Motivation And Performance Increase In UK Retail Industry

Chapter 1

Introduction:

This research is being conducted on employees of the retail industry in UK. The major concern of this research is to find out the factors that motivate to increase the performance of the employee working at retail industry. This paper will identify the motivating factors of the retail workers. What makes the employee feel motivated and increase their performance and productivity level? This means what the employee expects from the employer and how they influence do to batter work in the retail industry. In UK there are many big retail industries. This research will be conducted at Sainsbury. This paper will find out what make the employee motivate in the Sainsbury. This paper also narrates what are the strategies that are undertaken by Sainsbury to motivate their employee.

Background of the Study:

Motivation is an important factor in the human resources policy. According to Ivancevich (1998) motivation is a set of attitudes which stimulated a person to act in a specific goal directed way. Motivation energizes and sustains human behaviour to achieve goals. What makes employee motivated. There are certain factors that motivate the employee. Abraham Maslow mentions cited by Pinnington & Edward (2000) a hierarchy of five basic needs. According to him when these basic needs of human is secured then it drive him to be motivated. Those five levels of needs are Physiological, Safety, Social, Esteem and Self actualization. One need fulfils then the other needs emerge. Physiological needs and safety need are the basic needs of survival. These two are lower level needs. The other three needs are higher level needs; in other word growth needs. Maslow said in his work that when peoples needs starting from lower level is satisfied then people started to look for higher level of needs.

Reis & Pena (2001) mention in their research that motivation theory of early 1980s and 1900s are not efficient and appropriate for this century. Now the situations are changed. According to them total quality management (TQM) and reengineering are now more appropriate to motivate people.TQM and reengineering used by American companies in early 1980s while they face difficulties to motivate their employees. As a result productivity became less. The main concern of TQM is decanting treatment with the employee, elimination of quotas and slogans, true employee empowerment and so on. Reengineering is the radical redesign of the business process of the organizations in order to meet demands of the modern economy.

Jackson and Bak (1998) did a research on employee motivation in China. In there research they mention the Katz and Kahn’s model of rule enforcement, external rewards and internalised motivation and found that Chinese technique to motivate their employee is similar to the Katz and Khan’s model. But they expend the model slightly. There the job role is well defined and communicated and should be accepted by everyone. In China money is an important factor to motivate employee. So there reward and performance related bonus is used to motivate the employee. Political indoctrination and campaigning is a major source of internalised motivation in China. The Chinese employees are influenced by politics as they have desire to become labour hero. This drives them to give high performance to become a leader. Corporate identity motivates this employee to do batter performance.

Research Background:

Previously research is being done on motivation in other sectors by other researcher. Recently at 2008 a research is being conduct on the employee of rubber industry in Taiwan. The research is conducted by Fing-I Lin. Another research is done by CA Arnold and DJL Venter (2008) about the importance on motivational reward system. They did their research on the employee of the manufacturing and clothing retail industry. Arnold and Venter (2007) mention in their work that how rewards motivate the employee in these sectors. They state that such benefits like paid holiday, house loan and sick leaves plays key role in motivate the employee.

Tippet and Kluvers(2009) did a research on motivation in the Non profit organization in Australia. According to the findings in their work the mention that work environment, work achievement and life and work balance are important factor of motivating employee.

There is other research work on employee motivation in other different sectors. This research will help to find out more on the employee of retail industry especially in UK.

Organization Background

Sainsbury is the UK’s one of the oldest retail chain superstore. In the year 1989 Sainsbury store was first opened. John James and Mary Ann was the founder of Sainsbury. Sainsbury’s first shop was in London selling butter, milk and eggs. Sainsbury’s first real supermarket was opened in Southampton in 1954.At that point of time it was the first store of its kind.

The key component for Sainsbury’s success was the Quality and price. Sainsbury was regarded for their service given to customer and their product quality. Now it has over 130,000 employees in more than 750 stores through out the UK. Sainsbury has captured 14.7% of the overall market share in UK. As the demand of their product increased, in 1892 Sainsbury introduce their own band for first time. Their first own brand was smoked bacon. When a business grows rapidly that time the business needs to have their supplier in order to fulfil the requirement of the demand. The relationship between supplier and buyer became strong in 1892. Sainsbury also realized that. They also made a good relationship between the buyer and supplier so that they could get the right product at the right time. That time they tied with Lloyd Maunder. Lloyd Maunder used to be the supplier for Sainsbury. They supply meat, poultry and wheat to Sainsbury. Sainsbury provide most fresh and very quality product to customer. For this they made a very close and good relationship with the customer. During the First World War in 1914 Sainsbury started to recruit women to support their stuff shortage. During the world war period women played a big part in running the business.

Sainsbury open their first self service store in the year 1952. This kind of self service store was the first of its kind that time. By this Sainsbury take them self one step a head from their other competitors. These things gave the customer a good shopping experience. In the year 1982 all of stores of Sainsbury became self service store. Sainsbury also introduce other extra service and facilities for their customer. In 1970 Sainsbury introduce fresh bakery counter, fish counter, delicatessen and the meat counter. These provide their customer extra benefit and comfort of shopping. One of the most important times for Sainsbury was the year 1975. That time they added new section of non food in their line-up for first time. The move their business from further from the traditional fresh food item and grocery item and added the non food item.

Sainsbury was also concerned about the environmental factors as well. They use the recycle carrier bag for the customer. They also had introduced long life reusable carrier bags. They did massive campaign for reusing shopping bags. They also take other steps to become a socially concerned company.

Rationale for the chosen topics:

The reason behind conducting this research is significant. Retail industry in UK is a very big sector. More then 3 million people’s works in this industry which is 11% of the total working group. A considerable amount of GDP is generated by the retail sector. This research will help to find out how to motivate this group of people. There are many big retail super stores in UK such as ASDA, Tesco, Morrison, Sainsbury, Somerfield, Waitrose and others. The number of people working here is quite a big number. And these retail industries are very much dependable on their employee. If this employee do not perform well in their respective job then it is quite impossible for the industry to be successful in their business. So it is important to know what factors make this employee motivated. If this employee does not motivated to their job then the result will not be positive. Possible outcome will not come from them. As a result high employee turnover and lower productivity will be seen from the employee Sainsbury will be under the spotlight of this research as quite a large number of people work in Sainsbury.

Statement of the Problem:

Problem definition or statement of the problem, as it is also often referred to, is a clear, exact, and concise statement of the question or issue that is to be investigating with the goal of finding an answer or solution (Sekaran 2004).

The topic I choose for this dissertation is to find out the factors that motivate employee to increase and improve their performance level in the retail industry. By this research I want to find out about the motivating factors of the employee of Sainsbury. What the employee expected from their job and how the motivated towards their job and also what the management level of Sainsbury are doing to motivate these employees. On the basis of this overview the problem statement of this research is

“What are the factors that motivate employee performance in the retail industry: a case study on Sainsbury.”

In support of this problem statement and to develop a conceptual framework in relation to this problem statement, some research questions need to figure out.

What are the factors that affect the performance of employees in the retail job? In relation to this what makes the employee happy or unhappy in job.

Which are the factors that motivate the employee towards their job?

What is the expectation of the employee form their job?

Which are the facilities that provided for the employee in job at Sainsbury?

A framework will build up in relation to this research after investigating these questions.

Research Objective:

This research will use to achieve the following objectives.

To examine the factors that motivate employee to perform better in the retail industry

To explore the strategy use by the employers of retail industry.

To Identify the expectation of the employees of the retail sector from their employer

Define the requirements needs to motivate the employee.

Structure of the Dissertation:

This thesis paper will have five chapters which are listed in below.

Chapter 1: Introduction

Back ground of the study

Research background

Organization background

Rational for the chosen topic

Statement of the problem

Dissertation structure

Chapter 2: Literature Review

Review of previous literature which is similar to the topic.

Build a theoretical framework and objective.

Chapter 3: Research Methodology

Research design

Sampling method

Sample size

Data collection method

Chapter 4: Analysis of Findings

Analysing data

Displayed the result of analysis

Chapter 5: Conclusion and Recommendation

Conclusion for the project

Recommendation for the project

Chapter 2

Literature Review:

Introduction:

Motivation theories:

The content theories of work motivation attempt to determine what it is that motivates people at work. The content theories are concerned with identifying the needs that people have and how these needs are prioritized. There are many theories of motivation. The most important theories are Maslow’s hierarchy of needs, Alderfer’s ERG theory and Herzberg’s Hygiene factor theory, Victor Broom’s Expectancy theory etc.

Maslow’s hierarchy of needs:

Abraham Maslow is known for establishing the theory of a hierarchy of needs, writing that human beings are motivated by unsatisfied needs, and that certain lower needs need to be satisfied before higher needs can be satisfied. Maslow studied exemplary people such as Albert Einstein, Jane Addams, Eleanor Roosevelt, and Frederick Douglas rather than mentally ill or neurotic people. This was a radical departure from two of the chief schools of psychology of his day: Freud and B.F. Skinner. Freud saw little difference between the motivations of humans and animals. We are supposedly rational beings; however, we do not act that way. Such pessimism, Maslow believed, was the result of Freud’s study of mentally ill people. “The study of crippled, stunted, immature, and unhealthy specimens can yield only a cripple psychology and a cripple philosophy”(Motivation and Personality). Skinner, on the other hand, studied how pigeons and white rats learn. His motivational models were based on simple rewards such as food and water, sex, and avoidance of pain. Say “sit” to your dog and give the dog a treat when it sits, and-after several repetitions–the dog will sit when you command it to do so. Maslow thought that psychologists should instead study the playfulness, affection, etc., of animals. He also believed that Skinner discounted things that make humans different from each other. Instead, Skinner relied on statistical descriptions of people. Maslow’s hierarchy of needs was an alternative to the depressing determinism of Freud and Skinner.

Theory X and Theory Y (Douglas McGregor)

Douglas McGregor proposed two distinct views of business beings; one basically negative, labeled theory X, and another basically positive, labeled theory Y. After viewing the way in which managers dealt with employees, McGregor concluded that a managers view of the nature of human beings is based on a certain grouping of assumption and that he or she tends to mold his or her behave toward employees to these assumptions. Douglas McGregor in his book “The Human Side of Enterprise” published in 1960 has examined theories of behavior on individuals at work, and he has formulated two models which he called theory X and theory Y.

Theory X assumptions:

The average human being has an inherent dislike of work and will avoid if he can.

Dislikes work and attempts to avoid it. Because of their dislike for work. Most people must be controlled and threatened before they will work hard enough.

Has no ambition, wants no responsibility, and would rather follow than lead.

Is self-centered and therefore does not care about organizational goals.

Resists change

Is gullible and not particularly intelligent.

Theory Y assumptions:

Work can be as natural as play and rest.

People will be self-directed to meet their work objectives if they are committed to them.

People will be committed to their objectives if rewards are in place that addresses higher needs such as self-fulfillment.

Under these conditions, people will seek responsibility.

Most people can handle responsibility because creativity and ingenuity are common in the population.

Two-Factor Theory (Frederick Herzberg):

The two-factor theory (sometimes also called motivation-hygiene theory) was proposed by the psychologist Fredric Herzberg. In the belief that an individual’s relation to work is basic and that one’s attitude toward can very well determine success or failure, Herzberg investigated the question “what do people want from their job?” He asked people to describe, in detail, situations in which they felt exceptionally good or bad about their jobs. These responses were then tabulates and categorized.

From the categorized response, Herzberg concluded that the replies people gave when they felt good about their jobs were significantly different from the replies given when they felt bad. As see certain characteristics tend to be consistently related to job satisfaction and others to dissatisfaction. Intrinsic factors, such as the work itself, responsibility and achievement seem to be related to job satisfaction. Respondents who felt good about their field respondents tended to cite extrinsic factors, such as supervisions, pay, company policies, and working conditions.

The data suggest, said Herzberg that the opposite of satisfaction s not dissatisfaction, as was traditionally believed. Removing dissatisfying characteristics from a job does not necessarily make the job satisfying. As illustrated in the graph Herzberg proposed that his findings indicated the existence of a dual continuum, the opposite of “satisfaction” is “No Satisfaction”. And the opposite of “Dissatisfaction” is “No Dissatisfaction”

According to Herzberg the factors leading to job satisfaction are separate and distinct from those that lead to job dissatisfaction. Therefore managers who seek to eliminate factors that can create job dissatisfaction may bring about peace but not necessarily motivation. They will be placating their workforce rather than motivating them. As a result, conditions surrounding the job such as quality of supervision pay, company policies, physical working conditions, relation with others, and the job security were characterized by Herzberg as hygiene factors. When they’re adequate, people will not be dissatisfied neither they be satisfied. If wee want to motivate people on their jobs. Herzberg suggested emphasizing factors associated with the work itself or it out comes directly derived from it, such as promotional opportunities, opportunities for personal growth, recognition, responsibility, and achievement. These are the characteristics that people find intrinsically rewarding. Herzberg found that people have two different categories of needs in the work situation, and these are essentially independent of each other and affect behavior in different ways. He found that when people felt dissatisfied with their jobs, they were concerned about the environment in which they were working. On the other hand, when people felt good about their jobs, this had to do with the work itself. Herzberg called the first category of needs hygience or maintenance factors: Hygiene because they describe people’s environment and serve their primary function of preventing job dissatisfaction: maintenance because they are never completely satisfied – they have to continue to be maintained. He called the second category of needs, motivators since they seemed to be effective in motivating people to superior performance.

Growth and Development

The HRM process: Performance Management

Performance management includes activities to ensure that the organization goals are consistently met in an effective and efficient manner. Performance management focuses on the performance of the organization or a department in the organization, the processes in building a product and/or services, and the different personnel and/or employees of the organization. An employee of an organization is entitled to various benefits packages. This is accordance to the labor code. These benefits should be given to employees that served an organization. If an employee has come to their retirement age or the situation arise that the benefits are needed, an employee can claimed such benefits.

Every organisation aims to keep a good staff retention record. However, retaining staff can be very time consuming and expensive. To retain staff is to give them reason to stay. This is normally done by giving employees incentives in addition to salary. These incentives normally take financial form; however, other psychological incentives work just as well. These psychological incentives can be as simple as verbal encouragement. This ultimately leads to motivation; therefore better performance.

Other forms of psychological incentives include added responsibility and work challenges. Employees not only work for money, they work also to satisfy their psychological needs. As long as incentives are fair, employees will carry on working with more conviction. This will lead to good retention levels and result in lower costs in terms of recruitment.

There is relatively little training involved as a supervisor at organisation .Most of the work carried out by this position is monitoring and assisting in sales. Each organisation branch has its monthly sales targets. If these targets are met, the employees of that branch are rewarded financial incentives. Employees that have been with the company for a long period of time and have a good record are often given more responsibility and salary increments. Swatch employees are entitled to product discounts at Swatch stores upon working in the company for at least 3 months. The purchase amount is limited but increases as time progresses. Employees find it to be one of the most satisfying incentives other than pay increments and bonuses. Organisation with a handful of employees, the performance management process is relatively simple and informal. The store manager often has a very casual relationship with the workers and therefore independently decides on incentives. Since the manager knows the nature and personality of the workforce, he/she knows which form of incentives will be appropriate. The most common method is bonus incentives and product discounts.

The HRM process: Job Evaluations/Appraisals

Job evaluations and appraisals are very beneficial for an organisation; mainly due to the following reasons:

By evaluating current performance, setting targets becomes more accurate and realistic

It can determine whether employees are working up to standards and whether further training is required

Evaluation of staff can determine their potential; this will help when promoting and increasing salary

It is an effective method when determining if workers are under or overpaid

These appraisals are normally conducted by the line manager of general manager; depending on the size of the organisation. In order to conduct a successful and productive evaluation, there are several principles which must be followed. These include:

Two way communication – the conductor must not seem as a dictator but instead must explore the performance with the employee. This is a chance for constructive criticism for both parties.

Targets and achievements – for most employees, an evaluation will compare the objectives that were previously set and discuss if and how they were met. If the employee has met the previous objectives, the new aims and expectations must be set higher.

Job evaluations at 0rganisation are done every 3 months. These evaluations are for bother part time and full time employees. However, unlike many other companies, Swatch only conducts evaluations for employees that are underperforming or have a problem. For those employees that are performing fine, an evaluation is not necessary.

During the evaluation for the other employees, the conductor will explore and evaluate the employee’s progress and targets. In most cases, if the employee is not up to standards, he/she will be dismissed. Organisation has a very informal way of evaluating its staff. Because of its small workforce, the manager can assess the quality of work on a daily basis; thus eliminating the need to conduct appraisals. It would also be time consuming and costly to conduct evaluations for one or two employees. However, in essence, the outcome is the same as it is in Swatch. The managers know the abilities and potential of their employees.

To explore the strategy use by the employers of retail industry.

To identify the expectation of the employees of the retail sector from their employer

Define the requirements needs to motivate the employee by employer or manager.

As an employer/ manager it is their role to ensure that the organizations objectives and goals are followed by all personnel. Constant communication with the employees and evaluating their performance in their work will help organisation in role. Problems in terms of the organization’s work force must be immediately resolved in order to prevent unnecessary complexities. Our workforce is the organizations valued asset. It is my duty as HR manager to ensure that these assets will remain an asset for the organization; keeping our workforce productive and competitive in our business.

The employer/ manager is a both a business and a strategic partner of the company. The employer/ manager contribute to the development and accomplishments of the company’s business strategies and objectives. As a strategic partner, the employer/ manager design the company’s work positions: hiring, reward, recognition, and strategic pay; performance development and appraisal systems; career and succession planning; and employee development. As business partners, the employer/ manager have to think like business people, know finance and accounting, and be accountable and responsible for cost reductions and the measurement of all HR programs and processes. The employer/ manager can be considered as an employee sponsor or advocate, because of the integral role the employer/ manager plays in the company success due to his knowledge about and advocacy of the people. The expertise of the HR manager includes employer/ manager expertise in creating a work environment in which people will be motivated to work, productive and happy in the company. To due process approaches in solving corporate problems and schedule regular communication opportunities. The employer/ manager contributes to the company by constantly assessing and ensuring effective HR function. It is also the role of the employer/ manager to the company’s mission, vision, values, goals, and action plan.

employer/ manager within the organization will help in handling our personnel. As a big organization with branches and different departments, it will be difficult to handle all the organizations personnel. Line managers can help in managing this problem. Employer/ manager will be the one responsible in handling the personnel under their respective jurisdiction. They will be the one in charge to report to the employer/ manager all the progress and problems of an employee hey handle. The organizations HRM will be centralized, where the employer/ manager handles all the personnel through the line managers. By this means all problems in terms of the organization’s personnel will be given enough attention and priority.

The organization uses interview and examinations in assessing and determining the capabilities and potential of employees. We should try other means in choosing our personnel. This will ensure that an employee is really suited for the job at hand that they are applying for. I suggest that we develop new and alternative means in employing. We can try group interview instead of the conventional interview. Group interview can cater to not just one employee, but to number of employees. This will also determine the employee’s interpersonal skills. We can assess how an employee will react and communicate with other people. Group interview will also help to assess the HR personnel of an employee’s capability in adapting to people and the environment he/she is in to.

The Human resource department is the company’s greatest asset; because without man power, everyday business functions could be completed. That is why it is important to the company at all time should be considerate to its entire employee. The company and employees should work together in harmony to remain productivity, and the employer/ manager are the bridge for the company and the employees to understand each other.

Role Human Resources Management

The Human Resources Management (HRM) function includes a variety of activities, and key among them is deciding what staffing needs you have and whether to use independent contractors or hire employees to fill these needs, recruiting and training the best employees, ensuring they are high performers, dealing with performance issues, and ensuring your personnel and management practices conform to various regulations. Activities also include managing your approach to employee benefits and compensation, employee records and personnel policies. Usually small businesses (for-profit or nonprofit) have to carry out these activities themselves because they can’t yet afford part- or full-time help. However, they should always ensure that employees have — and are aware of — personnel policies which conform to current regulations. These policies are often in the form of employee manuals, which all employees have.

Note that some people distinguish a difference between between HRM (a major management activity) and HRD (Human Resource Development, a profession). Those people might include HRM in HRD, explaining that HRD includes the broader range of activities to develop personnel inside of organizations, including, eg, career development, training, organization development, etc.

There is a long-standing argument about where HR-related functions should be organized into large organizations, eg, “should HR be in the Organization Development department or the other way around?”

The HRM function and HRD profession have undergone tremendous change over the past 20-30 years. Many years ago, large organizations looked to the “Personnel Department,” mostly to manage the paperwork around hiring and paying people. More recently, organizations consider the “HR Department” as playing a major role in staffing, training and helping to manage people so that people and the organization are performing at maximum capability in a highly fulfilling manner.

Some industry commentators call the Human Resources function the last bastion of bureaucracy. Traditionally, the role of the Human Resource professional in many organizations has been to serve as the systematizing, policing arm of executive management.

In this role, the HR professional served executive agendas well, but was frequently viewed as a road block by much of the rest of the organization. While some need for this role occasionally remains – you wouldn’t want every manager putting his own spin on a sexual harassment policy, as an example – much of the HR role is transforming itself.

Strategic Partner

In today’s organizations, to guarantee their viability and ability to contribute, HR managers need to think of themselves as strategic partners. In this role, the HR person contributes to the development of and the accomplishment of the organization-wide business plan and objectives.

The HR business objectives are established to support the attainment of the overall strategic business plan and objectives. The tactical HR representative is deeply knowledgeable about the design of work systems in which people succeed and contribute. This strategic partnership impacts HR services such as the design of work positions; hiring; reward, recognition and strategic pay; performance development and appraisal systems; career and succession planning; and employee development.

Employee Advocate

As an employee sponsor or advocate, the HR manager plays an integral role in organizational success via his knowledge about and advocacy of people. This advocacy includes expertise in how to create a work environment in which people will choose to be motivated, contributing, and happy.

Fostering effective methods of goal setting, communication and empowerment through responsibility, builds employee ownership of the organization. The HR professional helps establish the organizational culture and climate in which people have the competency, concern and commitment to serve customers well.

In this role, the HR manager provides employee development opportunities, employee assistance programs, gainsharing and profit-sharing strategies, organization development interventions, due process approaches to problem solving and regularly scheduled communication opportunities.

Change Champion

The constant evaluation of the effectiveness of the organization results in the need for the HR professional to frequently champion change. Both knowledge about and the ability to execute successful change strategies make the HR professional exceptionally valued. Knowing how to link change to the strategic needs of the organization will minimize employee dissatisfaction and resistance to change.

The HR professional contributes to the organization by constantly assessing the effectiveness of the HR function. He also sponsors change in other departments and in work practices. To promote the overall success of his organization, he champions the identification of the organizational mission, vision, values, goals and action plans. Finally, he helps determine the measures that will tell his organization how well it is succeeding in all of this.

Role and Responsibilities for Human Resources Management

In a mature organization, there are three participants in human resources management: the Board, Executive Director and Managers. Line Managers are managers who directly supervise the work of other staff.

An organization with good governance practices clearly establishes the division of authority and accountability among the Board, Executive Director and Managers. The role of the Board is governance and the role of the Executive Director is management. Sometimes the roles can get blurred. In clarifying whose job it is, the Board and the Executive Director must always keep in mind the Board’s legal responsibilities and liabilities as the employer.

An employer/ manager are a person who has direct responsibility for employees and their work.

Human Resources Management

Employer/ Manager

Legal Responsibilities

Employer/ Managers are accountable to the Executive Director for employment issues(Armstrong, G. 2000)