Employee Communication's Role in Change and Turnover

The Role of Employee Communication during Change-
An Empirical, Qualitative Study of Employee Communication during Change
with Special Emphasis on Labor Turnover Using the Example of a
Communications Consultancy
Submitted by:
Maximilian Aue
0810511202
BA 2011 VZ
Date:
04.04.2011
Thesis supervisor:
Mag. Christina Leitner, MA
Affidavit
I guarantee that:
 I have independently written the thesis.
 I have not used other sources or reference materials than I have listed.
 I have used no other prohibited assistance.
 I have not submitted this thesis as an examination in any form either abroad or
domestically.
____________________________ ___________________________
Date Signature

II
Abstract
In times such as these the only constant in human life is change. Therefore change has also
become inevitable in the economic environment due to globalization, competitive pressure
and changing circumstances. Hence companies are obliged to undergo persistent change in
order to survive in competition. Embodying the most vital resource of an organization, the
employees are of utmost importance to the success of a change process. Thus businesses have
to focus on their employees’ capability to cope with change. Yet particularly today companies
tend not to take the staff into consideration and instead mainly care about immediate
economic success, which cannot be achieved without the contribution of the employees. This
situation is aggravated by the fact that people change their occupation in these fast-moving
times equally quickly. Consequently labor turnover during change is likely to have disastrous
effects on the economic viability of an organization. Since motivating employees and
providing them with a sense of security in times of uncertainty can only be achieved by
communication, managers particularly have to pay attention to employee communication.
Therefore the aim of this thesis is to examine the role of employee communication during
change and how it affects labor turnover.
In order to successfully achieve this objective, the theoretical part of this thesis focuses on
discussing the recent literature on these issues. In the empirical section three problem-
centered interviews conducted with three people from a communications consultancy which
underwent change are described. So as to analyze the data obtained through the interviews,
Mayring’s content analysis was applied.
On the basis of the research conducted the results show that employee communication is
likely to affect the outcome of a change process in various respects. Despite the fact that both
the literature and the respondents attribute the success of change mainly to employee
communication, the respondents add that employee communication only has limited influence
on labor turnover. However they also emphasize that without the necessary goodwill on both
sides, labor turnover is inevitable. Moreover the findings indicate that employee
communication is of even greater significance in times of change than in daily business.
Additionally it has to be consistent and continuous in order to create a sense of security.
In conclusion, these aspects have to be taken into account when planning employee
communication during change in order to minimize labor turnover.

III
Abstract
Veränderungen bestimmen das menschliche Leben. Besonders im wirtschaftlichen Umfeld
sind aufgrund von Globalisierung und Konkurrenzdruck Veränderungen unvermeidlich
geworden: Firmen müssen sich laufend verändern, um gegen die Konkurrenz bestehen zu
können. Der wichtigsten Ressource eines Betriebes - den Mitarbeitern - kommt im Zuge
eines Changes die entscheidende Rolle für den Erfolg zu. Meist wird bei
Veränderungsprozessen das Hauptaugenmerk auf unmittelbaren wirtschaftlichen Erfolg
gerichtet und dabei übersehen, dass dieser ohne die Beiträge der Mitarbeiter nicht
gewährleistet werden kann. Dazu kommt noch, dass Arbeitnehmer in dieser schnelllebigen
Zeit mit erhöhter Frequenz ihren Arbeitplatz wechseln. Folglich ist die Gefahr groß, dass
während einer Veränderung die Mitarbeiterfluktuation zunimmt und sich verheerend auf das
wirtschaftliche Überleben des Unternehmens auswirkt. Da in unsicheren Zeiten den
Mitarbeitern nur durch Kommunikation ein Sicherheitsgefühl vermittelt und die Motivation
gesteigert werden kann, müssen sich Führungskräfte besonders auf die
Mitarbeiterkommunikation konzentrieren. Daher ist die Zielsetzung dieser Arbeit, die Rolle
der Mitarbeiterkommunikation während eines Changes zu untersuchen und zu analysieren,
welchen Einfluss diese auf den Personalwechsel hat.
Der theoretische Teil dieser Arbeit konzentriert sich auf die aktulle Literatur zu diesen
Themen. Den empirischen Abschnitt bestimmen problem-zentrierte Interviews mit drei
Mitarbeitern einer Kommunikationsberatungsagentur, die einen Change erlebt hat. Für die
Auswertung der in diesen Interviews gewonnenen Daten wurde die Inhaltsanalyse nach
Mayring angewandt.
Die daraus resultierenden Ergebnisse zeigen, dass Mitarbeiterkommunikation einen
Changeprozess auf verschiedenartige Weisen beeinflussen kann. Trotz der Tatsache, dass
sowohl die Literatur als auch die Befragten eine erfolgreiche Veränderung in erster Linie der
Mitarbeiterkommunikation zuschreiben, merken diese jedoch an, dass Kommunikation alleine
nur einen begrenzten Einfluss auf die Fluktuation der Mitarbeiter hat. Sie betonen jedoch,
dass ohne den nötigen guten Willen auf beiden Seiten eine Fluktuation der Mitarbeiter
unumgänglich ist. Weiters weisen die Ergebnisse darauf hin, dass in Zeiten von Veränderung
die Mitarbeiterkommunikation von weit größerer Bedeutung ist als während des
Tagesgeschäfts. Zusätzlich muss die Kommunikation konsequent und regelmäßig sein, um
den Beschäftigten ein Gefühl der Sicherheit zu vermitteln. Abschließend ist festzuhalten, dass
bei der Planung von Mitarbeiterkommunikation im Change diese Gesichtspunkte
berücksichtigt werden müssen, um so die Mitarbeiterfluktuation minimieren zu können.

IV
Contents
1. Introduction............................................................................................... 1
1.1. Problem ................................................................................................................... 1
1.2. Aim.......................................................................................................................... 2
1.3. Research questions.................................................................................................. 3
1.4. Method .................................................................................................................... 3
1.5. Structure .................................................................................................................. 4
2. Employee communication................................................................................4
2.1. Definition and conceptual clarity............................................................................ 4
2.2. Goals and contents .................................................................................................. 5
2.3. The manager/ executive as communicator.............................................................. 8
2.4. Communication tools .............................................................................................. 9
2.4.1. Face to face ............................................................................................................... 9
2.4.2. Face to face- En masse............................................................................................ 10
2.4.3. E-mail...................................................................................................................... 10
2.4.4. Intranet.................................................................................................................... 11
3. Change.............................................................................................................11
3.1. Definition and conceptual clarity.......................................................................... 11
3.2. Types of change .................................................................................................... 12
3.3. Reasons for change ............................................................................................... 13
3.4. Phases of change ................................................................................................... 14
3.5. Why changes fail................................................................................................... 15
4. Labor turnover ...............................................................................................17
4.1. Definition and conceptual clarity.......................................................................... 18
4.2. Positive and negative aspects................................................................................ 18
4.3. Reasons for labor turnover.................................................................................... 19
4.4. Prevention and motivation .................................................................................... 19
4.5. Intangible incentives ............................................................................................. 20
5. Employee communication during change regarding labor turnover........21
5.1. Employee communication during change............................................................. 22
5.2. The impact of employee communication during change on
labor turnover and its consequences ..................................................................... 23
6. Research design ..............................................................................................25
6.1. Empirical sub-research questions.......................................................................... 25
6.2. Methodology ......................................................................................................... 26
6.3. Method of collecting data...................................................................................... 27
6.4. Access to the field and respondents ...................................................................... 27
6.5. Method of analysis ................................................................................................ 29

V
6.6. Quality assurance .................................................................................................. 29
7. Empirical findings ..........................................................................................30
7.1. The role of employee communication................................................................... 30
7.2. Employee communication during change............................................................. 31
7.3. Strengths, weaknesses, opportunities, and threats of
employee communication during change.............................................................. 33
7.4. Employee communication during change regarding labor turnover..................... 34
7.5. Employee communication during the change of the
communications consultancy ....................................................................................... 35
7.6. Reasons for labor turnover and its consequences in the case
of the communications consultancy..................................................................... 36
7.7. The importance of employee communication tools.............................................. 38
8. Conclusion.......................................................................................................39
8.1. Answer to the main research question .................................................................. 39
8.2. Discussion and outlook ......................................................................................... 40
9. Bibliography....................................................................................................41
9.1. Anthologies ........................................................................................................... 41
9.2. Books..................................................................................................................... 43
9.3. Journals ................................................................................................................. 45
10. Appendix........................................................................................................47
10.1. Interview guide.................................................................................................... 47
10.2. Transcripts........................................................................................................... 49
10.2.1. Respondent A........................................................................................................ 49
10.2.2. Respondent B........................................................................................................ 50
10.2.3. Respondent C........................................................................................................ 51
12.2.4. Mayring’s qualitative content analysis ................................................................. 52
Observation: In the interest of readability the masculine form has been chosen in the
text, nevertheless, the details provided refer to members of both sexes, except the
interviews with the respondents who will be referred to in the masculine and feminine
form, connected with or, in order to maintain anonymity.

1
1. Introduction
1.1. Problem
Labor markets are subject to constant change with the result that organizations are obliged
to flexibly move within these markets and readjust as well as react to new developments
(Längle 2009, p.35). The technical and economical network in a globalized market economy
raises and increases the complexity and dynamic for companies and organizations. Hence
profound changes represent and provide major challenges for employees and executives. Thus
only those who have the ability to adjust and adapt to rapidly changing conditions can be
successful and prevail in the long run (Kruse 2007, p.117). Communication undoubtedly is
one of the determining success factors within the scope of change management. This is due to
the mere fact that leadership and management as such are substantially based on
communication (Lauer 2010, p.105). Every kind of change must be regarded as an obstacle
and challenge to the communication within a company that can generate fear among the
employees. Furthermore the lack of orientation brought about by a basic change is considered
to be the reason for this emerging fear. The tried and trusted is being replaced by new
methods and new demands. People are expected to react to change with a changed behavior
and since change means something new, the habitual behavior ought not to and cannot be
continued (Mast 2008, p.425). Accordingly employee communication is a pivotal factor for
the success or failure of any change process and can facilitate change, when implemented
effectively (Barrett 2002, p.219) although opposition to change occurs more frequently
(Caldwell et al. 2004 cited in Parish et al. 2008, p.33).For organizations to succeed in
business it is of the highest priority to motivate its employees (Szameitat 2003, p.37). Since
most humans seek stability as well as safety and order (Kraus et al. 2010, p.10) it is of
particular importance for employees to hear crucial and vital information and instructions
directly from their executives in times of uncertainty and instability (Schick 2007, p.144).
If the desire and need to be informed and motivated is not met by the manager or leader,
this may lead to insecure employees and eventually result in labor turnover. For that reason
managers have to be able to correctly assess the role, strengths and weaknesses of employee
communication during change, strike the right balance between communicating too much and
communicating too little and understand the meaning and importance of employee
communication as a preventative measure or tool against labor turnover. The present thesis
therefore will firstly examine the role of employee communication during change with special

2
emphasis on labor turnover by the example of a communication agency. With this theoretical
background in mind the research questions can be clarified by means of an empirical study,
which will be conducted in the second part of this thesis.
1.2. Aim
In the literature much value and importance is attached to communication during change in
general as well as employee communication during change as a major contribution to the
success of a change process. Despite the fact that the literature presents the problem or
necessity for executives to effectively communicate with their employees in its entirety, the
topic and issue of employee communication during change with special emphasis on labor
turnover and in which way employee communication can affect labor turnover however is
either hardly dealt with or given very little attention. Accordingly this the main aim of this
thesis is to close this gap and to provide an in-depth and sound understanding of the role of
employee communication during change and how employee communication can be set up
during a major change so as to prevent labor turnover. In order to achieve this goal, the focus
lies upon explaining the role employee communication during change plays as a preventative
measure against labor turnover in the literature and what the strengths, weaknesses, threats
and opportunities of employee communication during change are and in which way those are
associated with labor turnover. Besides, this work should also have practical relevance, for the
purpose of which three persons from a communications consultancy were interviewed on this
issue. By the contributions of the three respondents new insights, newly found knowledge and
new findings from the interviews obtained through qualitative content analysis can be
critically linked to the theoretical knowledge so as to provide and point out potential for
improvement to managers, leaders and executives in order to contain and lessen the impact of
change processes in terms of labor turnover by effectively using employee communication.

3
1.3. Research questions
Based on the preceding aims to generate a better understanding of the role of employee
communication during change with special emphasis on labor turnover, various aspects and
theories of these conceptualities will be compared to answer the following research question:
“How and to which degree does the role of employee communication during change with
special emphasis on labor turnover as discussed in the relevant literature differ from its
role in practice?”
From this the following theoretical sub-research questions can be deduced:
 Which role is given to employee communication during change in general on the part
of the literature?
 How does employee communication during change affect labor turnover in the
literature?
As well as the following empirical sub-research questions:
 How do the respondents evaluate the role of employee communication during change
at large?
 How do the respondents evaluate the impact of employee communication during
change on labor turnover in general and in the case of the communications
consultancy?
 How do the interviewed persons asses various tools of employee communication
during change?
1.4. Method
This thesis is divided into two parts, of which the first one focuses on study of research
literature of already existing and researched knowledge of experts in the field of change,
employee communication and labor turnover while the second part consists of an empirical,
qualitative study, in the course of which one executive, one assistant and one former
consultant were interviewed on the topic of employee communication during change with
special emphasis on labor turnover in general and regarding their agency. Therefore the ample
knowledge this study provides is both theoretically and practically relevant.

4
1.5. Structure
The first chapter serves as an introduction to the topic. Chapter 2 specifies on the definition
of employee communication followed by the goals and tools as well as the role of the
manager as a communicator in order to provide a profound and sound understanding. The
third chapter, the chapter of “Change”, will thoroughly explain and present that same term in
detail and discuss the most important aspects of change. The fourth chapter sets out to analyze
labor turnover from a conceptual standpoint with regards to the impact of and reasons for
labor turnover. The answers and findings pertaining to the theoretical sub-research questions
are to be given in the fifth chapter, in which the three subject areas of employee
communication change and labor turnover will be conflated and brought together. Therefore
this chapter serves as the interim discussion of the theoretical part. Chapter 6 covers the
empirical section of this thesis, in which the methodology, the method of collecting data,
access to the field and respondents, method of analysis and quality assurance are being
examined in order to provide a better understanding of the empirical findings, which are
presented in chapter 7. Eventually chapter 8 will provide the conclusion, which will answer
the research question by comparing the theoretical results to the empirical findings.
Furthermore the eighth chapter will also contain the discussion of the results and the outlook.
2. Employee communication
In order to provide a sound and thorough understanding of employee communication in the
following chapter, the author at first sets great value upon the notional distinction between
internal communications and employee communication, as employee communication presents
and forms one part of internal communications. In spite of that, the boundaries of these two
terms often become indistinct in the literature. Subsequently the goals and contents of
employee communication will be examined as well as the role of managers and leaders as
communicators in order to preface the chapter “3.Change”.
2.1. Definition and conceptual clarity
Bruhn (2005, p.1203) states that the main reason for the insufficient analysis of all
company- internal communication results from the lack of conceptual clarity. In many cases
the terms “internal communication” and “employee communication” are treated as equal.

5
Therefore a notional distinction is useful. Bruhn (2005, p.1203) refers to employee
communication as all primary top-down activities within an organization which serve the
transmission of messages, whereas internal communication includes all activities to transmit
messages between current and former members of the organization on different hierarchical
levels.
Hence employee communication can be assumed to be a unique and specific part of
internal communications, since the term employee communication requires a certain direction
of communication.
The significance and importance of internal communication with employees cannot be
estimated generously enough. In fact its importance is just as essential and crucial as external
communication. Employee communication serves as the general basis for the public image of
one company or business ( Szameitat 2003, p.37).
Informing employees and communicatively involving them in the events and happenings
are both crucial and pivotal for the economic success (Mast 2008, p.253). Recent studies have
shown an intimate correlation between communication with employees and data to measure
success by, such as revenue and return on investment (Watson Wyatt 2005/ 2006 cited in Mast
2008, p.253). Regarding internal communication, Mast (2000, p.82) suggests to take more of
a target group approach, as it would certainly lead to more effective communication.
Internal communication is an integrative part of a holistic communication management. In
perfect condition its objectives and contents derive from the superior goals of corporate
communications, which again derive from the business goals and objectives. In reality this
ideal status can only be reached slowly. In many places an emancipation process of internal
communications can be observed. Internal communication is developing to become an
independent department or division in companies. Depending on the company, it can be used
as a strategic leadership-tool or an internal communication consulting (Lies 2008, pp.133-
134).
2.2. Goals and contents
According to Hoffmann (2001, p.41 cited in Mast 2008, p.258) employee communication
is in pursuit of various goals. In addition to aims and goals with business focus, which focus
on the influence on employee behavior regarding corporate objectives, there also exist
employee- oriented goals. These goals refer to the person and nature of the employee, to his
needs, wants and chances of development. Szameitat (2003, p.37) understands the primary

6
aim and goal of employee communication to be information and motivation of employees.
Mast (2008, p.258) summarizes the major aims of employee communication in the following
way:
- Coordination: A coordinated and controlled cooperation in a company is supported by
internal communications, which enables and facilitates aimed control, interconnectedness and
improvement of operating procedures from different departments. Hence communication
between management and employees contributes to increased and elevated labor productivity
(Mast 2008, p.258).
- Motivation: Additional communication within the company should specifically improve
and raise the motivation of the employed persons. Thus efficiency and effectiveness of the
individual job performance are expected to be influenced positively. “Management by
information” is believed to be one of the most pivotal and important motivation-tools (Mast
2008, p.258). Szameitat (2003, p.37) adds that, since a company’s management pursues the
goal of obtaining an economically optimal result for the good of shareholders and employees,
it is of particular importance to have capable and motivated employees, which identify with
the company and its goals and in addition develop individual initiative. In today’s reality, the
motivation of personnel, and tapping its full potential, also regarding creativity, can no longer
be achieved by mere material performance incentives, such as increase of salary or wage rise.
Instead immaterial performance incentives are becoming increasingly important. At the
present day employees want to consider their occupation as meaningful and be taken seriously
on an emotional level.
- Job satisfaction: Beside motivation and performance, job satisfaction presents an
additional goal of employee communication. Happiness derives from the satisfaction of
individual wants and preferences. If information and communication are considered as an
important need of employees, sufficient information and communication can lead to
satisfaction of wants and needs, such as orientation, involvement, contact, acknowledgement
and affirmation (Mast 2008, p.258).
- Trust and credibility: Trust presents the foundation of any working relationship.
Moreover, communication is an essential part of trust and credibility. The development and
preservation of trust and credibility in the top management is enhanced by the feeling of being
taken seriously as an equal and being informed in an honest and sincere way (Mast 2008,
p.258).
- Integration and identification: Identification with one’s work and company is affected by
work experience, such as the scale of social integration or opportunities of participation.

7
These experiences are linked to information, corporate identity and corporate culture (Mast
2008, p.258).
- Work climate and corporate culture: The way employees perceive corporate culture
depends on employee communication. Communication media, structures and rules of internal
communications are substantial to the corporate culture. In the case of an open corporate
culture, employees are open for co- responsibility and individual initiative (Mast 2008,
p.259).
The above exhibits, that Mast (2008, p.259) does not maintain the notional distinction
between employee communication and internal communications, which Bruhn (2005, p.1203)
considers to be essential and crucial. Now one could argue, that Mast (2008, p.259) relates to
work climate and corporate culture in terms of being a general content and goal of internal
communications and not only of employee communication.
- Knowledge and willingness to change: Modern businesses are subjected to ongoing
changes. Therefore knowledge and flexibility have to be considered as defining and crucial
resources. Internal communication vitally contributes to knowledge management and as a
consequence supports the management during chance processes. Internal communications
aims at the employees’ willingness to change and prepares them for the change process in
allaying fears. Only convinced, informed and qualified employees will back change (Mast
2008, p.259).
- External impression: The primary target group of internal communications is the
workforce of the corporation. Nevertheless employees act the part of information sources in
public, as they have high credibility and authenticity. Well informed employees, who identify
with the company, may contribute to the external impression of a business considerably (Mast
2008, p.259).
Barrett (2010, pp.346-347) adds further objectives and tasks of employee communication.
Employees have to be informed and motivated, so as to accomplish the organization’s
objectives. Also inspiring and promoting the workforce towards better performance and
containing if not preventing misconceptions and rumors, which might impair efficiency, is of
prime importance. In order to reach these objectives, the communication has to be clear,
consistent and aimed. Executives must develop a strategy of how to communicate with all
internal audiences.
Comparing Barrett (2010, pp.346-347) to Mast (2000, p.82) accents their similar target
group approach regarding internal communications. In terms of the objectives and goals of

8
employee communication Barrett (2010, pp.346-347) in opposition to Mast (2000, p.82)
points out the importance of employee communication as a tool to prevent misunderstandings.
2.3. The manager/ executive as communicator
As discussed in the chapter above, employee communication is an executive’s task, as it is
crucial to the economic success of a company. Therefore the terms leadership and
communication are closely linked.
Information and communication are vital and significant for companies (Herbst 1999 cited
in Fallosch 2007, p.53).
“Personal leadership is about communication, openness, and a willingness to speak often
and honestly, and with respect for the intelligence of the reader or listener. Leaders don’t
hide behind corporate double-speak. They don’t leave to others the delivery of bad news.
They treat every employee as someone who deserves to understand what’s going on in the
enterprise (Gerstner 2002 cited in Barrett 2010, p.344).”
According to Frese (1990, p.82 cited in Fallosch 2007, p.12), leading and guiding
appropriately also means informing appropriately. For he who does not know the right thing
cannot do the right thing.
Regnet (2009,p.204) states that leading primarily means talking with one another by way
of example to solve problems, to make decisions, for arrangement of teamwork, to express
appreciation and to criticize. As per Buckingham/ Coffman (2005, pp.21-22 cited in Regnet
2009, p.204) the quality of a workplace consists of different factors, such as the employee
knowing exactly what is demanded of him, he consistently receiving credit and winning
praise for doing a good job, having their opinions and ideas taken into account, discussing
progress and experiencing appreciation as a human.
To meet all these aspects a continuous communication between leader and employee is
indispensable. In reality though, employees, regardless of their hierarchy and area of
functioning, basically desire more information from their superiors (Regnet 2009, p.204).
Executives are in charge of internal communications, communication with other executives,
employees and teams of the organization, in regional, national and international business
contacts, in human resource and account management, and public relations (Richter 1996,
p.11 cited in Fallosch 2007, p.26).

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2.4. Communication tools
There are different tools and ways for leaders and executives to communicate with their
employees. In times of change the selection and choice of communication tools can be crucial
and pivotal to the success of change and influence the emotional condition of the employees.
In the following the author of this thesis will outline and explain various communication
tools. Particular attention will be paid to face to face communication, as it is of exceptionally
paramount importance for leaders and managers in order to generate a sense of security
among the employees in times of change and uncertainty.
According to Mast (2000, p.149) vertical communication procedures pursue the following
goals: Providing operating instructions and briefings, information about the purposes,
intentions, developments and plans of an organization and justification of management
decisions. Therefore Mast (2000, p.148) considers the challenge for managers to be deciding
by the use of which communication tools certain communication tasks can most effectively be
achieved.
2.4.1. Face to face
Out of all available media of communication the one-on-one interview is and shall remain
the most indispensable and irreplaceable one due to its advantage of providing direct and
immediate contact with the dialog partner (Längle 2009, p.37). Smith/ Mounter (2008, pp.80-
81) state that according to surveys of all communication tools and in all fields and areas face-
to-face communication respectively one-to-one communication is the most appreciated,
cherished and valued one by employees.
The comparison between the two statements above gives proof of the great significance
and mutual appreciation of one-on-one interviews by various authors and employees and
further confirms its undisputed role as the most important and most effective communication
tool.
According to Gierl/ Hüttl (2009, p.233) the term “personal communication” is being used
in an inconsistent and uneven manner. Bruhn (2005, p.400 cited in Gierl/ Hüttl 2009, p.233)
understands communication to be personal, if it is achieved and comes into being via face-to-
face communication between humans. Whereas communication is impersonal if
communication media are being used to convey and transmit messages.
The reason why face-to-face communication is of such high value is due to the mere fact
that it cannot be put down unread, cannot be ignored and furthermore signals undivided
attention on the part of the organization (Hochmeister 1993, p.34 cited in Längle 2009, pp.37-

10
38). Especially one-to-one interviews are still considered to be the prime selection to process
one person’s ideas, needs, suggestions and fears (Klöfer 2001, p.42 cited in Längle 2009,
p.38), which is especially crucial and pivotal in times of uncertainty and change.
Particular advantages of direct personal communication are the possibility of directly
giving feedback, the opportunity of emotionality, confidentiality and individual
differentiation, whereas the disadvantages include that it is costly in terms of time and the
information is not archivable (Schick 2007, p.53). Smith/ Mounter (2008, pp.80-81) add a
further disadvantage of face-to-face communication, as senior management might assume that
a corporate attitude is comprehended by all in equal measure. Therefore it is obligatory and
indispensable to determine and verify that mutual understanding on vital topics actually
exists.
2.4.2. Face to face- En masse
Certain messages have to be communicated to the whole staff and therefore depending on
the size of the staff different supportive tools have to be applied. This kind of communication
should be considered when delivering information about the organization and its
developments (Smith/ Mounter 2008, pp.81-82). Längle (2009, p.39) states that the aim of a
team meeting is to discuss current and ongoing projects and their work progress as well as
exchanging pivotal information and evaluating completed projects or planning further steps
regarding client acquisition.
This type of communication is especially important during change so as to ensure the same
level of information among the employees in order to prevent rumors, ambiguity and as a
result uncertainty.
2.4.3. E-mail
Schick (2007, p.55) considers the use of e-mail to be of supplementary nature to deliver up-
to-date information to the whole staff.
The advantages of e-mail communication are that messages can be sent and received
independent of time and location (Kohn 2003, p.53 cited in Längle 2009, p.39), its ease of use
and conversational functions (Längle 2009, pp.39-40) as well as having the ability to archive
information, low expenses in terms of production and transportation compared to print media
and being able to quickly inform vast target groups over great distances (Schick 2007, p.53).
As disadvantages Schick (2007, p.53) lists the flood of emails, insufficient design quality,

11
little emotionality and the fact that large quantities of text tend not to be read on the display or
screen.
Therefore, in order to assure that messages, sent via email, are being read by the
employees, managers should be brief and compile clear messages when delivering
information during change.
2.4.4. Intranet
The intranet is accessible to a defined group of employees of an organization and denies
access to external users (Längle 2009, p.41). Furthermore the intranet interconnects staff
members of a business and can be used for employee information, top management
communication, vocational education and training, archiving, demand sides and mailing lists
(Fuchs/ Möhrle/ Schmidt-Marwede 1998, pp.35-36 cited in Längle 2009, p.41).
Smith/ Mounter (2008, p.86) further adds and emphasizes the problem of reading on screen.
As one can conclude from the above the intranet is more qualified for short facts and
information, as employees should comfortably be able to access and process these.
3. Change
Before addressing change in an economic and commercial context, the author will in
contrast briefly illuminate change in general in order to clarify and explain their similarities,
as this may help to understand the human side of change and how it relates to labor turnover.
Then both the different types of change and various reasons for change will be discussed, as
different changes demand different approaches and management. Thereafter the possible error
sources during change will be analyzed in order to conclude the chapter.
Changes are part of people’s daily routine and everyday life, although most human beings
seek stability and desire safety and order, which often shape our actions and thinking (Kraus
et al. 2010, p.10). Due to the mere fact human beings advance in age every day, they change
biologically (Kraus et al. 2010, p.11). Therefore organizations and companies change, as they
can be understood as selective accumulations of people (Kraus et al. 2010, p.12).

12
Hence, change is inevitable and ongoing. The ambiguity and specific complexity of this
topic is evident from the fact that most people try to avoid change as they seek stability and
security, although they do change imperceptibly little by little on a daily basis.
Rischar (2005, p.1) states that the term change management has only been used for a few
years and extensively implies the management and handling of changes within an
organizations. These changes become necessary, for organizations need to adjust and adapt
preemptively or reactively to changes in its surrounding and environment. Whereas Rank/
Scheinpflug (2010, pp.16-17) consider change management to be as relevant as ever due to
globalization and changes of markets. Further change management is a method and approach
to proactively handle change, and through its targeted use necessary changes are supposed to
become easier to plan, controllable and successfully implemented.
In the above Rischar (2005, p.1) considers change management as a pre-emptive or
reactive activity, whereas Rank/ Scheinpflug (2010, pp.16-17) refer to change management as
a solely proactive action.
Organizations permanently have to transform in order to adjust to (the) competition due to
the mere fact that competitive situations and constellations constantly change. The challenges
and requirements for organizations and employees increase all the more, if suchlike necessary
adjustments have not been made and thus entail crises (Lange 2000, p.62).
From the above one can conclude that Lange also perceives change management as a
proactive activity, as he states that unless adjustments have been made in advance crises
emerge. Therefore the term change management is insufficient as it then is a matter of crisis
management.
Kostka/ Mönch (2009, p.9) state that change management connotes to plan, initiate,
implement, reflect and stabilize processes of change and transformation on a corporate and
personal level. The ability of an organization to integrate their employees in a paradigmatic
process of change has a determining influence on the success of changes. Change
management is a primary ingredient and integral part of successful corporate transaction, for
changes shape our existence.
3.2. Types of change
Change is an elastic and relative term. In the following, various types of change will be
listed in order to provide an understanding of what change connotes.

13
Berner (2010, p.12) presents a general view of different types of change, inasmuch as
different schemes of change arouse different emotions among the addressees and therefore put
different demands on the management, communication and change management. Thus all
change processes must not be treated equally, but rather one should look closely at what kind
of actions a specific change requires. Turnaround, rehabilitation, downsizing, cost reduction
programs, increase in productivity, mergers and acquisitions, restructuring, process
optimization, reengineering, quality management, implementing new IT- systems or
customer relationship management, the implementation of a new business strategy all amount
to possible change projects.
According to Stolzenberg/ Heberle (2006, p.2), labor in organizations is subject to constant
change, because organizations themselves have to change permanently. Change can be
triggered by modified parameters, globalized markets together with international competition,
altered legal situations, economic crises or product innovations.
3.3. Reasons for change
Why change takes place can have various reasons. Human beings and organizations both
change, though they change for different reasons. Nevertheless some of the reasons can be
linked to one another as the original condition and emotion of both human beings and
organizations is often the same.
The above holds true particularly since companies can be understood as selective
accumulations of people (Kraus et al. 2010, p.12). People do not change, unless it is
inevitable and necessary (Doppler 2003, p.101). Doppler (2003, p.97) considers two reasons
to be crucial and decisive regarding change. Passion and fear both urge people to do things
they have never done before, whereas passion declines in old age. Baumöl (2008, pp.25-26)
focuses on what triggers organizational change, as she divides these triggers into internal
triggers, such as primary triggers and secondary triggers, external triggers and the third
category being triggers, that originate in the field of information and communication
technology. Baumöl (2008, pp. 25-26) contends the primary internal triggers consist of a
change of leadership, a decline in sales, a shift of employees profiles and core competencies,
caused by labor turnover, and innovations in the product and services sector. Secondary
triggers could be constituted by the cost structure, which is obsolete, inapt positioning,
modified power structures and innovations in field of proceedings. Innovation behavior of
competitors and suppliers or impulses, caused by economic research, could represent external

14
triggers of organizational change. The third category of triggers could be the obsolescence or
outage of an application.
Schleuter/ von Stosch (2009, p. 9) add further triggering factors for change. Time-, quality-
and cost pressure, shorter product life cycles, accelerated courses of business, increasing and
changing customer requirements, increasing challenges and tasks for employees and co-
occurring labor deficit, quickly emerging and breaking away of markets and complex
economic zones constitute the most common factors according to Schleuter/ von Stosch
(2009, p. 9).
When comparing Schleuter/ von Stosch (2009, p. 9) to Baumöl (2008, pp. 25-26) the
mutual understanding of the reasons for change becomes evident, although Schleuter/ von
Stosch (2009, p. 9) does not divide the factors into different categories.
3.4. Phases of change
When analyzing change and its success, the human side of change has to be taken into
consideration appropriately, since the employees make significant contributions to the success
of change and thus are of paramount importance. Therefore the psychological state the
employees are in always has to be taken into account in order to manage and communicate
adequately and hence adjust to the conditions as effectively as possible.
Kostka/ Mönch (2009, pp.12-13) suggest that it is both crucial and pivotal for leaders to
deal with the psychological reactions of humans during change to develop structuring
measures in such a way that the people concerned become involved participants.
In the following Kostka/ Mönch (2009, p.14) subdivide the psychological process of
change into seven phases:
1. Shock, surprise: In this phase a confrontation with unexpected parameters and
framework conditions takes place, such as poor trading results. The self-perception of
one’s own competence decreases because the own action plans are not suited for the
new conditions.
2. Denial, refusal: At this point values and paradigms are being enabled and activated,
which strengthen the conviction that the change or transformation is not necessary.
The own competence is perceived as increased because the modified conditions are
not assumed to be indispensable for change of the own procedures.
3. Rational insight: In the third phase the necessity to change is recognized, which
results in a perceived decrease of the own competence. A search for solutions aiming

15
at short term success is being initiated, which often solely treat the symptoms. Hence
the willingness to change and modify own behaviors does not exist.
4. Emotional acceptance: This phase is also being termed as crisis, meaning decisive
turn. This crisis contains opportunities and threats. If the willingness to question
values and behaviors is activated there is a possibility to tap unused and unexploited
potentials. Though if it is not successful, this may lead to a renewed denial and refusal
of the situation, which ultimately results in a deceleration or halt of the change
process.
5. Testing, learning: The emotional acceptance of change initiates the willingness to
learn. The adequate new changed behaviors can be tested and practiced. There is going
to be success as well as failure. The own competence is perceived as increased and it
improves only through continuous trial and practice.
6. Awareness: While practicing these behaviors, more and more information that
indicates in which situation the new behaviors are appropriate, is being collected. This
leads to an expansion of consciousness. The enhanced behavioral repertoire enables
greater behavioral flexibility. The own competence is perceived as surpassing the level
of before the change.
7. Integration: The new mindset and behaviors are being integrated entirely, with the
result that they are being taken for granted and to a large extent are being executed and
performed unconsciously.
In contrast the transition curve of change as per Smith/ Mounter (2008, p.176) proceeds on
the assumption that employees pass and experience a wide range of stages before eventually
embracing change, namely in the following order: From denial, anxiety, shock, confusion,
resignation, anger, avoidance, undirected energy, creativity, conflict, high stress, realization of
loss, acceptance, impatience, hope, relief, excitement and trusting to enthusiasm.
3.5. Why changes fail
Before putting the focus on sources of error and mistakes, which might occur during
change and potentially lead to failure, it is necessary to define what the term failure implies.
Therefore Kraus et al. (2010, p. 158) consider failure respectively unsuccessfulness as not
achieving or only partially achieving the targeted objectives of the change. Hence the question
arises whether change can be considered successful if it requires twice as much cost and effort

16
or twice as much time as planned. Terming these difficulties as unsuccessful change would
certainly lead to a greater amount of unsuccessful change processes.
Kraus et al. (2010, p. 13) add that change brings uncertainty and insecurity. Nevertheless
human beings need clear orientation, rituals and traditions which make them feel as if the
world were controllable and assessable. Furthermore change requires both mental and
physical energy, which is why people try to avoid change. Kraus et al. (2010, pp.159-160)
state that there are three reasons for mistakes that subsequently are being made and therefore
lead to failure of change. The first error is that good intentions are not thought through
sufficiently or cannot be estimated properly with regard to effects and therefore may lead to
negative results. The second being ambiguity about feedback, because it is often disguised as
positive feedback due to dishonesty out of too much respect.
Especially relating to the second reason, communication can and must play a decisive role,
as the failure of change can be prevented by communicating honestly.
The third and last reason why changes fail, according to Kraus et al. (2010, p.160), is
because human beings are endued with a self- protection mechanism which causes the so-
called attribution error. This error or mistake implies that we, as humans, tend to attribute the
success of others to situational parameters and circumstances. On the other hand we attribute
others’ failure to their nature. Regarding ourselves, we see that constellation inverted,
meaning that we attribute our success to ourselves but blame situational parameters and
circumstances in case of failure.
Missing support from responsible executives is one of the most common causes of failure,
although in the majority of cases the top management initiates the change. Also a single
expert does not guarantee success, which is why consultants should help to fulfill
responsibility. Responsibility must not be escaped, as this inevitably leads to unhealthy
dependence. Oftentimes commitment and effort are being underestimated, as the exhaustion
of all participants presents itself as a borderline experience. In these moments of crisis it is
crucial to invest time and money in order to achieve a solid state. A lack of willingness to
invest and personally commit oneself within the top management may have disastrous
consequences as well. Change processes are being initiated as campaigns with the utmost
effort. Thereafter nothing is communicated; there is no feedback, no response and therefore
no results. Hence, the staff becomes accustomed to inconsequence (Lindinger/ Goller 2004,
p.36-37).
According to Kraus et al. (2006, p.160), the typical areas in which sins, relating to change,
are committed, consist of insufficient analysis of the initial situation, insufficient awareness of

17
the problem, poor communication of the change and poor strategy and practice. Also
unprofessional management of the stakeholders that are affected by the change, insufficient
consideration of the basic motives of humans, vast size and excessive speed of the change
process, unprofessional use of methods, insufficient controlling of the implementation of
change belong to the ten sins of change.
Lindinger/ Goller (2004, pp.38-39) add further mistakes. Some decision makers commit
the error of not wanting to implement an idea, although they are intellectually and emotionally
fascinated by it. This raises expectations, and if not implemented, leads to disappointment.
Additionally many change projects fail because they are not perceived as change. By way of
example in many cases the introduction of a new IT- system is perceived as a mere technical-
organizational task. In the course of this, the maturity level of the organization is oftentimes
misjudged. Solely companies with proved knowledge and experience are capable of getting
involved with change without additional change management. Changing the person in charge,
even though he or she is successful, during a change process is also a common error.
4. Labor turnover
Labor turnover, staff turnover, and employee turnover are mostly negatively referred to on
the part of the literature. This chapter examines the term labor turnover in general, and then
focuses on its aspects and what causes it and eventually analyzes prevention and motivation in
terms of labor turnover in order to lay the groundwork for chapter 5, in the course of which
the theoretical sub-research questions will be answered. When one thinks of labor turnover
and why employees resign, one might think it is solely because of dissatisfaction, whereas it
is much more important to find out what triggers dissatisfaction in order to minimize or
prevent labor turnover. The following quotation aptly summarizes the impact of labor
turnover.
“Although some resignations may permit an organization to correct a mistake in staffing
or to bring in “new blood”, excessive turnover can be very costly; with each departure, the
organization loses the investment it has made in recruiting, selecting, and training the
departing employee (French 2007, p.284).”

18
Labor turnover is the permanent attrition of the workforce as a result of lacking employee-
sided exit barriers and not just exclusively as a result of factors, initiated by an organization,
and other causes such as disability, invalidity and death of the employee. By virtue of the
criterion that labor turnover is not solely operationally induced, labor turnover admittedly
includes resignation, but not resignations due to employer termination (Scholz 2000,
p.704).According to Olfert (2010, p.289) staff turnover connotes any attrition of workforce of
a company, staff reduction on the basis of mutual agreement and staff reduction as
autonomous decisions of employees.
4.2. Positive and negative aspects
Although the negative consequences of labor turnover may prevail and outweigh the
positive aspects, the latter must not be omitted, as it is of particular importance regarding
change.
Rudham (2003 cited in Bröckermann 2004, p.17) lists the positive consequences of
attrition. A decrease of labor costs as well as the chance of restructuring and optimization
presents positive results of employees leaving the company. The prospect of promotion for
the remaining employees and the possibility of obtaining new and talented workforce also
constitute positive effects. New ways of personnel placement, such as outsourcing and
assignment of duties to third parties complete the list according to Rudham (2003 cited in
Bröckermann 2004, p.17).
After defining and describing the positive aspects and consequences, which arise as a result
of labor turnover, the negative aspects of employee turnover will be discussed as well in the
following.
Sizeable costs of recruiting, loss of knowledge and key skills, putting an increased amount
of pressure on remaining employees, and as a consequence thereof recessive motivation and
satisfaction, as well as reduced productivity and creativity all rank among the more fatal and
momentous negative aspects of staff turnover, according to Rudham (2003 cited in
Bröckermann 2004, p.17).
One can deduce from the above, that the negative aspects distinctly have further-reaching
consequences than the positive aspects.
This assumption is also confirmed by Thom/ Friedli (2003, p.64 cited in Bröckermann
2004, p.17), who specifically emphasize the financial impact by stating that the cuts and

19
savings of labor costs are incommensurate with the costs of contract annulments, restaffing
and replacements and the costs which result from diminished productivity and a lack of
motivation.
4.3. Reasons for labor turnover
According to Armstrong (2006, p.380), information about the causes for employees to
leave a company has merely been obtained through exit interviews, which rather aim at the
reasons of leaving rather than convincing them to stay. Schwierz (2001, p. 38, 41 cited in
Bröckermann 2004, p.22) found that employees, who leave a company, often feel
uncomfortable due to the corporate culture and feel they have been held in low esteem.
Furthermore they cannot imagine how they would fit in with the business goals and
additionally have not been assigned challenging tasks. Likewise, employees often feel they
have no chance or possibility of further development. Armstrong (2006, p.380) adds further
reasons for labor turnover, such as a bright and promising prospect in terms of developing
oneself at another company, the possibility of increased salary and increased security and
tense relationships with both colleagues and executives. At worst possibly even bullying or
tormenting could lead to the attrition of the workforce.
In addition, satisfied is not equivalent to perfectly happy, which evidently points out the
discrepancy between personal wishes and the actual expectations from the employer
(Schwierz 2001, p. 40 cited in Bröckermann 2004, p.22)
4.4. Prevention and motivation
Although there are positive consequences following employee turnover as well, it is
common for companies to try to prevent labor turnover and motivate their employees to stay
put. In the following different methods to prevent labor turnover and increase motivation will
be discussed.
Whenever the question of the reasons or causes of human agency is asked, it is ever, even
though various terminologies are used, such as desire, urge, reason, need, instinct or
aspiration, being related to driving forces within a person, which, in modern psychology, are
being summarized in the concept of motivation (Heckhausen 2006; Weiner 1996 cited in von
Rosenstiel 2009, p.158). Mayrhofer (2009, p.98) subdivides motivation into intrinsic and
extrinsic motivation. Human beings can trace their behavior to interior or exterior reasons

20
(Rheinberg 2008, 149-150 cited in Mayrhofer 2009, p.98). As per Mayrhofer (2009, p.98)
intrinsic motivation implies behavioral causes, which lie within a person, such as delight in
one’s occupation, enjoyment of performance, strong personal values or clear goals. The
energy for behavior originates from the activity itself, whose participation for the
establishment of a condition, which is viewed as personally satisfactory. On the contrary,
there is extrinsic motivation, in which the assumed reasons for specific behavior primarily
come from the environment or surrounding of a person. Therefore not the behavior itself
motivates, but rather an external circumstance, such as the request of another person, threat of
disciplinary action after failing to comply with a university’s code of conduct or financial
rewards for submission of improvement suggestions. Usually a correlation of intrinsic and
extrinsic motivation is assumed.
4.5. Intangible incentives
As mentioned previously, in chapter 2.1. (Goals and contents of employee
communication), immaterial performance incentives are becoming more important.
Becker (1990 cited in Berthel/ Becker 2007, p.483) assumes an intangible incentive system,
which is supposed to bring about intangible motifs. The form of the management subsystems
provide stimuli, especially the following can be connected to various incentive effects:
- Planning and decision-making system: On the one hand the participation of employees
in the planning and decision-making system relates to legally regulated participation
objects. The individual participation is slim in a way that is irrelevant in terms of
incentives. This implicit involvement does not influence the employee’s behavior in a
motivational way and therefore is not able to fulfill the targeted functions. On the
other hand the voluntary participation of employees or individual participation in the
corporate decision- making process is more important in terms of incentives. An
intensified involvement or participation in planning and decision- making is possible
because of organizational and individual- related measures. For relatively motivated
employees, these measures can be of considerable value (Berthel/ Becker 2007,
p.483).
- Personnel system: Many employees are fully aware of the importance adapting and
augmenting their qualifications in order to permanently persist in their occupational
life. This being the case, employees rate the support via human resource management
as an incentive. This is intensified by qualification investments, which evince

21
increased interest in employees as well as participation in applicable plans. Both
immaterial and material rewards are possible in the career system, as filling a new
superior position carries incentives, such as appreciation of a person, extended scope
for decision- making, new and interesting work content, improvement of prestige and
income. Some of these stimuli also occur during horizontal career positions. The use
of compensatory incentive tools depends on the career possibilities a business is
capable of offering. The career system can also be applied to steer and navigate
employees by referring to the intended performance and conveying the idea to the
employees that desired behavior will be sanctioned positively. As a result a
corresponding influence on behavior through career measures may be expected. In
many areas employee- related leadership behavior is increasingly perceived as an
individual incentive. The goal of individualized leadership of employees is the waiver
of schematization and therefore sophisticated leadership behavior should comply with
each employee’s individual motifs (Berthel/ Becker 2007, p. 484).
- Information system: The figuration and design of the information system can also
provide incentives. Regular, timely and comprehensive information on developments
regarding tasks and operations may result in employees feeling taken seriously. In-
house information policy can be an effective instrument to show employees the
company’s appreciation (Berthel/ Becker 2007, p. 484).
- Organization system: Within the framework of the organization system some of the
intangible incentives, which have already been mentioned in the above, are being
structurally positioned (Berthel/ Becker 2007, p. 484).
5. Employee communication during change regarding labor turnover
After illuminating employee communication, change and labor turnover separately, this
chapter aims at the merging of the theoretical approaches to the issue of employee
communication during change regarding labor turnover and thus will also serve as the basis to
answer the theoretical sub-research questions by solely addressing the areas which are
conducive to this purpose.

22
5.1. Employee communication during change
The basis for successful cooperation between a manager and his employees relies on
proper communication processes, as communication either directly or indirectly controls and
manages leadership and management processes (Kunz 2007, p.61). In particular the essential
managerial functions unfailingly attain effects and achieve impacts solely through processes
of communication (Kotter 1996 cited in Kunz 2007, p.61), which emphasizes the importance
of communication during change, as change presents the most essential managerial function,
being responsible for the economic viability. Quirke (2009, p.69) further attaches importance
to the evolvement of employees’ creativity, energy and commitment, since an organization is
only capable of tapping its full potential if all employees are engaged and thus work towards a
common goal.
According to Schick (2007, p.144), especially in times of change it is necessary and pivotal
for executives to address employees by the use of direct and personal communication.
Employees, in times of uncertainty and insecurity, have the desire to hear important
statements for their guidance as a direct quote from the top management. Often executives are
worried and anxious during turmoil situations as well. Precisely because they cannot offer a
perspective for themselves or for the company and frequently succumb loyalty conflicts. That
is to say executives are oblivious of their role as communicators and multipliers for the
purpose of corporate development. Furthermore Schick (2007, p.149) describes the manager
as the most important and pivotal communicator in a company. Thus the manager cannot and
must not escape his responsibility.
But for all that, the employees are also very effective communicators to the outside, in a
positive but also negative way. Meaning that deficiently informing employees and not
informing personnel may lead to a confusing representation of the company in public.
Consequently the information of the employees becomes the foundation for successful
external communication (Szameitat 2003, p.37). One goal of employee communication being
information (Szameitat 2003, p.37) and the fact that one cannot not communicate, referring to
Paul Watzlawick, who means that any behavior in response to something or someone
represents some kind of communication and hence no opposite to behavior exists, thus one
cannot not behave or act it is impossible to not communicate (Untermann 2007, p.76). As
non-communication within an organization by necessity shows a demonstrative indifference
and reckless disregard for its employees (Untermann 2007, p.76), the consequences are
decreasing employee commitment and work performance due to a lack of information and

23
communication, which both account for the development of motivation and competence
(Ehrhart 2007, p.134).
Therefore it is crucial for managers to prevent uncertainty and insecurity among employees
and in turn the emergence of negative dynamics, which may be caused by one employee who
disperses insecurity, to ensure successful change by sufficient communication and
information. Thus executives and managers have to equally communicate with the whole
staff. Hence the role of effective employee communication during change is a decisive factor
for the success of an organization by motivating the staff and creating a sense of security,
generating creativity, energy and commitment of employees as well as influencing external
communications through employees, as they represent an organization’s important
mouthpiece to the public.
This chapter functioned as the answer to the theoretical sub-research question:
“Which role is given to employee communication during change in general on the part of the
literature?”
5.2. The impact of employee communication during change on labor turnover and its
consequences
In order to thoroughly investigate and examine the effects of employee communication
during change on labor turnover and its consequences, this chapter will at first discuss the
impact of employee communication during change on labor turnover regarding satisfied or
dissatisfied employees and eventually analyze its consequences in order to answer the
following sub-research question: “How does employee communication during change affect
labor turnover in the literature?”
The importance of employee satisfaction and commitment during change is accented by
Birker (2004, p.254), who mentions that although the employee is a factor of production, he
differs from the others due to the mere fact that the performance cannot be seen isolated from
the employee who delivers it and beyond that the employee not only contributes but also
decisively shapes the operational performance process insofar as he discharges management
tasks and therefore his behavior affects the motivation and performance of others.
The above emphasizes the very high probability and likelihood that one employee is
capable of releasing both positive and negative dynamics solely by his actions.

24
Since employees who resign, mostly do so because of dissatisfaction (Robbins/ Judge
2009, p.121) the following will be devoted to explain satisfaction and dissatisfaction and its
impact on human behavior.
Fears within the private as well as business environment influence the performance and
willingness of a person (Richter 2007, p.137) and therefore dealing with fear in a constructive
manner can counteract its negative effects (Näf 1995, p.30 cited in Richter 2007, p.137). In
conformity with Birker (2004, p.256) insecurities and fears among employees may result in
the occurrence of affected people looking elsewhere for a prospective occupation and
therefore may put the organization in a difficult, adverse and very unfavorable position, since
those with the best qualifications are likely to find a new employment rather quickly as
contrasted with lesser qualified and lesser motivated staff members, who either do not take
action or cannot find another job. Pfannenberg (2007, p.826) divides the employees during
change into three different groups: Potential winners, supporters and blockers. Potential
winners and blockers each account for approximately twenty percent of the employees,
whereas supporters account for roughly sixty percent. Supporters have to be supported,
winners have to be mobilized and opponents or blockers, who constantly defy change, have to
be limited in terms of their influence, according to Pfannenberg.
The author of this thesis questions the notion of attempting to limit or calm employees, as
this may lead to increased defiance.
As per Robbins/ Judge (2009, p.121), four responses of employees to dissatisfaction exist.
The exit response is the first one, which implies an employee directing his behavior towards
resigning, and looking for vacancies at other organizations. The second one is the voice
response, which implies an employee constructively trying to progress conditions. The third
one is the loyalty response, which describes the action of an employee, who passively, yet
optimistically waiting for improvements and still trusting the leaders of the organization, and
the fourth one is the neglect response, which involves constant absence, delays, and a
decrease in performance. Reichwald/ Hensel (2007, p.649) state that today’s leaders have to
be capable of converting employees to the common achievement of objectives, and hence
assure continuity and stability.
Continuity is of decisive importance to the success of employee communication during
change in order to minimize or even prevent labor turnover and establishing a sense of
security among the employees.
So as to prevent and minimize denial and resistance in the early stages against change, it is
crucial to communicate the reasons and needs for change as well as the goals with precise

25
contents and determined sub-goals. Further the communication of the required willingness to
change and mutability with a description and representation of all relevant consequences for
the individual and the organization has to be focused on. Also communicating successes and
failures of change processes as well as maintaining an ongoing and constant dialogue with the
employees is crucial (Reichwald/ Hensel 2007, p.657).
The communication of failures can contribute to the development or amplification of the
credibility of a communicator and leader during a change process and therefore create
motivation and generate certainty.
As a leader it is crucial not to just overcome employee resistance, but rather to generate
employee support, motivation and excitement for the proposed change initiative in order to
assure successful organizational change (Piderit 2000 cited in Elias 2007, p.39). Antoni
(2004, p.198 cited in Elias 2007, p.39) cites “one has to change the beliefs of the
organizational members, which shape their behaviour, in order to support sustainable
organizational change.”
Changing the beliefs and overcoming resistanc is pivotal inasmuch as retaining employees
and preventing labor turnover as a result of insecurity, uncertainty and dissatisfaction.
So as to motivate employees and communicate change, Mast (2007, p.769) emphasizes the
decisive significance of personal communication and face-to-face communication when
exercising influence over someone.
Hence, one can assume that especially face-to-face communication as a tool of employee
communication is qualified to motivate employees and to convey a feeling of security and
therefore prevent employees from feeling insecure and as a result of that looking for vacant
positions at other organizations. Thus employee communication is of the essence to prevent
employees from resigning, if the communication takes place continuously and faithfully.
6. Research design
6.1. Empirical sub-research questions
In order to meet the criteria of an empirical study, this thesis aims at answering the
following empirical sub-research questions to amplify, complement or contradict the findings
obtained through the theoretical research. Hence it is necessary to examine whether the role of
employee communication during change with special emphasis on labor turnover given by the
literature holds its own in real life.

26
 How do the respondents evaluate the role of employee communication during change
at large?
 How do the respondents evaluate the impact of employee communication during
change on labor turnover in general and in the case of the communications
consultancy?
 How do the interviewed persons asses various tools of employee communication
during change?
6.2. Methodology
Whether qualitative or quantitative research is to be done must be determined by the
subject matter to be examined and the research questions to be elaborated on (Flick 2010,
p.41). However issues can only be expounded academically by means of qualitative methods
and research (Oevermann et al. 1979, p.16 cited in Flick 2010, p.41). In addition qualitative
research can stand its ground independently, whereas the quantitative method calls for further
qualitative adaptation for complete explication (Kleining 1982 cited in Flick 2010, p.42).
Furthermore the results of qualitative research are highly valid since the respondent is being
interviewed in an open and natural situation and can decide freely which aspect he wants to
communicate (Hienerth et al. 2009, p.120). The success of the qualitative method depends
largely on the personal expertise of the researcher (Lamnek 2010, p.83). Since this research
work is dealing with employee communication during change with special emphasis on labor
turnover, the qualitative method fits well regarding the aspect of flexibility, which allows and
enables the author and researcher to exploit and implement the achieved advances in
knowledge for subsequent steps in the inquiry, which could lead to more results and
information as various aspects of employee communication mentioned during already
conducted interviews can be added to the following interviews by asking an interposed
question.
On the one hand with quantitative research it is assumed that the matter to be looked into
has been dealt with sufficiently and is commonly known, whereas with qualitative research it
is assumed that during the process of researching further aspects will enter the study and thus
influence the outcome and further proceedings significantly, whereat this flexibility and
openness of qualitative research does not do any harm to a purposeful and target-oriented
study (Lamnek 2010, p.23).

27
6.3. Method of collecting data
Aiming at generating the best possible results in this bachelor thesis the method of survey
will be the problem-centered interview, although due to ambiguous questions and evasive
answers, interview B and interview C have more characteristics of an expert- interview in
terms of the information obtained.
In choosing the adequate method of survey the sort of information needed plays a key role
(Lamnek 2010, p.304). The problem-centered interview above all aims at creating incentives
to narrating so as to elicit subjective perceptions of a certain problem (Flick 2010, p.210). The
selection of the method of collecting data was based on these characteristics inasmuch as the
empirical sub-research questions aim at the human and subjective perception of employee
communication during change with special emphasis on labor turnover. Also because the
emotional condition of employees during a change process heavily influences labor turnover
and the emotional condition can only be described in an open interview which focuses on the
subjective perception of a human being the problem-centered interview was chosen as the
method of collection in order to change the theoretical concepts if necessary (Lamnek 2010,
p.333). There are three criteria that constitute these interviews: problem-centering, which
describes that the researcher orients him- or herself by socially relevant questioning, object-
orientation, which means that the interview is defined by the problem and if need be will be
customized, and finally process-orientation (Flick 2010, p.210). By using this kind of
interview the personal attitude towards the problem of both the employees and the managers
should be surveyed.
6.4. Access to the field and respondents
Whether research is successful and how successful it is depends largely on the researcher’s
ability to create the best possible access to the field of people that interest him (Lamnek 2010,
p.546). This requirement of optimal access to the field is met in this specific case, since the
author of this thesis completed a three months’ internship with the communications-
consulting agency, which will remain anonymous throughout this thesis, lasting from October
through December 2010. The communications agency met the authors’ proposition favorably
and consented to support him. The company is eagerly waiting to receive the results of this
survey. As an intern the author had made many contacts so that his access is a direct one.
According to Lamnek (2010, p.553), personal contact a good relationship and a certain
amount of mutual respect and intimacy between the researcher and the interview – partner

28
warrant success, preventing or reducing possible skepticism. Flick (2010 ,p.151) extends this
idea saying that the extent of intimacy and the relationship between distance and familiarity
are responsible for the quality of information that can be gained. In order to assure a balance
in the intensity of the relationships with the people interviewed, two persons to whom the
author of this thesis had personal contact were chosen and one person with whom the author
very seldom interacted. This combination of familiarity and distance leads to a balanced
information and safeguards the quality of the results. With the three persons the interview
was problem-centered. It was important to choose three people who would be of the greatest
help in answering the research questions as well as guarantee to provide various opinions,
which was the case due to different professional statuses and positions. The first person will
be referred to as respondent A through the course of this work, managing director and chief
executive officer of the communications-consultancy company. Therefore respondent A
covers the aspect of the management concerning and conducting employee communication
during the change of the agency ideally. The second person will be referred to as respondent
B and is a former consultant from the communications agency. Respondent B serves as a
representative of the employees that resigned during the change so as to represent their views
and how they experienced the employee communication. The last person to be interviewed in
a problem-centered way will be referred to as respondent C. Respondent C is an assistant
from the agency and thus adds variety to the research-results as he may provide different
information about his or her experience of employee communication during the change. This
field is especially qualified regarding employee communication during change with special
emphasis on labor turnover since a change took place within the communications agency,
during which shares and interests were sold to a multinational corporation leading to the
resignation of the entire board of management and the takeover of a new chief executive
officer. In order to provide a comprehensive understanding and necessary transparency, the
author of this thesis will briefly explain the change, which occurred regarding the
communications consultancy:
In 1965 the communications consultancy was founded by a family of industrialists and by
way of a management-buyout of X in 1987 began to constantly grow to be number one on the
PR-market in Austria. Between 2000 and 2003 a management-buy in was undertaken by Y
and partners. At the same time Z partner, Europe’s leading PR and lobbying network was
added to the agency and thus the leading position was strengthened and lead over its
competitors grew even greater. In 2010 Z and Z1
merged, the latter being a leading US-
communications consultancy and so a brand change was made to Z Z1
. In 2011 Y and partner

29
sold their shares of the original communications consultancy and A became the new
managing director of Z1
O Austria.
This interaction of numerous factors led to a considerable amount of resignations among
the staff. Therefore the author of this thesis set himself to question the reason for the staff
turnover and examine the relation between employee communication, change and staff
turnover.
6.5. Method of analysis
According to Mayring (2003, p.58 cited in Lamnek 2010, p.473) the goal of the Mayring
content analysis is to reduce the data to the basics in order to create a complete overview of
the basic material. Following these ideas one can say that this method is best suited for both
the evaluation of the data gained through the problem-centered interviews as it analytically
conceives individual cases through dissecting categories. Thereby the rendering of the
subjective perception of employee communication during change and its effects on employee
turnover is assured and consequently does not jeopardize the quality of the results. The
method of content analysis following Mayring (Flick 2010, p.416) especially with open-style
interviews, such as the problem-centered interviews, is highly significant since these
interviews generate an amount of data that call for a reduction to the basics. The advantage of
the qualitative content analysis following Mayring (Flick 2010, p.416) especially when
compared to other methods of analysis lies in its greater clarity when reducing the data. A
consistent scheme of categories belonging to this method especially focuses on the
comparison of different opinions and aspects provided by the respondents. Flick (2010, p.416)
adds Mayring’s content analysis is suitable especially when subjective views must be found
out and researched, which is often combined with the use of guided interviews. Lamnek
(2010, p.631) makes an extra point of the benefits of a guided interview with which also
people who are ineloquent and not so communicative can be interviewed.
6.6. Quality assurance
With any kind of qualitative social research, quality assurance is extremely important. The
criteria of validity, reliability, and objectivity cannot be applied to the evaluation of
qualitative studies, since these criteria are suited only for the evaluation of quantitative studies
(Froschauer /Lueger 2003, p.166). Froschauer / Lueger (2003, pp. 167–170) define the
alternatives of quality assurance on three levels: on the procedural and methodological level;

30
the level of the research-procedure; the level of the science system. These levels function as
qualitative assistance of the research procedure in order to make it comprehensible to third
parties. Lamnek (2010, p.130) further adds that qualitative methods provide and deliver
reliable and valid results, whereas the respective standards have to be conceived differently
and thus Mayring (2002 cited in Lamnek 2010, p.131) deems the quality criteria validity and
reliability, as developed and elaborated within the context of quantitative social research, to
be sparsely sustainable and acceptable for the qualitative paradigm and therefore suggests six
other quality criteria for qualitative social research. Furthermore the proximity to the subject
matter which is one of the six quality factors following Mayring (2002 cited in Lamnek 2010,
pp. 131–132) is verified, since an internship in the field to be surveyed has been completed.
Another important criteria of quality assurance provided in this thesis is the communicative
validation. When the qualitative researcher confronts the respondents with his interpretations
(Heinze/ Thiemann 1982 cited in Lamnek 2010, p.132), he may obtain important arguments
and reasons for the relevance of the results in terms of confirming the reconstruction of
subjective meanings (Mayring 2002, p.147 cited in Lamnek 2010, p.132). Therefore the
author of this thesis confronted his respondents with his interpretations of the respective
interviews in order to ensure communicative validation.
7. Empirical findings
This chapter presents the results of the conducted problem-centered interviews and aims at
answering the following empirical sub-research questions:
 How do the respondents evaluate the role of employee communication during change at
large and in the case of the communications consultancy?
 How do the respondents evaluate the impact of employee communication during change
on labor turnover in general and in the case of the communications consultancy?
 How do the interviewed persons asses various tools of employee communication during
change?
7.1. The role of employee communication
According to A, employee communication plays a very important role, as it is capable of
changing, affecting and moving a whole lot within an organization, whereas C states that
employee communication lays the groundwork for the development of corporate culture in

31
order to assure effective teamwork. B considers employee communication to be the most
important communicative discipline due to the mere fact that employees are of fundamental
value to their organization, literally build the relation to the public, represent the company to
the outside world and need to authentically reinforce any messages conveyed through external
communication channels. As per B, employee communication as well as internal
communication both take precedence over external communication, which is confirmed by
A’s statement that employee communication is the core in order to internally create
motivation, identification and success and further approves of the slogan “PR begin at home”
referring to the significance of employees conveying the messages to the outside world.
Ruisinger/ Jorzik (2008, p.225) also refer to “PR begin at home” and state, pertaining to this
slogan, that employees are the first ones to be asked about their organization and therefore
have to be informed in advantage in order to give precise answers. Concerning the goal of
employee communication, C deems it to be information, adding the importance of the
possibility of giving and receiving feedback, since members of an organization do not solely
want to receive information but rather give their opinion on issues and want to be heard,
whereas A thinks of employee communication being about information and emotion as well
as service and dialogue. As to C, a target group approach should be taken regarding internal
communication, which is also demanded by Mast (2000, p.82) as well as by Brehm (2009,
p.330), and A proceeds by also suggesting that internal communication has to pursue a
strategy and determine its target groups in order to be effective while A emphasizes the
capability of employee communication to enhance and influence the success of a company,
hence ensure a high degree of loyalty and identification with the organization and also
establish enjoyment of work among the employees.
7.2. Employee communication during change
Regarding employee communication during change, C considers it to be a matter of
appreciation, namely because the staff has to be the first audience to receive information by
its organization on major decisions as well as changes, which by doing so shows its
appreciation for its employees and thus forestalls insecurities, rumors and speculations. As per
A it is of utmost significance for a leader and especially in the case of several leaders for all of
them to consistently communicate identical messages to all employees in order to prevent
rumors from arising, whereas B notes that during a change process the importance of
employee communication increases significantly inasmuch as change initially takes place

32
internally and therefore it is crucial to get the employees on board, which can only be
achieved through consistent and proper employee communication as according to B, who
furthermore finds employee communication to be more difficult and delicate to perform and
implement in an agency as the employees merely focus on meeting the needs of their clients.
C proceeds by stating that employee communication during change is a matter of efficiency,
since organizations have to be efficient and make sure that they adapt and adjust to changes.
During change it is vital for the leader to communicate and present the reasons for wanting to
be part of the new as well as clearly communicating the next actions and outlining the new
path because there is no use in dragging employees along, who do not want to tread the new
path, as per B. C adds that employee communication during change should take place
periodically and will be more intense as well as more frequent, because employees will value
communication higher, plus the degree of regard of the employees is higher, too. As a
manager and communicator, A, finds it crucial during change to communicate as much as
possible but at the same time as little as necessary, which is to say to be mindful of the right
dose of communication since uncertainty and insecurity cannot be resolved by communicating
without a genuine message. According to B, one essential consideration of employee
communication for managers during change is not to whitewash the facts by solely
communicating good news but also communicating bad news as a change process also entails
changes that can be negative and in keeping those negative facts from the employees this
might result in a plummeting credibility of the leader. Krüger (2002, pp.263-264 cited in
Reichwald/ Hensel 2007, p.657) equally advise to communicate success and failure of the
change process in equal measure as well as to maintain an ongoing dialogue with the
employees. C approving of this statement made by B while adding that people generally fear
change and look upon it as something negative and emphasizing the supreme importance of
the manager’s credibility as a communicator as being decisive for the success of a change
process. C also states that it is pivotal for an organization’s management to foresee which
issues in the future could cause uncertainty among the staff and to ensure an organization’s
consistency in terms of internal communication being pivotal to the consistency of external
communications due to the mere fact that employees are the most authentic communicators,
as also mentioned by Ruisinger/ Jorzik (2008, p.225), who label employees as the most
important communicators of an organization. Further on A, being the chief executive officer
of the communications consultancy, notes that employee communication per se is a
combination of what has to be provided by the manager and what has to be acquired by the
employees. This view is supported by B, who further extends by stressing that employee

33
communication has to happen bottom-up, as this is of the utmost importance especially during
change as employees are capable of making an important contribution to the outcome of a
change process, thus getting feedback and communication is clearly of high value during
change since there is no sense in informing the employees without knowing how they react to
information. B amplifies by stating that steadily and continuously informing the employees
even when there is nothing to communicate, which is also relevant in the literature as Ehrhart
(2007, p.145) emphasizes that one cannot over-communicate in times of uncertainty and
insecurity, as well as providing a timetable that indicates and displays when communication
will happen and information will be given in order to not be left fumbling in the dark are
essentials during change. As per A the importance of being physically present as the head of
an organization during change also plays a decisive role.
7.3. Strengths, weaknesses, opportunities, and threats of employee communication
during change
As strengths of employee communication during change in general A lists the
establishment and increase of safety, certainty and security as well as resisting and absorbing
negative emotions among the employees so as to promote a positive emotional response,
while B views the ability to enhance the credibility of the leader during a change, by openly
communicating and ensuring complete transparency in terms of communication as a strength
or opportunity. One opportunity, according to C, is to nudge dynamics, which may arise as a
result of change processes, in the right direction. A and C both look on the amount of
communication as a threat, since communicating too much as well as communication too little
may lead to insecurity among the staff, whereas A especially highlights communicating too
much and providing information, which is neither definite nor official, as a threat, since it
could generate uncertainty as well as anxiety and unease all the more. However, C views
setting priorities and the focus in terms of what to communicate and what not, in order to
maintain authority and credibility by designing adequate messages as a potential threat. As
opposed to this, B notes that if set up and conducted properly employee communication does
not have a weakness or implies a threat in any way, on the understanding that the information,
which has to be correct and timely, is passed on purposefully. Yet, A adds the weakness of
involving employees too much in the change process, which may result in confusion about
their role and part in the process. Thus employee communication can be seen as a weakness if
what is being communicated is not correct, as this could cause considerable damage, as per B,

34
who then continues by mentioning that when conducting employee communication, the
adherence to announcements could also be viewed as a potential threat, inasmuch as not
adhering to the announcements can lead to a considerable loss of credibility. Despite the fact
that A knew that the adherence to the announcement of the date on which he or she would
declare the second managing partner was crucial to the sense of security and certainty among
the employees, thus as well to the emotional state of the employees, he or she could not pass
on information to the employees, for he or she had not come to an arrangement with the
various negotiating partners.
7.4. Employee communication during change regarding labor turnover
C states that the impact of employee communication on labor turnover during change
depends on what happened before the change and that employee communication can only
serve as a preventative measure against labor turnover to a certain degree, because it is too
late for a company to attempt to achieve employee commitment and retain staff members in
the middle of a change process and hence a company has to retain its employees before the
change process starts. B shares this view by remarking that employee communication by itself
can neither prevent nor inhibit labor turnover but yet employee communication is capable of
well and truly influencing the labor turnover rate, as employee communication can diminish
uncertainty. Furthermore C considers corporate culture to be of decisive importance as it
affects efficiency, performance and motivation, which then again influence labor turnover.
Although B finds a certain extent of labor turnover to be important for the new to develop and
arise as some employees may were comfortable with the old and do not want the new, C on
the contrary emphasizes that having good employees could not be valued high enough, since
organizations invest time and money in their employees and therefore should target employee
retention as a measure of employee communication. This statement made by C is also relevant
in the specialist literature, as French (2007, p.284) additionally states that with the loss of a
staff member the organizations also loses investment it has made in recruiting, selecting, and
training the employee. Therefore, as per B, it is of the essence that these employees, who do
not want to be part of the new, leave the organization at this point of time in the change, for
the new to develop with a staff that accepts the new path. B further on states that labor
turnover may increase at first if employee communication is effective, transparent and clear
because employees then would sooner realize whether or not they want to be part of the new.

Employee Communication's Role in Change and Turnover

Employee Communication's Role in Change and Turnover

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