Employee Satisfaction and Its Impact on Organizational Success

This report provides a literature review on employee satisfaction, exploring key factors that influence job contentment and organizational success. It highlights the importance of work culture, emphasizing the impact of group dynamics, communication, and socialization on employee motivation and mental well-being. The report also examines the role of employee benefits, linking them to the expectancy theory, which suggests that employees are motivated by rewards that are perceived to be valuable. The analysis covers the direct impact of work culture and benefits on employee satisfaction, turnover rates, and overall organizational productivity. The report references several key studies and authors to support its findings, concluding that fostering a positive work environment and providing competitive benefits are crucial for retaining employees and achieving organizational goals. The report also discusses the importance of employee satisfaction for productivity and reducing mental fatigue.

Running head: EMPLOYEE SATISFACTION
EMPLOYEE SATISFACTION
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LITERATURE REVIEW
Employee satisfaction refers to the extent to which employees are content with the job
that they have to do on a daily basis, or the extent to which they are content with what their
employers have to offer to them (Alegre, Mas-Machuca and Berbegal-Mirabent 2016). This
factor is critical for organizations to ensure lower rates of turnover.
The first thing to consider in this context is work culture and organizational setting.
According to Guiso, Sapienza and Zingales (2015), work culture directly affects employee
satisfaction. In other words, it means that in a culture where group dynamics are minimally
focused upon, group cohesiveness is adversely affected, leading to lack of communication,
interaction and socialization in between the employees of the organization. This boredom, as
a result of lack of group dynamics, eventually leads to mental fatigue for the employees, and
when that happens, employees feel less motivated to work (Guiso, Sapienza and Zingales
2015) A proper work culture should ideally constitute of a setting in which employees are
encouraged to socialize with each other, and where communication is facilitated. According
to the authors, mental fatigue is the leading cause of high turnover rates in organizations, and
therefore, the key is to create a healthy work culture where employees could nurture
themselves.
Secondly, employee benefits works hand in hand with employee satisfaction. This
could be related to the expectancy theory. According to Aguenza and Som (2018), the
expectancy theory suggests that employees tend to willingly work and act in a desired
manner, only when there is a psychological or materialistic reward attached to it. Moreover,
the perceived value of this reward has to be higher than the value of the efforts that the
employees are supposed to put in, to ensure that employees get the job done willingly and in
high spirits (Aguenza and Som, 2018). This is related to employee satisfaction because of the

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fact that when employees willingly do a work, the chances of mental fatigue are minimized.
This has a positive effect on the organization’s productivity as well. Namely, factors like
health insurances, grants, leaves and bonuses together influence employees to work in a
manner that they are desired to be working in (Aguenza and Som 2018).
Therefore, it could be said that work culture and employee have a direct impact on
employee satisfaction, because of which, employees tend to stay content with the work that
they have to do on a daily basis, and also with the organization that they are working for.
Keywords: Employee satisfaction, Employee satisfaction factors, group dynamics,
expectancy theory

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References
Aguenza, B.B. and Som, A.P.M., 2018. Motivational factors of employee retention and
engagement in organizations. IJAME.
Alegre, I., Mas-Machuca, M. and Berbegal-Mirabent, J., 2016. Antecedents of employee job
satisfaction: Do they matter?. Journal of Business Research, 69(4), pp.1390-1395.
Guiso, L., Sapienza, P. and Zingales, L., 2015. The value of corporate culture. Journal of
Financial Economics, 117(1), pp.60-76.