: write dissertation . WORDCOUNT = 4,000 excluding title, references and appendix (questionnaire) REFERENCES Brown, S.P., Cron, W.L., Slocum Jr., J.W., 1998. Effects of trait competitiveness and perceived intraorganizational competition on salesperson goal setting and performance. Journal of Marketing 62 (October), 88–98. Cartwright, S & Holmes, N 2006 ‘The meaning of work: The challenge of regaining employee engagement and reducing cynicism’, Human Resource Management Review, vol. 16, pp. 199-208 Chi, C G & Gursoy, D 2009 ‘Employee satisfaction, customer satisfaction, and financial performance: An empirical examination’, International Journal of Hospitality Management, vol. 28, pp. 245-253 Frankl, V. E. (1984). Mans search for meaning (3rd ed.). New York: Pocket Books. 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(2006). Work engagement. An emerging psychological concept and its implications for organizations. In S. W. Gilliland, D. D. Steiner, & D. P. Skarlicki (Eds.), Research in social issues in management (Vol. 5): Managing social and ethical issues in organizations (pp. 135–177). Greenwich: Information Age Publishers. Appendix Put a mark under the appropriate box depending on whether or not you agree with the statement. The choices are: SD = Strongly Disagree D = Disagree Neut = Neutral; neither agree nor disagree A = Agree SA = Strongly Agree Please provide any comments you may have about your relationship with your company: __________________________________________________________________________________________________________________________________________________________________________________________________________________________________________ Read More