Improving Employees' Attitudes during Recession

The fear of layoff prominent during a recession can have a huge impact on morale throughout an organization. While management is busy considering where to cut costs and how to properly invest during the economic hardship, employees become disengaged due to their concern about what the future holds. Finding inspiration and motivation can be a real challenge when anxious about whether your position will be available tomorrow. It is during these times that management must carefully consider their strategy for keeping employees optimistic and engaged. Planning to survive the recession could have fatal implications if management is too short-sighted. Cutting costs alone will not see the company through the recession without seeing the investment opportunities that exist during these times; the most important of which is the investment in people.



Managers at Bain & Company, Home Depot, and Best Buy have taken a variety of steps in the past to build and maintain talent during the recession; utilizing Schwartz’s value theory to keep employees engaged and motivated. According to Schwartz, values “represent broad goals that apply across contexts and time." He proposed that there are ten primary values that guide human behavior: Power, achievement, hedonism, simulation, self-direction, universalism, benevolence, tradition, conformity, and security. Shalom Schwartz, PhD (2012) explains that “values are critical motivators of behaviors and attitudes." Because of this, organizations often create strategy based on one or more these values to influence employee attitudes.

Home Depot is aware of the importance of these values; utilizing achievement to boost morale during the recession. Chief Executive Frank Blake lowered hourly employees’ sales and profit targets required for bonuses, resulting in a record-breaking percentage of bonuses for in-store employees. While these companies can use values such as achievement to improve employees’ attitudes, there is one primary value that is threatened in a recession that influences the behavior of managers and employees: security. Edward Lawler III explains that “people are looking for reassurances, for transparency, and they’re not looking for surprises." Managers are aware of the loss of productivity resulting from the security threat, and so they must work to create an atmosphere of transparency while seeking creative ways to build morale.

Steve Ellis looks at a recession with an optimistic outlook; recognizing the opportunities rather than the obstacles. He asserts that the recession is “a huge opportunity to grab very talented people,” explaining that talent is cheaper during this time and companies have the opportunity to grab valuable market share while other companies are cutting back. He believes that such investments offer a head start when the economy picks back up. His outlook offers a bit of insight into the general nature of attitudes, which is composed of three components: affective, cognitive, and behavioral.

The affective component of our attitudes is about feelings. Obviously Ellis feels positive about the recession, although this isn’t explicitly stated. This assumption is based on the cognitive and behavioral components that we can see. The cognitive component is about our thoughts. The thoughts that Ellis shared are about opportunity rather than any negative aspects; indicative of positive feelings. The behavioral component is about our actions in response to the thoughts and feelings. Ellis’ actions are in-line with the thoughts that he expressed; using the opportunity to hire and invest.

While Steve Ellis is looking to the future, Home Depot and Best Buy are seeking creative ways to increase employee involvement. For example, Best Buy set up online surveys to give employees an opportunity to share ideas for cutting costs. This not only gets the employees engaged, but it also gives them a sense of security in knowing that they are contributing to the solution rather than just worrying. As John Pershing, Best Buy’s executive vice president for human capital explains: “When you know you can make a difference and you’re part of the solution, it can change your mind completely." This involvement in the solution process also serves to build employee loyalty, as they feel as though they are actually a part of the team and can better identify with the organization.

Icek Ajzen’s theory of planned behavior offers insight that can be used by managers to increase employee performance during a recession. Katherine Margolis explains that this theory is based on the theory of reasoned action (TRA), which “posits that attitudes (toward the behavior) and subjective norms (beliefs about whether individuals who are important to the person approve or disapprove of the behavior) lead to behavioral intention which leads to behavior." Ajzen’s theory added that perceived behavioral control also predicts behavioral intention. Perceived behavior control “refers to the perceived ease or difficulty of performing the behavior and is assumed to reflect past experience as well as anticipated impediments and obstacles." Ajzen’s model explains the nature and role of the three determinants of intentions.

By understanding attitudes, subjective norms, and perceived behavioral control, managers can create more effective plans for facilitating desired behavior. These determinants could be solicited via survey and used to counter unwanted behavior through the implementation of behavioral controls. We’ve discussed a few ways that managers go about influencing attitudes, and attitudes throughout the organization are the foundation of subjective norms. The main takeaway from Ajzen’s theory is that these three determinants are vitally important because they form our intentions which lead to behavior. This means that the application of this theory could help companies predict behavior before it happens and create an effective response to prevent unwanted behavior while encouraging desired behavior. The primary determinants that management can influence are attitudes and controls.

While managers cannot control the state of the economy, they can influence employee attitudes. Some ways to do this include transparency, encouraging engagement, motivating through values, and most importantly; taking good care of them. Job satisfaction can boost employee engagement and organizational commitment, reducing the negative side-effects of a recession. Causes of job satisfaction influenced by management include need fulfillment, met expectations, value attainment, and equity. By taking good care of employees and being transparent during difficult times, managers can keep employees engaged and working to do their part in keeping the organization afloat during the turbulence.

References

Kreitner, R., & Kinicki, A. (2013). Organizational Behavior (10th ed.). New York, NY: McGraw-Hill Irwin.

Schwartz, S. (2012, December 1). An Overview of the Schwartz Theory of Basic Values. Retrieved May 23, 2014, from http://scholarworks.gvsu.edu/cgi/viewcontent.cgi?article=1116&context=orpc

Margolis, K. (2011, August 2). Theory of Planned Behavior/Theory of Reasoned Action.SurroundHealth. Retrieved May 23, 2014, from http://surroundhealth.net/Topics/Education-and-Learning-approaches/Behavior-change-strategies/Articles/Theory-of-Planned-Behavior-Theory-of-Reasoned-Acti.aspx