Organizational Behavior as a study on the companies in terms of establishing the behavior of employees and interaction between people has been in application since the 1920s up to date. The study has undergone various changes and improvements in accordance with the changes that present themselves over time, mostly the technological changes. Basically, this study was invented and introduced to organizations with the aim of improving the efficiency level and performance in business operations. Additionally, it helps to apply a scientific approach to individuals within the related organizations as a way of managing them for the benefit of the company. The learning involves numerous points related to behaviors within the organization and outside it. In the current paper, my group intends to focus on the Deloitte Company, an international public accounting firm that deals with the financial consultation provided to clients from different parts of the world. Just like any other business organization, Deloitte faces different kinds of challenges that need to be addressed to improve its operations and more so, the efficiency of the services it offers to clients. The paper will focus on a specific problem in the company and suggest an organizational theory along with the specific steps towards solving the problem.
Deloitte Company is among the Big Four Public Accounting Firms in the world with the branches in almost every part of the world and more than a thousand employees in each department. The company deals with public accounting requiring all the staff to hold a Certified Public Accounting certificate to qualify for the position. A career in public accounting requires individuals to be highly dedicated to the specific firms they are employed in to enable their prolonged career. Deloitte Company has different specifications about the positions available at each level of the firm which sets various requirements for work experience for an individual to be qualified as an employee. The staff level averages at about two to three years, another period of the same as a supervisor, three to six years as a senior manager and finally ten to thirteen years at the partner level (Miner, 2007). The company provides for ten to sixteen years of service in the firm for an employee to reach the senior level.
Studies show that employees, therefore, dedicate much effort and time to be able to reach the top position. It may be difficult for some of them to go through different levels while others loose the motivation at the very last stage for reaching the top, as a result of the hardships and period involved. Guinn Bhamornsiri, S., & Blanthorne (2004) followed the career paths of accountants in private and public firms and found out that the number of employees in private accounting conflicts with the number of the ones in public accounting. He provides a case of the Deloitte Company where many employees decide to withdraw into private accounting firms after a period of service in the company. This happens as a result of the training and experience acquired in the public accounting sector to be later transferred at some level to the industry, as the employees seek higher positions within a limited period.
Over the past few years, there has been a noticeable difference in the employee turnover in the Deloitte Public Accounting Firm. According to the recent studies, the accounting career in Deloitte Company is related to the interpersonal skills and management, rather than crunching numbers, financial consultation, and firms’ evaluation. The employee turnover has therefore decreased by a significant margin, with a percentage decrease from 27.7% to 23.4% having been reported between the years 2005 and 2006 (Guinn et al., 2004). According to studies, the problem of the employee turnover reduction has resulted from a different series of reasons, ranging from employees finding the promotion periods insignificantly long for them to reach the top level and therefore, deciding to shift to the private sector, as well as quitting from the firm in order to raise a family, while others have changed their accounting careers completely and started to pursue other career paths.
This has been a major problem faced by the Deloitte Company that has been struggling with it for a long period so as to maintain the productivity of the firm and sustain its reputation. Reduction in employee turnover is known to be disadvantageous for a company due to the extreme costs associated with it. Operations carried out by employees in the Deloitte Company are publicly based and therefore require real work experience whereby the employees are to apply the basic education knowledge to accounting and more so, the company’s clients. A replacement of the employees with other inexperienced individuals takes a long period of time for the firm to recover fully. Also, there are bigger costs associated with the replacements, as the company has to offer additional training and time off from offices as positions may be left vacant for some time. It is estimated that the firm faces an average cost of $50,000 for replacing a single employee (Greenhaus, Collins, Singh, & Parasuraman, 1997). This averages to 20% of an individual’s salary per year, making it highly expensive in case of a huge reduction in the turnover.
Behaviorist B.F Skinner established the reinforcement theory and put it in application. The theory is relevant in the workplace as it enables employers to retain employees in the organization for a long period while at the same time increasing their experience levels, which reflects a positive impact on the output level and quality. Reinforcement theory implies making changes in the system of handling employees, after a critical analysis and identification of the specific reasons that may disappoint employees and other personnel in the organization. The theory aims at improving the productivity of individuals in the firm, in a way that is less likely to foster resentment while at the same time develop positive attitudes and motivation among the employees so as to remain in service in the organization for as long as they can (Strangor, 2007). Managers in the Deloitte Company should use the reinforcement theory to enable their employees to retain in the organization for a long period of time, despite the hardships associated with attaining the top level positions and the related promotions. The management, therefore, should develop programs that fit each employee in the company and satisfy their needs about their service in the enterprise.
Reinforcement theory involves two main aspects along with other minor principles of the theory, including positive and negative punishments. These two principles should be followed for a solution to be identified by the organization for a specific problem. They include positive reinforcement and negative reinforcement (Tosi, Mero, & Rizzo, 2001). Concerning the reduction of employee turnover in the Deloitte Company, the positive reinforcement which deals with increasing the frequency of behaviors in the company will motivate the employees to keep acting in the right way as there will be rewards as a result. This may be incorporated with the help of promotions. Negative reinforcement, on the other hand, will remove the undesirables in the company when they do what is best for their performance. These principles are significant for solving the problem faced by Deloitte, as employees will have a reason to stay in the company for a longer period since the advance in their career levels will be within their reach.
Deloitte Company can largely deal with the decrease in employee turnover through the application of reinforcement theory which will help sustain its employees for a longer period. In doing this, the organization will be able to cut on costs related to replacements of the employees and increase the quality of services provided by the company to its clients all over the world. Under the reinforcement theory, these are some of the steps that can be employed to solve the problem.
Clear and reasonable expectations should be set so as to motivate the employees on the exact level of performance for the desired prospects. Unclear opportunities based on a specific period as in the case of the company’s policy discourages employees and may contribute to many of their withdrawals. Strong motivators should be identified while working with the employees so as to achieve the desired results. The employees will feel engaged in the decision-making process and therefore enjoy their positions which will make them stay in the company to reach even higher positions. Desirable behaviors should be strongly encouraged. As a result of this, the employees will demonstrate their best practices so as to attain the desired reward, a promotion in this case. Effective use of the reinforcement theory should be considered by the company to achieve the desired results of mitigating the employee turnover reduction. Using the policy effectively rather than partially will ensure obtaining the overall preferable results which will efficiently retain the number of the employees.
Organizational Behavior is a study that organizations use to enhance the efficiency among businesses. The study has many concepts used differently that have been applied across companies since the 1920s and have undergone improvements with changes being implemented over time. Reinforcement theory is among the ideas aimed at motivating employees within a company. In case of the Deloitte Company’s problem of employee turnover reduction, reinforcement theory should be applied in terms of both the positive and negative reinforcement in motivating employees to work for a longer period in the company rather than withdrawing from it.