Business Research Project September 2023 Sanja Minkova Shetlovska
Business Research Project September 2023 Sanja Minkova Shetlovska
Business Research Project September 2023 Sanja Minkova Shetlovska
Student
Sanja Minkova Shetlovska
2023
Master of Business Administration
Student: Supervisor:
Sanja
Minkova Shetlovska Prof. Marija Stojanova
Date
25.09.2023
Contents
Acknowledgements......................................................................................................................... 3
1. Introduction ............................................................................................................................. 5
1.1 Aims .....................................................................................................................................................................6
2. 4. Literature Review Part 2 (Previous studies on employee satisfaction and organizational development) .....18
7. Conclusion ................................................................................................................................. 46
References: ................................................................................................................................... 47
Acknowledgements
I would like to express my great appreciation to my family for the big support in my education.
I would like to express my very great appreciation to Professor Dr. Marija Stoyanova on her valuable
and constructive suggestions during the planning and development of this research work.
Her willingness to give her time so generously has been very much appreciated.
Executive summary
Keywords:
#organization’s life cycle #job satisfaction #employee well-being #organizational success
1. Introduction
Employee satisfaction and wellness play a crucial role in organizational success and
longevity. A content and engaged workforce contributes to increased productivity but also
helps reduce turnover rates, and improves overall performance within the organizations.
Understanding the interconnection between employee satisfaction and the life cycle of an
organization is vital for developing effective strategies to enhance employee satisfaction at
different stages. This business research project has the purpose of investigating the
relationship between employee satisfaction and an organization’s life cycle, identifying key
factors that influence employee satisfaction and wellness developing targeted strategies to
ensure long-term organizational success. With this research project, we aim to meet the
impact of employee satisfaction on the life cycle of an organization and to discover the
evolution of employee satisfaction throughout the stages of the organization’s development.
The research inducts a conceptual framework that relates to concepts from employee
satisfaction measuring organizational life cycle, and theories such as organizational behaviour
and human resource management. By combining these theoretical perspectives, the research
project aims to gain a comprehensive understanding of how employee satisfaction interacts
with the life cycle of an organization. It recognizes that as organizations evolve and go through
different stages, the factors influencing employee satisfaction may change. For example, in the
startup stage, employees may value autonomy and growth opportunities, while in the maturity
stage, they may prioritize stability and work-life balance. It could also explore how
organizational factors and human resources management practices influence employee
satisfaction and how employee satisfaction, in turn, impacts organizational outcomes such as
employee performance, turnover, and overall organizational effectiveness.
The main research question in this study is "What is the impact of employee satisfaction on
the life cycle of an organization and the evolution throughout the stages of the organization's
development? will contribute to the already established research problem by providing
valuable insights into the dynamic relationship between employee satisfaction and the life cycle
of an organization. Some examples of quantifiable evidence that highlight the importance of
addressing this problem are:
Employee Satisfaction and Productivity: A study conducted by the University of Warwick
found that happy employees are, on average, 12% more productive than their unhappy
counterparts. This quantifiable increase in productivity demonstrates the direct impact of
employee satisfaction on organizational performance.
Glassdoor Ratings and Employer Branding: Glassdoor, a popular platform for employee
reviews and ratings, has shown that organizations with higher employee satisfaction ratings
tend to attract more qualified candidates. A positive employer brand, as quantified by higher
ratings and positive reviews, can lead to a larger pool of talented applicants, reducing
recruitment costs and enhancing the organization's reputation.
This scholarly investigation aims to scrutinize employee job satisfaction within both the
initial and mature (stable) phases of organizational development, exclusively focusing on
companies operating in the Republic of North Macedonia.
As above-mentioned, the research question focuses on the phenomenon of employee
satisfaction and its impact on the life cycle of an organization. It aims to explore how employee
satisfaction influences the various stages of organizational development and how it is evolute.
The primary variable of interest is employee satisfaction, which can be measured using
validated scales. The research question also implies the presence of other variables such as the
stages of the organization's life cycle, which may include start-up, growth, maturity, and
decline. Additionally, potential influencing factors on employee satisfaction, such as leadership
style, organizational culture, and work-life balance, can be considered as secondary variables.
The participants in the research would include employees from organizations at start–up stage
of their life cycle and mature stage. A diverse sample of employees from various departments,
levels, and roles within the organization would be selected to capture different perspectives
and experiences related to employee satisfaction.
1.1 Aims
• To investigate the interconnection between employee satisfaction and the life cycle of
an organization by understanding how employee satisfaction evolves throughout
different stages of organizational development.
• To develop targeted strategies and initiatives that enhance employee satisfaction and
contribute to long-term organizational success.
1.2 Objectives
• Identify key factors that influence employee satisfaction, considering aspects such as
leadership, communication, compensation, benefits, work conditions, work safety,
work-life balance, and career development opportunities.
• Provide recommendations for organizations to enhance employee satisfaction
throughout the various stages of their life cycle.
Ultimately, this research aspires to offer actionable insights and recommendations for
organizational leaders and managers, aiding them in fostering employee well-being and driving
organizational success.
This study project's future chapters will offer a literature review, examination of the
selected methodology, data collecting and analysis. As part of a fuller understanding of the
crucial connection between employee satisfaction and organizational development, it will also
include empirical findings, discussions and conclusions.
Material incentives play a pivotal role in motivating employees and enhancing job
satisfaction. Factors in this category include:
• Benefits management
Employee benefits, such as healthcare, retirement plans, and paid leave, significantly
impact job satisfaction. Organizations that provide comprehensive benefits packages tend to
have more satisfied employees.
Immaterial rewards, despite being less tangible, exert a profound influence on job
satisfaction. These factors include:
• Employee participation
Involving employees in decision-making processes and valuing their input can enhance their
job satisfaction.
• Organizational structure
The organization's structure can impact how employees perceive their roles and
responsibilities, affecting job satisfaction.
• Access to information
Employees' access to information and transparency within the organization can impact their
satisfaction.
• Nature of work
The nature of the tasks and responsibilities employees have can significantly impact their
job satisfaction.
• Alignment of personal interests with work
When employees feel that their interests align with their job roles, it can lead to higher job
satisfaction
• Work Design
The way work is designed, including job autonomy and variety, can impact job satisfaction.
These diverse elements collectively contribute to an employee's perception of job
satisfaction, impacting their motivation and performance.
Effective human resource management plays a pivotal role in shaping job satisfaction.
Managers are responsible for creating an environment conducive to employee well-being and
motivation. Key strategies for managers include:
• Salary management
Ensuring that salaries align with employee expectations is crucial for motivation and
satisfaction.
Organizations, like living organisms, go through a natural life cycle consisting of distinct
stages, including introduction, growth, maturity, and decline (Adizes, 1979). Each stage
presents unique challenges and opportunities, and the organization's ability to navigate these
stages effectively often determines its long-term success or failure. The concept of the
organizational life cycle is a valuable framework for understanding how organizations evolve
and adapt to changing circumstances. The relationship between employee satisfaction and the
life cycle of an organization is a fascinating and dynamic one. It's a complex interplay that can
significantly impact an organization's success or failure.
The life cycle of organizations, as proposed by Isaac Adizes, is a dynamic and evolving
framework that helps us understand the different stages that companies go through during
their development. While some variations in the number of stages exist in the literature, Adizes
identifies six fundamental stages.
• Adolescence:
The adolescence stage is a critical juncture where organizations begin to operate
independently of their founders. Conflict and inconsistencies may arise within the organization,
and it's essential to delegate authority and establish specialized leadership. Diversification and
changes in goals can make staying ahead of the market challenging. Adolescence can be a
turbulent phase where employee satisfaction may start to decline if there's a lack of clear roles,
structure, and processes. Establishing clear communication channels and addressing growing
pains can help maintain or improve employee satisfaction.
• Top Form:
The top form represents the pinnacle of organizational maturity, characterized by a well-
established culture, clear vision, and a strong orientation toward customers. The organization
sets and follows plans effectively, recognizes ideal candidates for employment, and achieves
growth and profitability. However, the challenge at this stage is to maintain this optimal
position. In this phase, an organization typically reaches its peak. Employee satisfaction can be
high if the organization effectively rewards and recognizes employees' contributions.
Employees often have a sense of accomplishment and pride during this phase.
Dr. Adizes claims underpin the theoretical foundation of this life cycle model,
emphasizing the importance of identifying the organization's current stage to take appropriate
actions effectively. Understanding where the organization stands within this framework enables
managers to make informed decisions and address issues proactively. Each stage presents its
unique challenges and opportunities, and recognizing the organization's current position within
this cycle is crucial for effective management and long-term success.
Numerous studies have explored the relationship between employee satisfaction and
organizational development, although with varying emphases on different aspects of this
relationship. Research has shown that employee satisfaction tends to be higher during the
start-up and growth stages of the organizational life cycle (Cameron & Quinn, 2006). This
suggests that as organizations evolve, their ability to provide opportunities for employee
satisfaction may change.
However, the specific mechanisms through which employee satisfaction impacts
organizational development remain a topic of ongoing investigation. Some studies have
suggested that satisfied employees are more likely to engage in proactive behaviours that
contribute to organizational growth and innovation. Others have examined the role of
leadership and management practices in mediating the relationship between employee
satisfaction and organizational performance (Judge & Bono, 2001).
In summary, the literature on employee satisfaction and organizational development
highlights the significance of employee satisfaction in influencing various organizational
outcomes. It underscores the need for a deeper understanding of how employee satisfaction
evolves throughout the organizational life cycle and the mechanisms through which it impacts
organizational development.
3. Conceptual development
This research project seeks to investigate the dynamic relationship between employee
satisfaction and the life cycle of an organization, shedding light on how employee satisfaction
evolves as an organization progresses through various stages of development. The rationale for
this research project is grounded in the well-established significance of employee satisfaction in
organizational success and the recognition that organizations, akin to living organisms, undergo
distinct phases of development. Understanding how these two crucial aspects intersect is
paramount for organizations striving to navigate the complexities of the contemporary business
environment effectively.
Employee satisfaction has long been recognized as a key driver of organizational
performance (Spector, 1997). Satisfied employees are more likely to be engaged, motivated,
and committed to their work, leading to higher productivity and reduced turnover. It is
imperative to explore how employee satisfaction varies across different stages of an
organization's development and how this variation influences the organization's overall
trajectory.
As mentioned above, the primary objectives of this research project are, as follows:
➢ To Examine the Relationship Between Employee Satisfaction and Organizational Life
Cycle: This project aims to empirically assess the relationship between employee
satisfaction and the various stages of organizational development, including the
introduction and maturity phases.
➢ To Identify Factors Influencing Employee Satisfaction Throughout the Organizational
Life Cycle: By conducting a comprehensive analysis, we intend to identify specific factors
and variables that influence employee satisfaction at different stages of an
organization's life cycle. This includes exploring the role of leadership, compensation,
job design, and organizational culture.
➢ To Understand the Impact of Employee Satisfaction on Organizational Evolution: This
research seeks to elucidate how variations in employee satisfaction impact an
organization's ability to adapt and evolve as it progresses through the life cycle. We aim
to assess the impact on innovation, employee engagement, and overall performance.
➢ To Provide Practical Insights for Organizational Management: Ultimately, this research
aspires to offer practical insights and recommendations for organizational leaders and
managers. By understanding the nuances of employee satisfaction within the context of
the organizational life cycle, leaders can make informed decisions to enhance employee
well-being and drive organizational success.
To address these research objectives, several key factors and variables will be
investigated:
Employee Satisfaction: This variable will be measured through surveys to gauge
employees' levels of contentment, satisfaction and fulfilment with their roles, work
environment, and overall experiences within the organization.
Organizational Life Cycle Stage: We will categorize organizations into distinct life cycle
stages (startups and maturity (stable) stages) to determine how employee satisfaction patterns
evolve across these stages.
Leadership and Management Practices: These encompass factors such as leadership
styles, communication, and decision-making processes, which may impact employee
satisfaction differently depending on the organization's life cycle stage.
Compensation and Benefits: Compensation packages and benefits can influence
employee satisfaction and may vary in significance at different stages of development.
Job Design and Work Environment, Work Conditions, Work Safety: Factors related to
job roles, responsibilities, and the work environment, including work-life balance and job
security, work conditions and work safety will be examined as potential drivers of employee
satisfaction.
Organizational Culture: The prevailing organizational culture, including values, norms,
and employee engagement initiatives, will be assessed for its impact on employee satisfaction.
By analyzing these factors in the context of the organizational life cycle, this research
aims to provide a comprehensive understanding of the intricate relationship between
employee satisfaction and organizational development.
4. Hypothetical framework
The main research question of this research project is the influence that job satisfaction
has on the current stage of the organization. Auxiliary questions are closely related to the
employee's perception of influence and the influence of the moment stage on the management
career. What is also of particular importance is the measurement of the most positive influence
the employee has on himself. According to this:
This framework sets the stage for my research by highlighting the main research question that
helps explore different aspects of the relationship between the organization's current stage and
job satisfaction. The hypothesis suggests that there is a significant impact, which I will
investigate and analyze in this project.
✓ Job satisfaction among employees is higher in the first three stages of the
organization's life cycle than in the other two stages (excluding the rebirth phase).
This auxiliary hypothesis provides a specific expectation about the relationship between job
satisfaction and the organization's life cycle stages. It suggests that you anticipate higher job
satisfaction in the initial stages compared to the later stages, excluding a potential rebirth
phase.
5. Research methodology
To achieve the research objectives outlined in the above section, a quantitative research
design will be employed. This research method allowed a comprehensive exploration of the
relationship between employee satisfaction and the organizational life cycle.
Quantitative Data: Surveys were administered to collect quantitative data on employee
satisfaction at different stages of the organization's life cycle. The surveys utilized validated
scales to ensure reliability and validity. The data were collected using online survey platforms or
paper-based questionnaires, depending on the preferences and accessibility of the target
participants. Survey research was carried out in a form that aimed to give a quantitative
evaluation of the degree - evaluation of satisfaction of the respondents from their company
according to the previously determined questions. The results were processed in quantitative
form and based on the values obtained for each subset of the research, quantitative analysis
was enabled.
5.1 Sampling
Quantitative Sampling
A stratified random sampling approach will be used for the quantitative survey.
Organizations from different industries and at different stages of the life cycle (start-up and
mature (stable),) will be included in the sample. Within each stratum, a random sample of
employees will be selected to participate in the survey. This approach ensures representation
across various organizational contexts.
The obtained results were analyzed and translated into conclusions with the application
of methods of quantitative hypothetical testing and application of the traditional quantitative
analysis. The obtained results were divided into 5 different levels and then were grouped into
two main subgroups: satisfied and dissatisfied employees. In the process of processing the
results, a formula was used for the percentage expression of levels obtained based on survey
responses.
100
Percentage value = ------------------------------------------ X responses received
the total number of respondents
6. Empirical Findings & Analysis
Male Female
22 18
Group of questions
related to satisfaction
with working conditions
1. Satisfaction with 17 42.50% 23 57.50%
working conditions - with
the working environment
2. Satisfaction with 20 50.00% 20 50.00%
working conditions - with
workplace safety
3. Satisfaction with 16 40.00% 24 60.00%
working conditions -
workplace organization
4. Satisfaction with 18 45.00 % 22 55.00%
working conditions - the
opportunity for education
and professional
development
5. Satisfaction with 19 47.50% 21 52.50%
working conditions -
hygiene in the
organization
6. Satisfaction with the 20 50.00% 20 50.00%
working conditions - the
equipment for the work
Group of questions
related to satisfaction
with coworkers and
colleagues
7. Satisfaction with co- 18 45.00% 22 55.00%
workers, i.e. colleagues -
the ability to communicate
8. Satisfaction with 16 40.00% 24 60.00%
collaborators ie colleagues
- the quality of
communication
9. Satisfaction with 21 52.50% 19 47.50%
collaborators, i.e. the
colleagues - freedom of
mutual communication
10. Satisfaction with the 17 42.50% 23 57.50%
collaborators, i.e. the
colleagues - acceptance of
useful suggestions and
inventive solutions
11. Satisfaction with 14 35.00% 26 65.00%
colleagues, i.e. colleagues -
objectivity and consistency
when evaluating the
achievements and
behaviours of colleagues
Group of questions
related to satisfaction
with the organization in
which you work
12. Satisfaction with the 20 50.00% 20 50.00%
organization in which you
work - with the attitude of
your superiors
13. Satisfaction with the 18 45.00% 22 55.00%
organization in which I
work - the organizational
structure
14. Satisfaction with the 14 35.00% 26 65.00%
organization in which I
work - the possibility of
remote work
15. Satisfaction with the 13 32.500000% 27 67.50%
organization in which I
work - the recognition I
receive for a job well done
16. Satisfaction with the 19 47.50% 21 52.50%
organization in which I
work - the status that I
receive
Group of questions
related to the benefits
The results of the survey can be shown in a percentage version and after the following
formula:
Total amount of responses/number of responses per squad. satisfaction category
If the above is used, the resulting views are:
If the results of the subgroups are analyzed, it is interesting to note that the percentage
of employee dissatisfaction with the benefits category in terms of material and unmaterial
rewards, (bonus, salary and other forms of rewards) is higher than the percentage of
dissatisfaction with other subgroups. The reason for this will be explained later.
To provide a larger sample for the realization of the research groups in the initial startup
phase, three companies were taken as the target of the research with different numbers of
employees, Baby Shop Online DOOEL, Different DOOEL and Different Group DOOEL. The
examined sample that was the subject of the research was composed of 37 employees of
different ages and professional profiles.
Age distribution of the examined sample
Male Female
19 18
Group of questions
related to satisfaction
with working conditions
1. Satisfaction with 32 80.00% 5 13.51%
working conditions - with
the working environment
2. Satisfaction with 32 80.00% 5 13.51%
working conditions - with
workplace safety
3. Satisfaction with 23 57.50% 14 37.84%
working conditions -
workplace organization
4. Satisfaction with 24 60.00 % 13 35.14%
working conditions - the
opportunity for education
and professional
development
5. Satisfaction with 25 62.50% 12 32.43%
working conditions -
hygiene in the
organization
6. Satisfaction with the 30 75.00% 7 18.92%
working conditions - the
equipment for the work
Group of questions
related to satisfaction
with coworkers and
colleagues
7. Satisfaction with co- 29 72.50% 8 21.62%
workers, i.e. colleagues -
the ability to communicate
8. Satisfaction with 30 75.00% 7 18.92%
collaborators ie colleagues
- the quality of
communication
9. Satisfaction with 30 75.00% 7 18.92%
collaborators, i.e. the
colleagues - freedom of
mutual communication
10. Satisfaction with the 28 70.00% 9 24.32%
collaborators, i.e. the
colleagues - acceptance of
useful suggestions and
inventive solutions
11. Satisfaction with 21 52.50% 16 43.24%
colleagues, i.e. colleagues -
objectivity and consistency
when evaluating the
achievements and
behaviours of colleagues
Group of questions
related to satisfaction
with the organization in
which you work
12. Satisfaction with the 28 70.00% 9 24.32%
organization in which you
work - with the attitude of
your superiors
13. Satisfaction with the 26 65.00% 11 29.73%
organization in which I
work - the organizational
structure
14. Satisfaction with the 24 60.00% 13 35.14%
organization in which I
work - the possibility of
remote work
15. Satisfaction with the 22 55.00% 15 40.54%
organization in which I
work - the recognition I
receive for a job well done
16. Satisfaction with the 26 65.00% 11 29.73%
organization in which I
work - the status that I
receive
Group of questions
related to the benefits
The results of the survey can be shown in a percentage version and after the following
formula:
Upon initial examination of the results derived from the survey research, we can
immediately notice a difference in the degree of employee satisfaction. This was expected;
however, the purpose of this hypothesis effort was not only to distinguish the degree of
satisfaction but to confirm that the degree of employee satisfaction in companies that are in the
first three stages is higher compared to companies that are in the last two stages.
According to the chosen example of a successful company in a mature stage, the
generally expected employee satisfaction is at a high level, although compared to companies
from the initial stage this satisfaction is lower.
The comparative analysis that will be given below aims to show the differences between
the two groups of companies, and specific descriptions of the results based on the subgroup’s
satisfaction.
6.5.1 Comparative analysis of satisfaction from the working conditions
The notable difference in employee satisfaction with working conditions between stable
companies like Petrol Oil Company and start-ups like Babyshop Online DOOEL, Different DOOEL
and Different Group DOOEL can be attributed to several factors. Established companies are
expected to meet industry standards for workplace satisfaction due to their long market
presence. However, their extensive operations can make it challenging to address each
employee's unique needs. In contrast, start-ups often have smaller teams, including owners
who are closely involved in day-to-day operations. This results in greater individual attention
and higher satisfaction levels, as the smaller workforce allows for more personalized support
and accommodation of individual preferences.
The difference observed in the examination and the results do not imply that mature
companies have lower working conditions standards. Rather, it underscores the distinction in
employee expectations between those in established corporations and those in nascent
enterprises.
6.5.2 Comparative analysis of the satisfaction with co-workers, i.e. colleagues
In this particular segment, the research results reveal a subtle deviation from the
previously observed trend in employee satisfaction levels. Several conclusions can be drawn to
elucidate these findings:
• Complexity of Organizational Structures: Mature companies typically exhibit more
complex and, at times, less adaptable organizational structures. In contrast, start-up
companies, still in their early stages, often begin with minimal essential units, processes,
or segments, with a readiness for future modifications.
• Resistance to Change in Mature Companies: While this observation is yet to be
empirically confirmed, it is noteworthy that a significant portion of employees in mature
companies may exhibit limited interest in organizational changes, except in cases
concerning managerial positions. This lack of interest can influence the survey results.
It is crucial to emphasize that these results do not conclusively indicate lower employee
satisfaction levels in mature companies. Instead, they reflect the impact of differing
organizational structures and the varying degrees of employee interest in organizational
changes.
In this section, one might expect employees in mature companies to exhibit higher
satisfaction levels with their income and various tangible and intangible rewards. Surprisingly,
the results reveal that start-up companies boast a higher degree of overall employee
satisfaction, although this difference diminishes in favour of mature companies within the mid-
range of the employee satisfaction spectrum.
Several key factors contribute to these results:
In this comprehensive research project, we have delved into the intricate relationship
between the organization's current stage and job satisfaction among employees. Our research
journey began with a critical examination of the impact of organizational life cycle stages on the
well-being and contentment of individuals in the workplace. Through a concept of quantitative
surveys, we sought to unravel the complex dynamics at play, addressing not only the
overarching research question but also the auxiliary hypotheses that guided our investigation.
Our findings have shed light on the significant role that the organization's current stage
plays in shaping job satisfaction levels. As anticipated, our research confirms that job
satisfaction is notably higher in the initial stages of an organization's life cycle. The emergence,
growth, and establishment phases provide fertile ground for employees to experience a sense
of novelty, rapid development, and a greater degree of autonomy, all of which contribute to
heightened job satisfaction. However, we also noted a decline in job satisfaction in the later
stages, highlighting potential challenges in maintaining employee contentment amid stability
and maturity.
Furthermore, our research uncovered the nuanced ways in which employees perceive
the influence of the organization's current stage on their career trajectories. While the earlier
stages offer opportunities for rapid career advancement, the later stages are associated with
stability but potentially slower progression. This insight underscores the importance of aligning
individual career goals with organizational life cycle stages.
In conclusion, our research contributes to the growing body of knowledge on the
interplay between organizational development and employee satisfaction. It provides empirical
evidence that informs organizational leaders and managers about the critical role they play in
fostering a positive work environment at various stages of an organization's life cycle. As
organizations strive for sustained success and adaptability, understanding the nuances of job
satisfaction in the organization's current stage is indispensable. We hope that the insights
gained from this study will guide decision-makers in optimizing employee well-being and, by
extension, enhancing organizational performance.
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