Relationship Between Job Satisfaction and Job Performance and Absenteeism Assignment

Relationship Between Job Satisfaction and Job Performance and Absenteeism Assignment Words: 8166

Conceptual Background This paper will discuss about job satisfaction and its relation with job performance and absenteeism. Job satisfaction has been defined as a pleasurable emotional state resulting from the appraisal of one’s job. Stephen P. Robbins based in his book (Organizational Behavior, 12th edition) described job satisfaction as a positive feeling about one’s job resulting from an evaluation of its characteristics. Job satisfaction is one of dependent variable of organizational behavior.

It becomes one of primary dependent variable because it’s demonstrated relationship to performance factors, and the value preferences of many OB researchers. Some of the researchers already prove that job satisfaction has involved to other OB’s dependent variable. From the Stephen P. Robbins’s book, job satisfaction do effect to Job performance, OCB, Absenteeism, Turnover, and Workplace deviant. From all of the other factors that effected by job satisfaction, job performance will became the topic for this paper.

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The Human Relations movement, of Elton Mayo and others believed that job satisfaction had beneficial effects, including increased job performance (Argyle, 1988). Although some researchers used to believe that the relationship between job satisfaction and job performance is a management myth, a review of 300 studies suggested that the correlation is pretty strong. This paper strives to see how the job satisfaction has correlation with job performance. 1. 2 Research Object 1. Company Profile The object of my research is engineering division in Saipem.

Saipem is a contractor in the oil and gas industry. The organization, while providing many different kinds of services – including specialized services and maintenance, modification and operations – has been rationalized into three global business units: Onshore, Offshore, Drilling. It enjoys a superior competitive position for the provision of EPIC/EPC services to the oil industry both onshore and offshore; with a particular focus on the toughest and most technologically challenging projects – activities in remote areas, deepwater, gas, difficult oil.

Its drilling services continue to be distinctive, operating in many of the oil & gas industry’s ‘hotspots’, frequently in synergy with the Group’s onshore and offshore activities. The new Group is a truly global contractor, with strong local presence in strategic and emerging areas such as West Africa and FSU, Central Asia, Middle East, North Africa and South East Asia. Saipem is a international company. Along with its strong European content, the major part of its human resource base comes from developing countries. Saipem employs over 30,000 people comprising more than 100 nationalities.

In addition to the strong local content of its people, it employs large numbers of people from the most cost effective developing countries on its vessels and sites, and has sizeable service bases in India, Croatia, Romania and Indonesia. Saipem has a distinctive Health & Safety Environment Management System and its Quality Management System has been granted ISO 9001:2000 certification by Lloyd’s Register Certification. Engineering division in Saipem Indonesia only employ about 20 workers. And 13 from them became respondents for this research. 2. Company History and development The Company began operations in the 1950s.

During the 50s and 60s it accumulated competencies in onshore pipelaying, plant construction and drilling, operating initially as a division of the Eni group and then on a stand-alone basis, becoming definitively autonomous in 1969. Offshore operations commenced in the Mediterranean in the early 1960s and expanded to the North Sea in 1972. The Company started offering its services to customers outside the Eni group in the early 1960s and progressively widened its customer base to include almost all the supermajors, majors, major nationals and independent oil & gas companies worldwide.

Saipem has been listed on the Milan Stock Exchange since 1984 (having previously been a wholly owned subsidiary of Eni). Eni currently owns approximately 43% of Saipem. Saipem has always invested in the vessels, equipment and facilities to perform most its own work. Over the last decade, with the migration of the business towards deepwater and developing countries, this investment accelerated strongly. The primary areas of investment include deepwater drilling, field development, pipelay, leased floating production and storage (fpso), and subsea robotics. Saipem has led the trend in boosting local ontent by developing impressive facilities West Africa and the FSU. As a result, Saipem’s fleet and facilities are perhaps the most technologically advanced and efficient in the industry. While developing its vessels, equipment and facilities for the strong ‘frontier’ market trend, in 2001, the Company started to reinforce its engineering & project management capabilities to cope with the other important market trend towards large EPIC projects. This was achieved principally through a number of acquisitions, culminating in the acquisition of Bouygues Offshore s. . in 2002. This was the largest cross-border acquisition in Europe in the oil services sector and created a formidable international EPIC contractor with a strong offshore bias and a very wide, mainly international, oil company client base. Responding to the recent industry trend towards large onshore EPC projects, including those related to gas monetization, exploitation of difficult oil (heavy oil, tar sands, etc. ), and in order to strengthen its position in the Middle East and its national oil company client base, in 2006 Saipem acquired Snamprogetti. . 3 Research Process 1. 3. 1 Problem Statement Stephen P. Robbins tells us by his book (12th edition, Organizational Behavior) that a person who has job satisfaction will perform well than who does not. This statement is already verified by research that done by 300 researchers in United States. This paper will try to analyze how this statement will prove in engineering division. Employees who work in engineering division in Saipem have a very long work hour. They work from 9. 00 a. m. until 11. 00 p. m. with two times rest at 12. 00 p. m. and 6. 0 p. m. Of course, most people will dislike their job with this long work hour. But, for satisfied worker, this is not a problem that affects their performance. If they feel happy with their job, they will work better to give the best for their job. So, this paper will check how engineering division’s workers feel about their job and how this will have correlation with their performance. 1. 3. 2 Hypothesis ?H0 : Job satisfaction has significant correlation with job performance. ?H1: Job satisfaction has no significant correlation with job performance

A basic decision is probability: ?If probability > 0,05, accept H0 ?If probability < 0,05, reject H0 ?1. 3. 3 Research Method The participants for this study were employees in engineering division. In total, 13 members from 20 of the company were surveyed. All of the respondents are man. Tenure in the department ranged from 1-7 years. And they age is about 21-31 years old. The measuring instruments included a questionnaire with three sections, namely, a biographical questionnaire, a self-report questionnaire on job performance and the Job Satisfaction Survey (JSS).

These instruments were used to gather the data for the present study. Participants were ensured of their anonymity and confidentiality as they did not provide their names or identification numbers. The statistical programme used for the analyses and presentation of data in this research is the Statistical Package for the Social Sciences (SPSS) version 15. The method that will use to try the hypothesis is Linier Regression. CHAPTER 2 Review of Related Literature 2. 1 Job Satisfaction 2. 1. 1 DEFINITION OF JOB SATISFACTION

Job satisfaction is generally regarded as an employee’s attitude toward the job and job situation. Spector (1997, p. 1) defines job satisfaction simply as “the degree to which people like their jobs. ” Some people therefore enjoy work and consider it a central part of their lives while others do so only because they have to. French (1998); George & Jones (2002); Kreitner & Kinicki (2001) defines job satisfaction as a response towards various facets of one’s job, that is a person can be relatively satisfied with one aspect of his or her job and dissatisfied with other aspects Robbins (2005, p. 4) defines job satisfaction as “a collection of feelings that an individual holds towards his or her job. ” This implies that a person with a high level of job satisfaction will hold positive feelings towards the job and a person who is dissatisfied will hold negative feelings about the job. Locke (1976) as cited by Cooper and Locke (2000, p. 166) offers a further definition of job satisfaction as a “pleasurable or positive emotional state resulting from the appraisal of one’s job or job experiences. ” Job satisfaction is also defined in terms of equity.

Robbins et al. (2003, p. 16) define job satisfaction as “the difference between the rewards employees receive and the reward they believe they should receive. ” As a result, the higher this discrepancy, the lower job satisfaction will be. Weiss (2002) has argued that job satisfaction is an attitude but points out that researchers should clearly distinguish the objects of cognitive evaluation which are affect (emotion), beliefs and behaviors. 2. 1. 2 HISTORY OF JOB SATISFACTION One of the biggest preludes to the study of job satisfaction was the Hawthorne studies.

These studies (1924-1933), primarily credited to Elton Mayo of the Harvard Business School, sought to find the effects of various conditions (most notably illumination) on workers’ productivity. These studies ultimately showed that novel changes in work conditions temporarily increase productivity (called the Hawthorne Effect). It was later found that this increase resulted, not from the new conditions, but from the knowledge of being observed. This finding provided strong evidence that people work for purposes other than pay, which paved the way for researchers to investigate other factors in job satisfaction.

Scientific management (aka Taylorism) also had a significant impact on the study of job satisfaction. Frederick Winslow Taylor’s 1911 book, Principles of Scientific Management, argued that there was a single best way to perform any given work task. This book contributed to a change in industrial production philosophies, causing a shift from skilled labor and piecework towards the more modern approach of assembly lines and hourly wages. The initial use of scientific management by industries greatly increased productivity because workers were forced to work at a faster pace.

However, workers became exhausted and dissatisfied, thus leaving researchers with new questions to answer regarding job satisfaction. It should also be noted that the work of W. L. Bryan, Walter Dill Scott, and Hugo Munsterberg set the tone for Taylor’s work. Some argue that Maslow’s hierarchy of needs theory, a motivation theory, laid the foundation for job satisfaction theory. This theory explains that people seek to satisfy five specific needs in life – physiological needs, safety needs, social needs, self-esteem needs, and self-actualization.

This model served as a good basis from which early researchers could develop job satisfaction theories. 2. 1. 3 FACTORS INFLUENCING JOB SATISFACTION Job satisfaction is a complex variable and is influenced by factors of the job environment as well as dispositional characteristics of an individual. These factors have been arranged according to two dimensions, namely, extrinsic and intrinsic factors (Buitendach & De Witte, 2005). The extrinsic factors include things like pay, promotion opportunities, co-workers, supervision and recognition.

Intrinsic factors include personality, education, intelligence and abilities, age and marital status (Mullins, 1999). According to Spector (1997), these categories of factors often work together to influence job satisfaction. 2. 1. 3. 1 Intrinsic factors of job satisfaction Intrinsic sources of job satisfaction primarily come from within the individual and are essentially longer lasting than the extrinsic sources (Atchison, 1999). These sources are generally intangible, such as employees feeling a sense of pride in their work as well as individual differences such as personality. A. Person-Job fit

According to Spector (1997), some research has attempted to investigate the interaction between job and person factors to see if certain types of people respond differently to different types of jobs. This approach posits that “there will be job satisfaction when characteristics of the job are matched to the characteristics of the person” (Edwards, 1991 as cited by Spector, 1997). One stream of research has examined this perspective in two ways: (1) in terms of the fit between what organisations require and what employees are seeking and (2) in terms of the fit between what employees are seeking nd what they are actually receiving (Mumford, 1991 as cited by Mullins, 1999). Johns (1996, p. 140) refers to this as the “discrepancy theory” of job satisfaction and maintains that “satisfaction is a function of the discrepancy between the job outcomes people want and the outcomes they perceive they obtain. ” Thus, the smaller the discrepancy, the higher the job satisfaction should be (Johns, 1996; Spector, 1997). For example, a person who desires a job that entails interaction with the public but who is office bound, will be dissatisfied with this aspect of the job. B.

Disposition/Personality Robbins (1989, p. 51) defines personality as “the sum total of ways in which an individual reacts and interacts with others. ” Research indicates that some people are predisposed by virtue of their personality to be more or less satisfied despite the changes to their working environment and other factors (Aamodt, 2004; Johns, 1996). This idea can apparently be traced back to the Hawthorne studies, which found that certain people were continually complaining about their jobs (Spector, 1996). No matter what the researchers did, the participants found a reason to complain.

They concluded that their dissatisfaction is a product of their personality. Thus one way to increase the overall level of job satisfaction in an organisation is to recruit applicants who show high levels of overall job and life satisfaction (Aamodt, 2004). Schneider and Dachler (1978) as cited by Spector (1996) also found that job satisfaction seemed stable over time and that it might be the product of personality traits. This view holds some truth in that people with a negative tendency towards life would most likely respond negatively to their jobs even if their jobs changed (Atchison, 1999).

The author further advances that many organisations spend much time trying to turn these “negative” people around. In these cases, the best organisations could do is to keep these individuals from affecting the rest of their employees. On the other hand, people with a positive inclination towards life, would most probably have a positive attitude towards their job as well. Aamodt (2004), however, notes that findings on the personality-job satisfaction relationship are controversial and have received some criticism, therefore more research is needed before firm conclusions can be drawn.

Spector (1997) further indicates that most research on the personality-job satisfaction relationship has only demonstrated that a correlation exists, without offering much theoretical explanations. C. Impact of demographic variables on job satisfaction Research on job satisfaction has further identified certain personal or demographic characteristics which influence satisfaction in one way or another. This typically involves comparing job satisfaction ratings based on demographic variables such as age, gender, marital status, job level, tenure and number of dependents. D. Gender

More and more women are entering the workforce and it has become important to understand how men and women might differ in their job attitudes. There is a large body of research explaining the gender-job satisfaction relationship. However, research in this regard has been inconsistent. Some literature reports that males are more satisfied than females, others suggest females are more satisfied and some have found no differences in satisfaction levels based on gender. According to Spector (2000), most studies have found only a few differences in job satisfaction levels amongst males and females.

Studies conducted by Loscocco (1990) indicated that female employees demonstrated higher levels of job satisfaction than male employees across different settings. This author purports that most women value rewards that are readily available to them, such as relationships with co-workers. It therefore becomes easier for them to experience job satisfaction. Male employees on the other hand, most likely desire things like autonomy and financial rewards which are not as readily available. This might result in lower levels of job satisfaction.

A study by Alavi and Askaripur (2003) amongst 310 employees in government organizations, found no significant difference in job satisfaction among male and female employees. Carr and Human’s (1988) research is consistent with this view. These authors investigated a sample of 224 employees at a textile plant in the Western Cape and found no significant relationship between gender and satisfaction. Furthermore, Pors (2003) conducted a study including 411 Danish library managers and 237 library managers from the United Kingdom and concluded that there is no overall difference in job satisfaction in relation to gender.

A possible explanation is offered by Tolbert and Moen (1998), who maintain that men and women attach value to different aspects of the job. This therefore makes it difficult to measure differences in job satisfaction based on gender. On the other hand, a study conducted by Okpara (2004) which involved 360 Information Technology managers in Nigeria, indicated that female employees are less satisfied than their male counterparts – specifically with pay, promotion and supervision. According to Okpara (2004), this finding may be attributed to higher educational levels of women in this sample.

The author postulates that higher education levels raise expectations about status, pay and promotion and if these expectations are not met, they might experience lower levels of satisfaction. E. Age While research has yielded mixed evidence on the influence of age on job satisfaction, most studies suggest a positive correlation , that is, older workers tend to be more satisfied with their jobs than younger workers (Okpara, 2004; Rhodes, 1983 as quoted by Kacmar & Ferris, 1989; Saal & Knight, 1988). Numerous explanations may be presented to explain the positive correlation between age and job satisfaction (Okpara, 2004): Older employees have adjusted to their work over the years, which may lead to higher satisfaction. ? Prestige and confidence are likely to increase with age and this could result in older employees being more satisfied. ? Younger employees may consider themselves more mobile and seek greener pastures, which could lead to lower satisfaction levels. ? Younger employees are more likely to hold high expectations of their jobs and if these expectations are not met, they may experience lower satisfaction levels.

However, in contrast to this, other studies found that age does not significantly explain the variance in job satisfaction levels (Alavi & Askaripur, 2003; Carr & Human, 1988; Kacmar & Ferris, 1989; Siu, 2002). F. Tenure According to Saal and Knight (1988), research suggests that tenure is likely to influence job satisfaction. Literature overwhelmingly indicates a positive correlation between tenure and job satisfaction, that is, employees with longer job experience are more satisfied compared to those with fewer years of experience (Bilgic, 1998 as cited by Okpara, 2004; Jones-Johnson & Johnson, 2000; Staw, 1995).

Okpara (2004) provides an explanation for this positive correlation and advances that employees settle into their jobs over time, which leads to an increase in organizational commitment and job satisfaction. Furthermore, Robbins (1989) maintains that the longer an employee holds a job, the more they tend to be satisfied with the status quo. Lambert, Hogan, Barton and Lubbock (2001) on the other hand argue that there is an inverse relationship between tenure and job satisfaction. Hence, longer tenured employees are less satisfied than those who have been in the organization for shorter periods.

A possible explanation could be that employees, who hold the same jobs over a long period of time, may become bored and experience lower levels of satisfaction. Another view is provided by Alavi and Askaripur (2003). The authors conducted a study amongst 310 employees in government organizations and found no significant difference in job satisfaction amongst employees based on their years of service. Research in this regard is thus contradictory. G. Marital status Research has consistently found that married employees are more satisfied with their jobs than their un-married co-workers (Chambers, 1999; Loscocco, 1990; Robbins et al. 2003). Chambers (1999) in particular, found that married employees experienced increased satisfaction with pay, work, supervision and co-worker subscales of the JDI. A possible explanation is provided by Robbins (1989). He purports that marriage imposes increased responsibilities which might make a steady job more valuable, hence increasing their satisfaction. However, Robbins et al. (2003) note that the available research only distinguishes between being single and married.

Divorcees, couples who cohabit and the widowed have been excluded from research and these are in need of investigation. Furthermore, a study by Alavi and Askaripur (2003) reported no significant difference in job satisfaction and its five dimensions among single and married personnel. Researchers are therefore in disagreement concerning the relationship between marital status and job satisfaction. H. Number of dependents Robbins (1989) purports that there is strong evidence suggesting a positive relationship between the number of dependents and job satisfaction.

This implies that the higher the number of dependents an employee has, the higher the job satisfaction is likely to be. A possible explanation could be that employees with more children are probably older and longer in their jobs. They might therefore have adapted to their work situations, hence the increase in job satisfaction. Studies by Alavi and Askaripur (2003) amongst employees in government organizations reported no statistically significant relationship between the number of dependents and job satisfaction. Research in this area is, however, limited.

I. Job Level Oshagbemi (1997) highlights the fact that relatively few studies have attempted to investigate the relationship between employees’ job level and corresponding levels of job satisfaction. However, according to Mowday, Porter and Steers (1982) and Saal and Knight (1988), the limited research available suggests that people who hold higher level jobs are more satisfied than those who hold lower level positions. Several other researchers also found support for a positive correlation between job level and satisfaction.

Smither (1998) states that job satisfaction tends to be lower among employees in jobs characterized by hot or dangerous conditions, which is normally of a lower level nature. Furthermore, Miles, Patrick and King (1996) found that job levels moderates the communication-job satisfaction relationship. It is possible that the more challenging, complex nature of higher-level jobs lead to higher job satisfaction. Also, employees in professional and managerial jobs are normally paid more, have better promotion prospects, autonomy and responsibility which might also increase the levels of job satisfaction (Saal & Knight, 1988).

It seems therefore that job level is a reliable predictor of job satisfaction; more specifically employees in higher level jobs have greater satisfaction than lower level employees. 2. 1. 3. 2 Extrinsic sources of job satisfaction Extrinsic sources of job satisfaction are determined by conditions that are beyond the control of the employee (Atchison, 1999). The following factors will be discussed, namely, pay, the job itself, promotion opportunities, supervision, co-workers, working conditions and the issue of fairness. A. Pay Pay refers to the amount of compensation received for a specific job (Robbins et al. 2003). Luthans (1995, p. 127) notes that “wages and salaries are recognized to be a significant, but complex, multidimensional predictor of job satisfaction. ” According to Spector (1997) and Berkowitz (1987), the correlation between the level of pay and job satisfaction tends to be surprisingly small. This suggests that pay in itself is not a very strong factor influencing job satisfaction. Berkowitz (1987, p. 545) notes that “there are other considerations, besides the absolute value of one’s earnings that influences attitudes toward satisfaction with pay. Spector (1996, p. 226) postulates that “it is the fairness of pay that determines pay satisfaction rather than the actual level of pay itself. ” If an employee’s compensation is therefore perceived to be equitable, when compared to another person in a similar position, satisfaction might be the likely result. Atchison (1999) however, points out that an increase in pay only acts as a short-term motivator and management therefore has to look at other ways to increase the levels of job satisfaction. B. Job or the work itself

According to Luthans (1995), the content of the work performed by employees is a major predictor of job satisfaction. Not surprisingly, “research is fairly clear that employees, who find their work interesting, are more satisfied and motivated than employees who do not enjoy their jobs” (Gately, 1997 as cited by Aamodt, 2004, p. 326). Employees tend to prefer jobs which afford them the opportunity to apply their skills and abilities, offer them variety and freedom as well as jobs where they get constant feedback on how well they are doing (Robbins, 2005).

Hence, it is important for managers to take innovative steps to make work more interesting in order to increase the levels of job satisfaction of employees. Furthermore, if a job is highly motivating, employees are likely to be satisfied with the job content and deliver higher quality work, which in turn could lead to lower rates of absenteeism (Friday & Friday, 2003). Fox (1994) as cited by Connolly and Myers (2003, p. 152) however, advances a contradictory view and maintain that “as workers become more removed from the ability to make meaning through work, the opportunity to experience job satisfaction becomes more difficult. This stems from the fact that job satisfaction is related to a myriad of factors, including physical, psychological and demographic variables, which are unrelated to the workplace. C. Promotion opportunities According to Friday and Friday (2003), satisfaction with promotion assesses employees’ attitudes toward the organization’s promotion policies and practices. In addition to this, Bajpai and Srivastava (2004) postulate that promotion provides employees with opportunities for personal growth, more responsibilities and also increased social status.

Robbins (1989) maintains that employees seek promotion policies and practices that they perceive to be fair and unambiguous and in line with their expectations. Research indicates that employees who perceive that promotion decisions are made in a fair and just manner are most likely to experience job satisfaction. D. Supervision Research indicates that people who enjoy working with their supervisors will be more satisfied with their jobs (Aamodt, 2004).

Furthermore, a study by Bishop and Scott (1997) as cited by Aamodt (2004) found that satisfaction with supervisors was related to organizational and team commitment, which in turn resulted in higher productivity, lower turnover and a greater willingness to help. According to Luthans (1995), there seem to be three dimensions of supervision that affect job satisfaction. The first dimension has to do with the extent to which supervisors concern themselves with the welfare of their employees. Research indicates that employee satisfaction is increased if the immediate supervisor is emotionally supportive (Egan &

Kadushin, 2004; Robbins, 1989; Schlossberg, 1997, as cited by Connolly & Myers, 2003). The second dimension has to do with the extent to which people participate in decisions that affect their jobs. Research by Grasso (1994) and Malka (1989) as cited by Egan and Kadushin (2004) found a positive relationship between managerial behavior that encourages participation in decision-making and job satisfaction. Robbins (1989) supports this view and maintains that satisfaction is increased if the immediate supervisor listens to employees’ inputs.

A third dimension of supervision which is related to job satisfaction, according to Luthans (1995), is an employee’s perception of whether they matter to their supervisor and their organization. Connolly and Myers (2003) maintain that this aspect of an employee’s work setting may also be related to enhancing job satisfaction. E. Co-Workers Another dimension which influences job satisfaction is the extent to which co-workers are friendly, competent and supportive (Robbins et al. , 2003). Research indicates that employees who have supportive co-workers will be more satisfied with their jobs (Aamodt, 2004; Robbins, 1989; 2005).

This is mainly because “the work group normally serves as a source of support, comfort, advice and assistance to the individual worker” (Luthans, 1995, p. 127). Researchers further found that employees observe the levels of satisfaction of other employees and then model these behaviors (Salancik & Pfeffer, 1997 as cited by Aamodt, 2004). Hence, if an organization’s veteran employees work hard and talk positively about their jobs, new employees will model this behavior and be both productive and satisfied. The reverse can also be true.

F. Working conditions Working conditions is an extrinsic factor that has a moderate impact on an employee’s job satisfaction (Luthans, 1995). Working conditions refer to such aspects as temperature, lighting, noise and ventilation. Robbins (1989) stated that employees are concerned with their work environment for both personal comfort and for facilitating good job performance. Studies have demonstrated that employees prefer physical surroundings that are safe, clean, comfortable and with a minimum degree of distractions (Robbins, 2005).

According to Spector (1997), research has shown that employees, who perceive high levels of constraints in terms of their work environment, tend to be dissatisfied with their jobs. Contradictory literature, however, indicates that “most people do not give working conditions a great deal of thought unless they are extremely bad” (Luthans, 1995, p. 128). G. Fairness One factor related to job satisfaction is the extent to which employees perceive that they are being treated fairly (Aamodt, 2004).

According to Robbins (1989), employees seek for policies and systems that they perceive to be fair as this will likely result in an increase in job satisfaction. Johns (1996) distinguishes between distributive fairness and procedural fairness. Distributive fairness is perceived fairness of the actual decisions made in an organisation. If employees perceive that decisions are made in a fair manner, they are likely to express satisfaction with their jobs (Robbins, 2005). Procedural fairness on the other hand, occurs when the processes to determine work outcomes/decisions are perceived to be reasonable.

According to Johns (1996, p. 142), “procedural fairness is particularly relevant to outcomes such as performance evaluations, pay raises, promotions, layoffs and work assignments. ” Hence, if the processes used to arrive at for example, promotion decisions are perceived to be fair, it could lead to job satisfaction. Aamodt (2004) states that the relationship between perceptions of justice and job satisfaction is very strong, hence employers should be open about how decisions are made and provide feedback to employees who might not be happy with certain important decisions. 2. 1. 4 THEORIES OF JOB SATISFACTION . 1. 4. 1 Discrepancy theories According to Aamodt (2004), discrepancy theories postulate that job satisfaction is determined by the discrepancy between what employees want, value and expect and what the job actually provides. Employees will therefore experience dissatisfaction if there is a discrepancy between what they want and what the job offers. Theories that focus on employees’ needs and values include Maslow’s hierarchy of needs theory, ERG theory, Two-factor theory and McClelland’s needs theory (Aamodt, 2004; Robbins et al. , 2003) 2. 1. 4. 1. 1 Maslow’s needs hierarchy

Maslow’s (1954) theory, which is one of the best known theories, holds that employees would be motivated by and satisfied with their jobs only if certain needs are met (Aamodt, 2004). Maslow advances five major types of needs which are hierarchical. This implies that lower-level needs must be satisfied first before an individual will consider the next level of needs (Robbins, 1989). The five major needs are as follows: 1. Basic biological needs. According to Maslow’s theory, individuals are concerned first and foremost with satisfying their needs for food, water, shelter and other bodily needs.

An unemployed individual, who is homeless will be satisfied with any job as long as it provides for these basic needs (Aamodt, 2004). 2. Safety needs. These needs include security and protection from physical and emotional harm (Robbins et al. , 2003). After basic biological needs have been met, employees become concerned with meeting their safety needs. This implies that employees will remain satisfied with their jobs only if they believe the workplace to be safe to work in (Aamodt, 2004). 3. Social needs.

Once the first two levels of needs have been met, employees will remain satisfied with their jobs only when their social needs have been met (Aamodt, 2004). Social needs include the need for affection, belongingness, acceptance and friendship. In the work context this would typically involve working with others and feeling needed in the organization. Organizations attempt to satisfy their employees’ social needs by providing things like cafeterias, organizing sport programmes and family events (Aamodt, 2004). 4. Esteem needs.

Esteem or ego needs include the need for status, recognition and achievement (Robbins, 2005). Once an employee’s social needs have been met, they start to focus on meeting their esteem needs. According to Aamodt (2004), organizations can help to satisfy these needs through awards, promotions and salary increases. 5. Self-actualization needs. These needs represent the fifth level of Maslow’s needs hierarchy. According to Robbins et al. (2003), self-actualization needs include the need for growth, achieving one’s potential and self-fulfillment.

An employee striving for self-actualization wants to reach their full potential in every task. Therefore, employees who have been doing the same job for a long time might become dissatisfied and unmotivated in search of a new challenge. Even though Maslow’s theory has received wide recognition, there has been criticism of this theory. Robbins et al. (2003, p. 132) state that certain reviews of this theory postulate that needs are not necessarily structured along these dimensions “as people simultaneously move through several levels in the hierarchy of needs. Furthermore, because satisfied needs activate movement to the next level, the employee will always have an active need, making long term job satisfaction unlikely in terms of this theory. 2. 1. 4. 1. 2 ERG theory Alderfer (1972) reworked Maslow’s needs theory and classified needs into only three groups of core needs, namely, existence, relatedness and growth (Robbins et al. , 2003). The existence group is concerned with providing basic needs and includes items that Maslow’s theory considered as biological and safety needs (Robbins, 1989).

The second group of needs relates to maintaining important relationships and the growth needs refers to the desire for personal development (Robbins, 1989; Robbins et al. , 2003). According to Aadmodt (2004), the major difference between Maslow’s theory and the ERG theory is that the latter theory postulates that progression to the next level need not be fixed; a person can skip levels. People can therefore be simultaneously motivated by needs at different levels. A person can be concerned with satisfying growth needs even though existence and relatedness needs are not met.

The ERG theory removes some of the problems associated with Maslow’s theory and several studies supported the ERG theory (Robbins et al. , 2003). 2. 1. 4. 1. 3 Two factor theory One of the earliest theories of job satisfaction is Herzberg’s two-factor theory, the factors being “intrinsic factors” and “motivators” (Cooper & Locke, 2000, p. 166). Herzberg found that intrinsic factors (achievement, responsibilities and recognition) were more strongly correlated with satisfaction than extrinsic factors like policies, benefits and working conditions.

According to Atchison (1999), external satisfiers tend to be short –lived. The author provides an example of employees wanting faster computers to make them happy. They could be excited at first, but if those computers are no longer the status quo a few months down the line, these employees will begin to look to other external factors in their search for job satisfaction. As Randolph and Johnson (2005, p. 50) surmise “if you want to motivate workers, don’t put in another water fountain; provide a bigger share of the job itself. It becomes apparent that internal satisfaction is longer lasting and more motivating than external satisfiers. However, according to Cooper and Locke (2000), this theory has been widely criticized in that some research has shown that both intrinsic and extrinsic factors contribute to both satisfaction and dissatisfaction. 2. 1. 4. 1. 4 McClelland’s needs theory This theory focuses on three needs: achievement, power and affiliation (Robbins et al. , 2003). Employees who have a strong need for achievement would be satisfied with jobs that are challenging and over which they can exert some control (Aamodt, 2004).

In contrast, employees with low achievement needs are satisfied with jobs involving little challenge. Individuals with a high need for affiliation would be satisfied with jobs that involve working with people and establishing close interpersonal relationships (Robbins, 1989). Finally, employees who have a need for power, have a desire to impact, influence and to control others (Robbins et al. , 2003). Employees with strong power needs are most likely satisfied with jobs where they can direct and manage others. 2. 1. 4. 2 Value-percept theory Locke (1976) as quoted by Cooper and Locke (2000, p. 68) argued that “individual’s values would determine what satisfied them on the job. ” Employees in organizations hold different value systems, therefore based on this theory, their satisfaction levels will also differ. Furthermore, this theory predicts that “discrepancies between what is desired and received are dissatisfying only if the job facet is important to the individual” (Anderson, Ones, Sinangil & Viswesvaran, 2001, p. 32). According to Cooper and Locke (2000), the potential problem with this theory is that what people desire and what they consider important are likely to be highly correlated.

In theory these concepts are separable; however, in practice many people will find it difficult to distinguish the two. Despite this limitation, research on this theory has been highly supportive (Cooper & Locke, 2000). 2. 1. 4. 3 Equity theory This theory proposes that job satisfaction is a function of what employees put into a job situation compared to what they get from it (Cooper & Locke, 2000; Robbins, 2005). Therefore, the more an employee receives relative to what they put into a job, the higher job satisfaction will be.

Three components are involved in this perception of fairness, namely, inputs, outputs and input/output ratio (Aamodt, 2004): •Inputs refer to those elements we put into our jobs and include things such as effort, experience, education and competence (Robbins, 2005). •Outputs are elements that individuals receive from their jobs (Aamodt, 2004). These include things such as pay, benefits and challenge. •Input/output ratio. According to Aamodt (2004), employees subconsciously compute an input/output ratio by dividing output value by input value.

Employees may attempt to increase their outputs, for example, by asking for a salary increase. Conversely, they can reduce their inputs by not working as hard as they would normally do (Aamodt, 2004). Furthermore, employees compare their input-outcome ratio with that of other employees and if they perceive it to be fair, employees will experience satisfaction (Robbins, 2005). Conversely, if employees perceive an inequity in their input-outcome ratio compared to other employees, they become dissatisfied and less motivated. 2. 3. 5. 4 Job Characteristics Model

This model, introduced by Hackman and Oldham (1976), recognizes that “certain aspects of the job are inherently motivating for most people and individuals may perceive and respond to the same stimuli differently” (Anthony, Perrewe & Kacmar, 1999, p. 306). Employees are thus motivated by the intrinsic satisfaction they derive from doing their job. The five core job characteristics are defined in the following terms (Spector, 1997): (i) Task identity refers to the degree to which the job requires completion of a whole piece of work (Robbins, 2005).

Employees can complete a task from beginning to end with an identifiable outcome. (ii) Task significance is the degree to which the job is important (Spector, 1997). This is determined by the impact the employee’s work has on others within or outside the organisation. (iii) Skill variety refers to the degree to which employees are able to do a number of different tasks using many different skills, abilities and talents (Anthony et al. , 1999). (iv) Autonomy is defined as “the freedom employees have to do their jobs as they see fit” (Spector, 1997, p. 33).

This freedom or discretion relates to things such as scheduling, prioritizing and determining procedures for task completion (Anthony et al. , 1999). (v) Feedback refers to the degree to which the job offers information to employees regarding performance and work outcomes (Spector, 1997). According to Robbins (2005), the Job Characteristics Model has been well researched and evidence supports the general idea that certain job characteristics have an impact on behavioral outcomes. 2. 1. 5 MEASURING JOB SATISFACTION There are many methods for measuring job satisfaction.

Job satisfaction is mostly assessed by asking people how they feel about their jobs, either through a questionnaire or an interview By far, the most common method for collecting data regarding job satisfaction is the Likert scale (named after Rensis Likert). Other less common methods of for gauging job satisfaction include: Yes/No questions, True/False questions, point systems, checklists, and forced choice answers. 2. 1. 5. 1 Job Descriptive Index (JDI) Job Descriptive Index was created by Smith, Kendall, & Hulin (1969), is a specific questionnaire of job satisfaction that has been widely used.

It measures one’s satisfaction in five facets: pay, promotions and promotion opportunities, coworkers, supervision, and the work itself. The scale is simple, participants answer either yes, no, or can’t decide (indicated by ‘? ‘) in response to whether given statements accurately describe one’s job. According to Cooper and Locke (2000, p. 172), “the JDI is reliable and has an impressive array of validation evidence behind it. ” 2. 1. 5. 2 Minnesota Satisfaction Questionnaire (MSQ) Another popular job satisfaction scale is the Minnesota Satisfaction Questionnaire (Spector, 1997; 2000).

Robbins (2005) states that the MSQ has the advantage of versatility in that long and short form are available. It also makes provision for faceted as well as overall measures. The long form contains 100 items and the short form contains 20 items measuring different facets of job satisfaction (Spector, 1997). 2. 1. 5. 3 Job Diagnostic Survey (JDS) The Job Diagnostic Survey was developed to study the effects of job characteristics on people (Hackman & Oldham, 1975 as quoted by Spector, 1997, 2000).

The JDS covers several areas of job satisfaction, such as growth, pay, security, social, supervisor as well as global satisfaction. 2. 1. 5. 4 Job-In-General Scale (JIG) The Job-In-General Scale has been designed to measure overall job satisfaction rather than facets. According to Ironson et al. (1989) as quoted by Spector (1997, p. 18), “overall job satisfaction is not the sum of individual facets, it should rather be managed by using a general scale like the JIG. ” Cooper and Locke (2000, p. 172) also argue that “faceted and global measures do not measure the same construct. ” 2. 1. 5. Job Satisfaction Survey (JSS) The Job Satisfaction Survey is another common measure of job satisfaction and it was used in the present study to elicit data on the job satisfaction levels of participants. The JSS has been tested for reliability and validity across different studies (Spector, 1997). It assesses nine facets of job satisfaction as well as overall satisfaction. The nine facets are: FacetDescription 1. PaySatisfaction with pay and pay raises 2. PromotionSatisfaction with promotion opportunities 3. SupervisionSatisfaction with immediate supervisor 4. Fringe benefitsSatisfaction with fringe benefits . Contingent rewardsSatisfaction with rewards (not necessarily monetary) for good performance 6. Operating conditionsSatisfaction with rules and procedures 7. Co-WorkersSatisfaction with co-workers 8. Nature of workSatisfaction with type of work done 9. CommunicationSatisfaction with communication within the organization 2. 1. 6 CONSEQUENCES OF JOB SATISFACTION Satisfaction on the job influences many other organizational variables. These include not only work variables such as performance or turnover, but also personal or non-work variables such as health and satisfaction with life.

The next section briefly discusses the potential effect of job satisfaction on different variables. 2. 1. 6. 1 Productivity According to Robbins et al. (2003), managers’ interest in job satisfaction tends to centre on its effect on employees performance and productivity. The natural assumption is that satisfied employees should be productive employees. A large body of research postulates that job satisfaction has a positive effect on productivity, however, this correlation is rather modest (Cranny, Cain-Smith & Stone, 1992; Kreitner & Kinicki, 2001; Robbins, 2005; Spector, 1997).

Gibson, Ivancevich & Donnelly (1997) surmised that some employees who are satisfied with work are poor performers; conversely, there might be employees who are not satisfied, but who are excellent performers. Robbins (2005) concluded that productivity is more likely to lead to satisfaction than the other way around. Hence, if employees do a good job (productivity), they intrinsically feel good about it. In addition, higher productivity could lead to an increase in rewards, pay level and promotion, which are all sources of job satisfaction. 2. 1. 6. 2 Organizational commitment and Organizational citizenship behavior

According to Kreitner and Kinicki (2001, p. 227), organizational commitment “reflects the extent to which an individual identifies with an organization and is committed to its goals. ” Armstrong (1996, p. 319) advances that “organizational commitment has three components: identification with the goals and values of the organization; a desire to belong to the organization and a willingness to display effort on behalf of the organization. ” There seems to be a strong correlation between job satisfaction and organizational commitment. Higher commitment can, in turn, facilitate higher productivity.

Closely linked to the concept of organizational commitment is the variable called organizational citizenship behavior (OCB). Spector (1997, p. 57) defines OCB as a “behavior by an employee intended to help co-workers or the organization. ” It is thus voluntary things employees do to help their fellow workers and their employers. Robbins (2005) states that job satisfaction is a major determinant of OCB in that satisfied employees would more likely talk positively about the organization and go beyond their normal call of duty. According to Robbins et al. (2003), there is a modest overall 2. 1. . 3 Turnover The first form of withdrawal is turnover, which is defined as “any permanent departure beyond organizational boundaries” Cascio (2003, p. 51). Turnover is important to managers as it disrupts organizational continuity and it is can be very costly. The different costs associated with turnover include separation costs (exit interviews, separation pay), replacement costs of new employee and training costs of the new employee (Saal & Knight, 1988). According to Spector (1997), studies have been reasonably consistent in showing a correlation between job satisfaction and turnover.

Employees with low satisfaction are therefore more likely to quit their jobs. According to Luthans (1995, p. 129), “high job satisfaction will not, in and of itself, keep turnover low, but it does seem to help. On the other hand, if there is considerable job dissatisfaction, there is likely to be high turnover. ” It is therefore important to manage satisfaction levels as it might trigger decisions by employees to leave the organization. 2. 1. 6. 4. Absenteeism Absence is a phenomenon that can reduce an organization’s effectiveness.

Theories of absence hypothesise that job satisfaction plays a critical role in an employee’s decision to be absent (Spector, 1997). Most research indicates a consistent negative relationship between satisfaction and absenteeism, even though the correlation is not very high (Robbins, 1989; Spector, 1997). Literature therefore suggests that a dissatisfied employee will most likely be absent. However, there appears to be disagreement concerning the strength of this relationship as absenteeism is influenced by a number of inter-related factors. 2. 2 Job Performance in Relation to Job Satisfaction

In the field of Industrial/Organizational psychology, one of the most researched areas is the relationship between job satisfaction and job performance (Judge, Thoresen, Bono, & Patton, 2001). Landy (1989) described this relationship as the “Holy Grail” of Industrial psychology. Research linking job performance with satisfaction and other attitudes has been studied since at least 1939, with the Hawthorne studies (Roethlisberger & Dickson, 1939). In Judge et al. (2001), it was found by Brayfield and Crockett (1955) that there is only a minimal relationship between job performance and job satisfaction.

However, since 1955, Judge et al. (2001) cited that there are other studies by Locke (1970), Schwab & Cummings (1970), and Vroom (1964) that have shown that there is at least some relationship between those variables. Iaffaldano and Muchinsky (1985) did an extensive analysis on the relationship between job performance and job satisfaction. Across their many studies, they found a mean correlation of . 17 (Iaffaldano & Muchinsky, 1985). There are also stronger relationships depending on specific circumstances such as mood and employee level within the company (Morrison, 1997).

Organ (1988) also found that the job performance and job satisfaction relationship follows the social exchange theory; employees’ performance is giving back to the organization from which they get their satisfaction. Judge et al. (2001) argued that there are seven different models that can be used to describe the job satisfaction and job performance relationship. Some of these models view the relationship between job satisfaction and job performance to be unidirectional, that either job satisfaction causes job performance or vice versa.

Another model states that the relationship is a reciprocal one; this has been supported by the research of Wanous (1974). The underlying theory of this reciprocal model is that if the satisfaction is extrinsic, then satisfaction leads to performance, but if the satisfaction is intrinsic, then the performance leads to satisfaction. Other models suggest there is either an outside factor that causes a seemingly relationship between the factors or that there is no relationship at all, however, neither of these models have much research. The final model is “Alternative Conceptualizations of Job Satisfaction and/or Job Performance. This model discusses how positive attitudes toward one’s job can predict a high degree of job performance. George and Brief (1996) and Isen and Baron (1991) both found that employees’ attitudes are reflected in their job performance. If this is the case, then we can argue that there is a relationship between employees’ job satisfaction and job performance, as satisfaction is an attitude about their job. Industrial psychologists do not justify any relationship between job satisfaction and job performance; although it has been found that a positive mood is related to higher levels of job performance and job satisfaction. CHAPTER 3

Research result 1. Description Concept in Work Area Based on survey that I had done at May 6, 2008 in Sapem Indonesia, I can see how they are work and how the office. Located in Atrium Setiabudi 6th Floor, Suite 610, Jl. H. R. Rasuna Said Kuningan, South Jakarta, this office is very strategic. This is become one factor that make workers in this company feel free to come to the office. Because engineering division only consists of 20 workers, they are very cooperative. One with another has very close relations that 2. Description about Hypothesis Test Result Hypothesis is test by regression, with degree of confidence 95%.

And using SPSS version 15, the result is: a)Descriptive statistics MeanStd. DeviationN Job performance30. 674. 04715 Job satisfaction48. 337. 82515 From the table above, we can see mean of job satisfaction and job performance. From 15 respondents and standard deviation 4. 047, mean of job performance is 30. 67, meaning is average job performance from 15 respondents are good, with scale: 00 – 12: Very bad 13 – 24: Bad 25 – 36: Good 37 – 48: Very good From 15 respondents and standard deviation 7. 825, mean of job satisfaction is 48. 33, meaning is average job satisfaction is satisfied, with scale: 00 – 18: Very not satisfied 9 – 36: Not satisfied 37 – 54: Satisfied 55 – 72: Very satisfied This table show how with average job satisfaction: satisfied, the job performance is good. But, seeing correlation only from mean is not really strong. We have to see another factor. b)Correlations Job performanceJob satisfaction Pearson CorrelationJob performance1. 000. 387 Job satisfaction. 3871. 000 Sig. (1-tailed)Job performance.. 077 Job satisfaction. 077. NJob performance1515 Job satisfaction1515 This table shows correlation between job performance and job satisfaction. From the table above, significance level is 0. 077. This significance level is higher than 0. 5 which show that the correlation is strong. It is because from our hypothesis, if probability > 0. 05, accept H0, which H0 is job satisfaction has significant correlation with job performance. But this is not final decision, because there are still other factor that c)Model Summary ModelRR SquareAdjusted R SquareStd. Error of the Estimate 1. 387(a). 150. 0843. 873 a. Predictors: (Constant), job satisfaction Coefficients(a) Model Unstandardized CoefficientsStandardized CoefficientstSig. BStd. ErrorBetaBStd. Error 1(Constant)20. 9896. 470 3. 244. 006 Job satisfaction. 200. 132. 3871. 514. 154 a Dependent Variable: job performance

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