Table of Contents
Organizational commitment can be referred to as the strength of attachment felt by an employee towards the firm. It may be ascertained by the degree to which employees fulfill their tasks, readiness to adopt change and workplace behavior.
The following commitments may be higher in the firm owing to the decision made by Dan Price to ensure equality in employees remuneration: affective, normative, and continuance commitment.
Affective commitment involves how an employee feels part of the company. It has a tremendous effect on organizational performance. A workforce with high levels of affective commitment will always pledge their loyalty to the company. Positive work experience is directly related to affective commitment.
Continuance commitment is driven by the culture of the firm. This is mostly steered by the supportiveness of the organization. Employee loyalty and retention are essential elements of continuance commitment.
Normative commitment is high where employees see visible examples of the management and the executive being committed to their welfare.
The main idea behind the equity organizational theory is the principle of equality. The decision by Dan Price of raising and balancing employee salaries has its roots in the equity theory. As per this theory, the degree of employee motivation is directly affected his perception of fairness and justice from the management (Miner, 2015).
About the case, the reaction expressed by the employees will be based on the following assumptions: First, the employees are concerned with both their rewards and also the rewards of others. Secondly, individuals expect a fair and equitable return for their contribution to their tasks and responsibilities.
Thirdly; employees decide what their balanced remuneration should be after making comparison between their inputs and outcomes. Last but not least, Workers who feel that they are not treated fairly will try to minimize the inequity either by reducing inputs or by leaving the organization.
The style of leadership exhibited by Dan Price is Transformational Leadership. This involves initiating change in the firm. Transformational leaders boost the morale of the workforce to do more than they initially intended and even more than they thought possible (Robbins, 2009). They set more challenging goals to promote higher performance.
The leaders motivate and empower the workforce as in the case, Dan price has boosted the morale of the employees and transformed their perception of the enterprise. Transformational leaders will always change the firm’s core beliefs and procedures of working. Inspiration, effective communication, and individual attention are significant aspects of transformation leadership.
The following personality traits will be important:
Conscientiousness involves the degree to which an individual is organized, achievement-oriented, systematic and dependable. Conscientiousness is the personality trait that predicts how high an individual’s performance will be across a variety of jobs and occupations.
Proactive personality refers to an individual’s inclination to change things and use initiative to find solutions for problems. Dynamic persons take actions to initiate meaningful change and remove the drawbacks they face along the way.
Self-esteem is the degree to which an individual has an overall positive feeling about himself. Workers with high self-esteem are confident, and they respect themselves.
Self-efficacy is the belief that one can carry out a particular task successfully. Research indicates that the confidence in thought that we can do something in a better way is a good predictor of whether we can accomplish it.
Democratic leadership- In this style, everyone is allowed to participate in the decision-making process, but the final decisions are made by the top management (March, 2013). This style encourages the creativity of project team members and the workforce. Researchers have found that democratic leadership style is among the most effective since it leads to increased productivity and better contributions. This results in high productivity and job satisfaction.
Laissez-faire Leadership- Under this style, workers are given freedom to set their goals and objectives as well the work deadlines. Leaders in this style provide the resources required, support, and counseling to members if needed but they don’t get involved directly. This encourages job satisfaction and self-motivation to do their tasks efficiently.
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The functional structure is set up such that each portion of the firm is grouped according to its purpose or function (Griffin & Moorhead, 2011). In this type of organizational structure, there may be departments such as marketing, sales, and production. The functional structure works efficiently for small businesses since each unit can rely on the knowledge and talent of its workers. This structure enhances appropriate coordination of functions and better growth opportunities for the firm. However, one of the disadvantages of a functional structure is that communication and coordination between departments can be restricted by the enterprise boundaries. The functional structure has several merits to an organization as outlined below:
The structure enhances specialization and division of work. Each unit in the organization operates its own roles. Employees usually start their careers in the low ranks within the departments and given an opportunity to develop expertise and skills as they move up the hierarchy. The workers finally become experts within their departments and hence the business benefits from their experience.
Efficiency and Productivity
A worker who has enough experience in his functional area will always perform his/her work with a high level of competence and speed hence higher productivity. Also, since the career advancement paths within the functional structure are definite, the workforce may be highly motivated to advance
- Griffin, R. W., & Moorhead, G. (2011). Organizational Behavior. Cengage Learning.
- March, J. G. (Ed.). (2013). Handbook of Organizations (RLE: Organizations) (Vol. 20). Routledge.
- Miner, J. B. (2015). Organizational Behavior: Essential theories of motivation and leadership. Routledge.
- Robbins, S. P. (2009). Organizational Behavior. Pearson Education India.