In this chapter, introduction will emphasise on the initial stage of the study. The first section will briefly explain the overview of the study whereas the background of the company can be found in the next section. Next, the following section will focus on product lines of the company. Research problems, research objectives, scope of study, and significance of the study and definition of terms also consist in this chapter.
Researchers have done extensively studies on Herzberg’s Two-Factor Theory of Job Satisfaction on job satisfaction of employee (Tan, Teck Hong and Waheed, Amna, 2011). Herzberg’s two-factor theory is probably the most widely known and accepted approach relating directly to job satisfaction (Noell, 1976). Herzberg addresses the problem of job satisfaction in terms of those factors which cause satisfaction (motivators) and those which cause dissatisfaction (hygiene) (Noell, 1976).
Hygiene factors do not lead to satisfaction however it prevents dissatisfaction. Hygiene factors are the factors that keep away from bad feelings at work. On the other hand, the real factors that motivate employees at work are motivator factors (Tan, Teck Hong and Waheed, Amna, 2011). Research done by previous researchers have shown that employees will stay longer in the organization if they satisfied with their job, for example there will be lower turnover and be less absent in the organization (Jewell and Segall, 1990; Locke, 1976). This research will determine which Hygiene factors impact on employee’s job satisfaction.
The important of job satisfaction is it will help in maintaining and retaining the appropriate employees within the organization. Nowadays, quite hard for employer in construction sector to retain and attract new applicant to join their organization. From survey done by Meritaberta.com on 1200 craft workers employed by 21 construction employees the surveyed stated that the five top reasons why their peers leave the construction industry are poor pay and benefits, non permanent employment, poor job safety, poor treatment by supervisors, and poor working conditions. Thus there is a need for these companies to organize the tasks at hand, design systems and processes and re-evaluate and improve current management style (Harmon, 2007). Areas where the competition is constantly increasing and consistently challenging need this improvement. Thus construction industry needs improvement in order to retain and attracting employees.
MMC-Gamuda Joint Venture Sdn Bhd, is a joint venture company between MMC Corporation Berhad and Gamuda Berhad (Electrified Double Track Project, n.d.). The joint venture between MMC Corporation Berhad and Gamuda Berhad is 50:50. Electrified Double Track Project is design and builds by the joint venture company. The Electrified Double Tack Project involves the construction of infrastructure works, track and system works and this project duration is 5-year Design and Build Contract.
The overall length Double Track project is a 329-km northern railway project that involves KTM’s main line from Ipoh to KTM’s main line Johor Bahru. Kedah Line length is 157 km from Bukit Mertajam to Padang Besar, while mainline overall length from Butterworth to Ipoh is 171 km. When the project completed, the entire electrified dual tracks from south to north of Peninsular Malaysia will stretch 968-km (Electrified Double Track Project, n.d.)
MMC-Gamuda Joint Venture has clarified each of the project area. 2T Northern Section Packages is from Padang Besar to Ipoh. It has 4 sections consist of section A, section B, section C and section D. Section A is from N1 to N3. N1 is Padang Besar and N3 is Sungai Petani. Section B cover from N4 to N5. N4 is Pinang Tunggal site and N5 is Parit Buntar. On the other hand, Section C covers N6 area which is from Bagan Serai to Padang Rengas. The last section is Section D which covers N7 and N8. N7 is Kuala Kangsar and N8 is Ipoh.
Since the project is still on the progress MMC Gamuda Joint Ventures open branch in each project area. This office will help in management of the project. There a 4 main offices which located in Bukit Mertajam, Kamunting, Alor Star, and Sungai Siput.
The northern Electrified Double Track project Ipoh to Padang Besar involve the design and construction of the infrastructure and systems works for 329-km. Work involves in this project are replace the existing single-track, by laying two new parallel tracks, build new stations and bridges, as well as modern electrification and signaling systems (Electrified Double Track Project, n.d.).
Background of the electrified double track project is, Government have been reactivated the Electrified Double Track project in July 2006 since deferment in December 2003 (Electrified Double Track Project, .n.d). Then MMC-Gamuda Joint Venture has submitted Technical and Financial Proposals to the Government in March 2007 (Electrified Double Track Project, n.d.). On October 2007 Economic Planning Unit lead the negotiations and in finally Letter of Acceptance was issued to MMC-Gamuda Joint Venture on December 2007.
Overall length of Electrified Double Track project is 329-km. This overall length is total from the Mainline which 171-km which is the track from Ipoh to Butterworth. While Kedahline 158-km comprises from Bukit Mertajam to Padang Besar. This project also has total 34 stations to handle this project. There are 7 major station, 14 minor station, 10 halt and 3 depots. All of these station located in Perak, Penang, Kedah and Perlis.
Electrified Double Track project not only focus on track project, however MMC-Gamuda Joint Venture also do tunnel project for this Electrified Double Track project. Tunnel project is still in progress Perak which is in Bukit Berapit 3.3-km and in Bukit Larut 0.33-km. Other main project involve in Electrified Double Track Project is bridge project. There are 194 bridges will be done in this project. These 194 bridge is total from 66 Road Over Bridge (ROB), 8 Road Under Bridge (RUB), 75 River Bridge (RB) and 45 motorcycle/pedestrian bridge. Some of these bridges have been done and the rest is still under progress.
This project also had something special structure which is in Prai, Pulau Pinang there are Prai Swing Bridge. This bridge will swing if there any big ships want to use the way. The length of Prai Swing Bridge is 282m. Another special structure is Marine Viaduct in Bukit Merah. This Marine Viaduct length is 3.5km.
There are several factors that influence employee’s job satisfaction in the organization. For example, factors that influence employee’s job satisfaction at MMC-Gamuda Joint Venture (MGJV) are job security, salary and benefit, supervision and interpersonal relations.
Exit-Voice-Loyalty-Neglect (EVLN) model identifies four ways that employees respond to dissatisfaction (McShane & Von Glinow, 2010). First is exit, exit includes leaving the organization, transferring to another work unit, or at least trying to get away from the dissatisfying situation (McShane and Von Glinow, 2010). So job dissatisfaction among employees can be measure through turnover rate in the company. Research done by previous researchers also have shown that employees will stay longer in the organization if they satisfied with their job, for example there will be lower turnover and be less absent in the organization (Jewell and Segall, 1990; Locke, 1976). This supported with the company record, that the turnover is high among their employees. From January 2012 until November 2012 the company record showed that 58 of their employees were voluntarily resigned. However, the number of new join less compared to the resignation of employees which is only 26 employees been hired from January 2012 until November 2012. So the turnover rate is 33.72%. Turnover rate was calculated by using the number of employees resigned, then divide by the number of total employees at the end of the year and multiply 100.So the percentage gets showed that the result of the turnover rate in MMC-Gamuda Joint Venture is high. Since early 2012, MMC-Gamuda Joint Venture has freeze recruitment because of the project is 97% almost done. This is why in 2012 only 26 recruitments have been done. So with high turnover problem among their employees during this year, Human Resource Department find difficulty to find a replacement because they cannot hired a new employees even though in certain position is important to be replaced. From turnover analysis as at March 2012 until May 2012, from exit interview done by Human Resource department, the reason most of the employees resigned because of pay or benefit.
Researcher also can see that the turnover rate among employees in 2011 as reported by Malaysia Average Turnover rate for Executive is 15.4%. This showed that Malaysia faced with turnover problem in addition proven by research done by Barnett, 1995; Chang, 1996; Syrett, 1996 that many Asian countries such as Hong Kong, South Korea, Malaysia, Singapore, and Taiwan faced major problem of with voluntary turnover. Furthermore, survey done by Meritalberta.com on 1200 craft workers which employed by 21 construction companies, from the survey, the five top reasons why the employees leave the construction industry because of poor pay and benefits, non-permanent employment, poor job safety, poor treatment by supervisors, and poor working conditions.
Other ways to measure job dissatisfaction among employee in MMC-Gamuda Joint Venture is through look at the attendance record of their employees. Saifuddin, Hongkrailert, N., and Sermsri, S. (2008) stated that absenteeism can measure employee job dissatisfaction. They relate high turnover and high absenteeism with job dissatisfaction, while low absenteeism associated with high job satisfaction (Saifuddin, Hongkrailert, N., Sermsri, S., 2008). In addition, Exit-Voice-Loyalty-Neglect (EVLN) model showed a four ways that employees respond to dissatisfaction (McShane and Von Glinow, 2010). So absenteeism is an example of act that comes out from the EVLN model, which is under neglect (McShane and Von Glinow, 2010). Reducing work effort, pay less attention to the quality of work, and increase absenteeism and lateness are examples of neglect act by employees (McShane and Von Glinow, 2010). It is generally considered a passive activity that but has negative consequences for the organization (McShane and Von Glinow, 2010). This also supported by company record that every month there is about 5 cases in a month about absenteeism. Company faced difficulty to trace real absenteeism problem among their employees because most of their employees work at site so quite hard for management to control what they are doing during working hours. However, the company project right now has been extent for two years because of cannot finish on the date line set before.
As a result a company should identify what their employees need from them in order to improve their performance and productivity. Thus this will help employer and retain their employees. Bull, (2005) stated that job satisfaction is related to improved employee job performance, positive work values among employees, increase employee motivation, and less absenteeism, turnover and burnout.
Job satisfaction can be the important direction to the employees of how to feels about their jobs and also predictors about their work performance or behaviors such as the absenteeism and turnover. In spite of that, job satisfaction also can be defined as what the employees satisfied with their work from the aspect of rewards, the task that they does and also the supervision from the supervisor. According to Locke, (1976), job satisfaction is defined as positive effect of employees toward their jobs or job situations.
Nevertheless, job satisfaction will also impact the organization in order to advance and develop the quality and productivity of workers can produce more effective and efficient in carrying out the tasks entrusted to them (McShane and Von Glinow, 2010). Among the factors that influence job satisfaction is in terms of motivation at work, salaries and benefits in an organization and also the relationship between employees and officers. According to HR Focus Job Satisfaction HR and skill development (2008)” has found that satisfied employees are more likely to stay with their employers and compensation and benefits were ranked equally as the most important ingredients of job satisfaction.
This report intends to finds answer the following:
Does job security have impact on employee job satisfaction?
Does salary and benefit have impact on employee job satisfaction?
Does supervision have impact on employee job satisfaction?
Does an interpersonal relation have impact on employee job satisfaction?
To determine whether job security have significant relationship towards employee’s job satisfaction.
To determine whether salary and benefit have significant relationship towards employee’s job satisfaction.
To determine whether supervision have significant relationship towards employee’s job satisfaction.
To determine whether interpersonal relations have significant relationship towards employee’s job satisfaction.
In conducting a research, limitations and constraints are elements that unavoidable. For instance, it is impossible for a researcher to conduct a research in all MMC-Gamuda Joint Venture because researcher might not be able to collect data from all employees in all branches. In addition, the researcher does not have enough sources or capital to conduct such big project. The scope of this study is employees the MMC-Gamuda Joint Venture Sdn. Bhd based in Kamunting, Perak. It will focus on how these four Hygiene Factor Theory of Herzberg affect job satisfaction among MMC-Gamuda Joint Venture Sdn. Bhd. employees. The questionnaire was handed out to the workforce in MMC-Gamuda employees in Taiping, Perak area in order to obtain their opinion and views regarding these issues.
Problem is inevitable in any research and this researcher will face several limitations during the completion of the study. Some of the limitations faced in this research are time constrain, lack of cooperation, lack of experience and the availability and confidentiality of data.
The questionnaire had been distributed to the employees from several departments in MMC-Gamuda Joint Venture to be filled in. Some employee involved in this research work at site and had caused them unaware of the urgency of the questionnaire to be return back. This process took longer time than it is expected to be completed. Apart of questionnaire, the researcher also has lack of time to collect the information from many resources in order to establish a good research.
Another limitation faced by the researcher in doing this study is the reluctance of respondents in giving full cooperation. Respondents not give accurate answers for the questionnaires distributed to them during the work because of their work commitment and due to confidentiality.
The researcher faces problems in gaining employees and organization’s data from MMC-Gamuda Joint Venture because of their strict rules as well as their private and confidential regulations. There are some important data in the company, which is labeled as private and confidential. It cannot be distributed to outside parties or person who is not working for the company. This is to avoid any misuse of information, which is considered confidential thus restricting the ability of the researcher to do proper research.
This research study is beneficial to the organization itself. Organizations will be able to avoid less job satisfaction among their employees. Less job satisfaction will lead an employee to exit. So this will give a problem to the organization to find another employee to fill the vacancy. Thus, this research study help an organization to know what action they should do and focus in order to ensure their employees feel satisfied with their job. High job satisfaction among employees in organization, the organization will have fewer turnovers among their employees. This will help the organization to save time and financial costs such as training costs and recruitment costs to replace the employee who leave the job because of no job satisfaction. Evidently, a new employee might unfamiliar with the company’s structure and progress. He or she might need more time to catch up with the company’s working procedures. Hence, the company might need to assign a “buddy” to him or her for teaching purposes. Additionally, company might also need to implement any training courses to the new employees and thus such training courses incur quite a number of costs which burden the company. In contrast, if the employees’ turnover intention is low, the company does not need to organize such training courses or assign “buddy” to the new employees. The old employees are able to increase company’s productivity and remain company’s reputation at the same time because the old employees have familiar with the company’s progress.
The study is significance towards the university because the research can be use as reference to the university especially for Faculty of Business Management. Valuable knowledge of the research topic especially in the Human Resource’s context and the information of the company can be obtained by students.
The study is significance towards the researcher because it is compulsory to fulfill the requirement in completing the Bachelor of Business Administration (Hons) Human Resource Management. An understanding the impact of job security, salary, interpersonal relations, and supervision on employees job satisfaction of employee will make the researcher better understand what people out there need from organization. The researcher will also know which one of the factor affect most toward job satisfaction among private sector employees.
Job security as the extent to which an organization providesstable employment for employees (Herzberg, 1968)
Salary also is a form of periodic payment from an employer to an employee, which is specified in an employment contract (Sharma and Bhajpai, 2011).
Legally required benefit programs include social security, workers compensation while discretional programs include health benefits, pension plans, paid time off, tuition reimbursement, recognition award, foreign service premiums, responsibility allowance, child care, on campus accommodation, promotion, annual increment and a host of others( Cascio, 2003; Bernadin,2007).
Technical competence and fairness of the supervisor (Herzberg, 1968).
In which interaction with a superior, subordinates or peers is the major factor (Fuller et al., 2008).
Herzberg, 1968 define interpersonal relations as interaction between respondent and another person.
How people fell about their jobs and different aspects of their job (Spector, 1997). Ellickson and Longsdon (2002) support this view by defining job satisfaction as the extent to which their employees like their work. Job satisfaction can be defined as how people evaluate the different feature of their jobs and how they feel positively and negatively about their jobs (Locke, 1976).
In 1959 the outgrowth of a research study project on job attitudes conducted by Herzberg, Mausner and Snyderman show that Herzberg’s two-factor theory of job-satisfaction is not new. Job satisfaction is important to an organization’s success (Md. Rifayat Islam, Md. Tauhid Rasul, G. M. Wali Ullah, 2012). However, has been relatively little research into the determinants of job satisfaction in the construction industry using Herzberg’s two-factor theory. Therefore, this paper endeavours to address this literature gap.
Spector (1997) refers job satisfaction as how people feel about their jobs and the different aspects of their jobs. Ellickson and Logsdon (2002) support this view by defining the job satisfaction as the extent to which employees like their work. Schermerhorn (1993) defines job satisfaction as an emotional response of employees towards various aspects of an employee’s work. C. R. Reilly (1991), defines job satisfaction as the feeling that a worker has about his job or a general attitude towards work or a job and it is influenced by the perception of one’s job. J.P. Wanous and E.E. Lawler (1972) refers job satisfaction is the sum of job aspect satisfaction across all aspects of a job. Abraham Maslow(1954) suggested that human needs from a five-level hierarchy ranging from physiological needs, safety, belongingness and love, esteem to self-actualization
Job satisfaction and dissatisfaction also depend on the expectation what’s the job supply to an employee and not only depends on the nature of the job (Hussami, 2008). Job satisfaction is complex phenomenon with many aspects (Fisher and Locke, 1992); job satisfaction influenced by many factors, for example salary, working environment, autonomy, communication, and organizational commitment (Lane, Esser, Holte and Anne, 2010; Vidal, Valle and Aragón, 2007; Fisher and Locke, 1992).
Previous studies done by past researcher generally found that salary, occupational stress, empowerment, company and administrative policy, achievement, personal growth, relationship with others, and the overall working condition associated with job satisfaction (Hong, Tan Teck and Amna Waheed, 2011). This also supported by previous study done by Kabir and Parvin (2011), variety of factors can influence a person’s level of job satisfaction. Example of these factors are the level of pay and benefits, the fairness of the promotion system within a company, the working conditions, leadership and social relationships and the job itself (Kabir and Parvin, 2011).
Locke (1976) indicated that a person’s physical health, mental health and social life commonly affected by job satisfaction. Moreover, Rain, Lane and Steiner (1991) wrote that life satisfaction is connected to job satisfaction, where employees who are satisfied with their jobs tend to be happy with their lives as well, and vice versa.
On the other hand, Breed and Breda (1997) indicated that absenteeism, complaints, and labour unrest also affected by employee’s job satisfaction. Therefore, workers who satisfied with their job will be more productive and retained in the organisation for a longer period, however unsatisfied workers will have a greater tendency to quit their jobs (Crossman, 2003). A satisfied worker performs better while perform their job and also provide better service to customers, which could result in improving customer satisfaction. According to Dawson (2005), positive employee behaviour associated with employee satisfaction.
While job dissatisfaction associated with high absenteeism among employees, turnover in the organization, labour problems, labour grievances, attempts to organize labour unions and a negative organizational climate (Nezaam Luddy, 2005). Cherrington’s (1994) found that employees show their dissatisfaction by being late or staying absent from work.
Herzberg’s Two- Factor Theory is form from two groups of factors known as the motivation factors and hygiene factors (Riley, 2005). Company policy and administration, wages, salaries and other financial remuneration, supervision, interpersonal relations, working conditions and job security are the factors of Hygiene factors (Riley, 2012).
In 1959, Herzberg published his analysis of the feelings of 200 engineers and accountants from over nine companies in the United States. These professionals were asked to describe experiences in which they felt either extremely bad or exceptionally good about their jobs and to rate their feelings on these experiences. Responses about good feelings are generally related to job content (motivators), whereas responses about bad feelings are associated with job context (hygiene factor). Motivators involve factors built into the job itself, such as achievement, recognition, responsibility and advancement. Hygiene factors are extrinsic to the job, such as interpersonal relationships, salary, supervision and company policy (Herzberg, 1966).
Herzberg perceived motivational and hygiene factors to be separated into two dimensions affecting separate aspects of job satisfaction. This belief differed from the traditional approach of viewing job satisfaction and dissatisfaction as opposite ends of the same continuum (Herzberg, 1966). Hygiene factors prevent dissatisfaction among employees but they do not lead to satisfaction of employees towards their job. They are necessary only to avoid bad feelings at work, while motivators considered the real factors that motivate employees at work.
The two-factor theory was tested by many other researchers, who showed very different results. Some research has shown that hygiene factors are actually motivators, (Herzberg, 1966). The results of Herzberg’s theory if it is conducted in different industries, the result can vary. The differences are because of intensity of the labour requirement and the duration of employment (Nave, 1968).
Under Herzberg’s (1966) theory, workers who are satisfied with both motivation and hygiene factors would be top performers, and those who are dissatisfied with both factors would be poor performers. However, Christopher (2005) argued with Herzberg. He said that Herzberg’s results show accurate only under his original methodology.
Hodgetts and Hegar (2005), have defined hygiene factors as the environmental factors that associated with negative feelings. Even though hygiene factors do not motivate employees, however the absence of hygiene factors increases dissatisfaction (Hartel, Fujimoto, Strybosch, Fitzpatrick, 2007).
Therefore, the basic principle of the Two-Factor Theory is that if an employer or manager is trying to increase job satisfaction and ultimately job performance for an employee or coworker, then they need to address those factors that affect one’s job satisfaction.
The relationship between satisfaction and dissatisfaction of the traditional concept and Herzberg’s Two Factor Theory is different. According to Herzberg, the opposite of “Satisfaction” is “No Satisfaction” and the opposite if “Dissatisfaction” is “No Dissatisfaction”. While the traditional concept is “Satisfaction” and the opposite of satisfaction is “Dissatisfaction.
Satisfaction DissatisfactionTraditional Concept
Dissatisfaction No DissatisfactionHerzberg’s Concept
No Satisfaction SatisfactionHygiene Factors
Motivation Factors
Figure 1: Relationship Scales of Satisfaction & Dissatisfaction
Sources:Herzberg, F. (1968). One more time: how do you motivate employees? Harvard Business Review, vol. 46, no. 1, pp. 53-62
According to the Employee Job Satisfaction survey report June 27 2010 by Society for Human Resource Management (SHRM) Annual Conference in San Diego, the report stated that job security and benefits are the top two “very important” contributors to job satisfaction (Hastings, 2010). The importance of job security is also agreed by HR professionals as it ranked it second.
Job security is an important determinant for employee turnover (Arnold and Feldman, 1982). Ashford et al., (1989) found that job insecurity is leads to reduced employee’s satisfaction and commitment. Employees job performance also reduce because of job insecurity (Rosow and Zager, 1985).
Job dissatisfaction is the outcome of insecurity among employees (Ashford et al., 1989; Davy et al., 1991). Job security, working conditions and the nature of work, low wages and lack of promotion, low job autonomy found to have adverse affect on the level of job satisfaction of employees (Guest, 2004; Silla et al., 2005)
Salary is a form of payment from an employer to an employee, which is specified in an employment contract (Sharma and Bhajpai, 2011). Important reward to motivate the behavior of employees is through pay (Taylor and Vest, 1992). Even though other factors are important to enhance job satisfaction of employees but satisfaction from pay is important. Katzell (1964) stated that pay satisfaction depends on the difference between perceived pay and the amount of pay a person feels should be received.
It also been supported from the findings of previous study, pay one of the most important factors influencing employee level of job satisfaction. Most employees rated pay as the most influential factor related to job satisfaction. Pay refers to the amount of financial compensation that an individual receives as well as the extent to which such compensation is perceived to equitable (Bull, 2005). Sharma and Bhajpai, (2011) added that that dissatisfaction with pay caused an employees have low job satisfaction, reduces employees motivation and performance, increased absenteeism and turnover intentions, and more pay related grievance and lawsuits among the employees (Sharma and Bhajpai, 2011). It also supported by Cable and Judge (1994), satisfaction with pay influence overall of employees job satisfaction, motivation and performance, absenteeism and turnover intentions among the employees and may be related to pay-related grievance and lawsuits.
Salary was found to be the main factor for the motivation and job satisfaction of salaried employees (Kathawala, Moore and Elmuti, 1990). Salary also identified as a motivator for an employee in put commitment with the organization which this will enhances attraction and retention of employees (Zobal, 1998; Moncarz et al., 2009; Chiu et al., 2002). Pay also identified as a communicator, which shows how much an employee is valuable for its organization (Zobal, 1998).
From the Employee Job Satisfaction survey report June 27 2010 by the Society for Human Resource Management (SHRM) Annual Conference in San Diego, compensation or pay fell to fifth place for the first time after been appeared in the employees’ top five list before (Hastings, 2010). While on HR professionals’, compensation/pay not listed out as top five important.
According to Luthans (1998), salaries also instrument in satisfying the higher level needs of people and not only help people to achieve their basic needs. Previous research done by Voydanoff (1980) has shown that the most significant variables in explaining job satisfaction were monetary compensation. One the other hand, Groot and Maassen van den Brink (2000) provide different evidence for the relationship between pay and job satisfaction. They did not found evidence for a relationship between compensation and job satisfaction in their earlier research; however their subsequent research revealed the opposite result. However changes in compensation whether it increase or decrease have associated impact on the level of employee’s job satisfaction (Hamermesh, 2001).
On the other hand, the issuance of benefits (or lack of) also influenc
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