Loyalty

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European MBA OB presentation

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Loyalty

  1. 1. What is the state of « Employee Loyalty »? Organisation Behaviour Tami LAIB Esther TAN Chui Yuk CHAN Vincent BOGAERS Xavier VANDERCHMITT
  2. 2. « Employee Loyalty », Definition <ul><li>&quot;Loyalty, as a general term, signifies a person's devotion or sentiment of attachment to a particular object, which may be another person or group of persons, an ideal, a duty, or a work place.” </li></ul><ul><li> (Encyclopedia Britannica, 1998). </li></ul>
  3. 3. Content <ul><li>History and Trend </li></ul><ul><li>How to obtain Employee Loyalty? </li></ul><ul><li>How to keep Employee Loyalty? </li></ul><ul><li>Limitations </li></ul><ul><li>Pros and Cons </li></ul><ul><li>Professional experiences </li></ul><ul><ul><li>Japanese firm </li></ul></ul><ul><ul><li>US firm </li></ul></ul><ul><li>Scenario: Loyalty vs. Opportunity </li></ul><ul><li>Conclusion </li></ul>
  4. 4. History and Trend
  5. 5. How to obtain « Employee Loyalty »? <ul><li>People apply for a company for some reasons </li></ul><ul><ul><li>Business value </li></ul></ul><ul><ul><li>Positive image </li></ul></ul><ul><ul><li>Successful of the company </li></ul></ul><ul><ul><li>Future opportunities </li></ul></ul><ul><ul><li>Money and compensation </li></ul></ul><ul><li>People will be confronted to assessments: </li></ul><ul><ul><li>Personality tests (Big 5 Personality Model,…) </li></ul></ul><ul><ul><li>Psychological tests (Myers-Briggs Type Indicator (MBTI),…) </li></ul></ul><ul><ul><li>Technical tests </li></ul></ul><ul><ul><li>Strong assessments. Example: Humetrics </li></ul></ul>
  6. 6. How to encourage it (Personnal & emotional aspects)? <ul><li>The 5 I’s: </li></ul><ul><ul><li>Interesting work </li></ul></ul><ul><ul><li>Information </li></ul></ul><ul><ul><li>Involvement </li></ul></ul><ul><ul><li>Independance </li></ul></ul><ul><ul><li>Increase visibility </li></ul></ul>
  7. 7. How to keep it (material aspect)? <ul><li>Bonuses </li></ul><ul><li>Housing benefits </li></ul><ul><ul><li>Help with down payments </li></ul></ul><ul><ul><li>Advising & counselling as rental </li></ul></ul><ul><ul><li>Renovation & construction assistance </li></ul></ul><ul><ul><li>Housing assistance, examples: </li></ul></ul><ul><ul><ul><li>Ex Harley Davidson Motor-Co </li></ul></ul></ul><ul><ul><ul><li>CVS Caremark </li></ul></ul></ul><ul><li>Investing in employee’s ongoing training and education </li></ul><ul><li>Flexible work schedule </li></ul><ul><li>Family Friendly work emvironment </li></ul>
  8. 8. Limitations on Applying Loyalty in a firm <ul><li>Activity of the company </li></ul><ul><ul><li>Turnover (Ex. Fast Food vs Government agency) </li></ul></ul><ul><li>Personnal circumstances </li></ul><ul><li>Outside opportunities </li></ul><ul><li>Contre exemple Chiken-fil-A </li></ul><ul><li>Correlation between Loyalty vs. Resigning </li></ul>SPEAK Disagree Agree Loyal Disloyal High level of resignation Increasing of talks
  9. 9. Pros and Cons of having loyal employees in a firm <ul><ul><ul><li>Pros </li></ul></ul></ul><ul><li>Obtain houst & reliable employees </li></ul><ul><li>Less personnel problems that affect operating costs & quality of service </li></ul><ul><li>Stability vs turnover (essential in certain activities) </li></ul><ul><li>Less absenteeism & tardiness rates </li></ul><ul><li>More committed and experienced employees </li></ul><ul><li> business is more successful </li></ul><ul><li> Cons </li></ul><ul><li>Costs and expensese for the loyal programs </li></ul><ul><li>Longer working period might cause low motivated and less productive employees </li></ul><ul><li>Potentially low innovation </li></ul>
  10. 10. Professional Experiences <ul><li>Comparison </li></ul><ul><ul><li>Japanese steel company vs. US consultancy company </li></ul></ul>
  11. 11. Scenario Loyalty vs. Opportunity <ul><li>Scenario 1: </li></ul><ul><li>Matt has been working for Dell Computer for 4 years already, next year he could be promoted as a manager. Meanwhile, he got an offer from Intel Computer which offers him 25% salary increase with non manager position. </li></ul><ul><li>If you were Matt, what would you choose? </li></ul><ul><li>Dell </li></ul><ul><li>Intel </li></ul>
  12. 12. Conclusion <ul><li>We strongly believe that loyalty is essential for a company. </li></ul><ul><li>Company provides combination of benefits to obtain “employee loyalty”. </li></ul>

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