Job Satisfaction Impact on Employee Performance at British Petroleum

This report presents a comprehensive case study on British Petroleum (BP), focusing on the critical impact of job satisfaction on employee performance. The study investigates the challenges BP faces, including issues with compensation planning and its effect on employee engagement and retention. The research delves into the background of BP, its company structure, and the rationale behind the study, highlighting the significance of employee satisfaction within the UK's business landscape. The report explores various factors affecting job satisfaction, such as compensation, work-life balance, and motivational theories like Maslow's hierarchy of needs and Herzberg's two-factor theory. The methodology includes quantitative data collection through surveys, analyzing data from 150 BP employees. The findings reveal both positive and negative impacts of job satisfaction on employee performance, leading to recommendations for enhancing employee engagement and satisfaction through reward programs, improved work culture, and employee involvement in decision-making. The report also includes an analysis of the literature, research methodology, data analysis, and provides actionable recommendations for BP to improve employee satisfaction and performance, ultimately aiming to reduce turnover and boost organizational success.

Running head: EMPLOYEE ENGAGEMENT
Impact of Job Satisfaction on Employee Performance: A Case Study of British Petroleum
Name of the Student:
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Author’s Note:

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Acknowledgement
I would like to thank my supervisor to give the chance to work on the research study based on
“Impact of job satisfaction on employee performance: A case study of British Petroleum” I
would like to thank my all co-workers who have helped me to conduct and accomplish this
research study.
I would like to express my thankfulness to my supervisor Mr.-------------------------------------- for
his help and support in every step of my research study. Without his guidance it was not possible
for me to conduct this research and to collect proper data. I am grateful to my parents for their
support and love during my research study. I would like to thank every participant those have
taken part actively in the research survey and helped me to gather reliable and real-time data for
my study.
Thanking You
Yours Sincerely
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Abstract
Maximum organizations in the global world are now focusing on enhancing the job satisfaction
level in order to get competitive advantages. In UK, the job satisfaction level is low in
comparison to other developing countries. From the various studies it has been identified that
high turnover has been occurred in many organizations of UK due low level of job satisfaction
among the employees. This study highlights the current issues regarding the poor job satisfaction
in British Petroleum. However, BP has been facing employee retention problem due to their low
compensation program. The employees in this organization are not satisfied with their current
compensation planning, which also affects their job satisfaction level in this organization. The
first chapter of this research study includes research aim, objective, questions and problem
statement. From which it has been identified that poor job satisfaction among the employees is a
big challenge for business industry, which need to minimize. Second chapter of this study shows
a brief literature regarding the factors of job satisfaction, employee performance, motivational
theories and impact of job satisfaction on employee performance. Maslow’s and Herzberg Two
actor theories are used in this section to understand the basic needs and motivation al techniques.
Chapter there includes a brief explanation of research methodology. However, the primary
quantitative data collection method has been taken and the survey is used to collect quantitative
data. Questionnaires have used to gather information and the sample size is 150 employees of
BP. Secondary analysis has been applied in literature review section. Quantitative analysis is
significant for this study to gather authentic data.

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Chapter four and Chapter five focus on the research findings and possible recommendations for
the current issues. Current findings show that job satisfaction has both positive and negative
impact on employee performance. Hence, application of reward program, establishment of
positive work culture and employee engagement will be helpful for BP to enhance the job
satisfaction level in their organization.

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Table of Contents
Chapter 1: Introduction....................................................................................................................8
1.1 Introduction............................................................................................................................8
1.2 Background of the Study.......................................................................................................8
1.3 Company Background.........................................................................................................10
1.4 Research Rationale..............................................................................................................10
1.5 Research Aim.......................................................................................................................11
1.6 Research Objectives.............................................................................................................11
1.7 Research Questions..............................................................................................................12
1.8 Research Hypothesis............................................................................................................12
1.9 Structure of the Research Study..........................................................................................12
Chapter 2: Literature Review.........................................................................................................14
2.1 Concept of the job satisfaction and employee performance................................................14
2.2 Conceptual Framework........................................................................................................15
2.4 Potential factors of the job satisfaction................................................................................15
2.3 Significance of the job satisfaction on employee performance...........................................16
2.4 Maslow’s hierarchy of needs theory for Job satisfaction....................................................17

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2.5 Herzberg's motivator-hygiene theory..................................................................................19
2.6 Application of Job characteristics model.............................................................................20
2.7 Effect of job satisfaction on employee performance...........................................................21
2.8 Gap in the Literature............................................................................................................22
Chapter 3: Research Methodology................................................................................................23
3.1 Research Onion....................................................................................................................23
3.2 Research Philosophy............................................................................................................24
3.3 Research Approach..............................................................................................................24
3.4 Research Design..................................................................................................................25
3.5 Data collection method........................................................................................................25
3.6 Sampling method, sample size, and sampling technique....................................................26
3.7 Data Analysis.......................................................................................................................27
3.8 Ethical Consideration...........................................................................................................27
3.9 Limitation of the research study..........................................................................................27
4.0 Time Frame..........................................................................................................................28
Chapter 4: Data Analysis and Discussion......................................................................................29
4.1 Empirical Results:................................................................................................................29
4.1.1 Quantitative data analysis.................................................................................................29
4.2 Summary of the findings.....................................................................................................43
Chapter 5: Conclusion and Recommendations..............................................................................45

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5.1 Conclusion...........................................................................................................................45
5.2 Linking with objectives.......................................................................................................45
5.4 Limitation of the Research...................................................................................................49
5.5 Future Scope of the Study....................................................................................................49
References......................................................................................................................................50
Appendix 1.....................................................................................................................................54
Appendix 2.....................................................................................................................................55

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List of Tables
Table 1: Demographic Analysis....................................................................................................32
Table 2: Importance of job satisfaction on employee performance..............................................33
Table 3: Job satisfaction BP..........................................................................................................34
Table 4: Effect of poor compensation planning on job satisfaction..............................................36
Table 5: Factors of Job Satisfaction...............................................................................................37
Table 6: Comparison of Job satisfaction level of BP with other organizations.............................39
Table 7: Major consequences of poor job satisfaction in BP........................................................41
Table 8: Positive effects of Job satisfaction..................................................................................42
Table 9: Suggestions to improve job satisfaction level in BP.......................................................44
Table 10: Action planning for establishing a good working culture.............................................50
Table 11: Implementation of reward and compensation planning................................................50
Table 12: Action plan for Employee engagement in decision making..........................................51

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List of Figures
Figure 1: Structure of the Research Study.....................................................................................14
Figure 2: Conceptual Framework..................................................................................................17
Figure 3: Maslow’s Hierarchy of needs.........................................................................................21
Figure 4: Two factor Theory of Herzberg.....................................................................................22
Figure 5: Job Characteristics model..............................................................................................23
Figure 6: Research Onion..............................................................................................................25
Figure 7: Demographic Analysis...................................................................................................32
Figure 8: Importance of job satisfaction on employee performance.............................................33
Figure 9: Job satisfaction BP.........................................................................................................35
Figure 10: Effect of poor compensation planning on job satisfaction...........................................36
Figure 11: Factors of Job Satisfaction...........................................................................................38
Figure 12: Comparison of Job satisfaction level of BP with other organizations.........................40
Figure 13: Major consequences of poor job satisfaction in BP.....................................................41
Figure 14: Positive effects of Job satisfaction...............................................................................43
Figure 15: Suggestions to improve job satisfaction level in BP....................................................44

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Chapter 1: Introduction
1.1 Introduction
Employee performance refers to the personal ability and skill of the individuals to deal
with a work environment. Performance of the employees depends on the job satisfaction.
However, if the employees are satisfied with their job then they get interested in their work, as a
result, their performance can be increased. Job satisfaction is one kind of attitude that is shown
by the individuals. People who have a high level of job satisfaction are able to show positive
attitudes towards their job (Fu and Deshpande 2014). On the other hand, if a person is
dissatisfied with their job then they show a negative attitude towards their job. Job satisfaction
can be considered as the complex assemblage of emotion. There is no particular method to
measure the job satisfaction of the employees, however; there is various way through which a
company can identify whether their employee are satisfied or not with their job. This study deals
with the job satisfaction level of the employee as well as their performance in the context of
British Petroleum. However, British Petroleum or BP has been facing huge problem due to their
employee compensation. The employees of this organization are not satisfied with the
compensation plan of this organization, which is a major reason for their job dissatisfaction. A
huge employee turnover is caused due to this compensation problem in BP.
1.2 Background of the Study
Compensation is not only the financial reward for the employees. It also focuses on the
medical care work-life balance and flexible benefits. In UK many organizations have been facing
problem regarding the employee performance due to lack of engagement of the employees in
their work. One of the major reasons, of the employee engagement, is the poor job satisfaction of

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the employees (Leroy et al. 2015). This study is based on the employee satisfaction in BP. In the
recent years, BP has been suffering from the employee compensation problem, which has made
their employees dissatisfied. The employee of this organization accused BP of their poor
compensation program (Truth-out.org 2018). Many business and people have claimed that BP is
failed to give compensation to their employees.
Compensation problem in an organization is a great problem, which affects the
performance of the employees as the employees are not satisfied with their compensation
program. Compensation package is a major part of the job, especially in the oil and gas sector. In
order to enhance the performance of the employee's job, satisfaction is crucial. Job satisfaction is
considered as the motivational technique that insists the employees to give more effort in their
work. The employees of oil and gas sectors are always at risk. Thus, for the organizations, it is
crucial to arrange a good compensation program to provide support to the employees who get an
injury during their work (Anitha 2014). On the other hand, employee satisfaction is a crucial
part of an organization as the success of an organization depends on it. Research shows that UK
workers have the lowest level of the job satisfaction in comparison to other countries.
As for example, low level of job satisfaction has been seen in the BP due to their poor
compensation program. The major issue of the employee dissatisfaction in UK due to lack of
fairness in their employee development program. However, in BP the employees claimed that the
management of this organization did not keep their promise regarding the compensation program
(Shimazu et al. 2015). This left a major impact on the performance of the employees. As
mentioned by Fu and Deshpande (2014), happy employees are more engaged in their work and
happiness comes from the job satisfaction of the employees. Hence, for BP, the poor employee
satisfaction is a major drawback of this organization that affected the performance of the

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employees. The employees are strongly dissatisfied in BP due to the poor planning of the
compensation program. This caused high turnover in this organization. On the other hand, BP
did not acknowledged this properly as a result, their employee retention power is affected
(Bp.com 2018).
1.3 Company Background
British Petroleum is the world’s leading integrated gas and oil company. This is a UK
based organization. They offer the customers energy for heat, fuel for the transportation, light,
petrochemicals, and lubricant to make the engine moving and so on. In the present time, this
organization has been facing a major issue due to their poor employee satisfaction. However, the
employees are highly dissatisfied with this organization due to the poor compensation planning.
This leaves a great impact on the performance level of the employees (Bp.com 2018).
1.4 Research Rationale
Poor job satisfaction is the biggest issue in UK as many organizations have been
suffering employee turnover and poor performance level of the employees due to this low job
satisfaction. As for example, BP has been facing poor job satisfaction problem as they have
failed to keep their compensation planning. However, low job satisfaction has caused a high
turnover of the employees in BP. As per the statistical data, 7,000 employees have lost their job
in BP due to the major financial loss, which has occurred for the poor performance of the
employees (Theguardian.com 2018). The major reason, of this low performance, is the low job
satisfaction of the employees that is caused by the poor compensation planning of BP. However,
the poor performance of the employees is the main reason of 7000 job loss. On the other hand,
the financial problem of this organization is another big issue, which leads the employees to
leave this organization. The poor financial performance of BP leads the employees to be