Organizational Climate and Employee Turnover

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Organizational Climate and Employee Turnover

The theory of organizational climate emerged from the study by Lewin et al. (1939), where the researchers demonstrated that the social environment can be different by varying the behavior of homogeneous groups of people. The nomenclature of “organizational climate” was created by Cornell in 1956, after which a lot of researchers opined their own theory on its concept and approach (James and Jones, 1974). The research on climate as a set of perceptually based psychological attributes was initiated by Schneider and Hall (1972) and they defined it as a set of global perceptions held by individuals about their organizational environment. This set of perceptions is fundamentally the result of interactions between personal and organizational characteristics. The perceptual approach lays emphasis on the sum total of the individual attributes overlooking the organizational parts (James and Jones, 1974; Schneider and Hall, 1972). The organizational climate was perceived as a summary evaluation of events based upon the interfaces between actual and perceptions of these events (James and Jones, 1974). Based on this findings, over the years, many tools have been framed to measure the social work environment but it has been evident that climate differs from one context to another, so it can never be generalized and the study of its influence on a different set will always remain a unique one (Jones and James, 1979; Milton, 1981).

The study of hospitality organizational climate was pioneered by Davidson et al. (2001), and they measured it in 14 luxury hotels in Australia, using the further modified version of the Jones and James’s (1979)“Psychological Climate Questionnaire.” PCQ is based on 35 “a priori concept” (potential dimensions) and 145 items and categorized under four characteristics namely: “job and role,” “leadership,” “workgroup” and “subsystem and organizational.” Davidson reduced the number of items to 70 with each concept having two items. Ryder and Southey (1990) have revealed that the analysis method of Jones and James (1979) is the most suitable, but while loading for factor analysis Davison et al. (2001) deviated from 35 composites to 70 items loading and extracted seven interpretable dimensions. Manning et al. (2004) tried to develop a shortened version of the Davidson et al. (2001) model, but it failed to validate all predicted dimensions. Afterward, it was established through the deliberations of various researchers (Datta and Singh, 2018; Johnston et al., 2013; Johnston and Spinks, 2013; Manning et al., 2004) that Davidson et al.’s (2001) climate model of the hotel industry is more consistent than other instruments.

Organizational climate is explained as a perception of the organization’s citizens, which effects their work-related attitudes (Litwin and Stringer, 1968; Pritchard and Karasick, 1973). Climate study has too much depth in giving answers to the workplace behavioral outcomes of people. Amongst all the behavior outcomes, the most critical issues for the hospitality industry which constantly effects all other outcomes is turnover. Since the turnover tendency is measured as an antecedent of actual turnover, so controlling the employee perception at this stage is considered much convenient and effective than directly addressing the broader issue. It is expected that the climate factors will emerge as the strongest predictors of the turnover tendency of the hotel employees (Al-khasawneh, 2013; Johnston and Spinks, 2013; Manning et al., 2004; Subramanian and Shin, 2013).

Manning et al. (2004) investigated 400 hotel employees and established that the climate dimensions leadership facilitation and support, professional and organizational esprit, conflict and ambiguity and workgroup cooperation, friendliness and warmth, influence turnover intentions. Al-khasawneh (2013) study revealed that the climate components that were considered are: nature of work, authority styles, boss-employee relationship, rewarding system, and job security. The study also pointed out that job security and policies influence attrition. Subramanian and Shin (2013) study on 450 Asian hotel employees reveals that a reward system, responsibility, conformity, and leadership have a significant negative relationship with turnover tendencies. Study results of Johnston and Spinks (2013) contradict the findings of previous literature, as it failed to establish any significance between climate dimensions and turnover intention. Since their study was based on a food and beverage franchise group, the authors opined that results may not always be like the predicted results and may vary with different hospitality settings.

The relationship between employees’ perception of the organization’s work-environment and their work attitude should be strongly related (Mohsin et al., 2013; Rahimi, 2017). Past studies have revealed that there is an inverse relationship between organizational climate and staff turnover. When hospitality employees perceive the climate to be good, their satisfaction levels should be related to such perceptions and hence reduces their turnover intention (Ali and Amin, 2014; Kang et al., 2018).

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