Effect of Organizational Climate on Job Turnover of Employees at Tourism Hotels in Petra Region of Jordan

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1 AMERICAN JOURNAL OF SOCIAL AND MANAGEMENT SCIENCES ISSN Print: , ISSN Online: , doi: /ajsms , ScienceHuβ, Effect of Organizational Climate on Job of Employees at Tourism Hotels in Petra Region of Jordan Akif Lutfi Al-Khasawneh Assistant Professor, Department of Financial & Administrative Sciences, AL-Huson University College, AL-Balqa' Applied University, Irbid, Jordan, P. O. Box 50, AL-Huson, 21510, Jordan ABSTRACT The present study attempts to explore the status of tourism hotels within Petra region in Jordan to identify employee satisfaction level regarding organizational climate and to identify measure of job turnover among hotel employees by investigating some organizational climate components such as (nature of work, authority styles, boss-employee relation, rewarding system and job security). This study is promising hotel industry in Jordan because it addresses essential management issues at tourism business organizations in Jordan and focuses on the hotel sector that forms a major stream of economic returns for Jordan. This study was conducted with a sample of 362 employees at hotels within Petra region south of Jordan using the questionnaire to conclude results that found. High level of satisfaction among hotel employees regarding the organizational climate, where the highest satisfaction level was pertaining boss-employee relation, and the least satisfaction level was for job security. The impact of organizational climate components on job turnover appeared in the following order: nature of work, boss-employee relation, rewarding system, authority style, and finally in the last rank was job security. Job turnover level at hotels in Jordan was high (M=3.87), and the reason most motivating employees to search for a job is looking for stability and job security. There is a positive association between organizational climate component and job turnover of hotel employees in Jordan. There are statistically significant differences in the impact degree of organizational climate that vary by gender, age, and hotel rating; whereas no statistically significant differences were found regarding organizational climate impact degree by variable academic qualification. Keywords: Organizational Climate, Job, Tourist Hotel, Jordan, Petra Region INTRODUCTION Generally, business organizations including hotels witness perceived increase in their roles to create effective human resources from a strategic perspective. Recent organizations are motivated to adopt innovative practices and establish HR management units in order to take care of their manpower and energize their human capital strategically towards achieving performance excellence, and accomplishing organizational goals and bring about developments in most business activities. Pittigrew (1979) suggested that organizational climate is essentially important for organizational excellence and is the basis for success of the Japanese organizations (Popa, 2011). On the other hand, organizational climate is an essential factor for human element to interact effectively which reflect upon employee performance, greater productivity, job loyalty, and greater superordinate-subordinate trust. In this context, Hawthorne Studies led by behaviorist Elton Mayo highlighted that providing employees with appropriate and motivating environment reflect positively and directly on employee performance in terms of innovation and excellence for human resources and the wider organization. However, Peters & Waterman (1982) revealed that organizational climate is one of major enablers that leverage an organization to success and excellence and positively relates to employee performance and the whole organization productivity. Further, organizational climate is considered among the important management and technical processes that top managers should take into account to achieve highly valuable outcomes. In consequence, creation of an appropriate organizational climate is not a secondary choice for contemporary organization; rather it is vital to ensure substantial merit-based excellence under the intense global competition.

2 Statement of the Problem: The problem addressed by the current study emanates from the very nature of tourism industry and hotel sector, particularly tourist hotels in Jordan. Generally, tourist organizations deals with a mix of customers who diversify in their psychological, cultural and social characteristics. Hotels are also diversify in terms of rating level which imposes a suitable organizational climate supports competitiveness and improves positive performance of employees and ensuring more stable work environment with job security and least turnover rate. Study Questions: Q1: What is the satisfaction level of hotel employees in Jordan regarding the organizational climate at their organizations? Q2: What is the effect organizational climate has on hotels in Jordan in terms of (nature of work, authority patterns, boss-employee relation, rewarding systems, and job security) on job turnover of employees? Q3: What is the level of job turnover among hotel employees in Jordan? Q4: Is there a statistically significant correlation at (α 0.05) between the organizational climate and job turnover? Q5: Are there statistically significant differences at (α=0.05) in degree of the organizational climate that vary by (gender, age, academic qualification, and hotel rating). Objectives of the Study The purpose of the present study is to identify: Satisfaction level among hotel employees in Jordan regarding hotel organizational climate. Impact of organizational climate components (nature of work, authority patterns, bossemployee relationship, rewarding system, security) available at hotels in Jordan on job turnover Job turnover levels among hotels surveyed in Jordan Whether there is a statistically significant correlation at (α 0.05) between job turnover and organizational climate. Whether there are statistically significant differences (α=0.05) in effect estimates of the organizational climate that vary by (gender, age, academic qualification, and hotel rating) Significance of the Study This study addresses an important issue in management practice that attracted much of the interest of recent research since on organizational climate takes a significant part in producing positive outcomes from the human resource, and improves performance of the organization strategically. This study holds significance for the hotels industry in Jordan because results obtained will be meaningful for hotel organization by employing them to build their organizational strategies, essentially human resource strategy towards a competitive edge in the market. METHODS For the current study, population (N=1208) consisted of staff members recruited from twenty four tourist hotels within Petra region south Jordan. A representative (30%) sample of 362 participants was randomly selected and was thoroughly administered questionnaires. Out of 345 questionnaires returned back, only 17 were found unusable for analysis thus they were excluded, and 300 questionnaires (83%) were usable for analysis, which is acceptable ratio from statistical research perspective and allow for results generalize ability. Data Collection The study used the following sources: Secondary Sources: Include related references available at traditional libraries including and printed and electronic materials in addition to review of books and prior studies contained in paper and electronic journals. Primary sources: Included the questionnaire that was specifically designed for this study in line with variables studied to collect data from employees at the tourist hotels in Jordan within Petra region. The questionnaire primarily included three subscales: Part One: measures the demographic characteristics such as gender, age, academic qualification, and hotel rating. Part Two: Five items (5, 10, 15, 20, 25) that measures satisfaction level regarding organizational climate at tourist hotels. Items were centered around independent variable themes. Further, the remaining items measure independent variable elements 55

3 regarding the organizational climate and covered five theme: (1) nature of work (items 1-4), (2) authority styles (items 6-9), (3) bossemployee relation (items (11-15), (4) rewards system (items 16-19), and (5) job security (21-24). Part Three: includes items (26-35) measuring the dependent variable, i.e. job turnover for employees at tourist hotels in Jordan. To measure study question, Likert five-point scale was employed where {5=Very High, 4=High, 3= Don't Know, 2=Low, 1=Very Low} Validity & Reliability Test : To validate content, the questionnaire was sent to a number of judges who have sufficient experience in the academic field as university professors specialized in Business Administration and Statistics. There was general agreement on usability of the instrument for field administration once changes are made in accordance to their views. As a result, some items were reworded and lengthy items were deleted. A pilot study was administered to a sample of (30) employees excluding population in order to check for intelligibility and weaknesses, if any, from viewpoints of population. Some items were changed as needed to achieve highest possible level of item accuracy and intelligibility. The following table (1) demonstrates related results. Table (1) Internal Consistency Chronbach alpha Internal Consistency Organizational Climate 0.89 Job 0.77 Statistical Treatment: Statistical Package for Social Sciences SPSS was employed to implement the statistical analyses. Percentages and means were used to identify the relative importance of variables studied. Standard deviations, four way analysis of variance, Pearson correlation coefficient, and post hoc Scheffee tests were employed to answer the study questions. Theoretical Framework Organizational Climate Concept: Organizational Climate was defined as activities, attitudes, values, belief, criteria, feelings, means, and management and technological procedures used in organization (Al Taweel, 1999). Organizational climate is also described as a set of characteristics, factors, rules, and methods driving employees inside the organization and differentiate from other organizations (Al Thneibat, 2005). Further, organizational climate is referred to as the environment or overall social system of employees in the organization including their culture, values, traditions, behavior patterns, social beliefs and different work methods affecting activities and human and economic interaction inside the organization. For this study organizational climate indicates to different factors and prerequisites provided by top management to employees to determine the job path for employees such as organizational structure, organizational culture, regulations, management approach, communications styles, procedures and work policies, all of which form a driving force influencing positively or negatively on employee performance and their job behaviors. The positive or negative influences are governed by how tuned are such environmental factors with employee needs and requirements. Organizational Climate Components and Dimensions: Components of organizational climate are many and can be categorized into tangible and intangible. The organizational climate components form a vital centre point influencing employees, their behaviors, and attitudes whether positively or negatively. No doubt, positive attitudes reflect on quality of behavior, performance, satisfaction, excellence, and job loyalty, and cooperation between bosses and their employees, and create interchangeable benefits and in general achieving shared interest between the organization, employees, and stakeholders. On the other hand, negative attitudes are translated into negative behaviors ineffectively serving the common interest of parties inside and outside the organization but rather produce job conflicts, low performance, leave job, etc (Singh, et al, 2011). This study investigates the following components for organizational climate (Al Moghrabi, 2004): Work Nature: refers to tasks performed by employee in the organization that need to be vivid, elastic non-routine or frequent since routine task kill creativity, create boredom, discourage thinking and limit excellence. Authority Styles: When authority is held in top managers (centralization) and deprive other management levels in the organization from 56

4 practicing authority, employees will develop ineffective capabilities, poor self-confidence, and low self-esteem. Boss-employee relation: Successful organizations need to create a climate in the organization that supports positive relations between subordinates and superordinates and enhances trust, respect, and honesty in treatments of different job levels because such values create job loyalty, excellent performance and mutual interest. Reward/punishment styles: Employees who carry out their tasks creatively need to be rewarded justly to motivate their creativity and encourage creative practices from other employees. Job Security: Permanent jobs give employees job stability, and psychological wellbeing and prevent concern and stress caused by fear from losing job. Permanent jobs also directly affect performance level and job loyalty. Bhutto, et al, (2012) entitled "A comparative Study of organizational climate and job satisfaction in public, private and foreign Banks" and concluded a positive association between organizational structure, nature of work, human relations and job satisfaction. However, the study found no association between job justice, empowerment and job satisfaction. On the other hand, Melhem (2006) investigated effect of organizational climate on job satisfaction as a case study on Jordan Telecom Company. The study found that the organizational climate, in general, directly affects employee satisfaction. Major findings concluded by the study included: A positive association between the approach adopted by management to keep abreast with internal and external environments and encourage employees assumes responsibility on their jobs. And A positive association between employee-centered management practices and job satisfaction, whereas there was a negative association between production-centered management practices and employee satisfaction level. Liu (2010) entitle "Organizational climate and its effects on organizational variables: An Empirical study" found that longer work hours, right person in wrong place, and sizeable organization has great negative effects on employee dissatisfaction, instability, and low performance and direct negative effect on employee intention to search for a new job. Adjei-Appiah (2008) entitled "Organizational climate and turnover in the health sector. The case of the korle teaching hospital in Ghana" was conducted in the health sector of Ghana and sought to identify organizational climate components most contributing to job turnover level among employees. The study found factors most affecting job turn over are jobrelated stressors and the search for more reputable organizations. Putter (2010) questioned whether there is a relationship between organizational climate and performance. The study concluded a close relationship between organizational climate and both increased productivity, sustainability, profit increase and growth. The study also found that providing a suitable organizational climate with support from top managers, and participation take a significant part in the increased performance level. Jeswani & Dave (2012) conducted a study on the "Impact of organization climate on turnover Intention: An empirical Analysis on faculty members of technical education in India" for purpose of identifying management practices related to orientation, control, communication, decision making, and rewarding employed within the organizational climate and effects on job turnover among employees. The study found that the factor most contributing to job turnover was orientation and rewarding practices. Raza (2010) investigated the impact of organizational climate of performance of college teachers in Punjab to identify the effect of major influences motivating employee's performance at the educational institutions in Pakistan. The study found that the factors most motivating performance of employees within the organizational climate include training, teamwork, study circles, providing a comfortable climate characterized by appreciation between boss and employees, and top managers adopt wise management methods and clear policies. Noordin, et al (2010) investigated the organizational climate and its Influence on organizational 57

5 commitment in Malaysia for purpose of exploring the effect of organizational design, communications, leadership, work teams, decision making, organizational culture, job satisfaction, and incentives on job commitment. The study found no relationship between job commitment and organizational design, group work, decision making, whereas there was a close association between communications, leadership, organizational culture and incentives. Imran et al (2010) investigated the organizational climate as a predictor of innovative work behavior for purpose of identifying whether there is a relationship between organization size, organizational culture, open work system, work by objectives and the creative behavior. The study concluded a strong positive relationship between open work system, objectives-based work,, and creative behavior of employees; whereas the study found no significant role of organization size and creative behavior of employees. Statistical Analysis Table (2) Frequencies and percentages by study variables Category Frequency Percentage% Gender M F Age Less than Academic Qualification or more High School or less Intermediate Diploma BA or higher Hotel Rating 5 Stars Stars Stars Stars Total To answer this question, means and standard deviations of satisfaction levels of hotel employees in Jordan regarding organizational climate and the following tables shows related results. Table (3) means and standard deviations of satisfaction levels of hotel employees in Jordan regarding organizational climate in descendant order by means. Rank No. Item M SD Level 1 3 I am content with the positive relations between managers and employees 2 1 I am content with nature of work I do at my organization 3 2 I am content with authority practices implanted by bosses with employees 4 4 I like the rewards I receive in my organization 5 5 I like the job security provided by my organization High High High Mode rate Low Table (3) shows that mean scores ranged between ( ), where area "I am content with the positive relations between managers and employees" occupied the first place with the highest mean (3.94), and the area "I like the job security provided by my organization" was placed in the lowest rank (2.17). Second Question: What is the effect organizational climate has on hotels in Jordan in terms of (nature of work, authority patterns, boss-employee relation, rewarding systems, and job security) on job turnover of employees? To answer this question, means and standard deviations of the effect of organizational climate at hotel organization in Jordan on job turnover of employees and the following table (4) shows related results. First Question: What is the satisfaction level of hotel employees in Jordan regarding the organizational climate at their organizations? 58

6 Table (4) Means and standard deviations of the effect of organizational climate at hotel organization in Jordan on job turnover of employees in descendant order by means 5 4 Rewarding System/Job Moderat e Rank No. Area M SD Level 1 1 Work Nature High Job High 2 3 Boss-Employee Relation High 3 4 Rewarding System Moderate 4 2 Authority Patterns Moderate 5 5 Job Security Moderate Organizational Climate Moderate Table (4) shows that mean scores ranged between ( ),where area "work nature" ranked top with the highest mean score (4.23), and area "job security" was ranked last with the lowest mean score (2.95). However, the mean score of the organizational climate as overall was at (3.50) Third Question: What is the level of job turnover among hotel employees in Jordan? To answer this question, means and standard deviations of job turnover levels among hotel employees in Jordan were computed and the table below (5) shows results in detail. Table (5) Means and standard deviations of job turnover levels among hotel employees in Jordan in descending order by means Rank No. Area M SD Level 1 5 Job Security/Job 2 1 Work Nature/Job 3 3 Boss-employee relation/job 4 2 Authority Styles/Job High High High High Table (5) shows means scores ranging between ( ), where in the first rank was placed area "job security/job turnover) with highest mean (4.60), while area "rewarding system/job turnover" in the last rank (M=3.56) and the overall mean score of job turnover was at (3.87). Fourth Question: Is there a statistically significant correlation at (α 0.05) between the organizational climate and job turnover? To answer this question, Pearson correlation coefficient was computed between the organizational climate and job turnover as shown by table (6). Table (6) Pearson Correlation Coefficient between the organizational Climate and Job Organizational Climate *Statistically significant at (0.05) ** Statistically significant at (0.01) Correlation Coefficient R Statistical significance 0.625**.000* Count 300 Table (6) shows a positive statistically significant association between the organizational climate and job turnover. Fifth Question: Are there statistically significant differences at (α=0.05) in degree of the organizational climate that vary by (gender, age, academic qualification, and hotel rating). To answer this question, means and standard deviations of the organizational climate by the study variables of gender, age, academic qualification and hotel rating as shown by the following table (7). 59

7 Table (7) means and standard deviations of the organizational climate by the study variables of gender, age, academic qualification and hotel rating. M SD Count Gender M F Age Less than Academic Qualification or more High School high school or less Intermediate Diploma BA or higher Hotel Rating 5 Star 3, Stars Stars Stars or less Total Table (7) shows surface variance in means and standard deviations of organizational climate due to variation of variable categories of gender, age, academic qualification, and hotel rating. To demonstrate significance of stat statistical differences among mean scores, four way analysis of variance was used and table (8) shows related results. Table (8) Four way analysis of variance of the effects of gender, age, academic qualification, and hotel rating on the organizational climate. Source of Variance Total Squares Freedom Degrees Mean Squares F-Value Significance α Gender Age Academic Qualification Hotel Rating Error Table (8) demonstrates the following results: There were statistically significant differences at (α=0.05) attributed to effect of gender, where F value was (5.150) and statistically significant at (0.024) with differences in favor of males. There were statistically significant differences at (α=0.05) attributed to effect of age, where F value was (5.021) and statistically significant at (0.002) with differences in favor of males; and to demonstrate effect of statistically significant paired differences among mean scores, Scheffee test for post hoc comparisons was used as shown by table (10). There were no statistically significant differences attributed to effect of academic qualification with F value computed at (1.471) with statistical significance at (.231). There were statistically significant differences at (α=0.05) attributed to effect of hotel rating, where F value was (37.557) and statistically significant at (0.000); and to demonstrate effect of the statistically significant paired differences among mean scores, Scheffee test for post hoc comparisons was used as shown by table (9). 60

8 Table (9) Post hoc Shafee comparisons of hotel rating effect Organizational Climate 5 Stars 3.75 M 5 Stars 4 Stars Stars 3 Stars *.25* 2 Stars or less Significant at (α=0.05) Table (9) shows: 3 Stars *.86*.61* 2 Stars or less Statistically significant differences at (α=0.05) between three star hotels, on a hand, and both five star and four star hotels, on the other, with differences being in favor of both four and five star hotels. Statistically significant differences at (α=0.05) between two star or less hotels, on a hand, and both five star, four star, and three star hotels, on the other, with differences being in favor of five star, four star, and three star hotels. Table (10) Post hoc Shafee comparisons of age effect Organizational Climate Less than 20 M 3.21 Less than * *.02* 40 and above Significant at (α=0.05) Table (10) shows: *.27*.29* 40 and higher Statistically significant differences at (α=0.05) between the age group less than 20 years, on a hand, and both age groups (220-29) and (30-39), on the other, with differences being in favor of the group aging 40 or more. Statistically significant differences at (α=0.05) between age group 40 or more, on a hand, and age groups (less than 20), (20-29), and (30-39) on the other, with differences being in favor of group aging 40 yrs or higher. Study Results The current study concluded the following: There was a high satisfaction level among tourist hotel employees in Jordan as to the organizational climate in the hotels where they work. The highest satisfaction level was about the relation between bosses and employees, and the least satisfaction level was pertaining job security and permanent employment for hotel employees. In fact, tourist hotels offer job security vacancies and do not provide permanent employment for their employees, since the private sector makes retaining an employee depends on staffing decisions by top managers and also because the hotel activity is tied with environmental, seasonal and market fluctuations. The influence of organizational climate on job turnover was in the following consecutive order: nature of work, boss-employee relation, rewarding and punishing styles, authority styles, and finally job security in the last rank regarding influence on job turnover. Job turnover rate is relatively high (M=3.87) at tourist hotels in Jordan. The reason could be that hotel jobs provide little job security, thereby employees search from permanent job provide them stability and prefer vacancies that provide them long-term employment. However, the least contributing factor to job turnover among employees was rewarding and punishment practices. This result would be attributed to the importance given by employees to job security as a priori. The researcher believes that rewarding and punishing practices at hotels in Jordan are tied with the labor legislations and Social Security regulations. There was a positive association between organizational climate components and job turnover among employees at tourist hotels in Jordan. There were statistically significant differences regarding influence degree of the organizational climate that vary by gender, age, and hotel rating, whereas no statistically significant differences were found regarding influence of the organizational climate that vary by variable "Academic Qualification". 61

9 RECOMMENDATIONS The researcher suggests the following recommendations: Top managers at tourist hotels need to keep pace with various components of the organizational climate within hotel workplace environment, in general and pay greater attention to their vacancies that should provide job security and stability for employees, which improves their performance and lessen turnover rates among them, and increase retention level and prevent skilled employees migrate to other hotels. Top management need to develop strategic HR practices to recruit qualified personnel and limit down turnover rates. The government in Jordan is called to improve the organizational climate at tourist hotels in Jordan by building partnerships facilitating cooperation and mutual benefit. The government need to draft labor legislations to regulate work at hotels in Jordan and to provide support tourist hotels in Jordan particularly during declining seasons in order to help hotel sustain during tough times and preserve their existence on market and strengthen mutual trust between the government and hotel public sector. Further studies involving tourist hotels in other parts of Jordan are much recommended. REFERENCES Adjet-Appiah, Susan, A. (2008). Organizational Climate and in the Health Sector: the Case of the Korle-Bu Teaching Hospital in Ghana, A thesis Presented to the University of Waterfloo for Degree of Master in Psychology, Ontario, Canada. Al Omyan, Mahmoud Salman (2005). Organizational Behavior at Business Organizations, Dar Wael Publishers, Amman. Al Taweel, Hani Abdul Rahman (1999). Organizational Climate: Concepts & Horizons. Dar Wael Publishers, Amman. Al Thneibat, Mohammad Mahmoud (1999). Organizational Climate and Impact on Employee Performance at Managerial & Financial Control Apparatuses in Jordan, Research Bulletin, 1(26), University of Jordan, Amman. Bhutto, Niaz, A., Laghari, Minhoon, K., and Din-Butt, falah- Ud (2012). A comparative Study of Organizational Climate and Job Satisfaction in Public, Private and Foreign Banks, Asian Social Science, Vol. 8, No. 4, PP Imran, Rabia., Saeed, Tahir., Ul-Hag, M. Anis and Fatima, Afsheen (2010). Organizational Climate as A predictor of Innovative Work Behavior, African Journal of Business Management, Vol. 4 (15), PP Jeswani, Saket and Dave, Sumita (2010). Impact of Organizational climate on intention: An Empirical Analysis of India, International Journal of Business Management & Research, Vol. 2 Issue 3, PP Liu, Yaxin (2010). Organizational climate and its effect on organizational variables: An empirical study, International Journal of Psychological Studies, Vol. 2, No. 2, PP Melhem, Yahia Saleem (2006). Effect of Organizational Climate on Job Satisfaction: Case Study of Jordan Telecom, Arab Journal of Management, 2(26) Noordin, Fouziah., Omar, Safiah., Sehan, Syakirarohan and Idrus, Shukriah (2010). Organizational Climate and its Influence on Organizational Commitment, International Business & Economics Research Journal, Vol. 9, No. 2, PP Peters, T. and Waterman, R. (1982). In search of Excellence, Newyork, London: Harper and Row. Popa, Brindusa, M. (2011). The relationship Between Performance and Organizational Climate, Journal of Defense Resource Management, No. 2 (2), PP Putter, Lars (2010). Organizational Climate and Performance: The Relation Between Organizational Climate and Performance and an Investigation of the Antecedents of Organizational Climate, Thesis of Master Degree in Management, Delfet University of Technology. Raza, Syed A., (2010). Impact of Organizational Climate on Performance of College Teachers in Punjab, Journal of College Teaching & Learning, Vol. 7, No. 10, PP Singh, Reech, R., Chauhan, Amit., Agrawal, Sangeeta and Kapoor, Saurabh (2011). Impact of organizational climate on job satisfaction- A comparative study, International Journal of Computer Science and Management Studies, Vol. 11, Issue 2, PP