See discussions, stats, and author profiles for this publication at: https://www.researchgate.

net/publication/273137168

Job Satisfaction and Loyalty to the Organization

Conference Paper · March 2011

CITATIONS READS

0 343

4 authors:

Miha Marič Marko Ferjan

University of Maribor University of Maribor
98 PUBLICATIONS   94 CITATIONS    38 PUBLICATIONS   47 CITATIONS   

SEE PROFILE SEE PROFILE

Vlado Dimovski Matej Černe

University of Ljubljana University of Ljubljana
102 PUBLICATIONS   894 CITATIONS    63 PUBLICATIONS   546 CITATIONS   

SEE PROFILE SEE PROFILE

Some of the authors of this publication are also working on these related projects:

Personal brand View project

studying signals of certain biomarkers using living stains View project

All content following this page was uploaded by Miha Marič on 06 March 2015.

The user has requested enhancement of the downloaded file.

 Domov | Home Nazaj | Back

30th International Conference on Organizational Science Development

FUTURE ORGANIZATION
March 23rd – 25th 2011, Portorož, Slovenia

Job Satisfaction and Loyalty to the Organization

Miha Marič
University of Maribor, Faculty of Organizational Sciences
miha.maric@fov.uni-mb.si

Marko Ferjan
University of Maribor, Faculty of Organizational Sciences
marko.ferjan@fov.uni-mb.si

Vlado Dimovski
University of Ljubljana, Faculty of Economics
vlado.dimovski@ef.uni-lj.si

Matej Černe
Centre of Excellence for Biosensors, Instrumentation and Process Control (COBIK)
matej.cerne@cobik.si

Abstract
Loyalty is of great importance to organizations all over the world. Losing your
employees to the competition is at least a risk, that the organizations should not take
likely, if not a danger to the organization’s competitive position in regard to its
competitors. That is why it is important to retain the best employees and groom their
loyalty. We assume that the best way to retain employees is by keeping them
satisfied. Our research is on how employees’ job satisfaction determines their loyalty
to the organization. The research part has been done through a survey (n=459) that
gave us the data required to determine the extent in which employees’ job
satisfaction determines their loyalty to the organization. We have found out that job
satisfaction does in fact have an statistically significant effect on the loyalty to the
organization.

Keywords: employees, job satisfaction, loyalty, human resources, management

1 Introduction
Job satisfaction is a topic of wide interest to both people who work in organizations and
people who study them (Lu et al, 2005, p. 211). The area of job satisfaction has been one of
the most widely researched in the literature on organizational behavior (Gil et al., 2008, 923).
Job satisfaction has been examined by organizational and work psychology because it is
associated with all kinds of behaviors that are important for the organization (Zalewska, 2010,
p. 1).

772
Loyalty to the organization is one aspect of organizational behavior that is directly related to
job satisfaction and that is why it is important to understand to what extent can loyalty to the
organization be explained by employee’s job satisfaction, so that the managing structures in
organizations can retain their employees and gain on the benefits that loyal employees bring
to the organization.

2 Job Satisfaction
Studying the area of job satisfaction began in the 1930s due to the desire, mainly of industrial
psychologists to help company management control the workplace and it continues years later
because of its relation to aspects like productivity, absenteeism, employment turnover ratios
(Gil et al., 2008, 923). Job satisfaction is defined as an emotional state resulting from
appraising one’s job (Namasivayam & Zhao, 2007, p. 1214). Pay, autonomy, and professional
status were important predictors of job satisfaction according to the research of Tzeng (2002,
p. 868).

Job satisfaction, like other attitudes, has both affective and cognitive components (Ilies, 2002,
p. 1121). Job satisfaction is an affective (that is, emotional) reaction to one’s job (Weiss,
2002, p. 174) as a momentary affect and cognitive evaluations through the experienced affect,
resulting as the degree to which a person reports satisfaction with intrinsic and extrinsic
features of the job (Wu & Norman, 2006, p. 305). The key to job satisfaction is, in fact, in the
fit between the objective conditions of the job and the worker’s expectations (expected,
deserved, and soon). The better the fit between expectations and job reality, the greater the
satisfaction and vice versa (Munoz de Bustillo Llorente & Fernandez Macias, 2005, p. 663).

Job satisfaction may be both intrinsic, derived from internally mediated rewards such as the
job itself and opportunities for personal growth and accomplishment, and extrinsic, resulting
from externally mediated rewards such as satisfaction with pay, company policies and
support, supervision, fellow workers, chances for promotion, and customers (Schwepker,
2001, p. 41). Scholars have explored job satisfaction as an index to measure the desirability of
certain work conditions, because it reflects the quality of work life and psychological well-
being of workers (Kang, 2010, p. 152).

3 Loyalty to the Organization

Loyalty is usually seen as a virtue, albeit a problematic one. It is constituted centrally by
perseverance in an association to which a person has become intrinsically committed
(Kleinig, 2008). Believers give loyalty to the organization and take pride and identity from it
(Clark, 1972, p. 178). Loyalty is characterized as a strong desire to maintain membership of
an organization, and plays a positive role in retention of members in the organization (Wu &
Norman, 2006, p. 305).

Its paradigmatic expression is found in friendship, to which loyalty is integral, but many other
relationships and associations seek to encourage it as an aspect of affiliation or membership:
families expect it, organizations often demand it, and countries do what they can to foster it
(Kleinig, 2008). Personal relationships, particularly with immediate managers, therefore
may play a larger role in motivating organizational citizenship behavior and commitment
(Hui et al., 2004, p. 232)

Professional growth opportunities, workload, dissatisfaction with work hazards, and

relationship with coworkers, were found to predict turnover (Tzeng, 2002, p. 868) in

773
organizations. Job satisfaction has been recognized as probably the most important factor
influencing the desire to remain in a job (Wu & Norman, 2006, p. 305).

4 Methodology
4.1 Research Question
Through the research we wanted to know:
R1: Can loyalty to the organization be explained by employee’s job satisfaction?

4.2 Instruments and Variables

We prepared a questionnaire to acquire the data required for our study. The questionnaire was
of a closed type and contained 4 general questions about the respondent, 12 statements
referring to job satisfaction of the respondent and three statements referring to the
respondent’s loyalty to the organization. The whole questionnaire was composed as follows:
A. General data
1. Age
2. Gender
3. Work experience in years
4. Years working for current employer
B. Job satisfaction
5. I am satisfied with my colleagues
6. I am satisfied with my continuity of employment
7. I am satisfied with my work hours
8. I am satisfied with my work
9. I am satisfied with my immediate superior
10. I am satisfied with my working conditions (equipment, facilities, safety
equipment ...)
11. I am satisfied with my opportunities for education
12. I am satisfied with my status in the organization
13. I am satisfied with the leadership in the organization - with the top
management in the organization
14. I am satisfied with the possibility of promotion
15. I am satisfied with the quality of my work life (at work) in general
16. I am satisfied with my salary
C. Loyalty to the organization
17. I would remain in the current organization even if I were offered a higher
salary elsewhere
18. Personally, I feel very committed to the organization where I work
19. I am proud to be an employee of this organization

Statements from 5 to 19 were measured on a scale ranging from 1 to 5 where: 1 – always

false; 2 – mostly false; 3 – nor true nor false; 4 – mostly true; 5 – always true.

4.3 Sample
Participants in this study were selected randomly and participation was voluntary. The study
was conducted in June 2010 in all districts of Slovenia using a prepared questionnaire. A total
of 459 responses were obtained.

774
The sample consisted of 210 men and 249 women (N=459). The age range of the respondents
was between 20 and 62 years. The average age of the respondents was 37.34 years. The
average work experience of the respondents was 14.63 years, of which they spent on average
the last 9.97 in the organization where they are currently employed.

5 Results and Discussion

5.1 Results
We begin by constructing the frequency tables for the variables that we have used in our
research.
Table 1: Frequency tables for the variables
n=459 Mean Median Std. Min Max
Valid Missing Deviatio
n
Job satisfaction
5 458 1 3,70 4 0,983 1 5
6 459 0 3,76 4 1,009 1 5
7 458 1 3,52 4 1,095 1 5
8 459 0 3,54 4 0,960 1 5
9 456 3 3,32 3 1,009 1 5
10 458 1 3,45 4 1,002 1 5
11 454 5 3,14 3 1,119 1 5
12 458 1 3,24 3 0,968 1 5
13 456 3 3,05 3 1,082 1 5
14 453 6 3,08 3 1,064 1 5
15 459 0 3,37 3 0,943 1 5
16 459 0 2,90 3 1,189 1 5
Loyalty to the organization
17 459 0 2,66 3 1,209 1 5
18 370 89 3,34 3 1,018 1 5
19 456 3 3,33 3 1,061 1 5

For questions 5 to 19 we calculated the Cronbach’s alpha coefficient. The value calculated is
0.913, which indicates great reliability of measurement. With regard to the composition and
characteristics of the sample, we believe that it is representative. We further conducted factor
analyses first on the variables representing “Job Satisfaction” and second on the variables
representing “Loyalty to the Organization”. We used the following methods and parameters
for both calculations:
• Extraction Method: Principal Component Analysis.
• Rotation Method: Varimax with Kaiser Normalization.
• Suppression of small coefficients: Absolute value below: 0.5.

Table 2: Rotated Component Matrix (a)

Component
1 2
I am satisfied with my colleagues ,812
I am satisfied with my continuity of employment ,819
I am satisfied with my work hours ,705

775
I am satisfied with my work ,656
I am satisfied with my immediate superior ,564
I am satisfied with my working conditions (equipment, facilities, ,613
safety equipment ...)
I am satisfied with my opportunities for education ,723
I am satisfied with my status in the organization ,725
I am satisfied with the leadership in the organization - with the top ,733
management in the organization
I am satisfied with the possibility of promotion ,789
I am satisfied with the quality of my work life (at work) in general ,647
I am satisfied with my salary ,719
Extraction Method: Principal Component Analysis.
Rotation Method: Varimax with Kaiser Normalization.
a. Rotation converged in 3 iterations.

On the basis of this factor analysis we obtained two new factors from 12 elements of Job
Satisfaction as seen in Table 2. The new variables (factors) are:
1. Factor 1: “Satisfaction with work circumstances”
2. Factor 2: “Satisfaction with position”

Table 3: Component Matrix (a)

Component
1
I would remain in the current organization even if I were offered a ,694
higher salary elsewhere
Personally, I feel very committed to the organization where I work ,771
I am proud to be an employee of this organization ,833
Extraction Method: Principal Component Analysis.
a. 1 components extracted.

On the basis of this factor analysis we obtained one new factor from 3 elements of Loyalty to
the organization as seen in Table 3. The new variable (factor) is:
1. Factor 1: “Loyalty to the organization”

We also conducted a regression analysis, from which we found the influence of independent
factors on the dependent factor (see Table 4 and Table 5).

Table 4: Model
Model R R Square Adjusted R Std. Error of the
Square Estimate
1 ,677a ,458 ,455 ,74313808
a Predictors: (Constant), »Satisfaction with work circumstances”, »Satisfaction with
position”

We found that the two new variables (factors) representing “Job Satisfaction” can account for
45.5% of the variance of “Loyalty to the Organization”. Within this influence, we used
regression analysis to investigate the influence of individual factors on the “Loyalty to the
Organization”.

776
 Table 5: Coefficients (a)
Unstandardised Standardise T Sig.
Coefficients d
Coefficients
B Std. Beta
Error
(Constant) -,026 ,040 -,653 ,514
Factor 1: “Satisfaction with work ,568 ,039 ,576 14,563 ,000
circumstances”
Factor 2: “Satisfaction with ,350 ,043 ,322 8,139 ,000
position”
a Dependent Variable: Factor 1: “Loyalty to the organization”.

Factor 1: “Satisfaction with work circumstances” has the most influence (β=0.576). It is
followed by the second factor Factor 2: “Satisfaction with position” (β=0.322). We have also
found out that both factors are important with statistical significance levels at 0.000.

5.2 Discussion
This study attempted to explore the linkage between job satisfaction and employee’s loyalty
to the organization. Based on the data we got from the respondents we conducted factor
analyses first on the variables representing “Job Satisfaction” and second on the variables
representing “Loyalty to the Organization”. Based on the factor analyses we now had two
factors representing “Job satisfaction” which we named “Satisfaction with work
circumstances” and “Satisfaction with position” and one factor which we named “Loyalty to
the organization”.

Conducting a regression analysis using these “new” factors, where we used “Loyalty to the
organization” as a dependent variable and the two factors representing “Job satisfaction” as
independent variables we found out that the two factors representing “Job Satisfaction” can
account for 45.5% of the variance of “Loyalty to the Organization”. Both factors had positive
effects on the “Loyalty to the organization” and they were both statistically significant.

Based on our research we can confirm that job satisfaction does indeed have an effect on
loyalty to the organization. Job satisfaction is an aspect of organizational behavior that has
recently been neglected in practice. We can often read about various researches that
emphasize the importance of job satisfaction but it is regrettably not regarded as such in many
organizations. For further research we would like to suggest examining the effects of loyalty
on performance which will perhaps be a better motivator for organizations to pay more
attention to this aspect of organizational life.

6 Conclusion
This study provides evidence to prove to the organizations and to the managing structures in
organizations that job satisfaction does in fact affect loyalty to the organization. Influencing
the elements that construct job satisfaction can lead to reducing turnover of vital employees
and also of those that are perhaps not so vital to the organization itself but are still its
members.

777
 More research is required to understand the importance of job satisfaction on loyalty to the
organization and especially its consequences and implications. We also suggest researchers to
pay attention to various cultural affects from the organizations surroundings.

References
Clark, B. R., (1972): The Organizational Saga in Higher Education, Administrative Science
Quarterly, Vol. 17, No. 2, pp. 178-184.
Gil, I., Berenguer, G., Cervera, A., (2008): The roles of service encounters, service value, and
job satisfaction in achieving customer satisfaction in business relationships, Industrial
Marketing Management, Vol. 37, pp. 921 – 939.
Hui, C., Lee, C., Rousseau, D. M., (2004): Employment Relationships in China: Do Workers
Relate to the Organization or to People?, Organization Science, Vol. 15, No. 2, pp. 232-
240.
Ilies, R., Judge, T. A., (2002): Understanding the dynamic relationships among personality,
mood, and job satisfaction: A field experience sampling study, Organizational Behavior
and Human Decision Processes, Vol. 89, pp. 1119 – 1139.
Kang, J., (2010): Ethical conflict and job satisfaction of public relations practitioners, Public
Relations Review, Vol. 36, pp. 152-156.
Kleinig, J., (2008): Loyalty, The Stanford Encyclopedia of Philosophy (Fall 2008 Edition),
Edward N. Zalta (ed.), URL:
<http://plato.stanford.edu/archives/fall2008/entries/loyalty/>.
Lu, H., While, A. E., Barriball, K. L., (2005): Job satisfaction among nurses: a literature
review, International Journal of Nursing Studies, Vol. 42, pp. 211 – 227.
Munoz de Bustillo Llorente, R., Fernandez Macias, E., (2005): Job satisfaction as an indicator
of the quality of work, The Journal of Socio-Economics, Vol. 34, pp. 656 – 673.
Namasivayam, K., Zhao, X., (2007): An investigation of the moderating effects of
organizational commitment on the relationships between work–family conflict and job
satisfaction among hospitality employees in India, Tourism Management, Vol. 28, pp.
1212 – 1223.
Schwepker, C. H., (2001): Ethical climate’s relationship to job satisfaction, organizational
commitment, and turnover intention in the sales force, Journal of Business Research,
Vol. 54, pp. 39 – 52.
Tzeng, H., (2002): The influence of nurses’ working motivation and job satisfaction on
intention to quit: an empirical investigation in Taiwan, International Journal of Nursing
Studies, Vol. 39, pp. 867 – 878.
Weiss, H. M., (2002): Deconstructing job satisfaction Separating evaluations, beliefs and
affective experiences, Human Resource Management Review, Vol. 12, pp. 173 – 194.
Wu, L., Norman, I. J., (2006): An investigation of job satisfaction, organizational
commitment and role conflict and ambiguity in a sample of Chinese undergraduate
nursing students, Nurse Education Today, Vol. 26, pp. 304 – 314.
Zalewska, A. M., (2010): Relationships between anxiety and job satisfaction – Three
approaches: ‘Bottom-up’, ‘top-down’ and ‘transactional’, Personality and Individual
Differences, Article in Press.

778

View publication stats