Download - MEDIATING EFFECT OF JOB SATISFACTION ON … · mediating effect of job satisfaction on employee commitment and retention in response to human resource management practices in calicut

MEDIATING EFFECT OF JOB SATISFACTION ON EMPLOYEE

COMMITMENT AND RETENTION IN RESPONSE TO HUMAN

RESOURCE MANAGEMENT PRACTICES IN CALICUT AIRPORT

Dr. M.DHANABHAKYAM1

NISAMUDHEEN.T 2

1 Associate Professor, School of Commerce, Bharathiar University, Coimbatore

2 Senior Research Fellow, School of Commerce, Bharathiar University, Coimbatore.

ABSTRACT

Human Resource Management involves all management decisions and practices that directly

affects or influence the people who works for the organization. HRM practices are investigated from

the perspective of job satisfaction, employee commitment and employee retention. The main objective

of the study is to measure the mediating effect of job satisfaction on employee commitment and

retention in response to HRM practices. The data used in this paper is primary in nature and collected

through personal interviews in the form of questionnaire from a sample of 232 employees in Calicut

Airport. Structural Equation Modeling (SEM) is used for the study as a tool. The study concluded that

the job satisfaction has a strong mediating role between HRM practices and employee commitment

and retention.

Keywords: Employee commitment, Employee retention, Human Resource Management practices and

Job satisfaction

INTRODUCTION

Human resource is the most strategic resource and no other resource can be fully utilized to

generate income and wealth of a nation without the active involvement of this resource. Human

resource accounts for a large part of national output and there is a wide scope for increasing national

wealth through their proper development. It is pertinent to mention that human resources are

responsible for making use of physical resources and for the transformation of traditional economies

into modern and industrial economies. HRM is management function that helps managers to recruit,

select, train and develop members for an organization.

―HRM is concerned with the people dimensions in management. Since every organization is

made up of people, acquiring their services, developing their skills, motivating them to higher levels

of performance and ensuring that they continue to maintain their commitment to the organization are

essential for achieving the organizational objectives. Human Resource Management involves all

management decisions and practices that directly affects or influence the people who works for the

organization. HRM practices are investigated from the perspective of job satisfaction, employee

commitment and employee retention.

Employee commitment is one of the factors of HRM policy that binds an individual to a

course of action that is relevant to a particular target. A number of human resource experts (Babakus

et al., 19961; Guest, 1997

2) focuses on organizational commitment and found three assumptions. First

assumption is that the more committed employees are to the organization, they would be more willing

to work above and beyond contract. Second, these approaches presume that committed employees feel

greater responsibilities, and reduces managers need to monitor and supervise. Third committed

INTERCONTINENTAL JOURNAL OF HUMAN RESOURCE RESEARCH REVIEWISSN: 2320-9704 - ONLINE ISSN:2347-1662 - PRINT IMPACT FACTOR:1.615VOLUME 4, ISSUE 1, JANUARY 2016

www.icmrr.org 1 [email protected]

employees are expected to be less likely to be leaving the organization, resulting in the reduction of

recruitment and selection expenditure.

Air line industry is one of the biggest service organizations with huge manpower which

strictly follows HRM practices to recruit and select the employees. But the same industry faces

ineffective and unfair practices in human resource practices such as selection, training, career

development opportunities, shifting, compensating, rewarding and performance appraisal which

ultimately reduces the level of job satisfaction and employee commitment and that may lead to less

employee retention. Thus the present study focuses on the mediating role of job satisfaction on

employee commitment and retention in response to HRM practices followed in the Airline industry.

REVIEW OF LITERATURE

Human resources are considered as one group of key success factors in organizations

(Dessler, 20103; Barney et al., 2001

4). Lado and Wilson (1994

5) describe human resource practices as

―a set of distinct but interrelated activities, functions, and processes that are directed at attracting,

developing, and maintaining a firm‘s human resources‖. In general terms, HRM comprise practices

and activities of acquiring, retaining, empowering, and motivating employees. In this study, HRM

practices are investigated from the perspective of job satisfaction, employee commitment and

retention. Recruitment and selection enables business firms to acquire the appropriate human

resources in line with its aims and objectives (Dessler, 20106; Huselid ,1995

7). Training programs

help employees to obtain the necessary knowledge, skills, and abilities to work effectively in

sustaining and improving current work activities. Well trained employees, in general, not only require

less supervision (Gutteridge et al.,19938) but also tend to have higher morale and lower levels of

attrition. Training is believed to nullify the influence of factors which cause dissatisfaction of

employees at work (Xiao, 19969). Thus, employees may be provided with extensive training programs

in multiple functions and training on job skills (Ahmad and Schroeder, 200310

). In addition to training,

employees need to be rewarded and provided with appropriate incentives so as to produce the required

levels of performance (Mohinder et al., 201011

; Guest, 199712

; Lee 200013

). Incentives also influence

the level of employee satisfaction (Lawler, 2000)14

. When incentives are used properly, they may

prove to make important contributions to the survival and growth of an organization (Dessler, 2010;

Mowday, 198215

).

Human resource management in an organization is very important. These activities include

recruitment, selection, training, career development, compensation, and performance appraisal. They

are the basic functions of an organization (Tsaur and Lin, 200216

; Reid et al., 200217

). Human resource

management practices are able to provide an organization with a competitive advantage in local,

international, and global environment. They can assist job satisfaction and may increase the

organizational success and lead to employee commitment and retention (Burke, 200318

; Pare et al.,

200119

; Bond, 200420

). If human resource management practices are not effective, efficient, and fair,

an employee will lack commitment and loyalty toward the organization. Lack of trust in business

causes the demoralization of employees (Astrachan et al., 200221

).

A number of human resource management scholars studied the relationship between the job

satisfaction and organizational commitment such as Fiedler (199322

) who proved a strong positive

relationship between employee satisfaction and organizational commitment. LePine et al., (200223

)

and Podsakoff et al. (199624

) in two different Meta analysis studies demonstrated a significant positive

correlation between employee organizational commitment and job satisfaction. Many number of

literature reviews revealed the relationship between job satisfaction and employee retention by the



effect of employee commitment. Employee retention is considered as one of the important human

resource strategies of the organization. It commences with the recruiting of right people and continues

with practicing programmes to keep them engaged and committed to the organization (Madamba,

199725

). Mattila et al., (200426

) identified the impact of HRM practices on employee retention and

explained the positive relationship between employee commitment and retention from the influence of

HRM practices.

OBJECTIVES OF THE STUDY

To measure the mediating effect of job satisfaction on employee commitment and retention in

response to HRM practices.

CONCEPTUAL MODEL OF THE STUDY

H2

H1 H4

H3

HYPOTHESES OF THE STUDY

H01: HRM practices have no positive effect on job satisfaction.

H02: Job satisfaction has no positive effect on Employee commitment.

H03: Job satisfaction has no positive effect on Employee Retention.

H04: Employee commitment has no positive effect on Employee Retention.

RESEARCH METHODOLOGY

The present study examines the mediating role of job satisfaction on employee commitment

and retention in response to HRM practices among the employees of Calicut Airport. This study is

descriptive and empirical in nature. A well-structured questionnaire consisting of Thirteen items scale

of Human resource management practices index developed by Price & Mueller (198627

), Nine items

scale of job satisfaction developed by Maslach and Jackson (198628

), Eight item scale of employee

commitment developed by Allen & Meyer (199029

) and Five item scale of employee retention

developed by Mobley, et al., (197930

) was adopted to collect the data from the sample respondents.

Total 250 questionnaires were distributed randomly among the employees of Calicut Airport, out of

which 232 questionnaires have been returned completed in all respect and valid for the study yielded a

response rate of 92.8%. Reliability analysis has been applied to measure the reliability of data using

HRM

Practices

Employee

Retention

Employee

Commitment

Job

Satisfaction



SPSS 20 while factor loading has been tested through Confirmatory Factor Analysis (CFA) using

AMOS 20 and Structural Equation Model (SEM) using AMOS 20 has been applied to test the

hypotheses among the study variables such as HRM practices, job satisfaction, employee commitment

and employee retention.

RESULTS AND DISCUSSION

Confirmatory Factor analysis and Reliability Testing

Figure 1: CFA Measurement Model

Table 1: Results of Goodness of fit test

GFI AGFI NFI CFI RMSEA RMR Chi-Square CMIN/df P

.984 .975 .989 .992 .045 .042 42.598 2.341 .000

CFA model yielded a good model fit of GFI was .984, AGFI = .975, NFI = .989, CFI =

.992, RMSEA = .045, RMR= .042, chi-square = 42.598, CMIN/df = 2.341 and Probability level (p

value) = .000 (Anderson and Gerbing, 198831

; Hair et al., 199532

, Tabachnick and Fidell, 200133

;

Kline, 200534

). Keeping in view the CFA models conducted in the studies of Paré & Tremblay

(200735

) and Nasurdin, Ahmad, & Lin, (200936

), decided that the factor loading of an item statement

must be ≥ .40 to be retained in its respective scale whereas, insignificant and negatively

significant/insignificant statements (< .40) were removed from their respective scale. Thus, it is noted

that all items of HRM practices, Job satisfaction, and employee commitment and retention have been



retained in the respective scale. All scales used in the study found to be reliable as the internal

consistency of scales was tested using Reliability Analysis which shows the Cronbach‘s alphas of

HRM practices, Job satisfaction, and employee commitment and retention are 0.75, 0.89, 0.71, 0.85

respectively. The research has proved that the value of this alpha is greater than 0.5 and is acceptable

in social sciences (Nunally & Bernstein, 197837

).

Results of Structural Equation Modeling and Hypotheses testing

Figure 2: Structural Equation Model

Table 2: Results of Goodness of Fit for Structural Equation Model

Indices CMIN/df P GFI AGFI NFI TLI CFI RMSEA RMR

Model Value 1.135 .248 .996 .989 .995 .997 .961 .026 .005

Recommended

value <3.0 >0.05 >0.90 >0.90 >0.90 >0.90 >0.95 <0.05 <0.05

SEM model yielded a good fit of CMIN/df are 1.135, P value is 0.248, GFI is 0.996, AGFI is

0.989, NFI is .995, TLI is 0.987, CFI is .961, RMESA is 0.026 and RMR is 0.005 (Anderson and

Gerbing, 198838

; Hair et al., 199539

, Tabachnick and Fidell, 200140

; Kline, 200541

). These values

indicate that the results in respect of validity of the proposed model fall well within the generally

accepted limits. This confirms that the collected data set fits into the proposed structural model. HRM

practices found to have significant positive effects on job satisfaction (ß = .62, p-value <.01). Thus

hypothesis 1 is rejected and revealed that HRM practices have positive effect on job satisfaction that

is when HRM practices in an organization increases; it leads to high job satisfaction among the

employees (Lambert, et al., 201042

; Moliner, et al., 200543

). Job satisfaction found to have significant

positive effects on employee commitment (ß = .21, p-value <.01) and employee retention (ß = .21, p-

value <.01). Thus hypothesis 2 and 3 is rejected and revealed that Job satisfaction has positive effect

on employee commitment and employee retention that is when there is a high job satisfaction among

the employees by the influence of increased HRM practices will lead to high level of employee



commitment and employee retention (Shamila et al., 201344

; Mohammedbagher Gorji, 201145

).

Employee commitment found to have significant positive effects on employee retention (ß = .72, p-

value <.01). Thus hypothesis 4 is rejected and revealed that the high employee commitment by the

influence of high job satisfaction will lead to high level of employee retention (R. Cropanzano, et al.,

200346

; Singh, et al., 199447

). R2 value 0.62 states that the HRM practices have 62% influence on job

satisfaction. R2 value 0.58 states that the job satisfaction has 58% influence on employee commitment

with the effect of HRM practices and another R2 value 0.39 states that the job satisfaction has 39%

influence on employee retention with the effect of HRM practices. Hence it is identified that the job

satisfaction has a strong mediating role between HRM practices and employee commitment and

retention.

CONCLUSION AND RECOMMENDATIONS

The present study identified the perception of Airline employees towards HRM

practices and its effect on employee commitment and retention through the mediating role of job

satisfaction. The study identifies that HRM practices have positive effect on job satisfaction that is

when HRM practices in an organization increases; it leads to high job satisfaction among the

employees. The study also revealed that Job satisfaction has positive effect on employee commitment

and employee retention that is when there is a high job satisfaction among the employees by the

influence of increased HRM practices will lead to high level of employee commitment and employee

retention. It is to be noted that if human resource management practices are not effective, efficient,

and fair, an employee will lack commitment and loyalty towards the organization. Hence it is

identified that the job satisfaction has a strong mediating role between HRM practices and employee

commitment and retention.

The findings of the study strongly recommend that the Airline industry need to develop and

improve professional, fair and objective human resource management systems and practices. They

have to organize and provide to all employees equal opportunities for career development: educational

and training courses and programs. Promotions opportunities should be distributed fairly and offered

to competent personnel. Compensation packages should be designed and distributed fairly.

Performance appraisal must be implemented fairly and objectively. Thus job satisfaction through fair

HRM Practices is the key factor for organizational success, since higher levels of perceived job

satisfaction lead employees to be more loyal and committed to the organization.

REFERENCES

1. Babakus, E., Cravens, D.W., Johnston, M., Moncrief, W.C. (1996). Examining the role of

organizational variables in the salesperson job satisfaction model. Journal of Personal Selling

and Sales Management, 16 (3), 33-46.

2. Guest, D.E. (1997). Human Resource Management and Performance: A Review and Research

Agenda. International Journal of Human Resource Management, 8, 263–276.

3. Dessler, Gary (2010). Human Resource Management: The Strategic Role of Human Resource

Management, Prentice Hall, Inc.: NJ, NJ.

4. Barney, J., Wright, M., and Ketchen, Jr., D.J. (2001). The Resource-based View of the Firm:

Ten Years after 1991. Journal of Management, 21, 625–641.

5. Lado, A.A., and Wilson, M. (1994). ―Human Resource Systems and Sustained Competitive

Advantage: A Competence Based Perspective‖ Academy of Management Review, 19, 699–

727.



6. Dessler, Gary (2010). Human Resource Management: The Strategic Role of Human Resource

Management, Prentice Hall, Inc.: NJ, NJ.

7. Huselid, M. (1995). Human Resource Management Practices on Turnover, Productivity, and

Corporate Financial Performance. Academy of Management Journal, 38 (3), 635–672.

8. Gutteridge, T.G., Leibowitz, Z.B., and Shore, J.E. (1993). Organizational Career

Development, San Francisco, CA: Jossey-Bass.

9. Xiao, J. (1996). The Relationship between Organizational Factors and the Transfer of

Training in the Electronics Industry in Shenzhen, China. Human Resource Development

Quarterly, 7 (1), 55–73.

10. Ahmad, S., and Schroeder, R.G. (2003). The Impact of Human Management Practices on

Operational Performance: Recognizing Country and Industry Differences. Journal of

Operations Management, 21, 19–43.

11. Mohinder ,Chand (2010). ―The impact of HRM practices on service quality, customer

satisfaction and performance in the indian hotel industry‖ The International Journal of Human

Resource Management, 21(4) March ,551-556.

12. Guest, D.E. (1997). Human Resource Management and Performance: A Review and Research

Agenda. International Journal of Human Resource Management, 8, 263–276.

13. Lee, S. H. and Heard, A. (2000). A managerial perspective of the objectives of HRM

practices in Singapore: an exploratory study. Singapore Management Review, 22, 65–82.

14. Lawler, E.E. (2005). Creating high performance organizations. Asia Pacific Journal of Human

Resources, 43(1), 10-17

15. Mowday, R.T., Porter, L.W., Steers, R.M. (1982). Employee-Organization linkages: the

psychology of commitment, absenteeism, and turnover. Academic press: NY, NY.

16. Tsaur, H., Lin, C.Y. (2002). Promoting service quality in tourist hotels: the role of HRM

practices and service behavior. Tourism Management, 25 (1), 471-81.

17. Reid, R., Morrow, T., Kelly, B., Cartan, M.P. (2002). People management in SMES: an

analysis of human resource strategies in family and non-family businesses. Journal of Small

Business and Enterprise Development, 9 (3), 245-59.

18. Burke, R.J. (2003). Nursing staff attitudes following restructuring: the role of perceived

organizational support, restructuring processes and stressors, International Journal of

Sociology and Social Policy, 23 (8/9), 129-57.

19. Pare, P., Tremblay, M., Lalonde, P. (2001). The role of organizational commitment and

citizenship behaviors in understanding relations between human resources practices and

turnover intentions of its personnel, Ecole des Hautes Etudes Commerciales de Montreal, 7

(1),1-33.

20. Bond, S. (2004). Organizational culture and work-life conflict in the UK. International

Journal of Sociology and Social Policy, 24 (12), 1-24.

21. Astrachan, J.H., Klein, S.B., Smyrnios, K.X. (2002). The F-PEC scale of family influence: a

proposal for solving the family business definition problem. Family Business Review, 15 (1),

45-58.

22. Fiedler, A.M. (1993). The effect of vision congruence on employee empowerment,

commitment, satisfaction, and performance. Dissertation Abstracts International, 54 (03),

1006 A. (UMI no 9319048)

23. LePine, J.A., Erez, A., and Johnson, D.E. (2002). The nature of dimensionality of

organizational citizenship behavior: A critical review and meta analysis. Journal of Applied

Psychology, 87, 52-65.



24. Podsakoff, P.M. and Mackenzie, S.B. , and Bommer, W.H. (1996). A meta analysis of the

relationship between Kerr and Jemier‟s substitutes for leadership and employee job attitudes,

role perceptions, and performance. Journal of Applied Psychology, 81, 380-399.

25. Madamba, A.B., De Jong, G.F. (1997). Job mismatch among Asians in the United States:

ethnic group comparisons. Social Science Quarterly, 78 (2), 524-42.

26. Mattila, A.S., Patterson, P.G. (2004). Service recovery and fairness perceptions in collectivist

and individualist contexts. Journal of Service Research, 6 (4), 336-46.

27. Price, J., & Mueller, C. (1986). Handbook of organziational measurement Marchfield, MA:

Pitman.

28. Maslach, C and Jackson, S E (1986), ―The Maslach Burnout Inventory‖, Research Edition.

Palo Alto, CA: Consulting Psychologists Press.

29. Allen, N. J., & Meyer, J. P. (1990). The measurement and antecedents of affective,

continuance and normative commitment to the organization. Journal of occupational

psychology, 63(1), 1-18.

30. Mobley, W. H., Griffeth, R. W., Hand, H. H., & Meglino, B. M. (1979). Review and

conceptual analysis of the employee turnover process. Psychological Bulletin, 86(3), 493.

31. Anderson, J.C. and Gerbing D.W. (1988): Structural Equation Modeling in Practice: A

Review and Recommended Two - Step Approach. Psychological Bulletin, 103, 411-423.

32. Hair, J. F., Jr., Anderson, R. E., Tatham, R. L. and Black, W. C. (1995) Multivariate Data

Analysis, 3rd ed, Macmillan Publishing Company, New York.

33. Tabachnick, B.G., & Fidell, L.S. (2010). Using multivariate statistics (4th ed.). Boston: Allyn

& Bacon.

34. Kline, R. B. (2005). Principles and practice of structural equation modeling (2nd Ed.). New

York: Guilford Press.

35. Paré, G., & Tremblay, M. (2007). The influence of high-involvement human resources

practices, procedural justice, organizational commitment, and citizenship behaviors on

information technology professionals' turnover intentions. Group & Organization

Management, 32(3), 326.

36. Nasurdin, A. M., Ahmad, N. H., & Lin, C. E. (2009). Examining a Model of Entrepreneurial

Intention Among Malaysians Using SEM Procedure. European Journal of Scientific

Research, 33(2), 365-373.

37. Nunally, J., & Bernstein, I. (1978). Psychometric theory: New York: McGraw-Hill.

38. Anderson, J.C. and Gerbing D.W. (1988): Structural Equation Modeling in Practice: A

Review and Recommended Two - Step Approach. Psychological Bulletin, 103, 411-423.

39. Hair, J. F., Jr., Anderson, R. E., Tatham, R. L. and Black, W. C. (1995) Multivariate Data

Analysis, 3rd ed, Macmillan Publishing Company, New York.

40. Tabachnick, B.G., & Fidell, L.S. (2010). Using multivariate statistics (4th ed.). Boston: Allyn

& Bacon.

41. Kline, R. B. (2005). Principles and practice of structural equation modeling (2nd Ed.). New

York: Guilford Press.

42. Lambert, E. G., Hogan, N. L., Jiang, S., Elechi, O. O., Benjamin, B., Morris, A., Dupuy, P.

(2010). The relationship among distributive and procedural justice and correctional life

satisfaction, burnout, and turnover intent: An exploratory study. Journal of Criminal Justice,

38(1), 7-16.



43. Moliner, C., Martínez-Tur, V., Peiró, J. M., Ramos, J., & Cropanzano, R. (2005).

Relationships Between Organizational Justice and Burnout at the Work-Unit Level.

International Journal of Stress Management, 12(2), 99.

44. Shamila.N.Khan., Sohail Zafar. (2013). Exploring the cause and consequences of job burnout

in a developing country. Journal of Basic and Applied Scientific Research, 3(5), 212-227.

45. Mohammadbagher Gorji (2011), ―The Effect of Job Burnout Dimension on Employees

Performance‖, International Journal of Social Science and Humanity, Vol. 1, No. 4

46. Cropanzano, R., & Byrne, Z. (2000). Workplace justice and the dilemma of organizational

citizenship. Cooperation in modern society: Promoting the welfare of communities, states,

and organizations, 142-161.

47. Singh, J., Goolsby, J. R., & Rhoads, G. K. (1994). Behavioral and psychological

consequences of boundary spanning burnout for customer service representatives. Journal of

Marketing Research, 31(4), 558-569.



Download - MEDIATING EFFECT OF JOB SATISFACTION ON … · mediating effect of job satisfaction on employee commitment and retention in response to human resource management practices in calicut

Top Related