THE EFFECTS OF EMPLOYEE SATISFACTION, ORGANIZATIONAL CITIZENSHIP BEHAVIOR, AND TURNOVER ON ORGANIZATIONAL EFFECTIVENESS: A UNIT-LEVEL, LONGITUDINAL STUDY

This study addresses the issue of whether positive employee attitudes and behaviors influence business outcomes or whether positive business outcomes influence positive employee attitudes and behaviors. We hypothesize that employee satisfaction, organizational citizenship behavior, and employee turnover influence profitability and customer satisfaction. Data were gathered from the units of a regional restaurant chain via employee surveys, manager surveys, customer surveys, and organizational records. Cross-lagged regression analyses show that employee attitudes and behaviors at Time 1 are related to organizational effectiveness at Time 2. Additional cross-lagged regression analyses show no significant relationship between organizational effectiveness at Time 1 and the employee attitudes and behaviors at Time 2. These results add to the evidence that HR outcomes influence business outcomes, rather than the other way around.     

Test of a service profit chain model in the retail banking sector

Research has shown that organizational subunits where employee perceptions are favourable enjoy superior business performance. The service profit chain model of business performance ( Heskett, Sasser, & Schlesinger, 1997 ) has identified customer satisfaction as a critical intervening variable in this relationship. This paper examines the relationships between organizational climate, employee attitudes, customer satisfaction, and sales performance in the retail‐banking sector. The role of customer satisfaction as a mediator between employee attitudes and sales performance is examined in a large sample of bank branches, spanning multiple organizations. Mediation effects are found, which border on significance when the sample size is large, but the effects seem to be too small to be of practical importance. It is argued that alternative formulations of the service profit chain model may provide more powerful explanations of the link between employee attitudes and business performance.     

AN EMPIRICAL TEST OF CAUSAL INFERENCE BETWEEN ROLE PERCEPTIONS, SATISFACTION WITH WORK, PERFORMANCE AND ORGANIZATIONAL LEVEL

Previous research has suggested that organizational level may explain to a significant extent the differential impact of role perceptions (i.e., role ambiguity and role conflict) on employee satisfaction and performance. Causal inferences could not be drawn from these studies because of the predominant use of static correlational methods. In this study, in a hospital setting, a six-month time-lag between data collection periods was used to develop causal inferences. The results supported the hypothesis that role ambiguity was a source of causal inference with satisfaction with work at the higher organizational level, while role conflict was a source of causal inference with satisfaction with work at the lower organizational level. The source and direction of causal influence with respect to role perceptions and performance was supported only at the higher organizational level.     

A LONGITUDINAL EXAMINATION OF CONCOMITANT CHANGES IN TEAM LEADERSHIP AND CUSTOMER SATISFACTION

For each of three 1‐year time periods, we examined the relationship between changes in the team leadership of branch managers (as measured by employee ratings) and concomitant changes in customer satisfaction for branches of a regional bank. Specifically, for the time period 2001–2002, we examined concomitant changes in team leadership and customer service satisfaction with 68 branch managers; between 2002–2003 and 2003–2004 we examined these relationships for 46 and 40 of the remaining 68 branch managers, respectively. We expected that improvements (declines) in team leadership ratings would be accompanied by concomitant changes (i.e., improvement or decline) in customer satisfaction ratings. We found that, in 2 of the 3 time periods we examined, improvements (declines) in team leadership were related to improvements (declines) in customer satisfaction. We interpret these findings using the service climate literature.     

EMPLOYEE ATTITUDES AND CUSTOMER SATISFACTION: MAKING THEORETICAL AND EMPIRICAL CONNECTIONS

Previous research has established links between employee attitudes and customer satisfaction. Little theory has been used to help explain and build on the results of these studies. A theoretical model of the employee attitude-customer satisfaction process is proposed based on Bagozzi's (1992) model of attitudes, intentions and behavior. Employee attitudes and intentions, and customer satisfaction data from a service-oriented organization with 160 offices is used to provide an initial test of the usefulness of the model. Cross-validations of the model with and without common method variance were conducted. The results provide strong support for the model. Suggestions are offered on extensions of the model in future research.     

Employee attitudes,organizational performance,and qualitative factors underlying success

The first phase of this study investigated the relationship between aspects of organizational climate as assessed by a full consensus employee survey and a variety of organizational performance measures. Strong relationships were found for customer satisfaction, absenteeism, second level grievances, safety, and profits in the expected directions. Subsequent comparisons of the groups above or below one standard deviation from the mean score on an employee survey were completed to determine the extent of the differences suggested by the correlations. In the second phase of this study, a qualitative research project was conducted to determine those aspects of the organizational climate that were associated with the high scoring groups but not with either the average or low scoring groups. Strong evidence was found indicating that the presence of a caring, involved leader was the critical ingredient in the organization's success. The implications of these findings for organizational performance improvement efforts are discussed.     

Transforming service employees and climate: a multilevel, multisource examination of transformational leadership in building long-term service relationships

This longitudinal field study integrates the theories of transformational leadership (TFL) and relationship marketing to examine how TFL influences employee service performance and customer relationship outcomes by transforming both (at the micro level) the service employees' attitudes and (at the macro level) the work unit's service climate. Results revealed that, at the individual level, managers' TFL was positively related to employee service performance, which, in turn, positively predicted customers' expressed intention to maintain a long-term service relationship with the service employee and manager-reported number of the employee's long-term customers measured 9 months later. In addition, the relationship between TFL and employee service performance was partially mediated by employee self-efficacy. Furthermore, store-level TFL was positively associated with store-level service climate, and service climate further enhanced the relationship between individual-level TFL and employee service performance.     

From ideal to real: a longitudinal study of the role of implicit leadership theories on leader-member exchanges and employee outcomes

The results of the present longitudinal study demonstrate the importance of implicit leadership theories (ILTs) for the quality of leader-member exchanges (LMX) and employees' organizational commitment, job satisfaction, and well-being. Results based on a sample of 439 employees who completed the study questionnaires at 2 time points showed that the closer employees perceived their actual manager's profile to be to the ILTs they endorsed, the better the quality of LMX. Results also indicated that the implicit-explicit leadership traits difference had indirect effects on employee attitudes and well-being. These findings were consistent across employee groups that differed in terms of job demand and the duration of manager-employee relation, but not in terms of motivation. Furthermore, crossed-lagged modeling analyses of the longitudinal data explored the possibility of reciprocal effects between implicit-explicit leadership traits difference and LMX and provided support for the initially hypothesized direction of causal effects.     

Business-unit-level relationship between employee satisfaction,employee engagement,and business outcomes: a meta-analysis

Based on 7,939 business units in 36 companies, this study used meta-analysis to examine the relationship at the business-unit level between employee satisfaction-engagement and the business-unit outcomes of customer satisfaction, productivity, profit, employee turnover, and accidents. Generalizable relationships large enough to have substantial practical value were found between unit-level employee satisfaction-engagement and these business-unit outcomes. One implication is that changes in management practices that increase employee satisfaction may increase business-unit outcomes, including profit.     

ARE THE 100 BEST BETTER? AN EMPIRICAL INVESTIGATION OF THE RELATIONSHIP BETWEEN BEING A “GREAT PLACE TO WORK” AND FIRM PERFORMANCE

We argue that positive employee relations effectively serves as an intangible and enduring asset, and may, therefore, be a source of sustained competitive advantage at the firm level. We survey a number of measures of firm-level performance and conceptualize how each measure is likely to be affected by highly positive firm-level employee relations. We then empirically investigate whether positive employee relations is related to firm performance, focusing on publicly traded firms included in the "100 Best Companies to Work for in America." The relative performance of these "Best Companies" is examined via comparisons to both companies in the broad market and a group of matched firms. Our analyses suggest that companies on the 100 Best list enjoy not only stable and highly positive workforce attitudes, but also performance advantages over the broad market, and in some cases, over the matched group.     

Which comes first: employee attitudes or organizational financial and market performance?

Employee attitude data from 35 companies over 8 years were analyzed at the organizational level of analysis against financial (return on assets; ROA) and market performance (earnings per share: EPS) data using lagged analyses permitting exploration of priority in likely causal ordering. Analyses revealed statistically significant and stable relationships across various time lags for 3 of 7 scales. Overall Job Satisfaction and Satisfaction With Security were predicted by ROA and EPS more strongly than the reverse (although some of the reverse relationships were also significant); Satisfaction With Pay suggested a more reciprocal relationship with ROA and EPS. The discussion of results provides a preliminary framework for understanding issues surrounding employee attitudes, high-performance work practices, and organizational financial and market performance.     

Is “service with a smile” enough? Authenticity of positive displays during service encounters

Service providers use impression management strategies to engender satisfaction and repeat business in customers. Managing emotional expressions is one strategy to meet those goals. We extended research on the “Duchenne Smile” to see if authenticity of employee expressions influenced the impressions formed of the employee’s friendliness and the overall satisfaction with the encounter. Furthermore, we took two other factors into account—task performance and busyness—to examine the conditions under which authenticity would have the greatest impact. In Study 1, we obtained reactions to videotaped simulations that manipulated authenticity of positive displays and task performance during a hotel check-in encounter. ANCOVA results supported that authenticity of the service provider enhanced perceptions of friendliness, but only influenced customer satisfaction when tasks were performed well. In Study 2, hierarchical linear modeling with reactions from 255 customers of 64 restaurant servers showed that perceived display authenticity enhanced the perceived friendliness of the employee when the store was slow, but less so when it was busy. Display authenticity had a direct effect on customer satisfaction, regardless of task performance (which was generally high) and busyness. We conclude that display authenticity is an extra-role behavior for service encounters with an additive effect on encounter satisfaction only when other factors are at optimal levels. We suggest implications for display rule policies and service training.     

A Compositional Analysis of the Organizational Climate-Performance Relation: Public Schools as Organizations

The present study examined specific aspects of organizational climate related to job satisfaction, employee turnover, and organizational performance in public elementary schools. Survey data were obtained from school staff and students and from school district archives. Hypotheses tested included: (1) Employee perceptions of organizational climate and job satisfaction, when aggregated to an organizational level, would represent group-level constructs; (2) Employee perceptions of positive organizational climate would be associated with higher levels of job satisfaction and organizational performance and with lower levels of employee turnover; (3) Relations of organizational climate to organizational performance and to employee turnover would be mediated by employee job satisfaction; and (4) Employee perceptions of positive organizational climate and job satisfaction would be associated with less achievement disparity between minority and non-minority students. Study results supported all but one hypothesis. There was no evidence for the mediating effects of job satisfaction on relations of organizational climate to organizational performance and to employee turnover. Results were consistent with the broader organizational literature, which has shown the importance of orderly work environments, collegial relations, and supportive leaders for effectively functioning groups and organizations.     

Measuring organisational climate and employee engagement: Evidence for a 7 Ps model of work practices and outcomes

This study presents evidence supporting the psychometric properties of the Voice Climate Survey: an employee opinion survey that measures work practices and outcomes. The tool is tested across 13,729 employees from 1,279 business units representing approximately 1,000 organisations. Exploratory factor analyses, confirmatory factor analyses and internal reliability analyses support 31 lower‐order work practices and outcomes that aggregate into seven higher‐order work systems broadly covering practices and outcomes such as organisational direction, ethics, resources, involvement, recognition, development, teamwork, wellness, work/life balance, change management, customer satisfaction, job satisfaction, organisational commitment and employees' intention to stay. External validation of the tool is demonstrated by linking scores from the employee survey with independent manager reports of turnover, absenteeism, productivity, health and safety, goal attainment, financial performance, change management, innovation and customer satisfaction.     

Employee Lateness Behavior: The Role of Lateness Climate and Individual Lateness Attitude

The authors investigated the joint influence of contextual factors and individual attitudes on employee lateness in a field setting. Hierarchical regression analyses based on objective lateness data revealed that perceived lateness climate moderated the relationship between individual lateness attitudes and lateness behaviors. Specifically, as hypothesized, individual attitudes toward lateness were stronger predictors of actual lateness frequency in lenient climates. This moderating effect was observed when controlling for key attitudes such as job satisfaction, job involvement, and affective commitment. Thus, climate displayed a unique effect on employee lateness, constraining the influence of individual attitudes in strict climates and allowing more influence in lenient climates. Implications and recommendations for future research are discussed.     

Employee customer orientation in manufacturing organizations: joint influences of customer proximity and the senior leadership team

Pursuing a customer-focused strategy in manufacturing organizations requires employees across functions to embrace the importance of understanding customer needs and to align their everyday efforts with the goal of satisfying and retaining customers. Little prior research has examined what factors influence employee customer orientation in manufacturing settings. Drawing on the attraction-selection-attrition model, upper-echelons theory, and contingency theories of leadership, this study investigated the joint influences of functional roles' proximity to external customers and the senior leadership team's customer orientation on employee customer orientation. Hierarchical linear modeling results based on data obtained from 4,299 employees and 403 senior leaders from 42 facilities of a global manufacturer operating in 16 countries revealed that employees occupying customer-contact roles had the highest level of customer orientation, followed by employees occupying production roles, and then by those in support roles. In addition, there was a positive relationship between the senior leadership team's customer orientation and employee customer orientation for all 3 functional roles. The positive relationship between the senior leadership team and employee customer orientation was the strongest for employees in support roles, suggesting that lower levels of proximity to external customers may create a greater need for leadership in developing employees' customer-oriented attitudes.     

SINGLE-ATTRIBUTE UTILITY ANALYSIS MAY BE FUTILE,BUT THIS CAN’T BE THE END OF THE STORY: CAUSAL CHAIN ANALYSIS AS AN ALTERNATIVE

Research on providing single-attribute utility analysis has shown moderate or even negative effects on the acceptance of selection and training tests by human resource decision makers. In this study, we contrasted the perceived utility of single-attribute utility analysis with causal chain analysis as an alternative way of conducting utility analysis. Causal chain analysis focuses on measuring the linkages between HRM interventions and organizational outcomes mediated by employee attitudes and customer perceptions. We compared 144 managers' reactions to both methods of utility analysis concerning the variables understandability, information quality, perceived usefulness, user information satisfaction, and intention to use. Causal chain analysis yielded higher results than single-attribute analysis for these variables, and a compound measure of these constructs supported this finding. This indicates that causal chain analysis is a valuable alternative method of communicating the utility of HRM interventions.     

Leader responsiveness, equity sensitivity, and employee attitudes and behavior

This study investigated the relationships between leader responsiveness to employee requests and employee attitudes and behaviors in a sample of managers and their subordinates. Additionally, the study investigated the moderating effect of an individual difference variable (equity sensitivity), on the relationships between leader responsiveness and employee attitudes and behaviors. Leader responsiveness related significantly with job satisfaction, organizational commitment, and organizational citizenship behavior. Furthermore, equity sensitivity moderated the relationships between leader responsiveness and job satisfaction. Entitleds reported lower job satisfaction when manager fulfillment of employee requests was low than did Benevolents, whereas differences were minimal when manager request fulfillment was high. Implications of the findings were discussed.     

Why managers should care about fairness: the effects of aggregate justice perceptions on organizational outcomes

This work examines the aggregation of justice perceptions to the departmental level and the business-unit level, the impact of these aggregate perceptions on business-unit-level outcomes, and the usefulness of the distinction between procedural and interpersonal justice at different levels of analysis. Latent variables analyses of individual-level and department-level data from 4,539 employees in 783 departments at 97 hotel properties showed that the 2 justice types exercise unique paths of impact on employees' organizational commitment and thus on turnover intentions and discretionary service behavior. Business-unit-level analyses further demonstrate paths of association between aggregate justice perceptions, aggregate commitment levels, and the business-unit-level outcomes of employee turnover rates and customer satisfaction ratings.     

Salesperson time perspectives and customer willingness to pay more: roles of intraorganizational employee navigation,customer satisfaction,and firm innovation climate

This research aims to fill a critical gap in the sales literature by proposing a relationship-based model of customer willingness to pay more, involving salesperson time perspectives (i.e., long-term perspective and short-term perspective), intraorganizational employee navigation, and customer satisfaction with the salesperson. We also examine the moderating role of firm innovation climate. Multisource survey data were collected from 204 salespeople in a business-to-business sales context along with external ratings from customers of these salespeople three months later. The findings indicate that both long- and short-term perspectives have positive effects on intraorganizational employee navigation and customer satisfaction, which, in turn, positively affect customer willingness to pay more. In addition, short-term perspective has a stronger impact than long-term perspective on intraorganizational employee navigation. Further, the effect of long-term perspective on customer satisfaction is strengthened by the innovation climate of the firm, whereas the effect of short-term perspective on customer satisfaction is weakened by it.