CHAPTER ONE
INTRODUCTION
1.1. Background to the Study
In this 21st century, employees are the most vital resources in an organization. Without them, it is not possible for an organization to achieve productivity, profitability, and overall performance. Organizations therefore need to consider several ways of getting employees do their work willingly and enthusiastically, and be satisfied with their jobs. Every organization irrespective of the size, technology and market focus wants to be successful and have desire to get continuous progress in this competitive business environment. To overcome these restraints, there is the need for an organization to develop a strong, positive and maintained relationship with its employees. To achieve prosperity, organizations need to come up with different strategies that will aid their competitiveness with their rivals so as to enhance their performance.
Organization productivity is an assessment of the efficiency of the organization in terms of product outputs. According to Mathias and John (2015) productivity is a measure of the quantity and quality of work done, considering the cost of the resources used. The more productive an organisation, the better its competitive advantage, because the costs to produce its goods and services are lower. Better productivity does not necessarily mean more is produced; perhaps fewer people (or less money or time) was used to produce the same amount, (Mathias & John, 2015). McNamara (2017) affirmed that, results are usually the final and specific outputs desired from the employees. Results are often expressed as products or services for an internal or external customer, but not always. They may be in terms of financial accomplishments, impact on a community; and so whose results are expressed in terms of cost, quality, quantity or time, (McNamara, 2017). Measuring productivity involves determining the length of time that an average worker needs to generate a given level of production.
In Europe, a very few organizations believe that the human personnel and employees of any organization are its main assets which can lead them to success or if not focused well, to decline. Unless and until, the employees of any organization are satisfied with it, are motivated for the tasks fulfillment and goals achievements and encouraged, none of the organization can progress or achieve success. Brady (2017) asserted that, none of the resources utilized for production in an organisation are so thoroughly examined as the human capital. Most of the activities carried out in human resources systems are geared to influence employees or organisational productivity. Compensation, evaluation systems, training and development, recruitment, job characteristics are human resource responsibilities directly aimed at productivity
In the UK, Bernardin (2014) clearly affirmed that, the importance of motivational factors cannot be underestimated by an organisation in increasing the productivity levels of employees most particularly when trying to attain competitive advantage. Bernardin (2014) further claimed that productivity may be hard to determine, however it can be evaluated in terms of effectiveness and efficiency of employees. Therefore, it is very essential for every organization to improve the job performance of the employees. Undoubtedly, positive employee mobility is a major step that every organization needs to put in place in order to aid organization productivity. Another equally important aspect is how the existing human capital should be managed, increasing the interest in the determinants and implications of their mobility, i.e. if, why and where they are going. Turnover is defined as leaving the current organization, while mobility is both the act of leaving one organization and joining another (Wynen, Op de Beeck, & Hondeghem, 2013).
In the United States, productivity is an objective concept. As an objective concept it can be measured, ideally against a universal standard. As such, organizations can monitor productivity for strategic reasons such as corporate planning, organization improvement, or comparison to competitors (Mckersie & Hunter, 2015). As digitalisation and the Internet of Things (IoT) evolves in a rapid pace, along with the field of smart development, connectivity and communication, the need for highly skilled professionals such as engineers, IT specialists and software developers grow just as fast (Bonnaud et al. 2019). This introduces another challenge concerning the increasing shortage of skilled workers at all professional levels in the labor market. This has become an international concern where most countries report a shortage of skilled technical personnel and have been for years (Steenkamp, Nel, Andre Leon & Johnson, 2017)
In Africa, recent developments in the way employees are managed in organizations have brought about the need to seriously consider employees as major stakeholders in organizations (Tchapchet, Iwu, & Allen-Ile, 2020). At a time when employees in other parts of the world are regarded as the main source of competitive advantage, South Africa is still enmeshed in a labor crises typified by industrial actions. Voss and Gruber (2018) asserted that in order for public HE institutions to provide services of good quality to the students (who are the customers of public HE institutions), the employees should be knowledgeable, well-organized, encouraging, helpful, caring to students’ needs, approachable, experienced, friendly and should have good communication skills. Rendering services of good quality will help improve the productivity (that is more graduates) of public HE.
In Nigeria, organizations are facing issues of casual employment amongst indigenous employees, unrealistic target given to new employees, personality differences, adapting to changing environment such as globalization and technology, challenge of different faith and culture, challenge faced in handling difficult people and situation etc. These often resulted in employees’ turnover, dissatisfaction, among others. Employee mobility has been broadly viewed as a disadvantage for firms losing valuable human capital, affecting performance negatively and implicating replacement costs in the form of recruitment and training (Campbell, Ganco, Franco & Agarwal, 2013).
Quite a number of empirical studies focused on employee mobility. Employees moving between different external firms are a source of knowledge spillovers. It is argued to enhance overall innovation and productivity, as well as regional economic growth by facilitating access to new external ideas and capabilities (Singh and Agrawal 2011; Saxenian 1996; Braunerhjelm, Ding, & Thulin, 2015). In technology-intensive industries, some studies find it crucial to retain employees to gain competitive advantage (Aguenza & Mat Som 2012), leading to a large focus on identifying factors that affect why employees leave, with the intention of constructing and implementing strategies to strengthen employee retention practices. Similarly, some studies showed the relationship between mobility and knowledge flows, e.g., Song et al. (2003) that investigated ideas from inventors that moved from another employer, and Rosenkopf and Almeida (2003) who found that the flow of knowledge was greater between firms with more employee mobility between them. This also leads to an increased interest on identifying the factors influencing employees’ mobility.
Based on the above, there is barely any inclusive study focusing on employees’ mobility and organization productivity using the banking sector. Thus, this study seeks to bridge this gap in knowledge by examining employees’ mobility and organization productivity in Guaranty Trust Bank, Ikeja, Lagos State
1.2. Statement of the Problems
Over the last two decades, a significant research literature has emerged about organizational movement of personnel and its impacts on organization. Study into this phenomenon has spanned diverse fields, which include economics, human resource management (HRM), strategic management, and sociology. However, while each of these respective research streams has provided valuable insights into the antecedents and consequences of organizational movements of talent; the result is a research literature on employee mobility that is highly fragmented and disorganized. Despite its lack of consistency, literature on employee mobility is of particular interest to this present study.
In a study conducted in South Africa by the Human Sciences Research Council for the Education Labour Relations Council in 2005, it was found that 55% of teachers would leave teaching if they could. The reasons cited for this included workload stress, low salaries, lack of discipline in schools and lack of career advancement. Zimbabwe is reported to have lost very many newly qualified teachers who probably sort greener pastures. The problem of teacher turnover in Malawi is also reported to be over whelming in relation to other developing countries (Xaba 2015). It is arguable that the loss of qualified teachers from the profession for any reason affects Kenya’s economic development, particularly in the scientific, technological, and professional sectors, and objective which the Government of Kenya is striving to achieve through education (Republic of Kenya, 2012a; 2012b) as reported by Mutune and Orodho (2014).
The advantages of employee mobility are often seen from the perspective of the acquiring firm. In contrast, Corredoira and Rosenkopf (2010) studied the effect of mobility on the firms that the employee leaves. Mobility is associated with human capital and social capital, where the aspect of the leaving firm is more focused on the social ties involved, meaning that even though the human capital is lost to another firm, benefits are gained in form of communication channels and a strengthened relationship between the two firms. The mobility of an employee from one firm to another involves two different flows, the transfer of knowledge and skills from one firm to another when the employee is moving, and the bi-directional development of new relations between the firms. Kaiser, Kongsted, and Rønde (2015) also found that the social network effects when employees leave to join another firm is not only positive but cancel out the loss of knowledge from the employee leaving the firm. The benefits from employee mobility is not limited to organizations, employees that change jobs have shown to perceive more positive outcomes than those that do not (Fields, Dingman, Roman, & Blum, 2016). The benefits found from engaging in mobility includes higher salary, reduced stress, more job autonomy, better advancement opportunities and higher job satisfaction.
However, to the best of the researcher understanding, there is little or no work done on employee mobility on organization productivity in Guaranty Trust Bank Plc. This is a gap this study seeks to fill by examining employee mobility and organization productivity in Guaranty Trust Bank Plc, Ikeja, Lagos State, Nigeria.
1.3. Objectives of the Study
The main objective is to assess employee mobility and organization productivity in Guaranty Trust Bank, Ikeja, Lagos State. In order to achieve the main objective, the following specific objectives are:
- To assess the effect of employee promotion on employee retention in the organization
- To investigate the effect of working environment on employee job satisfaction in the organization
- To examine the effect of reward on employee turnover intention in the organization
- To find out the internal factors responsible for employees mobility in the organization
1.4. Research Questions
The following research questions are poised for the study.
- What is the effect of employee promotion on employee retention in the organization?
- What is the effect of working environment on employee job satisfaction in the organization?
- What is the effect of reward on employee turnover intention in the organization?
- What are the internal factors responsible for employees’ mobility in the organization?
1.5. Research Hypotheses
The research hypotheses for this study are formulated in their null form.
- Ho1: Employee promotion has no significant effect on employees’ retention in the organization
- Ho2: Working environment has no significant effect on employees job satisfaction
- Ho3: Reward has no significant effect on employees’ turnover intention
- Ho4: There exist no factors responsible for employees mobility in the organization
1.6. Operationalization of the Variables
The dependent variable is organization productivity, represented by Employee Retention (ER), Employee Job Satisfaction (EJS), Employee Turnover Intention (ETI). On the other hand, employee mobility, being the independent variable, is proxied by Employee Promotion (EP), Working Environment (WE), and Reward (R).
Where Y= Dependent variable
X= Independent variable
α˳ = Constant
ꞵ1 ꞵ3 = Coefficient of independent variable
µᵢ = Stochastic value or error terms
Y= f(X)
X= Employee Mobility
X = f(x1, x2, x3)
x1= Employee Promotion (EP)
x2= Working Environment (WE)
x3= Reward (R)
Y= Organization Productivity
Y= f(y1, y2, y3)
y1 = Employee Retention (ER)
y2 = Employee Job Satisfaction (EJS)
y3 = Employee Turnover Intention (ETI)
The four specific objectives are operationally expressed as:
To assess the effect of employee promotion on employee retention in the organization
Y1 = f (x1) ………………………………………. equation 1
Y1 = b0 + b1x1 + u ……………………………… regression 1
To investigate the effect of working environment on employee job satisfaction in the organization
Y2 = f (x2) ……………………………………….. equation 2
Y2 = b0 + b1x2 + u ………………………………. regression 2
To examine the effect of reward on employee turnover intention in the organization
Y3 = f (x3) ………………………………………… equation 3
Y3 = b0 + b1x3 + u ……………………………….. regression 3
1.7. Scope of the Study
The study is limited to employee mobility and organization productivity in Guaranty Trust Bank, Ikeja, Lagos State. The unit of analysis of the study is the employees of Guaranty Trust Bank Plc at Junior, Middle, Senior, and Management level positions. The selected sample for the study is given as 100 employees. The simple random sampling technique will be adopted to administer the questionnaire, in order to ensure that both male and female employees have equal chance of being selected for the study, while data gathered will be analyzed using the regression and ANOVA analysis. The geographical location for this study is Guaranty Trust Bank Plc, Ikeja, Lagos State, Nigeria.
1.8. Significance of the Study
Management Practice: findings from this study are important to management as it will educate them on the motivational and incentive packages to put in place in the organization so as to encourage employee satisfaction and retention.
Industry: findings from this study will as well be important to industry in sense that it will help provide knowledge in adjusting or modifying the factors leading to high rate of employee turnover. Besides, it will help industry management to have a structured and policy in place that will be of benefit to both organization and employees betterment.
Government: finding from the study is important to the government since they have the capacity to formulate policy and guidelines that will be of positive interest to employees.
University: the findings will be of significance to University authorities as it will provide them with adequate information that will be useful to address employee mobility.
Society: findings from this study will be of benefits to the society at large in order to identify the factors leading to employee mobility and how best to manage these factors. In addition, it will educate the general society on the importance of ensuring that employees are well motivated and satisfied on their job, in order to aid performance.
1.9. Definition of Operational Terms
Employee Mobility: is the movement of talented employees within or out of an organization
Promotion: refers to when an employee is offered an advanced position that is above his or her present position.
Reward: refers to when an employee is offered reward packages such as bonuses, salary increment, etc in order to enhance his or her job performance.
Working Environment: refers to the conditions or situations (such as, physical aspects, legal rights, job hours, etc) that surrounds the environment where employees operates (Kotler, 2016)
Employee Retention: refers to the ability of an organization to retain high skilled employees in its workforce.
Employee Job Satisfaction: is the difference between the inputs made by employee and the outputs receive from the job
Productivity: is an assessment of the efficiency of the organization in terms of product outputs
