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. 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 (Stoyanov, 2017). 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 (Robertson, 2016). The next level of needs in the hierarchy is 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 (Miner, 2015). 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.
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 meets 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 appreciation system and make the staff feel that they are irreplaceable. I would offer development opportunities by facilitating frequent trainings. 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. Cleary, Elizabeth is past the first four levels on needs in Maslow's hierarchy of needs. She needs to self-actualize; therefore, I would give Elizabeth more responsibilities to make her feel fully utilized. According to Herzberg's theory, Elizabeth is not dissatisfied with her work since the hygiene factors are provided for, however, she has not been provided with the right motivating factors to keep her loyal and committed to Norsk.
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. Lisa 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. Ola Rennemo needs the hygiene factors to prevent him from dissatisfaction. He is past the basic and security needs and is now motivated by satisfying his social needs. I 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 newborn when the baby is born.
Implications of the case as a future employee and as a future manager
As Maslow stated, motivation is a continuous process (Robertson, 2016). One may be motivated by a certain need but when it is achieved it stops being a motivator and one is motivated by higher needs. Employees need to be provided with factors that help them satisfy their needs at every stage in life. In my career, I would wish to be able to rise from being motivated by the basic needs, to achieving the highest level, which is self-actualization. Therefore, 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, such that I will be able to have time for social life and still develop my career. I would want to be in an organization that gives me the security for the future, by providing attractive retirement benefits and would like to feel that my job is secure by working in a company that does not dismiss its staffs without due reason. Most importantly, I would seek to work in an organization that promotes the 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 organizations achieve their goals (Kauppila, 2018). From Elizabeth's case, I realize that people do not work for money only but are motivated to work by the satisfaction and meaning they derive from the job. Therefore, as a manager, I would ensure that apart from the good remuneration and benefits workers get from the organization, the work should give its doer a meaning in life. The workers should be appreciated and recognized by being given the liberty to exercise their skills and grow. That way, they remain loyal and committed to their employers. As a manager, I will ensure that employee motivation becomes a daily routine. I would provide them with extrinsic motivation factors to prevent 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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Lazaroiu, G., 2015. Employee motivation and job performance. Linguistic and Philosophical Investigations, 14, p.97.
Mikkelsen, M.F., Jacobsen, C.B. and Andersen, L.B., 2017. Managing employee motivation: Exploring the connections between managers’ enforcement actions, employee perceptions, and employee intrinsic motivation. International Public Management Journal, 20(2), pp.183-205.
Miner, J.B., 2015. Organizational behavior 1: Essential theories of motivation and leadership. Routledge.
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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.
