Norsk Petroleum Company is facing a crisis of high staff turnover. In the past one year, 15% of the qualified professionals left the company after receiving offers from Norsk’s competitors. The human resource director, Lisa is concerned that the company is losing its knowledge workers to their competitors. In the case study, Elizabeth, a petroleum engineer, tendered her resignation to take up a new position in another company. She described the company she was moving to as small and independent and cited that her new role would give her greater responsibility for managing two teams of petroleum engineers and negotiating contracts with suppliers. Elizabeth was well paid, according to a recent labour market survey. Elizabeth said that she was happy with her supervisors and team members at Norsk. The HR director offered Elizabeth a salary increase of 5%, additional stock options and a company car to make her remain in the organization but she still resigned. Moreover, a computer technician, Ola Rennemo, has also tendered his resignation. Ola Rennemo said that he had found another job that was closer to his home, thus he would reduce his travel time to work. His wife is expecting a baby and he wants to be closer to his family. Ola Rennemo was a high-tech talent and his performance had been consistently excellent in his previous appraisals. The HR director advised Ola to stay, as there was a bright future for him in the company. Lisa offered Ola that the company would pay the tuition for a diploma in management at a local college to offer professional development but he declined the offer and said he was committed to the new job.
Employee motivation is the workers level of commitment, energy and creativity that they dedicate to their jobs (Arnolds and Boshoff, 2002). Organization strive to keep their employees motivated to ensure they have excellent individual and team performance, which in turn results to good organizational performance. There are two types of motivation, namely extrinsic motivation and intrinsic motivation (Lazaroiu, 2015). Extrinsic motivation is derived from external factors that cause a worker to put effort to achieve a work related goal and are usually reward or punishment based. A reward motivates the employee to act to receive the reward while punishments motivate the staff to work to avoid the punishment. On the other hand, intrinsic motivation is derived from factors within the employee. Employees are motivated to work when they derive satisfaction in the job itself. Elizabeth is well paid according to the industry pay standards, she is no longer motivated by the pay rise and benefits promised to her by the HR director. Lisa assumed that a pay rise would motivate Elizabeth, which is a myth as explained by Pfeffer (1998). Elizabeth longs for career growth, responsibilities and being involved in making decisions. Ola Rennemo is not motivated by professional growth, at the moment, he longs for flexibility at work so that he can be closer to his family.
Herzberg Two-Factor Theory
According to Herzberg’s two-factor theory of motivation, there are factors that lead to job satisfaction and others prevent from dissatisfaction (Sanjeev and Surya, 2016). The factors that cause satisfaction are referred to as motivational factors while those that prevent dissatisfaction are called hygiene factors. Hygiene factors are external to the job and are critical for extrinsic motivation at workplace. The hygiene factors include the physiological needs that workers want and expect to be provided for by the employer for the job to be done. Hygiene factors include a reasonable remuneration, which is competitive in the same industry, employee benefits including medical insurance, clean and safe working conditions, job security, healthy interpersonal relations within the workplace, flexible working plans, among others (Sanjeev and Surya, 2016). When these factors are not provided for, the employee becomes dissatisfied with the job and demotivated, thus, they are likely to leave the organization.
Motivational factors give a worker intrinsic motivation to pursue work goals. The motivational factors include recognition for achievements made by employees, growth opportunities including trainings and promotions, delegation of responsibilities and relevance of the work to personal career goals (Sanjeev and Surya, 2016). Elizabeth seems to be lacking motivational factors from Norsk and thus her reason for leaving the company is to get greater responsibilities, including negotiating contracts with suppliers. Despite being offered a pay rise and more benefits, she declines the offer as hygiene factors do not add to the job satisfaction and only motivate to a low level than the intrinsic factors. Ola Rennemo seemed to be dissatisfied with his job. He needed more time to be with his family, which Norsk did not offer by way of flexible working hours.
Maslow’s Theory
Abraham Maslow explained motivation by arranging human needs in a hierarchy. Maslow theory is based on the assumption that a need that is not met dominates behaviour and motivates one to work towards satisfying the need (Peters, 2015). When that need is satisfied, it stops being a motivator and activates the desire for meeting higher needs. According to Maslow, the hierarchy of needs starts with physiological needs, which are basic for human survival; they include food, water, and shelter. Basic needs recur and the employees need money incentives to be able to satisfy the physiological needs. The next level of needs in the hierarchy are the safety needs. Once the basic needs are met, one begins to desire safety to be able to cater for the basic needs in the unforeseen future. Organizations offer satisfaction for this need by giving job security, pension plans, among other retirement benefits assurances.
When the safety needs are met, the employee moves to social needs. The employee needs to have a sense of belonging by being allowed to join groups and associations where they feel significant and secure. When the social needs are met, one gets motivated by the need for self-esteem. The employees in this level want recognition, status and power. When the fourth level of needs is satisfied, the employee moves to the last level of needs, which is the need for self-actualization. The employee has set personal goals and is willing to work to achieve. The employee focuses on feedback which is task oriented and is not moved by personal praises or criticism. Elizabeth no longer derived motivation in her good salary and benefits, but wanted to actualize and use her skillset fully. Ola Rennemo was motivated by the social needs and wanted more time with his family. The offer given to him by Lisa for professional development, career growth and job security did not motivate him, as he was past that level is the hierarchy of needs.
Freud’s Theory
Freud’s theory states that there are psychological forces that define a person’s behaviour (Stoyanov, 2017). Freud argued that a human brain is divided into two, the conscious and the unconscious mind. The conscious mind is called the ego and consists of perceptions, memories, thought and feelings that define ones personality. The unconscious mind is referred to as the Id, and consists of the natural instincts that one has formed since birth. The third component is the superego, which moderates ego and the Id. The Id motivates an individual to do what satisfies basic physical needs unconsciously. One can then involve their reasoning by consciously weighing options and choosing the best course of action by involving the ego and the superego (Kauppila, 2018). Elizabeth and Ola were unconsciously demotivated by their current state at Norsk and when opportunities arose elsewhere, they weighed their options and settled for leaving the company to where they felt they would be satisfied.
Eysenck’s Theory
Eysenck’s theory explains three main personality traits derived from biological functions, that motivates ones behavior; extraversion, psychoticism and neuroticism (Miner, 2015). Extroverts’ personality seek for stimulation to achieve optimal level of satisfaction. On the other hand, introverts have achieved the maximum stimulation and thus do not seek more. For the neuroticism personality, the more emotional stimulus is available, the more the motivation one will get to achieve set goals. For the psychoticism personality, the individuals are hostile, impulsive and antisocial. Each personality has a trait that seeks sensation, which determines the level of intrinsic motivation (Corr and Krupić, 2017). Elizabeth had a high sensation, as she desired a new challenge and greater responsibilities thus had to leave Norsk. Ola Rennemo had a high sensation for social needs and thus quit Norsk to be closer to his family.
Recommendations to handle this situation
If I were Lisa Rennemo, I would utilize Herzberg theory to motivate the employees to reduce the staff turnover. First, I would be sure to provide the hygiene factors to keep the employees from dissatisfaction. I would ensure the worker’s salary meet the industry standards, the workers have flexible working conditions like allowing the workers to choose their shifts, a safe environment to work in and provide promote work-life balance. The workload should be manageable to prevent the workers from having burnouts and unhappy life outside work, which would result to dissatisfaction and demotivation. In addition, I would encourage the staff to develop intrinsic motivation by providing them with motivational factors. For instance, I would ensure that the managers provide sound leadership to their teams by delegating duties, giving responsibilities, involving staff in decision-making and providing channels for proper communication. I would develop an effective reward and appreciating system and make the staff feel that they are irreplaceable. I would offer development opportunities by facilitating frequent trainings. I would give Elizabeth more responsibilities to make her feel fully utilized and would give Ola Rennemo flexibility to come to work when there is less traffic. In addition, I would ask Ola to choose his shifts and promise him that the organization would allow him adequate time to take care of his expectant wife and the new born when the baby is born.
Implications of the case as a future employee and as a future manager
As a future employee, I will seek an organization that provides both intrinsic and extrinsic motivation to the employees. I would wish to work in a safe environment, get a reasonable pay that corresponds to the duties given to me and is in line with the market standards. I would also wish to work in an organization that encourages work-life balance. Most importantly, I would seek to work in an organization that promotes growth of their employees by offering trainings and promotions. I would wish my talents to be valued and recognized, that way, I would be motivated to self-actualize, thus give the best to my employer.
Employee motivation is critical to ensuring the organizations achieve their goals (Kauppila, 2018). As a manager, I will ensure that employee motivation becomes a daily routine. I would provide them with the extrinsic motivation factors to prevent from dissatisfaction. I would encourage feedback and have open lines of communication to have the workers share their views, which would make them feel valued, thus get motivated and remain loyal to the organization (Mikkelsen et al., 2017). I would also ensure that there is a positive workplace environment. I would ensure employee development by giving the employees responsibilities and delegating management duties. Lastly, I would recognize the employee’s efforts and reward them in a fair rewards system.
References
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Pfeffer, J., 1998. Six dangerous myths about pay. Harvard business review, 76(3), pp.109-119.
Sanjeev, M.A. and Surya, A.V., 2016. Two factor theory of motivation and satisfaction: an empirical verification. Annals of Data Science, 3(2), pp.155-173.
Stoyanov, S., 2017. A theory of human motivation. Macat Library.
