Unit 3 Employee Loyalty and Managerial Grid
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Overview
Congratulations on completing Unit 2. This unit will be focused on management style and its impact on employee engagement and stewardship.
The main challenge for any organization is how to effectively measure employee loyalty. What cannot be measured cannot effectively be addressed and maintained in the health/business industries. As such, there have been many measurements and assessment tools created over the years, for example, UWES (Utrecht Work Engagement Scale, 2010); ISA (2012), MBI (Maslach Burnout Inventory, 2001). We mentioned some of the measurement tools in Unit 2. In Unit 3, we will focus on the concepts of employee loyalty and the benefit of using Task and People factors related to Tao’s model (2006) of employee loyalty in the workplace.
This unit is divided into the following topics:
- Tao of Loyalty Concepts and Employee Loyalty;
- Managerial Grid: The Task and People factors;
- Quality of Work Life - The Determinants of Job Satisfaction and Job Retention.
Learning Outcomes
When you have completed this unit, you should be able to:
- Examine the effectiveness and shortcomings of an organization and its current engagement and stewardship practice.
- Employ best practices in creating employee loyalty within the organization.
- Analyze the critical roles played by the leadership group and immediate supervisors in creating high employee loyalty.
- Recognize employee motivation and satisfaction as a means of retaining employees.
3.1 Tao of Loyalty Concepts and Employee Loyalty
As per the perspective of positive psychology, employee engagement can be measured through ways that enable employees to bring more positive psychological resources to work, such as several forms of collective meaning-making communication, managerial communication, collegial communication, and the ability to find benefits; in other words, rather than measuring individual engagement as an asset to be built up and then utilized.
Using a management grid, Rao (2006) measures how tasks and people are prioritized in an organization, unit, manager, and employee. Two distinct buckets are measured: the Task Bucket and the People Bucket. A high score in the Task Bucket indicates a positive working environment that enhances current productivity. In the People Bucket, high scores indicate that there is an environment that fosters teamwork, innovation, learning, and long-term productivity. Ten of the eleven Tao factors fall into those two buckets or the Yin and Yang of Loyalty Tao. The eleventh factor, communication, is critical to the success of both buckets. In order for an organization to score highly in both categories, there must be strong communication channels from the top down, from the bottom up, and laterally (sideways).
The top-down or bottom-up approaches are associated with the archaic and ineffective “hierarchical” model of leadership. The point remains that an open, transparent, and receptive culture is fundamental to the creation and maintenance of high employee loyalty.
The Task Bucket and the Hard Factors
The Task bucket contains all the “hard” or “tangible” factors. These are the factors that develop a production-focused employee. An organization that manages the hard factors well creates employees that are “ready to be productive in the immediate present.
In the Tao of Loyalty book, Rao (2006) points out the five “hard or tangible” factors that are: Job Satisfaction, Role Clarity, Buy-into Vision/Mission/Values, Resources, and Accomplishments. An employee who scores high with task factors feels they are in the right job, know what is expected of them, have adequate resources to deliver the desired results, is inspired by the organization’s vision/mission, and feels a sense of accomplishment in their role within the organization.
In keeping with Rao’s Tao of Loyalty concept, the hard task factors are the Yang of Employee Loyalty. To have high-task orientation in an organization is necessary, but it is not enough to build high levels of loyalty. The organization must also be balanced with the soft people factors or the Ying of Employee Loyalty.
The People Bucket and the Soft Factors
In the People bucket are all the “soft” or “intangible” elements, which are more difficult to measure and manage. An organization that manages “soft” factors well creates a positive and nurturing work environment for its employees. In addition, these factors allow an employee to be nurtured and developed so that they will be productive in the future.
The five “soft or intangible” factors are:
- Appreciation
- Value
- Fairness
- Trust
- Care
- Concern
An employee who performs well on the people factors feels that they have been treated fairly and that the organization cares overall. The employees feel appreciated and have a sense of trust with the people at every level of the organization, and their ideas or suggestions are taken seriously.
An environment where employees feel safe and nurtured is created through the management of soft factors. Since they feel empowered, supported and encouraged, they are more likely to take risks and be innovative and creative. The right type of environment will not lead to employee burnout, ensuring long-term productivity.
3.2 Managerial Grid: The task and People Factors
Source: Peters, J. (2019). Employee Engagement: Creating High Positive Energy at Work. (p.5)
As Peters points out in the figure above, Tao’s employee loyalty model is highly connected to customer experience in organizations. The concepts will be connected to the Managerial Grid developed by Blake and Mouton.
Robert Blake and Jane Mouton (1964 & 1985) developed the Managerial Grid, also called a leadership grid. According to them, the leadership styles can be identified based on the manager’s concern for people and production (i.e. tasks at hand). Concern for people, in this context, means how committed an individual is to goal achievement, maintaining their self-esteem as employees, and satisfying their interpersonal relationships. The concern for production refers to an attitude of superiors towards the quality of procedures and policies, creativity in research, effectiveness of staff, work efficiency, and volume of output.
This figure illustrates the five leadership styles identified by the managerial grid based on two behavioral dimensions:
In the figure, there are 81 possible categories where the leader’s style may fall.
- Impoverished Management (1,1): The managers with this leadership style exert minimum effort to get the work done by the subordinates. They have minimal concern for both the people and production and they function merely to preserve their jobs and seniority. Therefore, disharmony, dissatisfaction, disorganization arises within the organization.
- Task Management (9,1): Here, the leader is more concerned with the production and lays less emphasis on the personal needs of his subordinates. This leadership style is also called a dictatorial or perish style, where the subordinates are required to perform the task as directed by the superiors. In this leadership style, the output in the short run may increase drastically, but due to stringent rules and procedures, there could be a high labor turnover.
- Middle of the Road (5,5): The manager with this style tries to keep a balance between the organizational goals and the personal needs of his subordinates. Here, the leader focuses on adequate performance through a balance between the work requirements and satisfactory morale. Both the people and production needs are not completely met, and thus the organization land up to an average performance.
- Country Club (1,9): Here, the leader lays more emphasis on the personal needs of the subordinates and gives less attention to the output. The manager adopts this style of leadership with the intent to have a friendly and comfortable working environment for the subordinates, who get self-motivated and work harder on their own. However, less attention to the production can adversely affect the work goals and may lead to unsatisfactory results.
- Team Management (9,9): According to Blake and Mouton, it is the most effective leadership style wherein the leader takes both people and production hand in hand. This style is based on McGregor’s Theory Y, where the employees are believed to be committed towards the goal achievement and need not require the manager’s intervention at every step. The leader with this style feels that empowerment, trust, respect, commitment helps in nurturing the team relationships, which ultimately results in the increased employee satisfaction and overall production of the organization.
Thus, the managerial grid is a graphical representation of different leadership styles that managers adopts while dealing in the industrial settings. (Source: Link here)
3.3 Quality of Work Life: The Determinants of Job Satisfaction and Job Retention
In terms of work life, how can quality be defined? Whether an organization succeeds is largely dictated by its ability to recruit, motivate, and retain its employees. Modern organizations must be flexible so that they can develop their employees and enjoy their commitments. A strategy to enhance employees’ quality of work life (QWL) is necessary to satisfy both organizational objectives and employee needs.
Quality of Work Life (QWL) programs in an organization are designed to improve the work environment for all employees. As a result, QWL targets improving human satisfaction, productivity, adaptability, and effectiveness in organizations.
Human factors include technological, human, societal, and organizational factors (factors of the workplace). QWL combines these factors to maximize performance.
Job satisfaction and employee retention
Retention of employees can be predicted by employee satisfaction. It has been shown that worker satisfaction improves when employers take steps to foster strong relationships because workers believe their skills are being utilized and that their service is being appreciated. Consequently, the level of worker satisfaction tends to increase with higher employee retention.
Learning Activity: Reading - Quality of Work Life
This topic is best understood by reading the Research Article “Quality of Work Life: The Determinants of Job Satisfaction and Job Retention among RNs and OHPs” This study examines the healthcare industry (public and private) in several countries including Saudi Arabia, where nurses and other health care professionals often experience high turnover, and explains the connection between quality of work life (QWL), satisfaction, and retention.
Parveen, M., Maimani, K., Kassim, N. (2017). Quality of work life: The determinants of job satisfaction and Job retention among RJs and OHPs. International Journal for Quality Research, 11(1), 173-194. (Assigned Article #1). Link here.
Use the following diagram to examine factors involved in the relationship between quality of life, satisfaction and job retention suggested by the article (p. 174).
This learning activity will help you build your knowledge of the topic and will be addressed in class or during your work assignments.
Learning Activity: Reading - Predicting staff retention from employee motivation and job satisfaction
- Reading the article (Assigned Article #2) linked below will help you better understand the topic of staff retention. An investigation into employee motivation and job satisfaction was conducted at a foreign exchange bank as a predictor of staff retention.
Please note that you will need to log in with the institution credentials to access the full article.
Sabbagha, M. D.S., Ledimo, O., Martins, N. (2018). Predicting staff retention from employee motivation and job satisfaction. Journal of Psychology in Africa. 28(2), 136-140. Assigned Article No.2
Use the following diagram to examine factors involved in the relationship between staff retention, motivation, and job retention suggested by the article (p. 139).
This learning activity will help you build your knowledge of the topic and will be addressed in class or during your work assignments.
Summary
This unit connects the concepts of measuring employee engagement that we learned in Unit 1 and 2 with employee loyalty. Our primary focus is Tao’s Employee Loyalty Model. The task and people buckets or measuring performance outcomes will not be enough to change the culture or properly address the issues associated with Employee Loyalty. Rao (2006) and Blake and Mouton (1985) proposed that the Ying and Yang of Employee Loyalty is made up of soft and hard factors.
Moreover, Rao covers each of the hard or tangible Task Factors in Chapter Six of his book, as well as the soft or intangible People Factors: Fairness, Care and Concern, Appreciation, Being Values, Trust in Chapter Seven. According to Rao’s (2006) framework, the ten Task and People Factors, rooted in the 11th Communication Factor, are what lead to high employee engagement and loyalty in an organization. Additionally, they will offer effective and efficient customer service to organizations, as stated by Peters (2019).
As Parveen et al. (2017) and Sabbagha et al. (2018) have shown, employee engagement and performance outcomes are linked. Rao’s findings are consistent with Blake and Mouton’s findings. Performance outcomes are strongly related to the Quality of Life at Work (QWL) that employees experience on a daily basis. A company’s performance outcomes, job satisfaction, retention, employee motivation, and their relationship within the company are all tied to engagement and loyalty.
References
- Blake, R.; Mouton, J. (1985). The Managerial Grid III: The Key to Leadership Excellence. Houston: Gulf Publishing Co.
- Peters, J. (2019) Employee Engagement: Creating High Positive Energy at Work (eBook).
- Bridger, E. (2018). Employee engagement: A practical introduction.
- The Tao of Loyalty concept. (Class Summary notes)
- Parveen, M., Maimani, K., Kassim, N. (2017). Quality of work life: The determinants of job satisfaction and Job retention among RJs and OHPs. International Journal for Quality Research, 11(1), 173-194. (Assigned Article #1)
- Sabbagha, M. D.S., Ledimo, O., Martins, N. (2018). Predicting staff retention from employee motivation and job satisfaction. Journal of Psychology in Africa. 28(2), 136-140. https://doi.org/10.1080/14330237.2018.1454578 (Assigned Article #2)