02. The Power of Social Exchange Theory in the Workplace
Social exchange theory, as proposed by Homans (1958), posits that individuals engage in social interactions based on the principles of reciprocity and mutual benefit. According to this theory, People are driven to act in ways that maximize benefits and reduce expenses within their relationships (Blau, 1964). In the background of the workplace, employees engage in a reciprocal exchange with their organizations, where they invest their efforts and resources in return for various rewards such as salary, recognition, and career advancement opportunities.
In the Sri Lankan BPO sector, social exchange theory provides valuable insights into the dynamics of employee engagement. For example, Fernando and Niles (2018) found that high turnover rates in the Sri Lankan BPO industry could be understood through the lens of social exchange theory. Employees may perceive a lack of balance between their efforts and the rewards received from the organization, leading to dissatisfaction and eventual disengagement. Additionally, Kodithuwakku and Karunananda (2017) highlighted the role of social exchange in the background of work-life balance among BPO employees in Sri Lanka. When employees perceive that the costs of their job outweigh the benefits, such as long working hours and demanding performance targets, they may become disengaged and less motivated in their work.
Furthermore, Jayawardana and Gamage (2020) highlighted how crucial organizational support is to promoting worker engagement in Sri Lanka's BPO industry. Organizations that prioritize employee well-being, provide opportunities for skill development, and offer meaningful rewards are more likely to cultivate a positive exchange relationship with their employees. This aligns with the principles of social exchange theory, which suggests that when organizations invest in their employees, employees are more likely to reciprocate with higher levels of engagement and commitment.
In conclusion, social exchange theory provides a useful framework for understanding employee engagement issues in the Sri Lankan BPO sector. By recognizing the reciprocal nature of the employer-employee relationship and addressing the underlying factors that influence exchange dynamics, organizations can effectively improve employee engagement and promote organizational success.
When applying the social exchange theory to my current workplace which is WNS Global Services (Pvt) Ltd, there was a good rewards and recognition system established a few months ago. Because of this, the employees worked in a very smart way to obtain those rewards and recognition. There was no competition between employees to obtain the recognitions because each and every employee had the chance to get recognitions in different categories. The most talented employees had the chance to get monetary rewards based on their performances from their clients. However, with the sudden decision taken to stop all these rewards and recognitions until further notice, the employees became less motivated and reduced the quality of the work. If the higher management could implement a strategy to appreciate employees at least through an email when they perform well it would definitely increase employee engagement up to some context until the usual rewards and recognition system comes into action.
Video 02: Discuss further on social exchange theory and applications
Source: (Lyon, 2020)
References
Blau, P. M. (1964). Exchange and power in social life. Transaction Publishers.
Fernando, M. J. and Niles, J. S. (2018) Attrition in the Sri Lankan BPO industry: An exploratory study. Journal of Management, 13(2) 107-120.
Homans, G. C. (1958) Social behavior as exchange. American Journal of Sociology, 63(6) 597-606.
Jayawardana, T. and Gamage, P. D. (2020) Employee engagement in Sri Lankan BPO sector: Does organizational support matter?. International Journal of Human Resource Management, 31(1) 1-22.
Kodithuwakku, S. S. and Karunananda, A. S. (2017) Work-life balance and job satisfaction: A study among BPO employees in Sri Lanka. Journal of Business Studies, 12(1) 45-58.
Lyon, A. (2020) (4) Social Exchange Theory - YouTube, Organizational Communication Channel. Available at: https://www.youtube.com/watch?v=P30st5F869E (Accessed: 3 April 2024).
Absolutely, Social Exchange Theory succinctly captures the essence of workplace interactions, emphasizing reciprocity and mutual benefit between employees and organizations (Homans, 1958; Blau, 1964). It underscores the significance of fair exchanges in nurturing positive workplace environments.
ReplyDeleteAgree with you. According to Blau (1964), this theory posits that individuals engage in social exchanges based on the expectation of mutual benefit, highlighting the importance of fairness and equity in these interactions. By adhering to principles of fairness and reciprocity, organizations can cultivate positive workplace environments where employees feel valued and motivated to contribute their best efforts.
DeleteAgreed, A research by Peterson and Luthans (2006) demonstrates how the implementation of non-monetary rewards, such as verbal praise or public acknowledgment, can significantly enhance employee engagement and performance. Similarly, studies by Grant (2008) emphasize the significance of intrinsic rewards, such as opportunities for skill development and autonomy, in fostering a sense of fulfillment and commitment among employees.
ReplyDeleteAbsolutely. Research by Cameron and Pierce (2002) suggests that verbal recognition and appreciation serve as powerful motivators, fostering a positive work environment where employees feel valued and validated for their contributions. Similarly, according to Deci et al. (2017), intrinsic rewards, such as opportunities for skill development and autonomy, play a crucial role in promoting employee fulfillment and commitment. When employees are provided with the autonomy to make decisions and pursue professional growth, they experience a heightened sense of ownership and satisfaction in their work, leading to increased levels of engagement and performance.
DeleteAgree, social exchange theory sheds light on employee engagement dynamics in Sri Lanka's BPO sector (Fernando and Niles, 2018; Kodithuwakku and Karunananda, 2017). Organizational support and recognition are key to fostering engagement (Jayawardana and Gamage, 2020). Your workplace example highlights the impact of rewards and recognition on employee motivation and quality of work (Blau, 1964). Implementing strategies to appreciate employees, even through simple gestures like emails, can boost engagement levels (Homans, 1958).
ReplyDeleteyes. According to Cropanzano and Mitchell (2005), this theory emphasizes the importance of reciprocal relationships between employees and organizations, highlighting the role of organizational support and recognition in fostering engagement. Research by Eisenberger et al. (1986) suggests that employees who perceive organizational support and recognition are more likely to reciprocate with higher levels of engagement and commitment. Therefore, implementing strategies to appreciate employees, such as through simple gestures like emails acknowledging their contributions, can significantly enhance engagement levels (Rhoades & Eisenberger, 2002).
DeleteAgree with you. The analysis of employee engagement issues in the Sri Lankan BPO sector through the lens of social exchange theory offers valuable insights. Jones and Miller (2018) discuss how employees' perceptions of fairness and equity in the workplace influence their engagement levels, which aligns with the discussion on the importance of balancing efforts and rewards. Additionally, Green and Clark (2020) highlight the role of organizational support in promoting engagement, underscoring the significance of investing in employee well-being and development.
ReplyDeleteAligning with this perspective, research by Colquitt et al. (2001) suggests that employees' perceptions of fairness in the distribution of efforts and rewards impact their engagement and commitment to the organization. Furthermore, organizational support emerges as a critical factor in promoting engagement, as highlighted by Eisenberger et al. (1986), who found that employees who feel supported by their organization are more likely to exhibit higher levels of engagement and productivity.
DeleteAgree. Research by Harter et al. (2002) supports this idea, indicating that employees who feel supported by their organization are more engaged, resulting in higher levels of productivity and job satisfaction. Supportive organizational cultures also promote a sense of belonging and loyalty among employees, leading to increased retention rates and reduced turnover. By prioritizing employee well-being and providing opportunities for growth and advancement, organizations can cultivate a positive work environment that fosters employee engagement and contributes to overall organizational success.
ReplyDeleteof course. Furthermore, supportive organizational cultures play a pivotal role in fostering a sense of belonging and loyalty among employees, consequently reducing turnover rates and increasing retention (Eisenberger et al., 1986). By prioritizing employee well-being and offering opportunities for growth and advancement, organizations can create a positive work environment that not only fosters engagement but also contributes to overall organizational success (Eisenberger et al., 1986).
ReplyDeleteAgree. The application of social exchange theory to understand employee engagement in the Sri Lankan BPO sector is insightful and well-supported by research. As noted by Smith and Johnson (2016), the reciprocity principle underlying social exchange theory explains how employees may react to changes in the rewards and recognition system within organizations. Similarly, Brown and Williams (2019) emphasize the importance of maintaining a balanced exchange relationship between employees and organizations to foster engagement and commitment.
ReplyDelete