Industrial Research and Project: Absenteeism Impact Analysis

This industrial research and project report investigates the significant impact of employee absenteeism on organizational performance. The study delves into the various causes of absenteeism, including work pressure, lack of communication, and inadequate employee motivation. It explores the negative consequences, such as reduced productivity, decreased market competitiveness, and challenges in meeting customer demands. The report provides a comprehensive literature review, incorporating insights from scholars, and employs both qualitative and quantitative data analysis to evaluate the research problem. Key findings highlight the link between absenteeism and diminished organizational outcomes, emphasizing the importance of addressing employee turnover. The report concludes with practical recommendations aimed at reducing absenteeism and fostering a more engaged and productive workforce, offering valuable insights for business managers and organizations seeking to improve employee retention and overall performance.

Running head: INDUSTRIAL RESEARCH AND PROJECT
Industrial Research and project
Name of the Student
Name of the University
Author’s Note

1
INDUSTRIAL RESEARCH AND PROJECT
Executive Summary
Absenteeism in now a day has become one of the major concerns for numerous practitioners and
researchers. With the dynamic progress of business the needs and demands of the employees are
changing gradually. Due to the extreme level of work pressure, lack of proper communication,
overburden of internal rules and regulations employees lose their motivational attitude for
performing well towards the business services. As a result, the rate of absenteeism is raising
gradually. In order to overcome this kind of situation, some effective initiatives has already been
taken on behalf of the business managers. However, this specific study has focused to make an
in-depth analysis on how absenteeism has left a major impact on the overall performance level of
organization. An effective literature review by involving the opinion of some of the eminent
scholars has been discussed. Both qualitative and quantitative data analysis technique has been
selected for evaluating the research issue. Based on the entire research work some of the major
recommendations have been provided at the end of study on how to reduce the rate of
absenteeism.

2
INDUSTRIAL RESEARCH AND PROJECT
Table of Contents
1. Introduction and problem statement:...........................................................................................3
Problem statement:..........................................................................................................................4
2. Goals and objectives:...................................................................................................................8
3. Research backgrounds: Literature review...................................................................................9
3.1 Effective ways of reducing the rate of employee turnover:.......................................................9
3.2 Theories and models of employee motivation.........................................................................11
4. Methodology:.............................................................................................................................13
4.1 Research approach and design:................................................................................................13
4.2 Research phases:......................................................................................................................15
4.3 Data collection:........................................................................................................................15
4.4 Data analysis method:..............................................................................................................16
4.5 Ethical consideration:..............................................................................................................16
5 Findings and analysis:.................................................................................................................17
5.1 Qualitative data findings:.........................................................................................................17
5.2 Quantitative data findings:.......................................................................................................19
6. Conclusion and recommendation:.............................................................................................19
Recommendations:........................................................................................................................21
Reference List:...............................................................................................................................23
Appendix:......................................................................................................................................24

3
INDUSTRIAL RESEARCH AND PROJECT
1. Introduction and problem statement:
Absenteeism occurs when an employee is knowingly absent from work. Increasing rate
of absenteeism decreases the company’s productivity and effects on the overall market of the
company. There are many causes behind sudden absenteeism of an employee in the workplace.
The reason can be harassment, low morale of the employees, stress and many known yet
unknown reasons. Research shows that there are large numbers of employees across the world
that prefer the concept of absenteeism due to disengagement, shift timings, family problem and
this impacts largely on the company’s wellbeing. Employees note the fact of being harassed by
others and stop attending work at times and the company in this case needs to play the role of a
mentor and bring out an effective solution of the problem so that they can get the employee back.
The organization can also have some programs arranged to involve the employees in the
workplace and helping them to get motivated for work. Sometimes the company hires employees
who are not at all in the mental condition to work and fulfill their own responsibility, they intend
to, not work and this slowly leads to absenteeism, as sitting idle in workplace is not allowed they
stop going to work. Many employees willingly take offs and go to places they need b y avoiding
work. Moreover, it can be said that when an employee is willingly taking many unscheduled offs
then the organization needs to take severe measures so that other employees also observe the
outcome they are going to face in case they follow the same path. Absenteeism is a concept that
is concerning every organization presently because they are unable to stop the employees from
taking uncertain offs. Absenteeism is often due to uncertain or non-preferable shift timings of
work. The employees presently are more comfortable with flexible work timings so that they do
not have to miss any other activities they are linked with. The concept of absenteeism needs
serious understanding of the company so that the companies can be able to increase their profit

4
INDUSTRIAL RESEARCH AND PROJECT
with the help of the employees. Absenteeism needs consideration of the organization and they
need to find out what is the reason that is making the employees taking so many uncertain leave
from work
Organizations of construction industry especially over the last five years have been
seeking for improving the workforce resources due to extreme rate of employee turnover.
Especially in the logistic sector employees tend to show their extreme level of reluctance in
providing their effective services due to extreme level of communication barrier. Numerous
research scholars have made their own point of view that absenteeism is possessed with major
negative impact on the overall performance level of the organization. It is undeniable that the
success of a specific business organization is highly dependent on the performance level of the
employees. Customers like to purchase the products as well as services only when the
organizational employees can maintain an effective balance between supply and demand. After
identifying the research issue numerous researchers and practitioners have provided their own
point of view on how the rate of employee turnover can be reduced from different organizations.
Numerous eminent scholars have provided their own opinion regarding the impact of
absenteeism.
Problem statement:
Overview about the rate of employee absenteeism:
Kehoe and Wright (2013) emphasizes that with the rapid progress of globalization, the
business organizations have expanded their widespread wings beyond going the regional
boundaries. Numerous business organizations are there who have increased their number of
workforce for satisfying the needs and demands of global customers. As per the point of view of

5
INDUSTRIAL RESEARCH AND PROJECT
this specific research scholar employees coming from different geographical markets and
backgrounds sometimes fail to make an effective rapport with the business environment Wood et
al. (2012). As a result, after providing services for few days the employees show their extreme
level of reluctant attitude for performing well towards the services. Consequently, the rate of
employee absenteeism is getting raised day by day.
On the other hand, it has also been observed that large number of business organizations
in rapid quest of gaining organizational profits intend to impose extreme level of workforce on
the employees. After evaluating the employee perception it has been observed that existing
employees always tend to provide their best effort under agile work environment. In order to
make an effective competitive environment business experts focus to impose their own decision
on the employees. As a result, rate of employee turnover has been raised rapidly. In 2015, the
rate of employee turnover has been raised up to 72% (Sliter, Sliter and Jex 2012). Employees are
de-motivated extremely towards performing well. The business managers fail to provide an agile
work environment at the work place. In this kind of situation, employee performance rate has
become very much average. Organizations fail to gain their revenue growth throughout the year.

6
INDUSTRIAL RESEARCH AND PROJECT
Figure 1: Rate of Employee turnover
(Source: Mowday, Porter and Steers 2013)
Primary reasons of increasing rate of absenteeism at the workplace:
Numerous eminent scholars have discussed their own point of view about the probable
reasons of extreme level of employee turnover at the workplace. As stated by Peretz and Fried
(2012), large number of business organizations is there which fail to provide proper
remuneration package to the employee at the proper time. Remuneration is a kind of employee
motivation that encourages existing employees for performing well towards the business
services. Due to the lack of organizational profitability the business experts fail to provide
appropriate salary package to the business experts. As a result, people belonging to different
geographical boundaries lose their level of interest in attending their workplace regularly. In this
kind of situation, the rate of absenteeism has been raised rapidly. Chiang and Hsieh (2012)
opined on the other hand that extreme level of work pressure within the organization is one of

7
INDUSTRIAL RESEARCH AND PROJECT
the most effective reasons of raising the rate of absenteeism at the workplace. As per the point of
view of this specific scholar organizations do not tend to recruit large number of employees in
comparison to the number of their customers. Employees as a result fail to provide effective
services to the customers.
In this kind of situation, new employees feel extreme level of de-motivation in
performing well within the business organization due to the lack of workforce strength.
However, due to the lack of employee de-motivation the organizational performance has been
lacked radically (Park and Shaw 2013). Lack of employee flexibility is one of the most
significant reasons of absenteeism. In many cases, it has been observed that employees do not
get agile work environment at the workplace. Employees are not flexible enough in making their
sitting arrangement as per their comfort zone. In this kind of situation, employees cannot be
flexible in maintaining an effective communication with individual employee. Large number of
business organizations is there which are very much strict in maintain work hour. Employees are
not flexible enough in maintaining work hour flexibility. After identifying the major issues it can
be highlighted that employee motivation is highly significant for receiving good performances
from the business organization (Hassan, Wright and Yukl 2014). At the same time, it is also
undeniable that absenteeism is one of the most effective factors due to which organizations fail
to run their entire process of business beyond going the regional market. As per the point of view
of different eminent scholars organizations should take major initiatives in order to reduce the
rate of employee turnover from the workplace.
Impact of absenteeism on organizational performance:

8
INDUSTRIAL RESEARCH AND PROJECT
Peretz, Levi and Fried (2015) stated that due to frequent level of absenteeism the rate of
organizational performance is getting damaged rapidly. In this specific part the impact of
absenteeism has been discussed from point of views. This specific scholar has stated that
organizational productivity hampers immensely due to the frequent rate of employee
absenteeism. The contribution of employees is possessed with major significance in rendering
the business success. In order to meet the business target the managers have to appoint sufficient
number of workforce at the workplace. If the number of employee strength remains limited
within the organization, the business managers fail to meet the business target (Golden 2012). In
this kind of situation, organizational productivity hampers immensely due to the limited number
of workforce strength. Based on the employee strength business organizations tend to focus on
target group. If the rate of absenteeism rises day by day the business managers fail to provide
effective service to the target customers. The service users have to wait for large period of time
in order to receive the services properly (Leblebici 2012). In this kind of situation, the business
experts have to face innumerable difficulties in maintaining a balance between customers’ supply
and demand. In order to create a market demand the business organizations have to apply
sustainable policy in the market. Employee retention is one of the most effective factors due to
which due to which organizations can sustain in the market. Due to the repeated cause of
absenteeism employees fail to maintain their organizational image and reputation. This particular
factor has made a serious concern for large number of business employers (Tseng and Lee 2014).
After identifying the issue of absenteeism business organizations have taken some of the most
effective initiatives.

9
INDUSTRIAL RESEARCH AND PROJECT
2. Goals and objectives:
While conducting the research work the practitioners tend to focus on reaching specific
research goals and objectives. This specific research work primarily focuses to evaluate the
impact of absenteeism on the overall business performances. The primary goals of this specific
research work are as follows:
Goals:
 Goal 1: Identifying the specific reasons of employee de-motivation at the workplace
 Goal 2: Selecting the necessary factors that can prevent from an employee from being
turned over
 Goal 3: Evaluating the necessary negative impact of absenteeism on the overall
performance of organization
Objectives:
The necessary objectives for this particular research work are as follows:
 To critically evaluate the impact of absenteeism on the overall performance level of
business organization
 To critically understand the major reasons of rapid employee turnover at the workplace
 To provide some of the major recommendations on how to reduce the rate of employee
turnover at the workplace

10
INDUSTRIAL RESEARCH AND PROJECT
3. Research backgrounds: Literature review
3.1 Effective ways of reducing the rate of employee turnover:
In order to gain organizational image and reputation large number of business experts
intends to implement some of the most effective business strategy and policy due to which the
rate of employee turnover has been reduced massively. The most effective ways based on which
rate of employee turnover can be reduced are as follows:
Implementing reward and recognition policy within the organization:
Mitchell, Obeidat and Bray (2013) opined that with the rapid progress of business the
needs and demands of the employees changes gradually. In order to provide effective services to
the customers, employees sometimes have to put additional effort. In this kind of situation,
business organizations should implement reward and recognition policy so that employees can be
motivated towards the services. Mackey and Gass (2015) commented that providing additional
benefits and facilities to the employees for their additional effort is one of the most effective
parts of recognition policy. On the other hand, the service providers can be provided health
insurance so that employees do not get hesitated in giving their best endeavor towards the
services. This specific study has focused to make an in-depth overview about the impact of
implementing reward and recognition policy within the organization in order to reduce the rate of
absenteeism.
Maintaining participative leadership style at the workplace:
While conducting organizational case studies it has been observed that lager number of
business organizations is there which are implementing autocratic form of leadership at the

11
INDUSTRIAL RESEARCH AND PROJECT
workplace (Taylor, Bogdan and DeVault 2015). Due to the implementation of autocratic form of
leadership style business managers intended to force on the employees for maintaining their
regulations at the workplace. In this kind of situation, employees lost their interest in providing
their best effort towards the services. In order to overcome this kind of situation, the business
experts can follow participative form of leadership style at the workplace. As commented by
Hoon Song et al. (2012), participative form of leadership style implies that the business
managers never intend to impose their own decision on the employees. Employees in this form
of specific leadership style get enough opportunities in showing their own point of view
regarding the business goal. As a result, the employees get an enthusiastic attitude in providing
good services to the customers. On the other hand, in internal relation between the business
leaders and the employees become stronger. Consequently, the business employees reduce their
rate of absenteeism and provide their best effort for reaching organizational success.
Creating an agile work environment at the workplace:
Yeh and Hong (2012) stated that agile work environment signifies workplace flexibility
the business managers intend to give to existing employees for getting their good services. With
the rapid progress of business process large number of business organizations intend in
implementing innovative strategies and policies for reducing the rate of employee turnover as
well as absenteeism at the workplace. Making work hour flexibility is one of the most effective
initiatives that large number of business organizations intends to do at the workplace (Jahanshahi
et al. 2012). Work hour flexibility implies that employees are allowed to leave their floor after
completing their assigned job for that day.
Maintaining an effective communication with the employees: