Daleel Petroleum is chosen to undertake the research of organizational practices and employee motivation. Daleel is chosen since it has plenty of information is available at the website of the company helped to draft the report with the help of academic knowledge and concepts on organizational behavior. The entire paper will show the academic knowledge on reward systems of Daleel Petroleum and discus implications on employees within the context of motivation to work, remain connected with the organization and optimal performance.
Organizational performance of an employee primarily depends up on the compensation plan. How fairly an employee is compensated for his time, knowledge, efforts and service directly drives the quality of performance provided by such employee (Agata StachowiczStanusch, 2017). It is a source of motivation. It gives an employee reason to work. When reward system is discussed there are two broader categories (Fiore, 2013). Intrinsic and extrinsic reward system (Boje, 2014). Extrinsic reward system is monetary in nature and controlled by the employer or paying entity. Intrinsic reward is psychological in nature and employee gives to themselves (Child, 2015). Extrinsic reward is very typical and always present in a job. However intrinsic reward is commonly present senior level positions posts of organization (David L. Elwood, 2013). At this level individuals have generally received plenty of monetary benefits offered by the employer so intrinsic reward helped them to find new scope for work (Fred C. Lunenburg, 2011).
Intrinsic reward serves as a motivation to work for senior level employees. There are many other sources of motivation in an organization described by different academic scholars. The paper will discuss theories of motivation within the context of Daleel Petroleum. The organization is a manufacturer of oil. It produces, extracts and exploit future reserves that helps Oman to grow socio – economically. With the official contract from ministry of oil and gas in Oman operations of Daleel Petroleum is undertaken.
Organizational employees and other stakeholders are key concern of the organization and adhere principles of safety and quality in the occupational performance. ISOs are precisely follow as a common practices for internal stakeholders. It provides a standard of quality and principles for improved performance. It is linked with the intrinsic reward and enhances employee motivation to perform well and above the par. It is also an evaluation criteria (French, 2011).
It has been observed in the organization where huge plants are installed and workings are undertaken by giant robots human motivation goes down (Ghanem, 2014). They do not find enough opportunities to express their selves since operations of an organization is heavy dependent upon machineries (Boje, 2014). Technical staff that actively participate in the working of machines have good esteem and satisfaction level. Managerial staff feel monotony with the nature of work they perform (French, 2011). This attitude is quite common in capital intensive sectors in Oman. Therefore such sector needs great motivation to work. The company have enough means to design extrinsic reward system through better pay plan, bonuses, incentives and other medical allowances (Imperatori, 2017). However providing sense of achievement and recognition in work that is the intrinsic part of reward system remain ignored. It is matter of business development to provide employees opportunity to work as a team and design effective and efficient production or oil extraction mode (Kessler, 2013)l. It will not only expand business but it will make the workforce creative, innovative and motivated to perform well (Child, 2015).
Organizational operations are heavily based on human resource performance. The better the performance the more chances that organization will achieve organizational objectives with great efficiency and effectiveness (Ghanem, 2014). It is usually a matter of cost for organization. For example if labor turnover will be high at an organization, it needs to incur recruitment and selection cost as well as training and development cost (Green, 2011). Further discussion will bring light on motivation and explanation given by academic scholars on the most important topic motivation and its application through different theories of motivation (Hassan, 2016).
Theory of Motivation
Theories of motivation have great importance in an organizational settings. It provides a clear link between organizational performances in relation to employee performance (Latham, 2012). Different scholars have identified numerous definition of motivation and multiple factors that drives motivation in an employee. The following theories of motivation is discussed with in the context of Daleel Petroleum.
Maslow’s Hierarchy of Needs Theory
Maslow hierarchy of needs is a foundation theory of motivation. It has implications for Human Resource as well as Marketing function of an organization. However the theory is not free from criticism. Apart from criticism the theory holds strength to apply in an organizational settings. Maslow has identified five levels of needs in an employee (Latham, 2012). The satisfaction of need helps employee to grow further to satisfy the need present at the next level of need pyramids. Such pyramid carry different roles and organizational goals with the promise to fulfil the need present at such pyramid organizations demand optimal performance. It is a win – win situation to employee and organization (McGuire, 2012). Five different needs identified by Maslow is discussed under the following different sub – headings.
Basic need is a need for food, clothing and shelter. These are also called survival need of an individual. Employees at very beginning are motivated to fulfil their basic level needs therefore employers bargain them over pay plan and they switch jobs due differences in monetary rewards from one organization to another (Rao, 2012). Daleel Petroleum offers handsome basic pay to its employees since oil and gas sector in Oman has very tough competition. Employees are motivated to change job within the same industry since other Oil and Gas Company will offer better basic level benefits.
It is a need that how much an employee feels safe at work place. It includes physical and emotional safety. Safety level increases trust f employee and affect work performance. Safety measures at Daleel Petroleum is enhanced by ISOs compliance. Working around chemicals carry great risk to life and different compensatory plans are offered to keep employee motivated to work with extreme work environment.
Social need is a need to interact with other individual at workplace. This need has great importance in keeping employees associated with organization (Boje, 2014). It help employees to develop informal organization and initiate sharing. At Daleel Petroleum employees have of sense of social community. All members of an organization serve as a community and it is a motivating factor (Richard, 2013).
Esteem need can be understood as the demands an individual that could made with himself is meeting with the challenges offered by an organization (Stoyanov, 2017). If a person finds himself more capable of performing a particular task with expertise but employee is not getting enough chance then he will feel demotivated since self – esteem need of such individual do not meet (McGuire, 2012). Daleel Petroleum is a capital intensive program and do not offer much self – esteem with respect to work performance since most of the work is executed by the huge plants and machineries (Richard, 2013).
Self –Actualization Need
It is need of performing better and better as if an individual is having a competition with his older self (Stoyanov, 2017). This need cannot be fulfilled. It remains with individual and urge for improved performance with every trail (Pichère, 2015).
Herzberg’s Two – Factor Theory
Herzberg has provided very interesting model of motivation. It described employee feels motivated with two types of factors hygiene factors and motivators (Richard, 2013). Hygiene factors at workplace are those the presence of which do not motivate an employee but it absence demotivate them (Rao, 2012). Motivator are those factors the presence of which motivate them to perform but the absence of such factors bring back the attention of employees towards hygiene factors (Richard, 2013).
Examples of hygiene factors may include company policy, supervision, relationship with the boss, working condition, remuneration or relationship with colleagues. On the other hand motivators’ factors include: achievement, recognition, the work itself, responsibility, advancement and growth (Latham, 2012).
Herzberg emphasized the fact that management of very organization need to pay close attention to hygiene factors it refrain employees from being dissatisfied (Agata StachowiczStanusch, 2017). It also provides management an opportunity to work of hygiene factors when they feel employees are getting demotivated (Price, 2011). Similarly In order to intact motivation level of employees’ organization needs to work on employee achievement practices, give them responsibility, and undertake such projects that may give employee advancement and growth (Maalderink, 2014).
Victor Vroom: Expectancy Theory of Motivation
Victor Vroom has identified intensity of occupational motivation of an employee and willingness to carry out efforts for organizational performance. Vroom argued that employee behavior is conscious efforts between numerous choices he made among alternative course of action (Imperatori, 2017). Individuals do have personal needs and motivation to perform a particular task (Ghanem, 2014). Therefore individual may be motivated through personal need at work as well. Vroom used syllogistic in order to build plot of expectancy theory of motivation (McGuire, 2012).
There is a positive and direct correlation among efforts put in and organizational performance. Positive attitude towards work will lead to optimal performance (Wilton, 2010). Since individual efforts are conscious choice so they are targeted towards reward giving goals (Rao, 2012). With the accomplishment of goals employee will be entitled for the reward and provided with a means of satisfying personal need (Miner, 2011).
Vroom also argues that rewards has two aspects that is extrinsic and intrinsic: extrinsic may include: pay, bonus, commission, medical allowances and so on (Fiore, 2013). However intrinsic reward may contain: promotion, sense of achievement or sense of recognition (McGuire, 2012). The author identified three factors that may drive the strength of individual motivation to attain rewards and give expected performance (Richard, 2013).
Valence it could be understood as intensity of wanting a reward or strength of individual need for reward. Expectancy it is defined as a belief of an individual that great efforts will result in appropriate performance. Instrumentality means attaining a reward is how much contingent upon expected performance (French, 2011). Whether an employee considered the organization will provide desired reward if organizational goals are achieved (Boje, 2014). In a conclusion it has been determined that strength of employee motivation to put efforts for greater performance when he feels that the reward will satisfy the need and there are enough chances that organization will provide the desired reward upon the completion of project (Boje, 2014). Any of the one factors is zero or negative it will turn down the employee motivation for optimal performance to zero or demotivate employee (Ghanem, 2014). This Victor Vroom expectancy theory of motivation provided as essential framework for HR manager who device reward systems (Hassan, 2016). The nature of reward is that it must be needed by an employee and flow of reward from organization to employee must be certain upon completion of expected performance (Maalderink, 2014). Therefore it has the ability to drive the motivation level of an employee and great implications in organizational settings (Imperatori, 2017).
Equity theory described that employees are naturally bound to compare inputs and output associated with one job is compared with other jobs (Latham, 2012). That is to say employees compare the reward system of their organization with other organizations operating in the same industry (Child, 2015). Within the same organization rewards system is compared with different statuses (Miner, 2011).
The author of equity theory argued that employees become bias while comparing them with their colleagues and peers within the same organization as well as in the organizations operating in same industry (Pichère, 2015). Employees merely analyze the rewards flow to the other employees from the organization to the employee they are unwilling to recognize the different value other employees are providing to the organization (David A. DeCenzo, 2016). For example an employee with a professional qualification and experience of sufficient number of years in a relevant department is no way similar to an employee having freshly graduated from college. The value they provide to organization is all the way very different and organization will value such employees with different compensation plan and reward system (French, 2011).
The paper suggests following recommendations to Daleel Petroleum:
- In order to synchronize the workforce performance the company is needed to conduct training session. It must be two way. It will facilitate to understand what important employees is so management can devise better reward plan as per their needs.
- Cognitive session will help company to demonstrate their value system and produce a trustworthy workforce.
- Initiate activities which require more human involvement as it will help to enhance self – esteem of individual employee.
- The policies are procedure need to be communicated clearly and must execute at all levels of organization to trigger performance and abstain from demotivation.
- Provide fair basis of comparison to employees in terms of value they are provided and respectively compensated.
- Mission and Vision statement of company need to be reaffirm in every training sessions so it will facilitate employees aligned with the goals of company.
- Improve their understanding about how company is benefitting their employees more than other Oil and Gas sector companies in Oman.
- Provide them extended compensation plan. The benefits must flow to the family of an employee. It may include medical and retirement benefits.
- Reward system of the organization must be progressive and lucrative in order to keep the motivation of employees high. It must be based on performance of an employee.
- Daleel Petroleum must be considerate of employee professional as well as personal needs.
Therefore the paper has analyzed reward system and application of numerous theories of motivation on Daleel Petroleum. It has identified that company offer a composite reward system that has element of extrinsic and intrinsic reward. Extrinsic reward may include: basic pay, cash bonuses, incentive and commission payment, share option plan is also offered, retirement or pension benefits, free medical insurance, any sort of vehicles and subsidized loans being provided by daleel Petroleum is come under the category of extrinsic reward (David L. Elwood, 2013). On the other hand, an accomplishment sense of completing a project, recognition provided at workplace, satisfaction with the position and status, the nature of work, the authority and responsibility of adding value to the performance of an organization all fall under the category of intrinsic reward (Hassan, 2016). Then paper discussed motivation four different motivation theories: Maslow hierarchy theory of needs, Herzberg two – factor theory, Victor Vroom: Expectancy theory of motivation, and equity theory. All such academics models of motivation are discussed in detail with application on the case of Daleel Petroleum. The last part of this paper highlighted certain recommendations. If implemented appropriately it would help organization to attain organizational objectives with satisfied and motivated workforce (Kessler, 2013).
Introduction- Human Resource Management Function
Human resource Management is essential in every organization to have appropriate human capital in order to execute manual tasks (Ghanem, 2014). At Daleel Petroleum due to high capital intensiveness and automated working through plants and machinery and research on chemical the nature of job is technical. Human Resource management has performed numerous functions like recruitment and selection, training and development, compensating and benefitting and performance evaluation (Price, 2011). The paper will discuss two functions of HRM that is training and development and performance evaluation in relation to the traditional practices of Personal management (PM) and modern practices of human resource.
Traditional Practices of Personal Management (PM) Verses Modern Practices of Human Resource (HR)
At Daleel petroleum 88 percent employees are Oman nationals. It is very huge percentage with respect to diversity issues. It falls under the traditional practices where concept of diversification in terms of gender, skills and expertise are not very much prevailed in business world (Wilton, 2010). These employees are enriched with values like leadership and innovation. It is considered as modern practices of human resource. Due to globalization employees are encouraged to perform well in more than one segment so that they are able to supervise the operations of different department. Therefore on – the –job trainings are highly appreciated (Sanghi, 2014). It also entails job rotation. Job rotation is treated as an effective measure to break monotony and satisfy an employees since it is a cause of self – esteem. Training and development function is very necessary due to the changes in technology and new skills of oil extractions (Child, 2015). Such technology is cost – effective and proved as efficient as Daleel Petroleum has able to increase its production capabilities. It also enhances the opportunities to increase revenue.
Training and development is necessary at every functional level of organization. It increases product knowledge, company image and drives employees towards positive attitudes. For a production person training is necessary to know the ingredients involve in production process (Stoyanov, 2017). The nature of such ingredient either explosive or non – explosive. Such training is very vital for workplace safety and mitigation of injuries. Training of sales force is necessary to not merely increase sales volume but also improves the image of company (Steven McShane, 2017).
For petroleum sector the major market is industrial not consumer. Therefore sales force is required to have skills of personal selling since in industrial market promotion is done through personal selling tool. Since industrial market is geographically concentrated, organized, and formal and informed, better bargaining position (David A. DeCenzo, 2016). Hence the sales person must be presentable in relation to missionary selling, have significant and detailed production knowledge and must have good negotiation skills. Similarly operational staff need to be trained ad expert, they are mainly required to deal with heavy machines and automated processes (Maalderink, 2014). If they are not familiar or good at working with machines there will be fair chances of huge losses in terms material resources and machine related injuries and safety (Price, 2011).
One of the other functions of HRM intended to be discussed through this paper is performance evaluation tools utilized by Daleel Petroleum. The measure of employee evaluation is how much and employee become successful at maintaining safety measures at the place of operations. How much the employees have adhere quality standards during their workings (David A. DeCenzo, 2016). The consciousness of following the standard of procedures is considered one of the great tool to evaluate the performance of individual employees (Latham, 2012).
Performance is also evaluated on the basis of prior – training performance. When an employee at any functional level of organization is provided with training the employee has an obligation to follow the new methods and curtail old practices (Maalderink, 2014). To give training is a way to make an employee realized that it did not merely mean learning new things but de –learning old practices is equally dealt as learning (Green, 2011). Moreover employees who get external training in a specialized discipline need to be disseminate the information among those who were not the part of direct training (Rao, 2012).
It facilitates a learning environment in an organization. It helps in developing an informal two – way communication channel. In such learning environment assessment of skills and expertise is undertaken (French, 2011). It provides honest feedback among operational staff which may assist company to improve the internal processes in order to gain competitive advantage. Performance evaluation and training are an on – going activity that is undertaken with all formalities to enhance organizational performance through effective HRM functions (Fiore, 2013).
Hence this part of paper is mainly based on the discussion how HRM functions is implemented at Daleel Petroleum. In context of training and development and performance evaluation of employees it has been analyzed that how tradition practices of personal management is different from modern practices of HR. It is also discussed in how many ways HRM functions facilitate the operations of Daleel Petroleum with cross – functional training, job rotation and on – job – training. Such trainings have implication on work place safety, standard of quality, interpersonal relation among employees. It contributed towards performance evaluation and helps organization find new opportunities to improve. The differences in traditional practices of personal management and modern practices of human resource is that traditional management did not support employee development to the extent of leadership. Traditional management believes in specialization where human activity is broken into smallest unit of task in order to provide them in a most efficient manner. However modern practices at
Daleel Petroleum encourages leadership and forwarding attitude of their which need to be effective and efficient in all respects and have operational level knowledge of very functional department. It will facilitate the employees to understand that input of one department is somehow treated as the output of other department. Therefore it need to be made in a uniform manner to support functioning of other departments. This practice enhances employee confidence and trust with the increase in organizational knowledge and image. Employees feel themselves more promising towards providing effective and efficient occupational performance.
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