Employee Motivation at Police Credit Union

24

Acknowledgement

The findings, interventions, and recommendations in this researchdocument are by no means product of one individual. It states asevidence of the extensive invaluable contributions of many, who haveadvanced my knowledge and skills to this point of synthesizing humanresource management statics in this practicum. While it will beimpossible to name all, I would like to give special thanks to thefollowing individuals:

My gratitude goes to the Almighty God, my parents and my lecturerwhose morale has brought me this far. I must also say thanks tofriends for the emotional support they so bountifully provided duringthis time when I needed it most.

I am also grateful to the entire group at Police Credit Union thatco-operated with me in the earnest hope that we could jointly bringsome structure to this organization we work in.

Thank you.

Abstract

The purpose of the research was to assess the impact oforganizational behavior in Trinidad and Tobago Police Credit Union.The key issues guiding this study include job design, jobsatisfaction, performance, job security, employee turnover, andcommunication. Trinidad and Tobago Police Credit Union is a financialinstitution that was started in 1956 with the objective of providingcredit services to police officers. Some of the key factors that havereduced performance of the credit union, including ineffectivecommunication, discrimination against employees, lack of jobsecurity, and lack of proper job design. The study used a mixedmethod design to investigate the effects of lack of effectivecommunication, job satisfaction, job security, employee turnover, andjob design on the performance of the credit union. The studyidentified that about 80 % employees believe that the credit uniondoes not have effective communication, 75 % felt unmotivated, 100 %felt discriminated against, and 60 % felt that the union did not havean effective leadership. The paper concludes that lack of jobsecurity, improperly designed jobs, and ineffective communication arethe possible causes of poor performance, high employee turnover, andlack of employee motivation.

The type of behavior adopted by the people or the stakeholders in theorganization determines the success of the firm. Althoughorganizations are expected to have an organizational culture thatdefine values and beliefs to be upheld by all employees, differentmembers of staff have distinguished behaviors. For example, employeesare motivated by different factors and at varying degrees. The levelof employee satisfaction in an organization can be measured usingdifferent variables, including their performance, satisfaction withthe present job, and the rate of employee turnover (Saleem, 2010,214). The management has the primary role in ensuring that employeesare motivated. This can be achieved by facilitative effectivecommunication within the organization, proper design of the jobpositions, and providing employees with job security. Organizationalbehavior is one of the most interesting fields of study that focus onwhat people feel, think, or do in an organization (McShane, 2000, p.5). Organizational Behavior investigates the impact that individualsand groups have on the organization as well as shared organizationalknowledge towards improving organization effectiveness.

Organizations that consider employees to be part of the mostimportant assets for meeting collective goals hire competent membersof staff and train them to enhance their capacity to pursueorganizational goals. Acquainting employees with the vision of theorganization empowers and motivates them to pursue organizationalgoals, which gives the organization a competitive advantage. Throughglobalization the company must plan to link Organizational BehaviorTheory with the reality of the modern workplace in an attempt tounderstand and achieve the mutual interest of the individual, group’scommitment and the organization leadership style to achieve successin today’s dynamic business environment.

Background information about the organization

Trinidad and Tobago Police Credit Union (PCU) is a financialinstitution that was started to offer financial credit services topolice officers. The organization was inaugurated in October 12, 1956with a mission statement stating “We are a dynamic FinancialInstitution committed to sustain the trust, confidence and well-beingof our membership through superior products, service excellence and ahighly empowered tea of Management and Staff” (Trinidad and TobagoPolice Credit Union, 2014, p. 1). The vision of the union is tobecome a premier financial institution for all members. Operations ofthis police credit union are guided by its core values, which includebeing member focused, team driven, and employee centered services.

The Credit Union owes its existence to the inability of policeofficers to obtain loans from banks and other lending institutionsbecause the Police Ordinance Chapter II No. 1 protected policeofficers from being sued also their jobs were deemed high risk. Outof this situation the idea of the Credit Union emerged to assistpolice officers in meeting their financial needs. At present theCredit Union has one hundred (100) employees in all branchescombined. The organization released a net surplus of 30 million asat the end of December 2012. Police Credit Union is a society thatprovides services, namely credit facilities to its membership as wellas insurance coverage.

Organizational Chart

SWOT analysis

Strengths

Trinidad and Tobago Police Credit Union has been in operation formore than five decades, which means that its target clients arefamiliar with its existence and its services. Over the years, theunion has managed to attract experienced members of staff who serveas senior managers in different committees and the board of directors(Trinidad and Tobago Police Credit Union, 2014, p. 1). This gives PCUan advantage over the newly established credit unions.

Weaknesses

Despite the long time in which the union has been in existence, ithas some serious weaknesses that threaten its going concern as wellas its future performance. These weaknesses include the low customersatisfaction poor website features, minimum product line, and lowstaff morale. These weaknesses reduce the capacity of the creditunion to compete fairly with other players in the industry.

Opportunities

Despite the existence of inherent challenges that the credit union isfacing, it has many opportunities that can be exploited to enhanceits performance and competitiveness. Some of these opportunitiesinclude the expansion of advisory serviced offered to clients,building a new customer relationship, and an opportunity to adopt thenew technology, which will enhance efficiency of the organization.

Threats

The Trinidad and Tobago Credit Union have three major threats. First,discrimination against employees is an unethical practice that mightdamage the image of the union in the eyes of its clients and otherstakeholders. Secondly, the high rate of employee turnover denies theunion the advantage of retaining experienced members of staff whohave the capacity to help the company in overcoming the prevailingmarket challenges. Third, the union faces a stiff competition fromestablished banks and other credit unions, which implies that it isnot a guarantee that all police officers will go for its services.

Pest analysis

An environmental scan done through a PESTLE Analysis highlights someof the challenges that the PCU fares. The PEST analysis investigatesthe Political, Economic, Social, Technological, Legal andEnvironmental conditions that affect the PCU.

Political

New laws by the Trinidad and Tobago Central Bank include the changeof policies whereby the Credit Union can only deal with finance andnot branch off into other sectors like the sale ofappliances/consumer department. This will limit the businessopportunities that PCU would have exploited to diversify its range ofproducts and services.

Economic

The substantial economic growth experienced by employers in Trinidadand Tobago has encouraged investment in the Credit Union sector. Thisinvestment will help the union acquire new assets and provide moredividends to members. This provides an opportunity for future growthof the union.

Social

The interpersonal relationship between the members of staff of theTrinidad and Tobago Police Credit Union is poor and this is mainlyattributed to the discrimination against the junior staff. Themembers of the Police Credit Union will expect the management toimprove and maintain at other services in light of the economicfortunes of the company.

Technology

PCU relays on human labor provided by its members of staff toaccomplish most of the transactions. The most competitiveorganizations, including those that operate in the financial sector,have a wide range of technology that can be used to enhanceefficiency by allowing clients to carry out some transactions (suchas balance inquiry and online purchasing) online. These technologicalapplications are cheap and easy to acquire.

Ecological

The union has to maintain good corporate image and be moreeco-friendly, for example, cut down on the amount of paper used. Thiscan be achieved by relying more on technological devices, which willhelp in reducing the need for hard copies.

Legal

There is a need for the credit union to observe the tax regulations(including the VAT requirements) and pay its creditors in time toreduce the conflicts with the laws governing the financial sector inTrinidad. Unethical and illegal practices (such as discriminationagainst employees) also increase the risk of the credit unionconflicting with the law.

Problem statement

Employee motivation is one of the most important factors thatdetermine their productivity and the overall performance of theorganization. This implies that a lack of employee motivation has adirect impact on the individual and team performance, which in turnaffects the performance of the organization. Research shows that manyorganizations have failed to acquire the necessary level ofcompetitiveness due to inadequate staff motivation (Vnouckova, 2013,p. 80). This results in problems in the fulfillment of theorganizational goals, poor job design, a significant reduction inemployee satisfaction, underperformance, high rate of employeeturnover, and ineffective communication within the organization.However, there are a limited number of research works establishingthe relationship between employee motivation and organizationalperformance in a credit union sector. The present study will fillthis gap by pursuing five major objectives

  1. To evaluate the impact of poor job design on employee performance

  2. To assess the impact of lack of job satisfaction on organizational performance.

  3. To determine the impact of employee motivation on their individual performance.

  4. To assess the effect of the perception of job security on employee turnover.

  5. To determine the relationship between effective communication within the organization and employee performance.

Purpose of Study and research questions

In the rapid changing working environment, the present study willdiscuss several factors affecting a company. Combining theory withreality by indicating ways in which organizational performance may beimproved through better understanding of human resource and humanresource management best practices.

Carefully blending theory with practice the project will seek toanswer the following

  1. Why do people behave as they do at work?

  2. How can individuals, groups, and whole organization work together more effectively within the increasing pace of corporate change?

  3. What can managers do to motivate employees for greater productivity?

  4. What responsibility do managers have for ensuring employee satisfaction?

  5. How can Theory and past experiences help the employee improve?

Finally, by assessing the organizational structure, leadership, andmotivational styles the research will identify the inherent weaknessand offer recommendation for improvement.

Literature review

Job design

Job design is a function of arranging duties, tasks, andresponsibilities into a firms unit of work. Proper deign of jobsensures that employees aware of what is expected from them, thusenhancing their performance. The job characteristic theory holds thatorganizations should design jobs in a way that the corecharacteristics that engender the three psychological states,including a feeling of responsibility, experiencing meaning, andunderstanding the outcome of efforts applied to accomplish some tasks(Hackman, 1997, p. 250). The psychological states associated with jobdesign results in intrinsic motivation of employees, an improvementin job performance, and job satisfaction. Similarly, the job designtheory holds that employees are motivated by jobs that they feel theycan make a difference and those jobs are designed with that idea inmind (Bowen, 2001, 3). This means that job design is positivelyassociated with employee performance.

Job satisfaction

Job satisfaction is one of the key fields of the organizationalbehavior that have been studied invariably. Job satisfaction is apleasurable emotional state that results from job experience andappraisal of one’s job. The affect theory of job satisfaction holdsthat satisfaction in a given job is determined by what employeeswants from the job and what they have in the job (Kumar, 2011, p.12). This means that employees feel satisfied with their present jobif they are capable of meeting their expectations regard those jobs.The two factor theory, on the other hand, holds that employees can bemotivated to work by two factors, including the motivational andhygiene factors (Kumar, 2011, p. 12). Motivational factors includepublic recognition, job promotions, and bonuses. Hygiene factorsinclude non-financial benefits, overall workplace environment, andcompany policies. In essence, job satisfaction is one of the keyfactors that determine employee performance and the probability oftheir stay in the present job.

Employee motivation and on-the-job performance

The relationship between employee motivation and their performancehas remained a remarkable aspect of discussion in the field ofpsychology, organizational management, and human resource management.Most of the available evidences indicate that both intrinsic andextrinsic types of employee motivation increases performance. Thetheories of self-determination and cognitive evaluation holds thatrewards intended to acknowledge the employees’ competence andsatisfaction of the individual’s needs enhance intrinsic motivation(Saleem, 2010, 214). Staff motivation is an essential confront forall organizations that intends to use human resource in achievingtheir goals. According to the theory of work adjustment, employeeperformance changes depending on the workplace environment (Kumar,2011, p. 15). Theory holds that work should be conceptualized as aninteraction between employees and their workplace. This implies thatorganizations have a role to play in ensuring that the workplaceenvironment they provide their employees is motivating.

Job satisfaction and employee turnover

Employee turnover is characterized by the transfer of experiences andwell trained employees from their present employer to otherorganizations. The primary cause of employee turnover if lack of jobsatisfaction, which forces employees to look for more satisfying jobopportunities (Saleem, 2010, 214). According to the sense makingtheory, human beings employ sense making whenever they come acrossdisruption of changes that disconnect them from automatic cognitiveresponse (Liu, 2008, p. 7). This suggests that any change in the jobsatisfaction motivates employees to seek for an alternative. The firmspecific human capital theory establishes the connection betweenemployee training and a reduction in employee turnover (Harris, 2003,p. 4). This introduces a new aspect of employee satisfaction, whichis training with the objective of enhancing employee competence intheir present jobs. In addition, the theory of job matching holdsthat employee turnover affects organizational productivity in anegative way. This means that employees who feel that theircompetence does not match with their present jobs are likely feeldissatisfied, unmotivated, and end-up performing below expectations.

Effective communication and employee motivation

Effective communication within the organization is an important toolthat creates a platform for the stakeholders to share information,make sense of their corporation, construct values and culture, andcreates relationships. Communication within the organization alsodetermines the level of employee motivation and performance.According to the theory of organizational support, effectivecommunication that is facilitated by the management increasesemployees’ perceived organizational support, which in turnmotivates them to work hard (Neves, 2012, p. 454). This emphasizes onthe need for an effective top-down communication in an organization.Moreover, the social exchange theory holds that norms of reciprocityshould in that workers strive to pay back an effective communicationfrom their seniors by dedicating themselves to the organization andincreasing their efforts at work (Neves, 2012, p. 455). Theeffectiveness of communication in an organization is mainlydetermined by the type of media used. The media richness theory holdsthat the relationship between perceived organizational support andmanagement communication depends on the richness of the media used(Neves, 2012, p. 461). In essence, effective communication in anorganization ensures that organizational goals are communicated toall stakeholders, which culminates in an increase in theorganizational performance.

Method

The study was accomplished using a mixed method design. This type ofresearch design focuses on studies that require multi-levelperspectives and contextual understandings (National Institute ofHealth, 2014, p. 1). In addition, the mixed research allows theresearcher to the qualitative approach to explore the underlyingmeaning and quantitative approach to assess the frequency ormagnitude of constructs. Participants in the study included 40employees of the Trinidad and Tobago Police Credit Union. Theinclusion criterion for the study participants was that each of therecruited employees must have served the union for a period of atleast 2 years. Random sampling of the study participants wasconducted in order to reduce bias in the selection of subjects.Random sampling eliminates bias by ensuring that all entities in agiven population are given an equal opportunity to be selected asstudy participants (Kitambara, 2010, p. 8-9). The data was collectedusing questionnaires, which were issued to all participants. Allrespondents were given at least two days to complete and submit thequestionnaire. The data was then analyzed using descriptivestatistics and the findings presented in the analysis and discussionsection.

Analysis and discussion

Communication failure within the Police Credit Union

Effective communication within the organization is an important toolthat creates a platform for the stakeholders to share information,make sense of their corporation, construct values and culture, andcreates relationships. The proportion of 80 % (shown in Figure 1) ofall the union’s employees who suggested that there is a problem ofcommunication within the credit union indicates that therecommunication breakdown is a threat to the progress of theorganization. This implies that only 20 out of 100 employees aresatisfied with the existing methods of communication used to passinformation from employees to managers and from managers to othermembers of staff. Psychosocial barriers among employees and betweenemployees and the management have the capacity to hinder bothvertical and horizontal communication. The psychosocial barriers ofcommunication within the credit union are caused by several factors,including negative perceptions, biases, unmet expectations, and lackof openness between employees and their managers (Lunenburg, 2010, p.5). Consequently, employees and managers fail to share information,which in turn compromises the effectiveness and productivity ofindividual employees, teams, departments, and the entireorganization.

Figure 1: Effectiveness of communication within the union

Source: Authors construction

About 20 % of the employees feel that communication in the union iseffective while 80 % believe that communication is effective.

Secondly, communication breakdown at Trinidad and Tobago PoliceCredit Union is caused by a lack of collaboration between differentfunctional areas. This implies that various departments within theorganization do not share information, but operate competitivelyinstead of collaboratively. This is one of the causes of poorrelationships between employees and unsatisfactory services beingoffered to customers. Previous research has shown that lack ofinter-functional collaboration leads to communication breakdowns,which in turn results in negative impacts on business performance(Kim, 2010, p. 12). In addition, inter-functional collaborationdetermines the effectiveness of internal and external performance.This provides a sufficient explanation for the poor quality ofservices offered by the credit to its target customers. This isbecause lack of collaboration within the union reduces thepossibility of the stakeholders to share information that can help indesigning products and services that address the needs of customersand compete well in the market.

Staff motivation

Although there are general factors that motivate the majority ofemployees, there are instances in which members of staff aremotivated to work by different factors. The link between employeemotivation and performance is based on the notion that human beingsact with a higher level of enthusiasm and dedication whenever theydeem that the task is valuable (Chaudhary, 2012, p. 29). It is theresponsibility of the management to motivate employees by showingthem that their contribution to the organization is highly valued.The high proportion (75 %) of the members of staff at Trinidad andTobago Police Credit Union who asserted that they were not motivatedat work is an indication that there is a need for the Unionmanagement to reconsider the motivation strategy. It is also likelythat part of the 25 % of the members of staff who failed to answerthe question were also unmotivated. In the case of Trinidad andTobago Police Credit Union, a global recession that resulted in a 7 %decline in demand for union services might have imparted a feeling ofjob insecurity among the members of staff. This is because theincrease in uncertainty of the going concern of the organizationincreases the uncertainty of employee retention. The occurrence ofrecession and slow recovery, are the key factors that reduce employeemotivation in the union.

Figure 2: Assessment of employee motivation

Source: Authors construction

Employee discrimination

Discrimination of employees on the basis of their socialcharacteristics is one of the key factors that reduce their moraleand on the job performance. Discrimination against members of staffat Trinidad and Tobago Police Credit Union is an obvious occurrencethat is noticed by all employees (100 %). This shows that theprevalence of discrimination in the union has reached a level atwhich nearly all employees feel discriminated against. Although thisis a rare scenario, it could be the cause of a significant drop inthe demand for union services by approximately 7 % sincediscrimination affects the quality of services that employees give toclients. This is because disparities within the workplace reduce theability of employers to recognize employees’ performance, whichreduces their morale to work (Lee, 2005, p. 489). This implies thatthe reduction of the overall union performance during the globalrecession might have been brought about by both internal factors(such as discrimination against members of staff) and externalfactors (including the global financial crisis).

Recommendations

The present study makes six recommendations that will help themanagement in addressing the underlying issues of breakdown incommunication, lack of staff motivation, a decline in jobsatisfaction, poor relationship between members of staff, and poorleadership. First, the union should give a training program oncommunication skills to managers and junior staff with the objectiveof enhancing downward and upward flow of information. The trainingprogram should emphasize on the importance of using a descriptiverather than evaluative communication.

Secondly, the management should encourage group thinking by assigningtasks to teams, instead of individuals. Traditional approaches todecision making laid exclusively with the individual decision maker,today’s business are increasingly being taken over by groups. Thiswill encourage team building and lead to the involvement of morepeople in setting up the organizational goals.

Third, the management of the union should encourage long-term careerplans to all members of staff. Today job security is important toeveryone and it motivates members of staff to commit themselves towork and retain their loyalty to the firm. Long-term career planningand be encouraged by eliminating issues (such as staffdiscrimination) that make employees feel dissatisfied and trainingthem on the importance of perceiving their career in the long-term.

Fourth, the management should encourage a good relationship among themembers of staff and motivate them to be more vibrant in decisionmaking. This will be accomplished by encouraging the union employeesto join birthday clubs, sport clubs, and trade unions. This will alsocreate an opportunity for employees to establish interaction thatgoes beyond on-the-job relationships.

Fifth, the management should practice job rotation, which will ensurethat all employees understand the roles played by each employee.Apart from helping employees to understand what their co-worker do ona daily basis job rotation will facilitate intrinsic motivation byexposing the members of staff to newer challenges. Moreover, jobrotation will act as part of career development and an opportunityfor job enrichment.

Sixth, the management should communicate what the firm expects fromemployees in a clear way to avoid uncertainties and ensure that allmembers of staff are pursuing the same goals. This will be achievedby updating employee handbook that guides employees on what isexpected of them as well as rewards and punishment for their actions.

Conclusion

Organizational behavior is one of the most important factors thatdetermine the going concern of any firm. The decline in performanceof Trinidad and Tobago Police Credit Union is a product of adysfunctional organizational behavior that has reduced the capacityof the union to overcome the market wide challenges, such as theglobal recession. Although the global recession affected nearly allfirms, internal challenges (such as employee discrimination and lackof motivation among the members of staff) reduced the capacity of thecredit union to recover at a faster rate and improve theattractiveness of its services to the targeted clients. In addition,lack of effective communication between the management and juniormembers of staff is a significant barrier that prevents the timelyflow of information that can help the firm in providing services thataddress the needs of the clients. For example, junior staff who arein direct contact with clients understand their needs better thanunion executives. In addition, failure to provide job security to thejunior staff is one of the key factors that have reduced their moraleto work, thus affecting the overall performance of the union. Inoverall, lack of job security, improperly designed jobs, andineffective communication are the possible causes of poorperformance, high employee turnover, and lack of employee motivation.

List of references

Bowen, P., 2001. A matter of design: Job design theory andapplication of the voluntary sector. Ontario: Volunteer Canada.

Chaudhary, N., and Sharma, B., 2012. Impact of employee motivation onperformance (productivity) in private organization. InternationalJournal of Business Trends and Technology, 2 (4), 29-35.

Hackman, J., and Greg R., 1976. Motivation through the design ofwork: test of a theory. Organizational Behavior and HumanPerformance, 16 (2) p. 250–279.doi:10.1016/0030-5073(76)90016-7.

Harris, N., Tang, K. and Tseng, Y., 2003. Employee turnover: Lessis not necessarily more? Brisbane: University of Queensland.

Kitambara, 2010. A comparison of simple random sampling andstratified random sampling. Pretoria: Statistics South Africa.

Kim, C., Lee, M. and Park, T., 2010. The effects of collaborationbetween marketing and production on internal and externalperformance. California Journal of Operations Management, 8(1), p. 11-20.

Kumar, N. and Singh, V., 2011. Job satisfaction and its correlates.IJRESS, 1 (2), p. 11-24.

Lee, J., 2005. Unconscious bias theory in employment discriminationlitigation. Harvard civil Rights Liberties Law Review, 40, p.481-503.

Lica, M., 2014. Digital discrimination: the case of Airbnb.com.Boston: Harvard Business School.

Liu, D., Mitchell, R., Lee, W., 2007. Job satisfaction growth andvoluntary turnover: A dynamic multilevel investigation.Washington, DC: University of Washington.

Lunenburg, C., 2010. Communication: The process, barriers, andimproving effectiveness. Schooling, 1 (1), p. 1-11.

Malbasic, I. &amp Brcic, R., 2012. Organizational values inmanagerial communication. Management, 17 (2), p. 99-118.

McShane, L. and Von Glinov, M., 2003. Organizational leadership.New York: McGraw Hill Companies Incorporation.

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Trinidad and Tobago Police Credit Union, 2014. Welcome to theTrinidad and Tobago Police Credit Union Online. Trinidad andTobago Police Credit Union. [Online] Available at:&lthttp://www.policecreditunion.com/&gt [Accessed 28 June 2014].

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Appendix

Questions in research questionnaire

Part A

Age:

20-40 years old

41-60 years old

Above 61 years old

Gender:

Female

Male

Education level:

A level

Undergraduate

Post graduate

Others, please specify

Marital status:

Married

Single

Number of years working with the union:

1-2 years

Above 2 years

Part B

Do you think the union’s job design supports employee performance?

Yes

No

Do you thing communication in the union is effective?

Yes

No

Do you feel motivated by the union’s management?

Yes

No

Does the union discriminate against employees?

Yes

No

Do you find organization’s leadership effective?

Yes

No

Given a job opportunity in a different company, would you be willingto leave the present job?

Yes

No

Do you that your current job is well described in terms of what youare expected to do?

Yes

No

Do you think the communication within the credit union is effective?

Yes

No

Are you satisfied with your current job opportunity?

Yes

No