A critical evaluation of the impact of employee motivation on the success and growth of the supermarket chains in the UK: A study on Asda
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Table of Contents
1.1 Background of the Research 3
1.2 Organisational Background 3
1.3 Significance of the Problem 4
Chapter 2: Literature Review 8
2.2 Internal Factors that Determine Workplace Growth and Success 8
2.3 The Concept of Human Resource Management 9
2.4 Relationship Between Employee Satisfaction and Customer Satisfaction 10
2.5 Factors that Influence Employee Motivation and Satisfaction Levels 11
2.6 The Concept of Motivation 12
2.7 Significance of Employee Motivation and Satisfaction 12
2.8 Methods of Improving Employee Motivation 13
Chapter One: Introduction
Organisations across all sectors are investigating ways of improving customer experience and a crucial factor in doing so is understanding the relationship of employee motivation with customer experience. Customer satisfaction is dependent on not only the quality of the product or service that they are provided with but also on their experience in the different points of contact with the representatives of the organisation (Olos, 2022). Understandingly, it is important for companies to find different ways on improving such interactions between employees and customers as this would help in providing a better customer experience and thus increase customer satisfaction. Good customer experience improves customer satisfaction and customer retention (Olos, 2022). An interpretation of it is that customer satisfaction levels increase the loyalty of the consumers and this helps companies to grow organically. Furthermore, having a strong and loyal clientele would also increase the resilience of the organisations in times of crisis and consequently, it is highly significant in the current times of uncertainty.
Due to the pandemic situation, organisations have changed drastically due to the evolving business environment around them. Some of the key trends that have arisen during the COVID-19 Pandemic in the retail sector are a huge shift to online shopping and a major shift in consumer behaviours. Several temporary effects such as apparel overstock, supply chain disruptions and grocery hoarding have also been faced by retailers during this time of crisis (McKinsey, 2021). Consequently, it has become important in the current time to understand the internal ways in which organisations can become stronger and improve their organisational productivity in the current times. According to Tariq et al. (2016), the human resource of an organisation is the most important asset. It can be understood that organisations need to strategize ways of improving the utilisation of this strategic advantage by ensuring optimal productivity of the employees.
ASDA was founded in 1969 and is currently one of the most popular retailers in the UK. ASDA maintains a portfolio of stores such as supercentres, supermarkets, petrol filling stations, superstores and depots in the UK and on average, caters to the need of 18 million customers each week (ASDA, 2022). In addition to the overwhelming physical presence, ASDA also has managed to develop a large online presence as its official website claims to have served 98
% of the households in the UK through its online food delivery services (ASDA, 2022).
In 2020, ASDA was bought by EG Group from Walmart for £6.8 billion and according to news, the company has decided to invest £1 billion to improve the efficiency of the supermarket chain in ASDA (Jordan, 2020). ASDA has also announced to expand into the convenience store business after a trial at the "ASDA On the Move" project in three fuel stations of EG Group (Jordan, 2020). From this aspect, it can be understood that ASDA has the funds it requires for expansion and consequently, the company can afford to improve its capabilities to offer a better customer experience.
In the times of the COVID-19 Pandemic, organisations in the retail sector have faced several challenges such as the increased regulations under which they need to operate and the heightened risks to the health of the stakeholders. According to Xiong et al. (2020), the COVID-19 Pandemic has taken a major psychological toll on the general population. Understandingly, the motivation levels of employees have been deeply impacted by the Pandemic situation and this has a negative impact on the ability of employees to perform well in their work. It can be assessed that employees work poorly when they are not sufficiently motivated. Consequently, it is important for researchers to conduct this dissertation for efficient identification of the correlation between employee motivation and organisational success. Another purpose of this dissertation is to identify the factors that impact employee motivation and thereby come up with solutions to overcome the issues. Identification of the challenges faced by organisations to maintain a motivated workforce would help companies to optimally utilise their human resource for the purpose of expanding their business. Consequently, it can be assessed that the problem that organisations are facing is significant and much research has to be conducted for overcoming it.
1.4 Statement of Purpose
The purpose of the research is to overcome the problem that ASDA is facing regarding its inability to adapt to the changing environment. This dissertation would help in overcoming the negative factors that is prohibiting its employees from working optimally due to low motivation and job satisfaction levels. In case the researchers are able to identify these factors, organisations would be able to make informed decisions that can improve employee motivation and in turn productivity levels. This would be beneficial for the organisation to meet their company objectives in terms of improving their productivity. Optimal utilisation of the workforce due to high motivation and productivity levels would also enable organisations to increase their growth prospects. As ASDA has expressed its interest to expand its chain of convenience stores, conducting this research is essential in the present times.
Figure 1: Ratings of ASDA
(Sources: Trustpilot, 2022)
Despite having ample funds to expand, the company has been performing poorly in the perspective of the customer as the company has been rated 1.5 stars out of 5 stars on the customer review channel, Trustpilot (Trustpilot, 2022). It can be assessed that the operations of ASDA are not up to the mark with the customer expectations as most of the consumers have complained of terrible customer service. Poor attitude, lack of responsiveness, and poor communication ability of the customer service employees in ASDA are the frequent complaints of customers of ASDA (Trustpilot, 2022). Over 75% of customers have reported having a bad experience while shopping at ASDA (Trustpilot, 2022). Understandingly, it can be assessed that the organisation faces the problem of poor employee performance and commitment, which has negatively impacted the customer satisfaction levels and thereby endangered its growth prospects.
Figure 2: Customer Reviews of ASDA
(Sources: Trustpilot, 2022)
1.6 Aim and Objectives
The aim of this dissertation is to critically evaluate the impact that employee motivation levels have on the growth and success of ASDA.
The research objectives that would be met in this desertion are:
To understand the concept of employee motivation
To assess the relationship between organisational success in the retail sector and employee motivation.
To identify the challenges that are faced regarding employee motivation.
To recommend ways of improving employee motivation levels.
1.7 Research Questions
The dissertation will be answering the following set of questions:
What is employee motivation?
How is employee motivation related to organisational success?
What challenges do organisations face while improving employee motivation?
What strategies can be used for improving employee motivation levels?
1.8 Dissertation Structure
A dissertation is defined as a long piece of academic writing that conducts original research work. Dissertation writing is an essential part of bachelor's and master's degrees as they help in improving the ability of researchers to conduct research work (Scribbr, 2022). The key chapters of the dissertation are an introduction, literature review, research methodology, data analysis and findings, and conclusion and recommendations. In the first chapter named “Introduction”, the research background is studied and presented. The organisation that has been selected for the research is studied as well. After that, the problem statement of the company, and the significance of the research is mentioned for a better understanding of the research and after that, the research aims and objectives are set.
In the next chapter called “literature review” different collecting sources of literature are selected as per the research aim and object and then critically evaluated for gaining in-depth knowledge of relevant concepts. In the literature review, a literature gap is identified and the researchers aim to meet that gap in the subsequent chapters. Different theoretical concepts and models that help in explaining the concepts are also discussed in this chapter. The third chapter is called “research methodology” and in this part of the dissertation, the researchers discuss and evaluate the approach and method that would be used for collecting and analysing data (Scribbr, 2022). Each of the steps involved in this process is justified and the obstacles that might be faced are mentioned. On the basis of the selected steps, the researchers assess the reliability and validity of the research.
Researchers execute their research work in the next chapter called “Data Collection and Analysis”, in which the data is collected from the relevant sources and then analysed as per the research questions (Scribbr, 2022). The objective of this chapter is to collect and analyse research findings in alignment with the research objective while ensuring high ethical practices. Subjective interpretation of the information is conducted in the analysis part of the chapter and this helps in ensuring the fulfilment of the research purpose. The fifth chapter is “Conclusion and Recommendation” where the researchers conclude the research by answering the research questions using the research findings. Recommendations are also provided in this chapter in case the research questions require them to be. The final chapter is a “Reference List” which mentions details of the sources that have been cited in the dissertation.
Chapter 2: Literature Review
2.1 Introduction
The literature review is the process of identifying different relevant pieces of literature work related to the topics of the research objectives for the purpose of gaining intensive knowledge which would help in the conduction of the dissertation. In this research project, the factors that influence workplace productivity would be identified and then the concept of motivation would be discussed. The importance of developing a motivated workforce and the relationship between employee motivation and satisfaction with customer satisfaction would also be discussed. Relevant motivation theories that can help understand the strategies of increasing the motivation levels in a workplace setting would also be reviewed in this chapter. Furthermore, literature work that presents the methods of improving employee motivation would also be discussed in the chapter. A literature gap that the research would be filling in the subsequent chapters would also be identified.
2.2 Internal Factors that Determine Workplace Growth and Success
The internal business factors refer to the conditions within an organisation that impacts the operational process and their chances of success. Organisations have control over the internal factors and consequently focussing on developing a positive internal business environment is crucial. Strong leadership and management are the first internal factor that is needed for organisational success. As commented by Cilla (2020), strong leadership helps in understanding and defining the value, vision and mission of the organisation and thereby ensures that they are optimally utilised for the attainment of the company's strategic objectives. As per Carter et al. (2019), strong leadership helps in increasing employee retention rate. Consequently, it can be stated that effective leadership in a workplace increases the loyalty of the employees towards the organisation, as a result of which the chances of workplace success and growth increase. Strong leadership also has an impact on the organisational culture, which in turn impacts the workforce productivity and motivation levels. According to Whelan (2016), work culture refers to the values, attitudes and basic underlying assumptions that are shared by the members of an organisation. Organisational culture plays a major role in understanding the ways in which employees of a company think and act and thereby it also influences the productivity levels of the employees.
In addition to these factors, employees are a crucial element of the internal business environment and consequently, maintaining a productive and dedicated workforce is crucial for companies to attain growth. Tariq et al. (2016) commented that employees are considered as one of the most valuable assets of organisations. Accordingly, it can be said that keeping them satisfied and motivated would immensely help organisations to improve their overall productivity. This would also increase the competitive advantage of the workforce and consequently, the employees would be in a better condition to compete and perform well in the target market. According to Mansaray (2019), the human resource department plays a major role in determining employee performance and motivation. It can thus be said that the human resource department of an organisation and its ability to look after the workforce is a major influencer of organisational success. Mansaray (2019) also commented that employee motivation is a key requirement that helps in increasing employee productivity and efficiency. Understandingly, the role of HRM practises is to improve employee motivation levels as they help in increasing the willingness of the employees to perform their work responsibilities.
2.3 The Concept of Human Resource Management
Human Resource Management is the business function that encloses essential activities related to hiring new employees, training them and managing them for the betterment of the organisation. It is therefore the role of HRM for ensuring that the organisation has sufficiently skilled employees to conduct the business activity as per the employers' expectations. As per Chai and Sutner (2022), employees of an organisation are referred to as human capital and it is the role of HRM to look after this asset. Reinforcing the Work Culture and managing the performance levels of the employees is a significant function of HR Departments. HR Managers help in identifying key talents within the organisations and thereby prepare them to take on leadership roles in future. In addition to it, HRM practices also manage the performance of the workforce by improving their motivation and satisfaction levels. In presence of effective HRM practices, organisations develop a healthy work culture where the employees maintain good relations with one another and thereby their ability to collaborate for optimal utilisation of their skills improve. This is positively correlated with the organisational profitability of the organisations. In addition to that, HR also actively search and locate talented employees in the labour market and attract them for increasing the human capital of the company.
According to Paauwe and Boon (2018), hard HRM is aimed at maximising the shareholder value by optimal utilisation of human resources for a short term; while soft HRM emphasises the human element of the workforce. It is thus the role of HRM to ensure that the employees are working as per the organisational expectations and guidelines by setting up company rules and policies. This helps in ensuring that the employees are well protected from the risks of health issues and hazards and consequently protects the organisation from chances of legal issues. Furthermore, the HRM practices conduct workplace planning for identifying the skill gaps within the organisation as per market requirements and thereby trains and develops the workforce to become efficient. Maintaining the motivation levels also require addressing employee complaints and meeting their expectations and consequently, a major component of HRM is to provide support to the workforce in terms of employee-centric policies and activities. According to Lopez-Cabranes and Valle-Cabrera (2020), HRM practices helps in ensuring corporate sustainable growth by encouraging employees to incorporate sustainable behaviours. Understandingly, the development of employee benefit packages and salary structures that can motivate the employees to change as per company expectations is also a responsibility of HRM.
2.4 Relationship Between Employee Satisfaction and Customer Satisfaction
Due to the increased competition in the market, it has become essential for organisations to increase competitive advantage by improving customer experience. According to Leninkumar (2017), customer satisfaction refers to the attitude of customers towards an organisation that has been shaped by their customer experience. It can be assessed that customer satisfaction plays a major role in determining the success of the organisation as a positive attitude towards the company helps in retaining customers and thereby developing a strong clientele. Leninkumar (2017) also commented that satisfying the customers' expectations while interacting with them during the purchasing process also helps increase the repurchase probability. Consequently, it can be assessed that employees have a much larger role in satisfying customers and improving organisational profitability as they influence the customer experience during the consumer decision-making and purchasing process. Satisfied and motivated employees are more likely to behave well with the customers. When the employees are dedicated to performing their responsibilities well, the quality of service that they offer to the customers is high. This positively impacts the employee satisfaction levels and thus increase the revenues of the organisation.
On the other hand, Leonard (2019) commented that when the employees are not satisfied with the organisational outputs, their motivation levels and dedication toward work decrease. Consequently, the quality of service that they provide to customers deteriorate and therefore they fail to meet customers' expectations. This results to lower customer satisfaction levels and impacts the profitability of the organisation. It can be assessed that low motivation levels of employees would negatively impact the proactiveness of the workforce to assist the customers regarding the information or support that the customers expect from the employees and this upsets the customers. In case the employees do not care regarding their work, they do not feel obligated to ensure the success of the company or abide by its vision. Consequently, they neither approach customers with the offer of helping nor show readiness when asked for any help. Low motivation also leads to the increased waiting period for the customers and this also negatively affects their shopping experience. According to Leonard (2019), unmotivated employees tend to perform the minimal best and therefore they show no energy to improve their performance. It can be assessed that in absence of the willingness to improve their productivity, such employees do not take employee feedback into consideration and this also reduces the customer satisfaction levels.
2.5 Factors that Influence Employee Motivation and Satisfaction Levels
Improvement of employee motivation levels and satisfaction levels requires understanding the needs and expectations of the workforce. According to Peluso et al. (2017), maintaining a balance between monetary and non-monetary rewards and compensations helps in encouraging employees to work harder than before. Employees tend to seek recognition for their contribution within the organisation and offering this helps in meeting the need for praise and belongingness within the company. Consequently, employees need to be recognised for their performance. It can be assessed that proper recognition would make the employees feel valued within the company and thereby their satisfaction levels, motivation levels and also loyalty towards the organisation would improve. This would also increase the employee retention rate. Therefore, it can be assessed that the presence or absence of a proper recognition system is a major determinant of employee motivation levels.
Scopes of career development can also help in motivating the employees as they would feel tempted to work harder in hopes of getting promoted (Maciag, 2016). It can be assessed that the prospect of promotion would help in meeting the self-actualisation needs of the employees and consequently their motivation levels, as well as satisfaction levels, would increase. On the other hand, in case the employees feel that their career growth aspects in an organisation are stagnated, their motivation to work harder would decline and thus their job satisfaction and loyalty towards the organisation deteriorates. Understandingly, it can be said that the absence or presence of career development opportunities is an influence on employee motivation and satisfaction.
According to Hsu et al. (2019), work-life balance plays a major in determining the motivation and satisfaction levels of the employees. It can be assessed that a proper work-life balance would help in reducing work-related stress and consequently, the employees would feel refreshed. When the employees feel well-rested, they tend to work passionately and dedicatedly, which in turn improves the quality of work that they perform. On the other hand, when the employees are forced to work without sufficient rest, their satisfaction with the organisational policies decline and they show less dedication to maintaining the quality of work (Hsu et al., 2019). Moreover, a poor work-life balance also leads to high exhaustion and a tendency to fall sick which leads to high absenteeism as well. Therefore, the amount of work that the employees are to perform each day is a factor that influences satisfaction and motivation levels.
2.6 The Concept of Motivation
The psychological process of initiating, guiding and maintaining goal-oriented behaviours is called motivation. Motivation involves a composition of emotional, biological, cognitive and social stimuli which tend to activate the behavioural response of individuals (Cherry, 2022). It can be assessed that motivation helps individuals to set and meet targets and consequently, this aspect helps individuals to meet their needs and expectations. On the basis of the source of motivation, it can be categorised into two types, they are intrinsic motivation and extrinsic motivation. Intrinsic motivation arises from within the individuals for the sake of personal gratification. On the other hand, extrinsic motivation arises from the outside for the sake of attaining external rewards. According to Cherry (2022), working for the attainment of materialistic rewards and social recognition is an example of extrinsic motivation, while that internal satisfaction is an example of intrinsic motivation. It can thus be assessed that for the sake of extrinsic motivation, an external stimulus such as the prospect of reward or punishment is essential. On the other hand, intrinsic motivation requires no such external influences. According to Gopalan et al. (2017), motivation helps individuals to react to their needs and fulfil them. Consequently, it can be assessed that identification of individuals’ needs and expectations is a crucial step in optimising their motivation levels.
2.7 Significance of Employee Motivation and Satisfaction
According to Rožman et al. (2017), organisations need to focus on job design which reduces the work stress and improves the satisfaction and motivation of the employees for increasing workforce performance and improving competitive advantage. This implies that the development of a motivated and satisfied workforce is important for organisations to sustain in the competitive environment. High employee motivation can help in increasing the skill utilisation and performance of the employees, which would in turn improve workplace productivity. High satisfaction levels are also crucial for the development of the company as it would increase employee retention rate. It can be assessed that high satisfaction levels will encourage the employees to stay loyal in the organisation and consequently, the workforce would not be leaving the firm and joining competitors in hopes of better rewards. Furthermore, high satisfaction levels also decrease the need for frequent hiring practices for filling vacant positions and consequently, this helps in reducing the HRM expenses of the organisation. Reduced expenses on hiring can be seen as increased profitability and thereby is beneficial for the organisation.
Rožman et al. (2017) commented that the presence of stereotypes and prejudices is a major threat to the employee satisfaction levels as these negative elements tend to make the employees feel marginalised and consequently their willingness to stay in the company declines. Such instances also endanger the work culture of the organisation and consequently is a threat to the brand image and reputation. On the other hand, good satisfaction levels and motivation levels, encourage the employees to abide by the company guidelines and visions, which has a positive impact on the brand reputation and value of the organisation. In addition to it, good employee satisfaction levels and motivation levels also tend to increase the ability of organisations to attract talented candidates by virtue of their brand image in the labour market. Consequently, satisfying the workforce and motivating them also tends to improve the talent management capabilities of the firms. When the employees are motivated to work for the betterment of the organisation, they tend to perform better and show high commitment and thereby the organisational productivity levels improve. According to Salleh et al. (2019), motivated employees are more committed to organisational growth and development and consequently, they face less work stress and seek ways of positively contributing to the organisation. Conversely, it has been noted that unmotivated employees contribute to a rise in absenteeism and therefore are detrimental to the betterment of the organisation.
2.8 Methods of Improving Employee Motivation
In order to improve the ability of employees to work efficiently towards the attainment of organisational goals and objectives, increasing employee motivation is mandatory. Asking input from the employees on a regular basis can help in increasing employee engagement in organisational activities. Taking the opinions of the employees into consideration would help in making the employee feel valued and consequently, the motivation levels can be increased. Looking after the work-life balance of the employees for ensuring the overall wellbeing of the workforce can also increase the motivation levels of the employees. According to Krekel et al. (2019), the strategy of maintaining the well-being of the employees would reduce the cases of absenteeism in the workforce. This would have a positive impact on organisational productivity and therefore assist in organisational success. Validating employees for their good performance and recognising them would help in providing motivation to the employees and therefore the employees would feel energised and confident to perform well in future as well.
As per Rasool et al. (2021), setting up an inclusive and diverse work environment is also beneficial in developing employee motivation. It can be assessed that an inclusive work culture would make the employees feel welcome among co-workers and therefore, the relationship among employees would improve This would increase the sense of belonging of the employees and thereby reduce the chances of absenteeism. Furthermore, improving the reward system within the organisation to make the employees feel well compensated for their work would increase the motivation levels as well. It can be assessed that external motivators such as bonuses, paid vacations and employee discounts would help in attracting the employees and in turn motivating them to work harder to gain the benefits. However, Kirilina and Panina (2107) commented that focusing on an individual approach in motivating employees is highly effective. Consequently, it can be assessed that the organisations need to communicate and identify the individual motivators of the employees and then meet them for increasing motivation levels of the workforce.
2.9 Relevant Theories
Expectancy Theory
According to Gopalan et al. (2017), expectancy theories explains that the performance of employees is dependent on factors such as their skills, capabilities, knowledge and their personality. The variables that are used to explain the concept of employee motivation are expectancy, instrumentality and valence. In this theory, expectancy is the internal capability of the employees to believe that they are capable of improving their work performance. Factors such as time, availability of the necessary resources, skills and requisite knowledge are considered in this variable. Instrumentality refers to the trust and perception of the employees towards the employers regarding the chances that high performance would result in high rewards from the organisation. Transparency between the management and employees, employee relationship and trust within the organisation plays a crucial role in this variable. Gopalan et al. (2017) commented that valence is the third variable of employee motivation which determines the preference of the individual employees regarding the expected outcome. It can be assessed valence refers to the degree to which the employee desires to attain the rewards. According to Lloyd and Mertens (2018), the value of expectancy ranges from 0 to 1, that of valence ranges from -1 to 1 and instrumentality is 0 to 1. It has been stated that motivation is the multiplied product of the three mentioned variables. Lloyd and Mertens (2018) commented that if the valence is lesser than zero, then the individual tends to be demotivated and thereby avoid the task. Alternatively, if the number is high, then the individual tends to be motivated to work harder and achieve the reward.
Maslow’s Hierarchy of Needs
According to Hopper (2020), motivation depends on the fulfilment of different employee needs. Accordingly, Maslow's Hierarchy of needs presents a graphical representation of five different categories of needs in a hierarchical structure. In this theory, the lower needs are the basic needs that initially must be met and then as the requirement are being met, the needs and expectations of the employee keep rising to the next levels. The first category that organisations must meet is physiological needs such as food and shelter. In case the employees are not provided with sufficient rest or wage, they are most demotivated and consequently, unproductive. When these needs are met, the employees seek safety needs such as job security and health at the workplace. After attainment of those needs, the employees seek love and belonging within the workforce in terms of having good interpersonal relationships with colleagues.
Figure 3: Maslow’s Hierarchy of Needs.
(Source: Hopper, 2020)
The fourth category of need, that organisations can fulfil to improve employee motivation levels even further is the need for esteem. Promotions at the workplace and frequent recognition for high performance are some ways in which organisations meet this expectation. According to Hopper (2020), "Esteem Needs" can be subdivided into two parts, they are the need of feeling good and be self-confident and the need of being recognised by others. Accordingly, organisations need to determine the way in which the employee is to be recognised and rewarded. The final type of need is called "Self-Actualisation Needs" in which the employers help the employees to reach their true potentials. Assisting employees in their personal and professional development plans and creating opportunities for career advancements within the organisation are some ways of meeting this type of need.
2.10 Literature Gap
From the literature review, it has been noted that employee motivation improves workplace productivity. However, the factors that become a challenge during the improvement of employee motivations were not found in the literature sources and consequently, it would be the literature gap that the dissertation would cover.
2.11 Conclusion
On the basis of the above-presented literature, it can be concluded that the literature has found abundant information regarding the concept of employee motivation and organisational performance. It has been concluded that meeting employee expectations and needs would help in improving employee motivation. The literature review has also noted that employee motivation would increase employee productivity and commitment, as a result of which, organisations can expand more efficiently.
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