Question

Question C4

In a local bank, there was a very high employee turnover among the Loan Officers in the past year. Loan Officers are responsible to promote the banking services and check the credibility of various firms before lending money to them. Many new Loan Officers, after joining the bank, resigned within six months.

Joe assumed as the new manager to the department in the local bank. He found that most employees were dissatisfied with the company. Their salary levels were lower than those of the market levels. Employees said they disliked the previous manager who was very harsh to them. Joe later successfully asked the company to increase employees’ salaries up to the market levels. He treated his subordinates well and fairly.

(a) Apply the Three Needs Theory of McClelland by linking it to the case of the Loan Officers in this bank.

(b) Based on Herzberg’s Two-Factor Theory, which factor is Joe’s case referring to? (1 mark)

(c) Based on your discussion in C4 (b) above, provide examples from the case to justify your argument.

(d) Could Joe increase employees’ job satisfaction by doing those mentioned in the case? Start your answer with yes or no. Then explain your reason with justification.

Answer 1

(a) Applying the three needs of achievement, power and affiliation as per McClelland's theory, the loan managers were dissatisfied as their need for power and achievement was not acknowledged. They were not given salary raise and neither received good behavior from their manager. Due to lack of affiliation with the team and organisation the managers left their jobs soon.

(b) Based on Herzberg's Two Factor Theory, Joe's case is referring to the hygiene factor. The salary of the employees was not increased and they were dissatisfied with the work environment. As per Herzberg's theory, employees are motivated at jobs due to hygiene factors and are motivated to perform due to motivators. Hygiene factors like work environment, work policies, salary levels are responsible for satisfaction or dissatisfaction and motivators are responsible for better performance at work.

(c) The case has examples of employees leaving the company due to lesser salary than market levels. The employees were also treated harshly by their manager that created hygiene factors issue with the managers. The managers became dissatisfied and left their jobs soon from the organisation due to lack of motivation.

(d) Yes, Joe could increase employee's job satisfaction by doing as mentioned in the case as the salary levels were asked to increase as per the market standards and Joe treated the managers with good behaviour. The managers reason for dissatisfaction with the company were addressed. The managers were being paid lesser than market levels and their manager also behaved rudely with them. With Joe's efforts for increasing the salary levels at par with market standards and better behaviour with managers, there was improvement in the hygiene factors faced by the employees in the organisation for motivation.