Frequent changes in the external environment leaves no choice other than for companies to adapt to the changes by introduction of organizational changes so as to allow them to stay in competition with other companies. Such changes are now becoming more prominent in public organizations that are seeking to be more business oriented. One of the prerequisites of successful organizational changes is the employees’ mindset.
Their mindset should be such that they are committed and readily embrace new unexpected situations. They ought to perceive the various situations as challenges worthy of their efforts rather than as stumbling blocks in their daily work chores. 1.1.1 Electronic Manufacturing Service (EMS) and Contract Electronics Manufacturer (CEM) Electronic Manufacturing Service (EMS) refers to the companies that offer manufacturing related services to Original Equipment Manufacturers (OEMs). EMS focuses on provision of comprehensive services. Contract Electronics Manufacturer (CEM) meanwhile is the term used to describe companies that are focused towards production.
1.2 Research Background
In Malaysia, the electronics industries took off from its humble roots that begin in the early 1970s in Penang. Those pioneer multinational companies are still expanding and enhancing their operations till today. While Penang used to be associated with excellence in manufacturing, assembly and test operations, which is no longer valid today for Penang is also one of the design and development hubs, especially in terms hardware designs. Almost 40 years of rich experience in electronics industry has contributed to the making of world class local suppliers with advantages such as capabilities in automation systems, precision engineering and software development. Currently, manufacturing is the most important component of the Penang economy with a significant contribution of 45.9% of the state’s Gross Domestic Product (GDP) in the year 2000.
Electronic Manufacturing Service (EMS) companies have experienced rapid growth in the past 10 years, especially in the consumer, communication, and computer sectors with an annual growth rate of 20–25%. (Sherman and Berry, 2005; Buetow Mike, 22nd March 2011). In the year 2009, the turnover rate in EMS hit 270 billions and it is estimated that it may grow up to 479 billion in the coming year especially in Asia Pacific region. International trade and globalization has led many organizations to expand their networks in order to compete with the market across national barriers, cultural practices, technology barriers and economic isolations throughout the globe.
(Craig and Douglas 2005; Czinkota & Ronkainen ,2007: Ball, Geringer , Minor and Mcnett, 2010) The organization needs to enhance vital key factors such as brand name competitiveness, product innovations, business strategies, operational flow, strength of finances and human resources, supply chain management (such as quality , cost, delivery and customer service) and capability to manage changes at functional level to help them to be successful domestically.(Kotler. April 1972; Voss1995; Porter 1996) Organizational changes are vital especially for a large corporation to survive and prosper in today’s highly competitive business environment that is volatile due to globalization, competitive forces, and technological advances. Globalization, changes in customer behaviour, threat of new entry, uncertainty in the economy and daily operational issues faced by today’s businesses are set to become more challenging.
(Nadler and Tushman, 1999; Micheal Porter, Jan 2008, Paul Flatters and Micheal Willmott, July 2009). In order to compete successfully in the market, the Organization ought to develop Customer Focused Concept (Figure 1) that reinforces the focus on the customer through customer teams and focused factories (Harvard Business Review article (Skinner, 1974). Wrapping around the customers to provide an excellent service to meet their specific needs gain a high customer satisfaction on multi-skill job functions direct labours. The operation method must be modified with most of the manufacturing line having re-layout from straight line to U-shaped work cell for greater flexibility to cope with higher customer demand.
Figure 1: Customer Team & Focus Factory Concept
Doole and Lowe (2008); Johnson and Turner (2010) argued that many organizations struggle to strategically streamline costs by reorganizing , downsizing or gaining resources through merging or acquiring another organization to sustain their business globally . Consequently, the prevalence of organizational changes has increased over the past decade and has been continuous as the competition in the global market rises. Sustaining employees after the organizational changes requires the company to deal with after-effects such as workload increase, continuous uncertainties and job insecurities. (Lines, Selart, Espedal and Johansen, 2005). The organizational changes often result in absenteeism, high turnovers, dissatisfaction, demoralization, decrease in commitments, unproductive behaviours and sabotages (Morrison and Robinson, 1997) .
Kotter (1995) argues that commitment from employees is a vital factor that decides how much an organizational change is going to be successful. Common errors often overlooked by the management in the course of managing the changes include natural sense of resistance towards changes, capabilities and intellectuals of lower subordinates, communication barriers and group cultures (Lewin, November 1947; Mintberg, October 1971; Hawkins, July 1991; Kotter, 1996; Burnes 1996; Marschan-Piekkaria,Welchb, August 1999) Marks (2006) argues that it is challenging for executives to apply best practice and facilitate changes effectively because practically, mergers and acquisitions often happen in secrecy for competitive and legal reasons to defend the failed changes.
Given the needs that the executives must keep a tight lid on their intentions and need to be in open communication with employees early in the process, and /or involving of employees in decision making to increase buy-in, requires strategies to facilitate smooth transitions especially with mergers and acquisitions requiring secrecy. Increased participation (Glew, O’Leary-Kelly, Griffin and Van Fleet, June 1995) and open communication (Schweiger and DeNisi, 1991; Young and Post, 1993) are not very practical, hence there is a disparity between the ideal and practical enactment of organizational and behaviour consequences change. Communication methods between managers and subordinates about changes play important role in managing changes successfully. (Burnes, November 2002; Kotter, 2008). Effective communication about organizational changes to employees is very vital in the organization.
Wheatley (2005) has discussed about this notion by focusing on the role of the leader.
The leader can play an important role in implementing changes by continuously supporting conversations within teams and groups with the objective of clarifying their goals. Effective communication is a major factor in organizing the process of changes leading to success in the organisation’s management (Ojo and Nneka, 2009) Makawatsakul and Kleiner (2003) supported the idea that organizational changes are challenging and the impact of such changes can be too much to bear for employees who have been sustained in the organization during the times of turmoil and uncertainty, thus affecting emotions, attitudes , and behaviour toward lower morale and higher attrition. As a matter of fact, organizational changes have been deemed to be so critical that it can either create or destroy trust in the management.
(Morgan & Zeffane, 2003) Lines (2004), another source too supports and says that organizational changes can lead to loss of trust, poor morale and low motivation by means of breaking the relational exchanges between the organization and employees. Also, low satisfaction and motivation among the employees sustained during the uncertainty and turmoil can be a problem after the organizational changes. This is especially true when job satisfaction survey done in 2009 by the Conference Board clearly shows that job satisfaction level in the United States are at all time low. Only 45% of Americans are satisfied with their jobs. This is in contrast to the results obtained in 1987 in which it was 61% (Gibbons 2010).
Another source, (Pepitone, 5th January 2010) shares a similar report by stating that 1 out of 10 Americans are out of jobs and that those whom are employed are increasingly getting dissatisfied with their jobs. A possible reason for the decrease in job satisfaction among employees is due to decreased availability of jobs which are neither challenging nor interesting. Also, cost saving and downsizing initiatives are another two factors that have contributed to low job satisfactions. High job satisfaction has been linked to increased retention of employees and productivity, among other organization benefits. (Bedein and Armenakis, Mossholder, October 1981). Therefore, low levels of job satisfactions especially during economic crisis undermine efforts of organizations trying to achieve their objective of change.
1.3 Problem Statement
The research is undertaken to investigate the relationship of the factors such as leadership style; communication approach by the leader may affect employees’ perception and motivation during organizational change in Electronic Manufacturing Service (EMS) companies in Penang.
In the past, many organizations seek change with the name of different banner for the aim to remark themselves better (Kotter,1995).The researcher further added that not every change was successfully implemented despite the seemingly perfect visionary idea. However, in real-life scenario, changes may eventually dictate failure due to the difference in the perspective of the employees caused by improper management of change transformation. (Oreg, 2006; Kotter October 2007) De Wit and Mayer (2010) argued that there is a close link between business model, organization structure, process flow, and culture. Those theories supported Olorunniwoa and Udob (2002) studies on the changes to Cellular Manufacturing (CM) which involves re-layout of facilities and equipments into work cell by product base.
Cellular manufacturing is made up of a range of dissimilar functional equipments, machines and processes linked one to another and categorized by a product line (Black 1991). Functional manufacturing layout on the other hand, has its equipment layout consolidated in terms of its functional basis. As gated by workplace design and process layout, change of employee’s job design is inevitable. (Smith and Sainfort, July 1989) Brandon (1996) and Williams (2001) says that restructuring from functional manufacturing to cellular manufacturing brings with it beneficial outcomes such as reduction of material inventories, reduction of lead time, reduction of waste to a bare minimum, higher product quality control and greater range of flexibility. Job scope varies with regards to the type of manufacturing.
Functional manufacturing focuses on individual skills based specific to functions while cellular manufacturing requires multiple skills. An operator needs to understand few stations in the work cell and the job function is designed to match the multifunctional task instead of the individual’s station. Huber and Brawn (1991); Hyer, Brown and Zimmerman (1999) questioned on the evaluation of the changes in cellular manufacturing job design which is required prior to full implementation so as to find a balance between the job design versus stress reduction and employee perception that may lead to poorly motivated employees. (Smith and Sainfort, July 1989; Shafer,, Tepper, Meredith and Marsh ,1995). Erwin and Garman (August 2009); De Wit and Mayer (2010) to echoes similar point when they said that changes in the structure, process layout and working environment incur resistance in the employee and therefore managers are to lead and motivate their staffs towards the goals of the companies.
There are many researches and literature that have outlined the fact that organizational change management may lead to differences in terms of employee morale that may impact the performance of the organization. (Kotter,1996; Burnes, November 2002; Vakola and Nikolaou, 2005; Oreg, 2006; Brantley, August 2009: De Wit and Mayer,2010; Godwyn and Gittell,2011). However, very few organizations focused on the work-cell environment change that has been lagging behind employees’ morale, employee perception and motivation in the contract manufacturing industry. Therefore, this research shall provide the insight for the management to look into the ways employees perceives on leadership style and communication approach. And understand the factors that will determine the employee’s perception and motivation during the change.
Oreg (2006) also noticed similar correlation between individuals as information receivers about change and change resistance. His study results showed that managers will face a high resistance of change from employee by simply providing information. On the other hand, employee decision may stem from the understanding and agreement of change proposed by managers. Poor communication and planning, personal assumption, lack of coherence, awkward sentence structure, semantic distortion, jargon and lack of precision will cause misunderstanding among team members (Ojo and Nneka.2009). Communication and leadership are closely linked. According to Bennis, Coleman, and O’Toole(2008) described that communication is akin to leaders trying to create meaning in their messages. Sending the message to all levels of an established organization is what the authors call a commonwealth of learning, which is the hallmark of an effective organization.
Good and effective leaders know that the importance of the organization rely on the communication shared meanings that reveal roles, responsibilities, and line of authority regardless the communication method. This is to ensure that all employees operate based on the same interpretation of reality and keep common goals (Bennis et al,2008). Orlikowski and Hofman (January,1997) states that employees feel as though they are under-performed, stressed, feel anxiety and fear of uncertainty during the change occurring in the organization, especially during a major change such as merging, acquisition and organization re-structuring. They expect support from managers to seek solace and comforted from their anxiety.
Relevant acquisition research by Bhal, Bhaskar and Ratnam (April 2009) indicated that there is an increase in employee’s query for information and knowledge on company progress and making assumption based on what they receive. Employees who obtained higher leader-member information exchange may build up trust and latitude from supportive and positive communication. Building trust in organizational leadership is a continual challenge for those in authority roles (Preston-Ortiz D, August 2011). Poor organizational communication can result in its members’ retreat into
“Silos”. Lencoini (2006) explored this phenomenon as “Silos, Politics and Turf Wars”. Conflict build-up during change may incur barriers that turn colleagues into competitors. Individual managers may eventually turn intra-organizational communication to deteriorate into an individual struggle for survival rather than a collective effort to accomplish a common goal. In order to reduce conflict, gained cognition and improved morale are necessary. Mere communication cannot bring about any result to change.
Nonetheless, communication is a tool for managers to use to announce, explain and organize their employees towards positive or negative results of change. Kitchen and Daly, 2002; Pearson and Thomas, 2010 advised that managers should selectively disclose information what employee must know or should know and survey what employees could know. Managers need to understand and communicate clearly regarding the key role of the employee; should brief on the essential information that are of interest to the employee and understand the group on any discussed topics. Communication needs to be accurate and consistent so that all team members will understand the decisions made by organization leaders (Bass and Bass, 2008). In order to understand the world view of organizational members, it is essential to know their “language”. Schuster & Copeland (2008) pointed out that effective communication depends on former and informal group understanding.
It covers the language, the style, trust and the logic behind the group culture. Bratton and Gold (1999) also argued that communication is a fundamental process in organizing and providing insight to strategic management. Communication is an essential commitment of the manager to his/her employees. Managers are responsible to devise and maintain a healthy communication system in the organization. Healthy communication is built from written or face-to-face conversations. Managers should not only pass the message but act on the messages they have conveyed (Kitchen and Daly,2002). Different communication framework is depends on different change approach. Frahm and Brown (2007) suggested that organization that applied the plan change model may utilize more transmission theoretical communication, which requires instrumental framework.
Managers may communicate through sending messages and getting receiver feedback with reaction on the feedback. Meanwhile, a constructivist framework may suit continuous (emergent) change models whereby managers act as sense maker to influence employees through active conversation by using the critical theory ( Taylor and Van Every ,2000). Many researchers prefer the open “briefing and feedback” framework to understand organizational communication and change but it doesn’t promote proactive and leadership roles which is emphasized in emergency change (Frahm and Brown (2007).
Many researchers including Witherspoon and Wohlert (1996) disclosed that downward information is often distributed differently. The managerial level would agree that there were many cases where the top management direction was disconnected at the middle management level. Middle management may selectively receive information and cause incomplete and diversified change information that is to be passed down to the employees, which may lead to confusion and direct employees towards a negative perception (Frahm and Brown, 2007).
Harris (1996) pointed out that during the organizational change process; employee may experience uncertainty and feel insecure for their jobs. Instead of working under a secured blanket environment, employees may increasingly query the destiny of the company’s future progress. Employees will look for organizations that will provide them a challenging and interesting job, which offers freedom as well for their career prospects. To boost an employee’s motivation and satisfy their needs, managers must use knowledge and information communication as a motivating factor (Maslow,1943; Harris and Brannick, 1999).
2.5 Employee Perception on Change
Rogers and Roethlisberger (2000) stated that perception often occurs when what the receiver listens is not equivalent to what they should understand. Researchers Samara (June 2008) and Matali M. (Spring 2010) agreed that change often starts with the top management believing its needs but wrong initial perception become the first barrier to change which may lead to employee resistance . Emmerik, Bakker and Euwema, (2009) quoted that employees are used to observe with their own perception on the impact of change through change process before reacting to organizational change. Employee perception may impact their morale, job satisfaction, productivity and motivation (Ugboro and Obeng, August 2001). Huber and Hyer (February 1985) pointed that the major concerns regarding human factors in operation
for an organization to transform into a cellular layout. Employees who work in cells may not feel a sense of identity, significance, autonomy or cohesiveness compared to a traditional function (Huber and Brown, January 1991). Employees’ perception may differ from management’s if managers do not perform a proper change management (Kotter 1995:2007).
They may assume that they need to learn more functional skill and work harder without additional pay (Shafer and Charnes, May 1993). Parasuraman, Zeithaml & Berry (1995); Kirkpatrick & Locke (1996);Harber et al (1997); Deluga (2001) ; Slack , Orife and Anderson( December 2010) documented the relationship between mission achievement and organizational commitment as one of the powerful and pervasive mechanisms in a driven organizational culture . When performing an organizational change, it is important to be aware of the culture within the organization.
Culture change influences employee’s perception, affect job satisfaction, occupational alienation, and organisational performance. However, human nature resists change and conflict may occur unintentionally due to personal perception, cognitive view, emotional threat and behavioural change (Mayer, 2008). Conflict and resistance often occur due to employee’s perception or feel threatened on status quo; unknown fear; anxiety on uncertain future, personal security threat and lack of self-confidence (Ford, Ford and McNamara,2002; Agboola and Salawu, January 2011).
French and Bell (1998) mentioned that Employee perception is manageable. Ojo and Nneka(2009) reviewed that good communication normally utilize seek receiver feedback by questioning why , what when and how in their communication to ensure employee understand the risk of status quo. They also put in effort and spend sufficient time to reduce possible communication barriers by coaching, training, incentive and act as role models to lead change among the group. Bhal et al , (April 2009); Erwin and German (August 2009) reflected employee perception and acceptance of change hardly depends on the manager’s interpretation of change and hardly influenced by the manager’s communication skill and operation definition.
Employees may choose to accept or reject a manager’s direction by observation through the manager’s actions, participation level, daily communication and the relationship of trust (Larson and Tompkins, 2005). Employee resistance of change may bring down group motivation, which may then lead to poor change result (Dent and Golberg, Match 1999).
2.6 Employee Motivation
Employee motivation is an essential variable in our rapid changing workplace because motivation is prove to help in increasing the commitment, productivity effectiveness and efficiency of the employee. To be effective, managers need to understand what motivates employees within the context of the role they perform and reach peak performance. To increase employee motivation is not an easy task for managers because employees respond in different ways to their jobs and their organization’s practices. Motivation is a set of processes that moves a person towards a goal.
Motivated behaviours are therefore voluntary choices controlled by an individual employee. The manager would want to influence the factors that motivate employees to higher levels of productivity. In order to provide guidance to the organization’s managers to boost employee motivation and gain positive support, many motivation theories have been developed. Maslow (1943) initiated the human need of motivation via the hierarchy of needs. He pointed out that human needs can be motivated through the fulfillment of needs and desires, which then the employee will have the desire to grow into the next level of hierarchy once a level of need has been satisfied.
Herzberg, Mausner and Snyderman (2009) enhanced esteem and actualization with the hygiene factor, by which that employees will be moralized through job enlargement and job empowerment. Taylor (1911) however disagreed with the need and desire motivation by arguing that employees should work hard to achieve the goals set to gain their reward and compensation from the company. On the other hand, Mayo (1975) stated that workers could motivated by the social needs at the work place through better communication, management support and team work instead of money. To gain employee support on organizational change, motivation plays an important role in managing change (Kotter, 2008). Orlikowski and Hofman.(January1997) criticized that employees who are sensitive in a changed environment feel stressed, anxious and insecure. An employee may however perceive different views on feedback, goal clarity, autonomy and participation level (Weber and Weber 2001)
Proper communication is a part of challenge for the manager to motivate and boots employee morale to achieve change transformation.(Bernard Burnes,2009). The interaction between employees and management boosts morale and improves team work. This has been proven by Mayo (1975). Ugboro and Obeng (August 2001) further quoted that proper empowerment , reassurance and job redesigning help managers build higher levels of employee commitment, trust on management and job security. Bowles and Cooper (2009); Larson and Tompkins (2005) examined not only what management said about a change initiative but also their action and how they both related to resistance to change and employee morale during and after change. The organizational change affects workers’ morale on work commitment and satisfaction, occupational alienation and organization performance..
Employees react complacently, experience withdrawal and become cynical by ignoring organizational needs, procrastination, resignation, and reject changes. Some may resort to politicking and perform hidden agenda among the team to sabotage and promote turnover rate. Many organization studies reflect the relationship between employee morale and performance but not all managers manage employee morale well in an organizational change environment (Kelley and Volkart, August 1952; Brayfield and Crockett, September 1955; Kotter, April 1995; 2008; Kotter & Schlesinger, 2008; Bowles and Copper, 2009; Abdel-Maksoud, Cerbioni F, Ricceri and Velayutham. March 2010). Britt (August 2009) supported with the notion of leader motivation techniques carried an impact on employee morale and they are accountable for the success or failure of the organization in a larger system environment.
He stresses that a leader needs to encourage and appreciate their subordinates with rewards as a motivation on their hard work. According to researcher (Smith, 2002) believed that subordinate can be motivated to perform their work to higher levels by a creative compliments. However, managers often manipulate their employees by offering rewards for work performance as opposed to applying proper motivation techniques to achieve desired outcomes; the application of this fallacy within the organization lead to frustrated and demoralized employees ( Levinson, 1973; Kiburg, Richard and Levinson, March 2008).
Many experts believe that the transformational leadership style is the most motivating and performance-influencing to the employees. (Anderson and Anderson, 2010; Zhang Cao and Tjosvold, November 2011). Bass and Bass (2008) mentioned that a transformational leader must be grounded on moral foundations. Transformational leaders must be exhibit moral character and display ethical values embedded in their vision, demonstrate morality in their processes of social and ethical choices, and in all actions in which the leader and subordinates engage in. A set of activities and ideas for building healthy relationship between leader and subordinates is offered in Kouzes and Posner’s (2003) five practices. Noer (1997) mentioned that authenticity with subordinates is essential for creating a successful relationship.
Dumdum, Lowe and Aovoli,(2002) defined that authenticity has something to do with the awareness of one’s thought, behaviours , value and moral perspectives. In addition, others tend to view transformational leaders as having this levels of self-awareness, confidence, hopeful, optimistic, resilient and high moral character, which will help enhance employee motivation and morality (Northouse,2007). Sy (2006) found that strong subordinate–manager relationship helped enhance emotional intelligence in both parties, which in turn led to increased job satisfaction and higher levels of performance. Brandst (2007) outlined that communication is one of the important factors in the healthy relationship between leader and subordinate. He has further emphasized that the quality and amount of communication was associated with higher employee effort and higher organizational profit. The link between transformational leadership to transform change through proper communication strongly associated to employee motivation and succeed of change has strongly been recommended by Kotter & Schiesinger (2008) and Nothouse (2007).
THEORETICAL FRAMEWORK AND RESEARCH METHODOLOGY
This chapter will focus on the nuances of the research methodology used in this research. The various strategies used, manner of data collection and selection of samples will be explored throughout this chapter. 3.2 Theoretical Framework
Theoretical framework is a conceptual model to show theorizes among the factors that have been identified as important to the problem statement.
This theory flows logically from the documentation of previous research in the problem areas integrating with another one logical beliefs with published research. This existing published research had taking into consideration of limitations and constraints governing the situation. By developing the conceptual framework, it is able to help us to hypothesize and test their relationships.
Therefore, it will improve our understanding of the current dynamics situation. Theoretical framework identifies and makes the important variables in the current situation that are relevant to the problem identification. Theoretical framework describes the logic sense and interrelationship between the dependant variables and independent variables. From the theoretical framework, the testable hypotheses can be developed to study whether the theory formulated is valid or not. The hypotheses will be tested using an appropriate statistical analysis which is SPSS.
The result from findings is more assured with the strictness on research carried out. Although the hypotheses are testable, it is not necessarily able to develop and generate a good theoretical framework which is used to examine and problem investigation. Theoretical framework provides the theoretical foundation for the research. Hence, inter relationships between all variables in the problem statement are identified. It is essential to understand all variables types and its meaning. Schematic diagram of Theoretical framework
3.3 Hypotheses Statement
Two hypotheses developed base on the theoretical framework discussed: H1: There is correlation between change communication satisfaction and employees’ perception on organizational changes
H2: There is association between employees’ perceptions on organizational changes with employees’ motivation
3.4 Data Collection (Research Design)
3.4.1 Nature of Research
The purpose of this research is to evaluate employees’ motivation after organizational changes occur in the manufacturing industry in Penang. There are several ways in which data are collected which are through the usage of primary data and secondary data. (Johnson and Christensen, 2011). Primary data is self-collected data and are generated by the researchers through employees’ questionnaire survey forms. Meanwhile, secondary data is collected from external resources such as journals, magazines, internet, research articles, and books.
It also includes adoption from the established records of the organization. Data collection refers to compilation of organized information from experiences, observations, surveys and experiments (Yin 2011). Data can be presented in the form of alphabets, numbers or images either as measurement or observation of a set of variable. (Bryman and Bell, 2007). Primary data for this research is generated by using the most common method of data collection, which is by means of survey. 3.4.2 Pilot survey
Pre-testing survey was conducted in order to evaluate survey questionnaires. Bryman and Bell (2007) argued that pre-testing survey is necessary for researchers for them to perform various functions: 1) Testing and reviewing experimental procedures set for this research 2) Review of candidate’s understanding of the questionnaire 3) Review on intellectual barriers
4) To study preliminary time taken to complete the questionnaire. Survey questionnaires were modified where necessary based on the pilot survey results and findings. Unnecessary parts were removed and simpler words were used instead in order to avoid language barriers. 3.4.3 Conversational / Semi –structure interviews
Qualitative research that includes observation, case study and interview has various advantages as it helps to analyze the reason and process of decision making in a smaller but focused group (Denzin and Lincon, 2011). For this research, face to face interviews were carried out in order to gather required information in order to seek empirical support for preset research hypotheses. The interview was then initiated with the leaders in order to gather opinion on the organizational changes and the approach employed in the process of communicating.
According to Bryman and Bell, researchers are able to converse with the interviewee face to face during the interview and simultaneously perform synchronous communication so as to gather social cues. According to Patton (2000), face to face interviews aid in the interpretation of the body language, feelings, and voice intonations. Such extra information was noted down during the interview. As per the previously mentioned framework, the interview session was conducted by interviewing four leaders from various customer focus factory team in the organization (Saunders, Lewis and Thornhill, 2009). The leader plays the role of leading the shift in the team so as to achieve manufacturing set target. There are about 50 operation operators and material handled was reported to each leaders. Brantley (August 2009) stated that change is a process that is not easy to measure.
However, Tuckman, (2002) argued that change management by shifting leaders may influence operators morale and performance which is interlinked with operation productivity and product quality. This may lead to changes in results and serious financial impact. Interviews were held at one of the EMS Company in Penang during the course of end of July 2013. Each interview took about an hour to be reviewed and discussed on the questions. Personal bibliography was covered in the interview questions. Four elements constitute the interview questions so as to gather and review points of view which are as i) type of management style applied ii ) changes in communications iii) resistance and iv) motivation Semi-structured interview comes with the key advantage of pre-planning the linking of questions as per the research objectives and also giving the participants fair opportunity in expressing their points of view thereby reducing biasness. (PSC 2009).
In addition to that, semi-structured interview grants the researcher some flexibility in order to cover some additional questions that are dependent on the response of the participants during the conversation. The results obtained from the interview were converted into interview summary sheets categorized into four elements as mentioned earlier on with each elements focusing on three main questions. Interview result was summarized into summary sheet and acknowledged by the participants. The names of the participants were not disclosed in both the interview questions and summary sheet in order to avoid further complications and biasness. Privacy and confidentiality of the participants were strictly upheld and protected. (Resnik, 2010). 3.4.4 Employees Survey Questionnaires
Deductive approach was applied to the research design to review past researches that was carried out on management of organizational changes, communications, perception of employees and motivation after organizational changes (Burnes, November 2002; Oreg, 2006; Frahm and Brown , 2007; Kotter, 2008). Hence, the rationale of the research being focused on questionnaire survey so as to determine employees’ perception on the organizational changes. Questionnaire was designed with a section covering personal bibliography and another three core sections as follows:- 1) Opinion of employees on change communications.
All questions on the above-mentioned section were adopted from Mayfield and Mayfield (June 2002) with the questions being filtered by the researcher on the basis of understanding from works by Rogers and Roethlisberger (2000); Ojo and Nneka (2009). Questions were prepared on the subject of employees’ perception of their manager’s communication behaviors such as timing, cleanness, exposure and ability of the managers in reviewing the feedback of their employees.
2) Employees’ opinion on recent organizational changes in the company in order to review their perception on the needs, satisfaction level, urgency, affective cognitive, behavioural, and trust towards the management on changes. Questions on the above-mentioned section were adopted from Weber (2001) and Oreg (2003). Reverse questioning method were used in designing Q7 & Q8 in order to prevent any form of manipulation of the validity and reliability of the questionnaire. Also, to prevent biasness in the results that may occur due to the process of recording and standardizing the data from the participants. ( Dornyei and Taguchi 2010). Data was keyed in the reverse ratio while compilation was done. 3) Employees’ motivation after changes
This section was used to observe employees’ motivation incurred by changes which may impact motivation and performances thereby leading to varying change in results ( Baehr and Renck , September 1958;Abbott,2003; Kotter ad Schlesinger, 2008; Erwin and Garman,2010). The questions on the above-mentioned section were adopted from Oreg, (2003; 2006) and UTS Employee Survey Questions which focuses on reviewing employees’ trust on management, job satisfactions and job security.
Questions were drafted so as to observe employees’ motivation incurred by changes which may impact motivation and performances thereby leading to variable changes in results. The survey questionnaires include a cover letter that explains the purpose of the distributed questionnaires to all the two hundred employees in one of the EMS Company in Penang via convenient sampling method so as to get employees’ feedback on their morale after the change processes. The questions were designed to examine the attitudes and feelings of the participants by the usage of five (5) point scales. The participants were required to indicate their agreement or disagreement in three (3) core sections by means of the interval scale method. The rating scales are as below:-
The standard may contain communication gap that can induce wrong interpretation and thereby leading to wrong data (Dezin and Lincoln, 2011). Reliability test were highly used in the research study in order to avoid superficiality or wrong data. Reliability of survey data is vital as it is synonymous with consistency of survey, test or other measuring device.
Cronbach’s alpha test applied in this study in order to measure the internal consistency of the respondent’s answer for the employees’ survey. The significant value reflects on how close a group of answers were inter-related. Higher significant value reflects high true-score variance. Cronbach’s alpha reliability coefficient ranges between 0 and 1 with acceptance point of above 0.7 significant values. (Cronbach and Shavelson , June 2004).
Both primary and secondary data were used in this research to generate, analyze and prove the hypothesis that was set and the theories that were applied. Interview results were discussed to determine the impact of the organization (Yin 2005). The results were summarized into a summary sheet to facilitate later stage of data analysis. (Antonakis et al, June 2003). Employees’ survey results were processed through MS-Excel (Microsoft office) and SPSS in order to generate data summary for the purpose of analysis. Descriptive and inferential analysis was applied in this research in order to find the hints and answers for the objective set beforehand.
Onwuegbuzie and Leech (September 2006) advises that correlation are used to investigate the relationships between two quantitative and continuous variables. Common association tests used were Pearson correlation, Spearman correlation and contingency coefficients. Pearson correlation coefficients (r) were used in this research to test the two hypotheses. Bee and Bee (2005) advises that in Pearson Correlation Coefficient, the significant value r drops between -1.00 (-Ve) and 1.00 (Positive correlation) to reflect the relationship strength of two (2) variables. The closer r value to 1 reflects the stronger association and normally the standard of r being above 0.6 is accepted. According to Friend (1997) the percentage of dependency can be found by squaring the r value. Two (2) hypotheses are set below in order to prove the theory that was set in the research objectives via Pearson’s Correlation Coefficient test.
H0: There in no correlation between change communication satisfaction and employees’ perception on organizational changes
H1: There is correlation between change communication satisfaction and employees’ perception on organizational changes H0: There is no association between employees’ perception on organizational change with employees’
H2: There is association between employees’ perceptions on organizational changes with employees’ motivation
Hypotheses 1 is applied to analyze the correlation between changes in communications and employee perception. Researcher may be able to prove objective (3) by comparing the mean of different groups and H1 to reflect employee perception of organization changes that is impact by changes in communications. Hypotheses 2 is set to test and prove the assumption on objective (4) in order to determine the impact of employee perception on changes towards employee motivation in the organization. 3.6 Summary
This chapter comes with a theoretical framework that evaluates the restrictive organizational processes and helps to analyze on ways to enhance communications in all the operational levels, changing employees’ perception on such changes and the effect of employees’ motivation at the operational level. In this research, the empirical and deductive research are combined and designed with one (1) aim and four (4) objectives.
The primary data were collected by using triangulation methods. Pilot study were conducted in order to evaluate survey questionnaire and required modifications were made on the survey questionnaires by cutting out the unnecessary and simplification by means of plain , jargon-free language to avoid language based barriers that was evidenced by the pilot study. Secondary data were adapted from historical studies, published literatures, journals and the organizational records in order to support and aid in the data analysis. The research done can serve as a reference and to guide the prospective companies that are seeking greater improvement in their organization.
PRESENTATION AND ANALYSIS OF FINDING
This chapter presents the findings generated from the interviews of 4 managers and employee survey questionnaires. These results can benefit
organizations by providing the clear tools to assist employees with the communication approach, perception and motivation regarding organizational change.
4.2. Conversational / Semi –structure interviews analysis The data was collected by interview with 4 shift managers who report to different work cell managers of the organization to gather proposition information to seek empirical support for the present research’s hypotheses. Purposive and convenient sampling methods are applied for data collection with 50% coverage. Interview questions are categorized into personal details and four (4) elements to review and gather points-of-view on management style applied; change communication, resistance and motivation.
Based on the summary of the interview, each shift manager has a working experience of more than 15 years and handles about 60 to 70 operators. 4.2.1. To review the organizational change applied by the organization Four managers interviewed gave a summary of their organizations that were undergoing the process of re-structuring from a traditional departmental organizational structure to a matrix organization structure using the Customer Focused Concept that reinforces the focus on the customers through customer teams and focused factories. The latest organization chart is available in the interview section (Appendix 5). The managers have briefed their organizations that tried to align themselves with the new organization structure and change of manufacturing re-layout from the straight line production flow to the U-shaped cellular line production flow. (Appendix 6 & 7) This is linked to objective one (1) in this research.
4.2.2 Change communication applied by the manager
Many researchers, including Yuki (2002), mentioned that a manager with strong leadership skills would facilitate individuals and encourage team efforts towards the accomplishment of organization’s vision and objective. However, Kotter (1996) argued that managers may focus more on sustenance but leaders are meant to be used to transform, and therefore, organizational change results may vary depending on the manager’s performance.
There are different leadership styles in this interview summary: Shift manager 1 adopted the laissez-faire leadership style (Eagly et al, July 2003). He has created a good relationship with his team and delegated the tasks to his subordinates while providing little direction and allows his subordinate to have complete freedom to suggest any decisions concerning the completion of their work. At the same time however, he also offered guidance and provided necessary support. When the management initiated the re-layout plan, he used to promote some ideas and suggestions from his team to the management.
He however claimed that due to the organization’s call for the practice of standardization, the suggestions or proposal from his team were just kept in view by management, hence causing him to face high resistance of change from his subordinate. He was able to adopt the minor change in his area as the team was dissatisfied with the results. Due to this, he tried to persuade the management to spend more time meeting and briefing the team. Shift manager 2 on the other hand had a transactional leadership style and hence, possessed a more autocratic management approach. He stressed on the strict compliance of the company’s standard operating procedures (SOP) by employees. He was responsible in monitoring his subordinates to follow the established routines and procedures. Reward was given to employees who meet the goal and action taken on those who failed to meet the goal.
He requested subordinates to fill in the standard form / template via the employee feedback forum on the company’s intranet so that it can follow the proper route of feedback to management regarding any grievances from his subordinate. This manager sought opinions from his superior to act upon on his subordinates’ feedback and suggestions regarding the change. Shift manager 3 and 4 had a transformational leadership style by leading the team through example and goal setting (Bass and Bass, 2008).
They tried to resolve their subordinates’ issue through some work station modification or practice. Both managers sought feedback from their subordinates and allow their subordinates to be involved in decision making to a certain level by adopting their suggestions on operational issues. They agreed that interaction communication with subordinates plays a major part of managerial role where they seek feedback through integrative communication; enhance employee morale and build team spirit. Overall, both shift managers 3 and 4 applied the same leadership style and communication approach.
Shift manager 4 however shared that he also chats with his subordinates while working together in the manufacturing line as it helps to work closely with the team to find out any grievances at the work station set up and how the employees are feeling about the new layout structure. However, he still prefers to have a periodical discussion or meeting with his subordinates as he believes formal discussions will have better negotiation power to convince his subordinates as compared to informal chats at the workplace. All four shift managers have spent a fair number of times to speak, convince and encourage stubborn subordinates who initially refused to fix themselves into re-structured layout by slowing down their job speed, absenteeism, politicking and other negative action.
Manager 1 mentioned that he still faces a lot of complains regarding the change such as extra workload, inter-team comparison, work station inconvenience from his team even though he has tried to fulfill most of their requests. Manager 2 on the other hand said he experienced moderate level of resistance in the change process, but managed to overcome through some supervisory techniques in place. Managers 3 and 4 managed to resolve the problems by adopting their subordinates’ suggestions on the minor work station layout modification. According to Kotter (1996); Bass and Bass (2008), they outlined that the key point of change communication is how managers transform a company’s direction becomes employees’ action towards the organization performance.
From the change communication point of view, managers 1 and 2 preferred the Top down communication approach as they believed that subordinates should receive information through daily meeting, intranet, email and talking session. On the other hand, managers 3 and 4 preferred the two-ways communication approach to promote interaction communication. However, all managers agreed that there is still some room to improve on communication within the organization. Employee motivation will impact employees’ perception and trust in management (Ugboro and Obeng, August 2001). Bowles and Cooper (2009) supported that high employee motivation helps increase employee job satisfaction, improve and increase productivity and drive company performance.
Based on the interview results, all participants agreed that the organization’s middle management needs to motivate employees to ensure high employee performance and increased daily manufacturing performance. Managers 1 and 2 preferred to openly praise their subordinates, which they believe will gain employee trust and support. However, managers 3 and 4 believed that employee motivation can be managed by working closely as a team to resolve routine activities to lead subordinates by example. Nevertheless, all 4 managers set public reward as a standard reward practice as it is one of the many motivation tools, which is useful in encouraging and showing appreciation to employees for outstanding contributions. The interview results are used to link to the employee survey section to reflect the inter-relationship of different variables.
4.3 Employee survey analysis
In this section, the employee survey results were categorized into 4 groups according to each interview manager. Using SPSS, session (1) questions were labeled as C1 to C7 according to their sequence, session (2) labeled as O1-O10 and session (3) as M1 to M10. The reliability test, descriptive analysis and hypothesis are applied in this chapter to analyze the collected data to find out the imprecations and to reflect if the objectives of the research has have been met.
4.3.1 Response rate and reliability
The purposive sampling method was applied with questionnaires distributed to employees from all 4 interviewed managers. The researcher targeted to collect 50 employees from each shift manager group with the aim of making comparisons between each group. By doing so, the researcher will be able to link the interview results and employee survey results. A total of 200 questionnaires were distributed to 4 groups of managers, however only a total of 161 questionnaires were returned. This made up a total of 80.5% of total questionnaires distributed were satisfactorily completed. Cronbach’s alpha test sets to test all variables on the mean and correlation for the 161 respondents’ answers, which obtained a 0.972 Alpha value. Test by session with result session 2 (C1 t0 C7 .n=161) obtained Alpha value of 0.895; Session 3 (O1 to O10, n=161) obtained 0.927 and session 4 (M1 to M10, n=161) obtained 0.932.
Table 3 summarizes all demographic data of respondents including age, gender, race, education level, marital status, number of years worked at current company and job level. Table 3 shows 15 respondents are 20 years old and below, making up 9.3% of the total number of respondents, the majority of the sample age is between 21 and 30 years old with 108 respondents (67.1%), 22 respondents (13.7%) were aged between 31 to 39 years old, and 16 respondents (9.9%) were aged 40 years old and above. From the results, majority of the employees are still in lower age population with a computed median group age of 24.3 years old compared to the world population median age of 27.9 years old (CIA. July 2011).
The researcher believes that younger work force may contribute to higher productivity from the perspective of aging. A total of 138 respondents were female, accounting of 84.47% and 25 respondents were male, accounting of 15.53%. Therefore, the ratio of male to female is 1:5.44. The researcher believes this may be due to the nature of the job function that direct labour focus on higher passion work rather than physical strength in this industry. Results show that the majority race were Malays, with 40.37% (65 respondents), 16.77% (27 respondents) were Chinese, and 24.22% (39 respondents) were Indian while only 18.63% were others.
A total of 15 respondents’ education level were only at the primary school level, accounting of 9.32%, but majority of the respondents had only studied until the secondary school level (133 respondents) – 82.61%. It is then followed by the Certificate and Diploma of 13 respondents, accounting for 8.07%. For marital status, the results showed 108 (67.08%) respondents were single and 38 respondents with percentage of 23.60% were married and only 15 respondents with 9.32% were others.
The results also indicated 15 respondents, accounting for 9.32%, have worked 5 years and above, 45 respondents, accounting for 27.95%, have worked between 3 to 5 years, while majority of the 64 respondents, accounting for 39.75%, have been working for 1 to 3 years in the organization and 37 respondents, accounting for 22.98%, have only been working for less than 1 year in current company. For the job level criteria, most of 145 respondents with the percentage of 90.06% are operators, 12 respondents with a percentage of 7.45% are senior operators and only 4 respondents with percentage of 2.48% are leaders.
Referring to the above table, it shows the mean value for Employee Satisfaction on Change Communication in the 4 different managers’ group. Varied mean values obtained by the 4 different groups were 3.24, 3.47, 4.24 and 3.84 while the overall mean value is 3.84. From the results indicated, employee satisfaction was influenced by the manager’s leadership style and communication approach. Based on the different mean values of the 4 groups of managers, it is indicated that the respondents from group 3 and 4 have positive views and are more satisfied with the transformational leadership utilizing democracy, theory Z and the two-way communication applied by their managers as the leadership style and communication approach, which were applied to gain higher optimism and less frustration among their subordinates. Therefore, results show the mean value is above
4. Additionally, significant results have proven McColl-Kennedy and Anderson’s (October 2002) statement that transformational leaders are able to influence employees’ attitude and behaviours on frustration and optimism emotion. On the other hand, the mean value from group 1 and 2 reflected that respondents are less satisfied compared with group 3 and 4. Manager 1 practices the free reign management style and applied top down communication while Manager 2 practices a transactional leadership style with autocracy, theory X and top down communication.
Graph 2: Employee Satisfaction on Change Communication Graph 2 presents frequency analysis on employee satisfaction on change communication by different groups of managers; the results show that Manager 3 and 4 obtained higher satisfaction feedback on change communication from their subordinates with a total of 34 respondents, accounting for 21.12%. Managers 1 and 2 obtained a slightly lower satisfaction rate from their subordinates, which are made up of a total of 27 respondents, accounting for 16.77%.
Majority respondents’ feedback of an “average” satisfaction rate however is a total of 94 respondents with percentage of 58.39% for all managers. There were only 5 respondents with 3.11% from group 1 that commented they were dissatisfied and 1 respondent with a percentage of 0.62% from group 2 showed strong dissatisfaction on the change communication approach applied by the manager. 4.3.5 Employees perception on organizational change in the organization. Session 2 questionnaires on employees’ perception was adopted from Oreg (2006) “Resistance to Change; Developing an individual Differences Measure”.
The data was obtained to review the optimist and resistance of employee perception from the information received in session 1. The purpose of this session was to gather employee’s cognitive rigidity underlying their responses to organizational change for further comparisons on the employee morale and motivation in session 4. In addition, computed mean value obtained on employee perception will act as one of the variables to reflect the relationship between session 1, 2 and 3 to find an answer for objective 3 and 4. Table 5 presents the means for employee perception on organizational change in the organization. Question
he survey results show employees’ perception on work re-structuring was satisfied with a mean value of 3.83. Breaking down into 4 groups for comparison, respondents from group 3 and 4 showed more consistency and higher optimism level with an overall mean of 4.19 and 4.16. The results show a small part of respondents from group 1 and 2 were repulsive with an overall mean of 3.41 and 3.21. The result trend has been proven and synchronized with Erwin and Garman (2010)’s thought where higher employee opinion and perception on the change impacts link to greater tendencies of change resistance
Graph 3: Employee perception on change by manager group
Referring to above graph 3, the result significantly shows that employees from group 3 and 4 perceive optimistically to the organizational change. Overall 41 respondents make up the 25.47% from group 3 and 39 respondents make up 24.22% from group 4 compared to the 12 respondents with a percentage 7.45% from group 1 and 16 respondents with a percentage 9.94% from group 2.
Majority of the respondents from both group 1 and 2 shown no comment which is 38 respondents with percentage of 23.60% and 7 respondents perceive repulsive on the change with percentage of 4.38%. Therefore, the survey outcome has been proven and it supported Erwin and Garman (2010)’s statement on higher individual’s perception on change impact incurred greater resistance and irrationalism. 4.3.6 Employee motivation on organizational change
The survey questionnaire in this session reflected the interrelationship of each question.
Additionally, the comparison result has supported Huang (1997)’s thought on respondents carrying positive effect on employees’ morale and motivation. Referring to Morrison, Burke III and Greene (summer 2007)’s analysis, stress and poor motivation will contribute to resignations. This is clearly reflected in the survey questionnaire results from group 4 with a mean value of 4.13 satisfaction level and 4.29 in loyalty level verses group 1 with a lower mean value of 3.36 in satisfaction level and 3.36 in loyalty level. Therefore, the tangency of employee attrition in group 1 is higher than group 4.
Graph 4: Employee motivation on organizational change
Graph 4 shows a frequency of employee motivation from 4 different groups.
Results show group 3 and 4 have a higher ratio on motivation level compared to group 1 and 2, which is an overall of 83 respondents, accounting for 51.55% from group 3 and 4, 67 respondents, accounting 41.62% from group 1 and 2. 5 respondents from group 1 with a percentage of 3.11% shows that they are demoralized and only 1 respondent from group 2 with percentage 0.62% shows that he is strongly demoralized.
4.4 Correlation between Communication Satisfaction and Change Perception Hypothesis 1 is applied to analyze the correlation between change communication and employee’s perception to reflect the result of objective 3. H1 dependent variable (Y) is employee perception and independent (X) is change communication. The Pearson Correlation set to test the relationship between the computed mean of perception (Y) and computed mean of communication (X) at 95% confident interval level. The Pearson Correlation coefficient below reflected strong positive linear correlation between change communication satisfaction and employee perception on organizational change (r=0927) with a correlation coefficient statistic (P
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