The current employment climate, heavily favouring the employee, is leading employers to reevaluate their business direction in order to maximize employee retention, engagement, and business performance. Currently, we have one of the lowest rates of unemployment ever, respectively the lowest since 1976 in Canada at 5.8%, and 3.8% in the United States (Trading Economics), the problem is no longer for employees to find jobs, but rather for employers to keep employees satisfied and have them stay.
With this in mind, it’s important to move away from organizational obstacles that cripple your business. As the adage says, “employees don’t leave jobs, they leave managers”, keeping employees engaged and satisfied within their work environment is extremely important. As companies become more geared toward altruism, having managers that not only manage badly but also display avarice or organizational greed, can severely cripple a company. Having a manager whose self-interest is low, is [more] likely to have “other orientation” which is a “dispositional tendency to be concerned with and helpful to other persons.” (Megliano & Korsgaard, 2004, p.948)
Keeping employees at the forefront of an organization’s priority list not only ensures that production and output are maintained, but it is likely to keep employees engaged with their work, and ensures they reach for what every employer wants from their employees, to go above and beyond for the good of their company. By refraining from playing on the insecurities that many people have, you can easily avoid undercutting your employees’ productivity. Organizational Greed defined not only by greed, or avarice, [but also] wantonly presenting your possessions or fringe benefits earned in the workplace is not only indicative of a bad attitude but often gives a bitter taste to those people who are witnessing the attitude.
These behaviours from greedy top executives are bad examples for other employees, which further creates more people who have little regard for altruism or their peers; and these kinds of attitudes often create higher agency costs, reducing shareholder wealth (Tipping Point: Managers’ Self-interest, Greed, and Altruism, p274).
The intangible costs of fostering this kind of business culture range from an increased cost of absenteeism to the cost of employing people who simply show up, do the bare minimum and clock out without any concern for the business itself. Up to $3,600 per employee, per hour of absenteeism, costs productivity up to 84 billion dollars on a yearly basis (The Causes and Costs of Absenteeism). That is an incredibly substantial amount of money that could be saved each year, and removing organizational greed is a huge step in the right direction.
Employing staff that are more conscientious, according to recent studies, and show less corporate greed displayed less “myopic behaviours, such as lower investment in R&D, short-term earnings management” (Haynes, et al. p271), and increase the longevity and perceived reputation of a business, benefitting the company’s financial, social, and human capital in the long run. While organizational greed demonstrated by top and middle management is associated with short-term financial gain for the business, it fosters the wrong kinds of ideas in employees not living up to expectations, because expectations keep moving [and that they] can never achieve anything [as a result](Haynes, et al. p271).
Self-interest, in modest amounts, however, is a boon to help propel an organization’s goals forward. Maintaining the balance between ambition and avarice, while including a good amount of altruism in order to fashion a company culture, geared towards employees, and serving the surrounding or worldly community has been proven to increase a company’s bottom line dramatically, as its longevity increases. Employees remain with much more loyalty and passion to help push goals, and there is a better chance to garner much more business as people’s perceptions of the business are so much the better.
Be clear to watch out for some of the warning signs of employee disengagement, and root out the causes right away, whether systemic or simply because of a bad manager, issues like these can cost you dearly. For help with creating a conducive environment for your employees click here.