Impact of employee morale in an organization review of literature

-Navneet Kanted

INTRODUCTION
Employee Morale refers to an attitude of satisfaction with a desire to continue and
strive for attaining the objectives of a factory. Morale is purely emotional. It is an
attitude of an employee towards his job, his superior and his organization. It is not
static thing, but it changes depending on working conditions, superiors, fellow
workers pay and so on.
Morale may range from very high to very low. High Morale is evident from the
positive feelings of employees such as enthusiasm, desire to obey orders,
willingness to co-operate with coworkers. Poor or low Morale becomes obvious
from the negative feelings of employees such as dissatisfaction, discouragement or
dislike of the job.
Definitions:
Morale is a fundamental psychological concept. It is not easy to define. Morale is
the degree of enthusiasm and willingness with which the members of a group pull
together to achieve group goal. It has been defined differently by different authors.
Different definition of Morale can be classified into three major approaches.
1) Classical approach
2) Psychological approach
3) Social approach
1. Classical approach: According to this approach the satisfaction of basic needs is
the symbol of Morale.
According to Robert M. Guion "Morale is defined as the extent to which the
individual perceives that satisfaction stemming from total job satisfaction".
2. Psychological Approach: According to this approach Morale is psychological
concept i.e., state of mind.
According to Jurious Fillipo Morale is a mental condition or attitude of
individual and groups which determines their willingness to cooperate".

3. Social Approach: According to some experts Morale is a social phenomenon.

According to Davis "Morale can be defined as the attitudes of individual and
groups towards their work environment and towards voluntary cooperation to the
full extent of their ability in the best interest at the organization".

History
Long used by the military as a "mission-critical" measure of the psychological
readiness of troops, high morale has been shown to be a powerful driver of
performance in all organizations. Extensive research demonstrates its benefits
in productivity, profitability,customer satisfaction and worker health By measuring
morale with employee surveys many business owners and managers have long
been aware of a direct,causative connection between that morale, (which
includes job satisfaction, opinions of their management and many other aspects of
the workplace culture) and the performance of their organization.

Importance and effects

Recognized as one of the major factors affecting productivity and overall financial
stability of any business, low morale may lead to reduced concentration, which in
turn can cause mistakes, poor customer service and missed deadlines. It also can
contribute to a high turnover rate and absenteeism. Employee morale proves to be
detrimental to the business in these respects. Morale can drive an
organization forward or can lead to employee discontent, poor job performance,
and absenteeism (Ewton, 2007). With low morale comes a high price tag.
The Gallup Organization estimates that there are 22 million actively disengaged
employees costing the American economy as much as $350 billion per year in lost
productivity including absenteeism, illness, and other problems that result when
employees are unhappy at work. Failing to address this issue lead to decreased
productivity, increased rates of absenteeism and associated costs, increased
conflicts in the work environment, increased customer or consumer complaints,
and increased employee turnover rates and costs associated
with selection and training replacement staff.

Advantages and disadvantages

The relationship between employee morale and organizational performance is
straightforward. Here are a list of advantages and disadvantages:
When employees are satisfied with their jobs, they are motivated to work
harder and contribute the best of their abilities toward the achievement
of organizational goals.
They feel appreciated, important and significant members of the
organizational chain and as such, they are ready to maintain a positive
action with their colleagues, clients and anyone they come in contact with.
By putting their best face forward, not only they are more attractive, but
they are also able to complete their tasks more efficiently.
Compared to employees who are motivated, disengaged workers are less
efficient, miss more workdays and cost their employers thousands of
dollars in lost productivity.
Keeping employee morale high is one of the best things you can do to instill
loyalty and maintain a productiveworkplace.
On a simple note, morale can be equated with happiness. However, there
have been on-going studies that suggest "happy employees are not more
productive than unhappy employees." These counterarguments indicate
that "productive employees are much happier than unhappy employees."

Methods of raising
Employees tend to lack motivation to perform their jobs when morale is low. A
lack of motivation can also be circular in nature. Management and employees can
help increase morale in the workplace by, in no particular order:
1. Recognize employees
2. Be a respectful manager
3. Have one-on-one meetings with employees
4. Invest in your employees
5. Get to know your employees,
While there are many more methods than what is listed above, each method is
dependent on the workplace.

Importance of Employee Morale:

Employee Morale plays vital role in the origination success. High Morale leads to
success and low Morale brings to defeat in its wake. The plays of Morale is no less
important for an industrial undertaking. The success of failure of the industry much
depends up on the Morale of its employees.

Types of Morale:
I. High Morale:
It will lead to enthusiasm among the workers for better performance. High Morale
is needed a manifestation of the employees strength, dependability pride,
confidence and devotion. Some of the advantages of high Morale such as:
1. Willing cooperation towards objectives of the organization.
2. Loyalty to the organization and its leadership.
3. Good Leadership.
4. Sound superior subordinate relations.
5. High degree of employees interest in their job and organization.
6. Pride in the organization
7. Reduction in absenteeism and labour turnover.
8. Reduction in grievance.
9. Reduction in industrial conflict.
10. Team building.
11. Employee empowerment.
II. Low Morale:
Low Morale indicates the presence of mental unrest. The mental unrest not only
hampers production but also leads to ill health of the employees. Low Morale
exists when doubt in suspicion are common and when individuals are depressed
and discouraged i.e., there is a lot of mental tension. Such situation will have the
following adverse consequences.
1. High rates of absenteeism and labour turnover.
2. Decreased quality.
3. Decreased Productivity.
4. Excessive Complaints and Grievances.
5. Frustration among the workers.

6. Lack of discipline.
7. Increase errors, accidents or injuries.

FACTORS AFFECTING MORALE:

Employee Morale is a very complex phenomenon and is influenced by many
factors on the shop floor. Several criteria seem important in the determinants of
levels of workers Morale such as:
1. Objectives of the organization: Employees are highly motivated and their
Morale is highly if their individual goal and objectives are in tune with
organizational goal and objectives.
2. Organizational design: Organization structure has an impact on the quality of
labour relation, particularly on the level of Morale. Large organization tend to
lengthen their channels of vertical communication and to increase the difficulty of
upward communication. Therefore the Morale tends to be lower. Against this flat
structure increases levels of Morale.
3. Personal Factors: It is relating to age, training, education and intelligence of the
employees, time spent by them on the job and interest in worth taken by them,
affect the Morale of the employees. For examples if an employees is not imparted
proper training he will have low Morale.
4. Rewards: Employees expect adequate compensation for their services rendered
to the organization. Good system of wages, salaries, promotions and other
incentives keep the Morale of the employees high.
5. Good Leadership and Supervision: The nature of supervision can tell the
attitudes of employees because a supervisor is in direct contact with the employers
and can have better influences on the activities of the employees.
6. Work Environment: The building and it appearance the condition of machines,
tools, available at work place provision for safety, medical aid and repairs to
machinery etc. all have an impact on their Morale.

7. Compatibility with fellow employees: Man being a social animal finds his words
more satisfying if he feels that he has the acceptance and companionship of his
fellow workers. If he has confidence in his fellow worker and faith in their loyalty
his Morale will be high.
8. Job Satisfaction: If the job gives an employee an opportunity to prove his talents
and grow personality, he will certify like it and he will have high morale.
9. Opportunity to share profit: one of the requirements of high morale is possibility
and opportunity of progress in any concern. All worker should be given an
opportunity of the progress and earn high wages without any discrimination.

MEASUREMENT OF MORALE
Morale is basically a psychological concept. As such the measurement of morale is
a very difficult task to measure it directly. However the following methods are
more commonly used to study employee morale.
1.Observation Method:
Under this method evaluator observes the employees on work and records their
behavior, altitude, sentiments and feelings, which have developed in them. The
changes in the attitude and behavior of the employee are the indicators of high and
low morale.
2.Attitude Surveys:
In order to overcome the limitation of the above method attitude survey method is
being largely employed in modern days. This method includes conducting surveys
through questionnaires and interviews. This relates what the workers are looking in
and what step should be taken to improve their approach towards work.
3.Company Records and Reports:
The records and reports relating to Labour turnover, rate of absenteeism, the
number of goods rejected, strikes and such other things, which are indicators of the
level of morale.

4.Counseling:

Under this method employees are advised to develop better mental health. So that
they can imbibe self confidence, understanding and self control. This method is
used to find out the causes of dissatisfaction and then to advice the employees by
way of remedial measures.
The above methods of the measurement of the employees present only the
tendencies or the attitude of the employee morale. The statistical measurement of
morale is not possible because it relates to the inner feelings human beings. We can
say that morale is increasing or decreasing, but can not measured how much it
increased or in creased.

BUILDING OF HIGH MORALE

In order to achieve high morale among the employees the following suggestion
may be followed.
1. Two-Way Communication:There should be a two-way communication between the management and the
workers as if exercises a profound influences on morale. The workers should be
kept informed about the organization polices and programmes through
conferences, bulletins and informal discussions with the workers.
2. Show Concern:Large or small every business should have names on desks work stations or
cubicles to show that a real person with worth works there not just a machine. Next
ask their opinion whenever an opportunity arises rather than always telling them
what to do or the way to do it. This allows employees to add their own creative
thoughts to the work process, which then can lead to more of a feeling of
ownership. Finally ask how they are with out wanting to know deeply personal
data the boss can easily show on interest in the individual walkers.
3. Job Enrichment:This involves a greater use of the factors which are intended to motive the worker
rather than to ensure his continuing satisfaction with the job he performs the idea is
to reduce employee discontent by changing or improving a job to ensure that he is
better motivated.

4. Modifying the work environment:This involves the use of teams of work groups developing social contacts of the
employees the use of music regular rest breaks.

5. Rotation of Jobs:
This is also one of important techniques to increase employee morale. Job rotation
helps to reduce an employee's boredom.
6. Incentive System:
There should be a proper incentive system in the organization to ensure monetary
and non-monetary rewards of the employees to motivate them.
7. Welfare Measures:
Management must provide for employees welfare measures like canteens credit
facilities sport clubs, education for their children e.t.c
8. Social Activities:
Management should encourage social group activities by the workers. This will
help to develop greater group cohesiveness which can be used by the management
for building high morale.
9. Training:
There should be proper training of the employees so that they may do their work
efficiently and avoid frustration when the worker are given training they get
psychological satisfaction as they feel that management is taking interest in them.
10. Workers Participation:
There should be industrial democracy in the organization management should
allow workers participation in management. Whenever a change to be introduced
which effects the workers they must be consulted and taken into confidence
workers must be allowed to put forward their suggestion and grievance to the top
management.

11. Offers recognition of the employee efforts:

It takes but a few seconds to say "Nice Job" "Well done", "Marked improvement",
"You 're' on the right road" or any number of other phrases that communicate to the
employee that you care about the job and about them and that you recognize an
improvement in productivity. Also, employees can be given performance awards or
have their name mentioned at staff meetings, posted on a notice boards or in
employee inter office E-mail to say that some one did a note monthly Job. All of
these simple modes of painting out individual team or group behaviour serve as
very strong methods of improving productivity self worth and morale

Impact of employee morale in an organization

Changes in Management
Employees can become accustomed to the practices and methods of a particular
manager, and when there is a change in management that can have an effect on
morale. It can also depend on the circumstances that caused the change. If a
manager was perceived to be effective and appreciated by employees, then letting
that manager go without explanation can have a negative effect on morale. Try to
offer an explanation to employees on why a manager is no longer with the
company, and then encourage the staff to move on with the manager's replacement.
If there is no explanation, then rumors can make it difficult for the incoming
replacement to implement his ideas and plans because speculation as to the fate of
the outgoing manager has altered employee focus.
Employee Opportunity
Employee morale is impacted by the opportunities and recognition that the
company offers, according to Human Nature At Work. If an employee can be
recognized for their efforts through a promotion or raise, then the rest of the
employee population sees that the company does reward hard work. Morale can be
negatively impacted if employees feel that the company offers no career path with
advancement, and if the company does not offer some kind of reward for employee
loyalty and dedication.
Confidence in Management
If employees feel that company management is competent, then the morale of the
company remains high as employee expectations of company success remain
intact. When management proves to be incompetent, then the entire organization

can suffer from a drop in morale that can be counter-productive. Psychology expert
A. J. Schuler recommends offering employees ways to voice their anonymous
opinions on management's performance, such as an employee suggestion box, and
then utilizing the feedback to make changes that can retain employee confidence in
management.
Communication
A company has many levels of communication--from management to employees,
between departments, between management groups and between individual
employees. To maintain morale, communication lines need to remain open and
important information needs to be delivered in a timely fashion. For example, if a
small number of layoffs are being planned, then it is important to communicate the
magnitude of the layoffs to employees so that rumors do not get spread that could
shatter morale. Laying off employees usually has a negative impact on morale, but
allowing employees that are not scheduled to be laid off to believe that they could
damage morale even further

How to increase the morale

1. Keep employees feeling their work is more than just a job.

Everyone wants to feel that his or her work has a higher purpose. Sometimes,
though, that purpose gets lost in the day-to-day grind. One of the key ways that
Snagajob.com, an online job-search company, based in Glen Allen, Virginia,
inspires its 126 employees is by sharing "I Got a Job!" stories that show them the
value of their work. Circulated by email, the real-life stories come from grateful
job seekers who recently landed a new job through the company's website.

2. Take time to creatively celebrate accomplishments.

It's natural to focus on what's ahead rather than reflect on how much has been
achieved. Taking time to reflect, though, helps employees appreciate how much
they have done. All departments at Acuity, a financial-services company based in
Sheboygan, Wis., are asked each year to recognize their own work by providing a
list of significant accomplishments of their team. The lists are reviewed by Acuity
officers, who select the 100 most outstanding achievements for inclusion in a "Top
100 Accomplishments" list. The latest list was designed as a book, Acuity World
Records, with the help of Guinness World Records, and given to all 831
employees.

3. Grant time off to employees to pursue projects they are passionate about.
Personal projects can provide an energizing break from regular responsibilities and
can serve as a source of innovation for a company. Atlassian, a developer of
collaboration software based in Sydney, encourages creativity during its "FedEx
Day." During this event, all 62 employees can work on anything that excites them
-- as long as it is somewhat related to Atlassian products or processes, can be
completed in the allotted time, and is fun. Employees have from 2 p.m. on a
Thursday until 4 p.m. Friday, giving them roughly 24 hours to deliver a project
(thus the name, FedEx Day). Then at a presentation, participants show off the
results of their projects. From these ideas, Atlassian has adopted more than a dozen
projects, ranging from product upgrades to process improvements.

4. Mix up the company's usual way of doing things.

Departing from the customary routine of meetings and cubicle life can go a long

way toward building morale. The accounting firm Ehrhardt Keefe Steiner &
Hottman, based in Denver, uses the concept of neighborhoods to shake things up.
All 387 employees are organized into neighborhoods, based on the floors or
sections of floors in each office. These groups have regular get-togethers and shape
the contours of meetings. For example, during an all-employee meeting day, as the
firm staged a neighborhood basketball tournament, each group came up with team
names, homemade jerseys, mascots, and cheerleaders.

5. Don't forget to have fun.

For the online discounter FatWallet, based in Rockton, Ill., fun is a regular part of
the schedule. Its 55 employees are invited to play in a monthly Game Day, an inhouse competition with activities ranging from Trivial Pursuit to Wii bowling
matches. The company also offers quarterly "fun" rewards when staffers achieve
certain goals, such as hockey games, casino nights, or playdays at at amusement
parks. Team-building events have included a city scavenger hunt in Chicago and a
rooftop Cubs game.

6. Train employees to develop positive attitudes.

During the height of the recession in 2009, employee morale became a big issue
for 4Imprint, a maker of customized promotional products, based in Oshkosh, Wis.
The company's training team decided to try to boost morale by setting up classes
for the 419 employees to watch and discuss videos with inspiring themes like
Lance Armstrong's comeback from cancer and the friendly culture at Southwest
Airlines.

7. Offer time away from the office to do some good.

Another way to build employee morale and camaraderie is through community
service. Studer Group, a Gulf Breeze, Fla.-based management consulting firm,
gives its 114 employees four paid hours a month to volunteer for a charitable
initiative or organization of their choice. Departments also take on volunteer
projects as a group.

The three-stage approach to lift employee morale

STAGE ONE - Listen: Get feedback and ideas.

STAGE TWO - Communicate: with solutions to business issues and
employee concerns.

STAGE THREE - Recognize: business and employee accomplishments

and successes.
STAGE ONE - Listen to employees
Relationships between the organization and employees are fractured following a
period of upheaval. And this situation wont improve on its own. Companies must
take a proactive approach, beginning with listening to employees and getting their
concerns out into the open. Leaders must acknowledge employee issues and be
motivated to make improvements.
Of vital importance is publicizing that employee feedback is encouraged and
necessary and that the organization values their ideas. Decide the messages behind
the listening activities deployed, and use them consistently, for example:

We know staff morale is low and want your help.

We need to save money and are looking for ideas on how to best achieve
that.

We want to add to our top line and need your feedback on opportunities to
look at.

Who does what in Stage One?

Leaders should be visible, approachable and well-briefed, so that they can field
employee questions. Interaction should be face-to-face whenever possible. Key
messages should also be developed and be used as part of regular, ongoing internal
communication activities.
Managers need to believe in and support all listening activities. They should be
briefed on the rationale and approach for these activities before they meet with
employees, and asked for their ideas on how listening activities should be
implemented.
Leaders should be visible, approachable and well briefed, so they can field
questions

Listening activities

Employee survey. This can encompass routinely scheduled company

surveys or those designed expressly to communicate change.

Employee discussion/focus groups. Include as many employees as

possible. Managers with the right people skills (listening, questioning, for
example) can be trained to run these groups.

Management discussion groups. Led by a facilitator, these sessions are

designed specifically as management briefings. Managers are guided through a
process that will enable them to run employee discussion groups and to get
feedback on specific topics. (This approach works best with cost saving or similar
topics, rather than morale and trust issues.)
STAGE TWO - Communicate your solutions to business issues and employee
concerns
The next stage is communication. The listening activities should have created lots
of ideas and feedback. In this stage, it's important to build a shared understanding
of your companys future, including substantive solutions to business issues and
progress being made.

Who does what in Stage Two?

Company leaders focus on addressing concerns expressed by employees in the
listening stage and briefing managers on issues. The purpose is to create a shared
understanding of the challenges and solutions facing the organization.
Build a shared understanding of your companys future, including solutions to
business issues and progress being made
Managers undertake specific efforts to communicate these outputs. They must
create opportunities for dialogue and discussion, which leads to higher levels
of employee engagement. Managers should also assure employees that they can
expect honest and timely information. They should show their willingness to
discuss anything on employees minds and help employees feel comfortable asking
questions and sharing solutions.
Employee advisory work groups should be set up to address a number of
challenges most critical to the organization. Because this program thrives on
momentum, these groups should have clear objectives and a limited shelf life.
Potential activities must be honed down to focus only on their most important
issues. A kick-off meeting can define the teams scope, role and timescales. Work
groups should also encourage leaders to communicate progress through all
communication channels.
Communication activities

Public forums. Communication should take place in person through Town

Hall and team meetings, site visits and brown bag lunches. Gossip is curtailed if
managers become more transparent with performance data, such as sales figures
and customer information. A highly visible and approachable leadership team
shows that senior management cares about its workers. This alone serves to foster a
more positive employee work environment.

One-on-One dialogues. Discussions between managers and direct reports

enhance personal communication and increase trust.

Electronic media. Emails, web casts and other means of rapidly reaching
out across boundaries should be employed to reinforce messages and speed the
flow of information.
STAGE THREE: Recognize business and employee accomplishments and
successes
Focusing on quick wins and success stories and recognizing employee
accomplishments will help keep morale as high as possible. No one is immune
from becoming despondent and unproductive when they work in a doom and
gloom environment. Negativity is often exacerbated outside the workplace by
personal issues and a constant onslaught of negative news stories.
Who does what in Stage 3?
Leaders and managers seek out successes and recognize and thank employees for
their contributions to the company and/or team initiatives. Every effort should be
made to point out quick wins, for example, a project deadline met, a new order
placed, or success in a key objective.
Focusing on quick wins and success stories and recognizing
employee accomplishments will help keep morale as high as possible
Recognition activities

Formal initiatives. include established companywide recognition programs

as well as rewards such as small bonuses and plaques.

Informal gestures. include such things as a warm "thank you" for a job well
done, or a congratulatory email or hand-written note.

Public recognition. includes acknowledging an employee or work groups

contributions in a meeting with their peers, or in company publications. Being
recognized publicly often has the added bonus of encouraging and motivating
peers to strive for similar successes.
Maintaining employee morale
This three-stage approach can lift employees out of the bottom of the change
curve, however ongoing adjustments are needed. Managers should be trained to
enable a more empowered workplace, particularly when they no longer have easy
access to traditional motivational tools such as promotions, bonuses and pay raises.

Following are a series of useful, cost-effective tools to deploy in todays economic

environment; managers should review the following activities:
Autonomy. The freedom, independence and discretion employees have in
carrying out their jobs.
Skill and task variety. Employees activities to ensure that they are making
best use of their different skills and abilities. Also to check that the extent to which
their job involves whole and meaningful work so they have ownership over a
whole process rather than small parts.
Decision making. How the managers are making decisions. If they are very
directive, ask them to look for opportunities where employees are can be
consulted. Promote more self management, where employees have autonomy to
make their own decisions.
Career development. Team members have up-to-date career development
plans which recognize the limited resources available but draw on cost effective
activities such as job rotation, mentoring and coaching.
Objectives. Individual objectives to check that employees are clear on their
priorities and contribution to the organization.

Motivation and Morale are closely related concepts, they are

different in following ways:
While motivation is an internal-psychological drive of an individual which
urges him to behave in a specific manner, morale is more of a group scenario.
Higher motivation often leads to higher morale of employees, but high morale
does not essentially result in greatly motivated employees as to have a
positive attitude towards all factors of work situation may not essentially
force the employees to work more efficiently.
While motivation is an individual concept, morale is a group concept. Thus,
motivation takes into consideration the individual differences among the
employees, and morale of the employees can be increased by taking those
factors into consideration which influence group scenario or total work
settings.
Motivation acquires primary concern in every organization, while morale is a
secondary phenomenon because high motivation essentially leads to higher
productivity while high morale may not necessarily lead to higher
productivity.

Things tied to morale are usually things that are just part of the work
environment, and things tied to motivation are tied to the performance of the
individual.

Reference
1. Personnel Management : C.B. Memoria
2. Personnel and Human Resource Management : P. Subba Rao
3. Principle and practice of Management : Dr. J.N. Chabra

http://en.wikipedia.org/wiki/Employee_morale
https://www.melcrum.com/research/change-crisis-communication/three-stage-strategyimproving-employee-morale