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– Research title: Enhancing Organizational Performance though diversity and inclusion in workplace
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King Faisal University
College of Business
Administration Department of
Management
Research Project
Impact of Workplace Flexibility on Employees’ Performance
in Industrial Sector
By:
Date: January 10, 2022
Impact of Workplace Flexibility on Employees’ Performance in Industrial Sector
2
Contents
Abstract ………………………………………………………………………………………………………………………… 7
Chapter 1: Introduction ………………………………………………………………………………………………… 8
1. Introduction ………………………………………………………………………………………………………………. 9
1.1.
Overview …………………………………………………………………………………………………………. 9
1.2.
Background ……………………………………………………………………………………………………… 9
1.3.
Research Problem ……………………………………………………………………………………………. 9
1.4.
Research Objectives and Research Question……………………………………………………. 10
1.5.
The Industrial Sector in Saudi Arabia …………………………………………………………….. 10
1.6.
Research approach …………………………………………………………………………………………. 11
1.7.
Companies (Aramco, SABIC, Saudi Electricity Company) ………………………………. 11
1.8.
Sampling………………………………………………………………………………………………………… 12
1.9.
Conceptual Model and Hypotheses …………………………………………………………………. 12
Chapter 2: Literature Review ………………………………………………………………………………………. 13
2. Literature Review ……………………………………………………………………………………………………. 14
2.1. Introduction to the Literature Review ………………………………………………………………… 14
2.2. What is the Industrial Sector? ……………………………………………………………………………. 14
2.3. What are the Conditions of a Suitable Workplace in the Industrial Sector? …………. 15
2.4. Workplace Flexibility Definition and Examples ………………………………………………….. 16
2.5. Workplace Flexibility Variables/Determinants …………………………………………………… 18
2.5.1. Information Technology ……………………………………………………………………………….. 18
2.5.2. Nature of the Work ………………………………………………………………………………………. 18
2.5.3. Employer’s Awareness ………………………………………………………………………………….. 18
2.6. Characteristics of the Industrial Sector ………………………………………………………………. 19
2.7. Industry in KSA ………………………………………………………………………………………………… 20
Impact of Workplace Flexibility on Employees’ Performance in Industrial Sector
3
2.8. Workplace Flexibility in KSA …………………………………………………………………………….. 20
2.9. Employee Satisfaction ………………………………………………………………………………………… 21
2.10. Measures of Employees’ Satisfaction ………………………………………………………………… 21
2.11. Employees Performance …………………………………………………………………………………… 22
2.12. Employee Satisfaction Impact on the Employee Performance ……………………………. 22
2.13. Measures of Employees’ Performance ………………………………………………………………. 23
2.14. Workplace Flexibility’s Impact on Employee Performance ……………………………….. 23
2.15. Bonus and Rewards …………………………………………………………………………………………. 24
2.16. Impact of Giving Employees Bonus and Rewards on the Employee Performance . 24
2.17. Literature Review Summary ……………………………………………………………………………. 25
2.18. The Conceptual Model …………………………………………………………………………………….. 25
Chapter 3: Research Approach ……………………………………………………………………………………. 28
3.
Research Approach ………………………………………………………………………………………………. 29
3.1.
Introduction …………………………………………………………………………………………………… 29
3.2.
Research Design……………………………………………………………………………………………… 29
3.3.
Theoretical Approach …………………………………………………………………………………….. 29
3.3.1.
Thesis Epistemology………………………………………………………………………………….. 29
3.3.2.
Theoretical Perspective ……………………………………………………………………………… 29
3.4.
Practical Approach ………………………………………………………………………………………… 30
3.4.1.
Research methodology ………………………………………………………………………………. 30
3.4.2.
Research techniques …………………………………………………………………………………. 30
3.4.3.
Piloting ……………………………………………………………………………………………………. 30
3.4.4.
Sampling ………………………………………………………………………………………………….. 30
3.5.
Data Analysis …………………………………………………………………………………………………. 31
3.6.
Validity and Reliability …………………………………………………………………………………… 31
Impact of Workplace Flexibility on Employees’ Performance in Industrial Sector
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3.7.
Generalizability ……………………………………………………………………………………………… 32
3.8.
Summary ……………………………………………………………………………………………………….. 32
Chapter 4: Results……………………………………………………………………………………………………….. 33
4.
Results …………………………………………………………………………………………………………………. 34
4.1.
Part 1: Participant’s Demographics ………………………………………………………………… 34
4.1.1.
Gender …………………………………………………………………………………………………….. 34
4.1.2.
Age ………………………………………………………………………………………………………….. 34
4.1.3.
Education ………………………………………………………………………………………………… 35
4.1.4.
Position ……………………………………………………………………………………………………. 36
4.1.5.
Experience ……………………………………………………………………………………………….. 36
4.2.
Part 2: Survey Results…………………………………………………………………………………….. 37
4.2.1.
Section 1: The impact of technology on flexibility ……………………………………….. 38
4.2.2.
Section 2: The impact of employer’s awareness on flexibility ……………………….. 41
4.2.3.
Section 3: The impact of nature of work on flexibility ………………………………….. 45
4.2.4.
Section 4: The impact of flexibility on satisfaction ………………………………………. 48
4.2.5.
Section 5: The impact of bonus on employee satisfaction ……………………………… 52
4.2.6.
Section 6: The impact of employee satisfaction of performance (conclusion) …. 55
4.3.
Data Analysis Using SPSS ………………………………………………………………………………. 59
Chapter 5: Discussion and Conclusions ………………………………………………………………………… 60
5.
Discussion and Conclusions ………………………………………………………………………………….. 61
5.1.
Discussion ………………………………………………………………………………………………………. 61
5.1.1.
Demographics…………………………………………………………………………………………… 61
5.1.2.
Section 1: The impact of technology on flexibility ……………………………………….. 61
5.1.3.
Section 2: The impact of employer’s awareness on flexibility ……………………….. 62
5.1.4.
Section 3: The impact of nature of work on flexibility ………………………………….. 62
Impact of Workplace Flexibility on Employees’ Performance in Industrial Sector
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5.1.5.
Section 4: The impact of flexibility on satisfaction ………………………………………. 63
5.1.6.
Section 5: The impact of bonus on employee satisfaction ……………………………… 63
5.1.7.
Section 6: The impact of employee satisfaction of performance ……………………. 64
5.2.
The Revised Model …………………………………………………………………………………………. 64
5.3.
Conclusion ……………………………………………………………………………………………………… 65
5.4.
Limitations and Implications ………………………………………………………………………….. 65
6.
References ……………………………………………………………………………………………………………. 66
7.
Appendices …………………………………………………………………………………………………………… 73
7.1.
Appendix 1: The Survey …………………………………………………………………………………. 73
7.2.
Appendix 2: Times of Responses & Demographics ………………………………………….. 80
7.3.
Appendix 3: Statistical Analysis Using SPSS……………………………………………………. 95
Tables
Table 1: Survey section 1 results …………………………………………………………………………………….. 38
Table 2: Survey section 2 results …………………………………………………………………………………….. 41
Table 3: Survey section 3 results …………………………………………………………………………………….. 45
Table 4: Survey section 4 results …………………………………………………………………………………….. 48
Table 5: Survey section 5 results …………………………………………………………………………………….. 52
Table 6: Survey section 6 results …………………………………………………………………………………….. 55
Figures
Figure 1: the relationship between employee satisfaction and employee performance ……………. 23
Figure 2: The Conceptual Model: the relationship between workplace flexibility, employee
satisfaction, and employee performance in the industrial sector in Saudi Arabia …………………… 27
Figure 3: Participants’ gender …………………………………………………………………………………………. 34
Figure 4: Participants’ age ……………………………………………………………………………………………… 35
Figure 5: Participants’ education ……………………………………………………………………………………… 35
Impact of Workplace Flexibility on Employees’ Performance in Industrial Sector
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Figure 6: Participants’ Position ……………………………………………………………………………………….. 36
Figure 7: Participants’ Experience …………………………………………………………………………………… 37
Figure 8: Section 1.1 results (pie graph) …………………………………………………………………………… 39
Figure 9: Section 1.2 results (pie graph) …………………………………………………………………………… 40
Figure 10: Section 1.3 results (pie graph) …………………………………………………………………………. 40
Figure 11: Section 1.4 results (pie graph) …………………………………………………………………………. 41
Figure 12: Section 2.1 results (pie graph) …………………………………………………………………………. 43
Figure 13: Section 2.2 results (pie graph) ………………………………………………………………………… 43
Figure 14: Section 2.3 results (pie graph) …………………………………………………………………………. 44
Figure 15: Section 2.4 results (pie graph) …………………………………………………………………………. 44
Figure 16: Section 3.1 results (pie graph) ………………………………………………………………………… 46
Figure 17: Section 3.2 results (pie graph) …………………………………………………………………………. 47
Figure 18: Section 3.3 results (pie graph) …………………………………………………………………………. 47
Figure 19: Section 3.4 results (pie graph) …………………………………………………………………………. 48
Figure 20: Section 4.1 results (pie graph) …………………………………………………………………………. 50
Figure 21: Section 4.2 results (pie graph) …………………………………………………………………………. 50
Figure 22: Section 4.3 results (pie graph) …………………………………………………………………………. 51
Figure 23: Section 4.4 results (pie graph) …………………………………………………………………………. 51
Figure 24: Section 5.1 results (pie graph) …………………………………………………………………………. 53
Figure 25: Section 5.2 results (pie graph) ………………………………………………………………………… 54
Figure 26: Section 5.3 results (pie graph) ………………………………………………………………………… 54
Figure 27: Section 5.4 results (pie graph) ………………………………………………………………………… 55
Figure 28: Section 6.1 results (pie graph) …………………………………………………………………………. 57
Figure 29: Section 6.2 results (pie graph) …………………………………………………………………………. 57
Figure 30: Section 6.3 results (pie graph) …………………………………………………………………………. 58
Figure 31: Section 6.4 results (pie graph) …………………………………………………………………………. 58
Figure 32: The revised model: workplace flexibility increases employee satisfaction and thus
employee performance …………………………………………………………………………………………………… 64
Impact of Workplace Flexibility on Employees’ Performance in Industrial Sector
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Abstract
The implementation of workplace flexibility is becoming more popular with time. This
research is primary research conducted in KSA to measure the impact of workplace flexibility on
employee performance. The conceptual model of this study identified many variables that play a
major role in the research topic. The four major factors were technology, employer awareness,
nature of work, and giving bonuses and rewards to employees. The research was conducted using
the survey model. The majority of 183 participants showed high agreement on this research’s
conceptual model. Major outcomes of this research showed that technology, employer awareness,
and nature of work impact workplace flexibility. High technology implementation, high employer
awareness, and specific types of works as administrative work and shifts rotations work increase
workplace flexibility. Further, this research showed that workplace flexibility increases employee
satisfaction, which is also raised my giving bonuses to employees. As a result, higher employee
awareness derived from workplace flexibility and bonuses increase employee performance in the
industrial sector in KSA.
Keywords:
Workplace flexibility, employees’ performance, Saudi Arabia, and the industrial sector.
Impact of Workplace Flexibility on Employees’ Performance in Industrial Sector
Chapter 1: Introduction
8
Impact of Workplace Flexibility on Employees’ Performance in Industrial Sector
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1. Introduction
1.1.Overview
This chapter will present key facts about the research topic. Firstly, a background about
the industry in Saudi Arabia will be presented. Besides, the introduction will introduce the reader
to the research problem, which is the impact of workplace flexibility on Employees’
performance. Moreover, the introduction will present the aims and objectives of the research, the
research approach, the sampling procedure, and key points about the industrial sector in Saudi
Arabia.
1.2. Background
The Kingdom of Saudi Arabia is known for big industries such as the oil industry (Nakov
& Nuño, 2013). Globally, KSA produces 17% of the world’s petroleum (Puri-Mirza, 2020). In a
country like KSA, research on industrial organizations’ performance is necessary to improve the
industrial organizations’ performance. Moreover, the Industrial manpower in the Kingdom of
Saudi Arabia is massive, and they consist of Saudi workers and foreign workers. “The Saudi labor
market can be described as highly dependent on foreign labor, especially in the private sector; for
example, in 2010 Saudis accounted for only 7% of the labor in the private sector and 47.1% of the
overall labor force”(Alhamad, 2014). This research focuses on human resources development.
This research studies the impact of workplace flexibility and employee satisfaction on
organizational performance in three large industrial companies in the Kingdom of Saudi Arabia.
The companies are Aramco, SABIC, and the Saudi Electricity Company.
1.3. Research Problem
The research problem that this research aims to address is filling the gap in the knowledge
of workplace flexibility in KSA. There is no enough understanding or research made on workplace
flexibility in KSA. Adham & Hammer (2019) had argued that there is a gap that must be filled in
workplace flexibility research in KSA. The relationship between workplace flexibility, employee
satisfaction, and employee performance in the industrial sector in KSA needs to be studied and
analyzed because the industrial sector in KSA is one to watch in the region; hence a better
understanding of the workplace flexibility on employees’ performance is needed. Concisely, the
research problem is going to be finding the relationship between workplace flexibility and
employee performance in the industrial sector in Saudi Arabia.
Impact of Workplace Flexibility on Employees’ Performance in Industrial Sector
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1.4. Research Objectives and Research Question
Research Objectives:
•
find a better understanding of the influence of workplace flexibility on the industrial sector
in Saudi Arabia,
•
draw the relationship between workplace flexibility characteristics such as worktime
flexibility and employees’ rewards on the overall employees’ performance and hence the
organizations’ outcomes,
•
find relationships between workplace flexibility as an independent variable and the
employees’ performance as a dependent variable because Employees’ performance is a
critical measure for organizations because all organizations aim for outstanding employees’
performance.
•
Building a model that can describe the relationship between workplace flexibility and
employees’ performance in the industrial sector in Saudi Arabia.
•
Filling the gap in lack of research regarding the research problem of this research.
•
Identifying factors that impact workplace flexibility and employees performance.
Research Question:
•
What is the relationship between workplace flexibility, employee satisfaction, and
employee performance in the industrial sector in Saudi Arabia? What are variables that
impact workplace flexibility and employee satisfaction? And how increased workplace
flexibility can elevate employee performance in the industrial sector in Saudi Arabia?
1.5. The Industrial Sector in Saudi Arabia
The Kingdom of Saudi Arabia is a pioneer country for industrial work in the Middle East.
Saudi Arabia is a pioneer in the construction industry (Alosaimi, Renukappa, & Suresh, 2018).
The Kingdom has a bright record in manufacturing goods that reach neighboring countries and
even far countries around the world. As an example, “Saudi Arabia’s Industrial Production:
SABIC: Polymers data was reported at 10,227.378 Metric Ton in 2016” (Saudi Arabia: Industrial
Production: SABIC: Polymers: Economic Indicators: CEIC, n.d.). The Saudi industrial sector has
many big industries such as the petroleum industry, mining industry, logistics, engineering, and
information technology. In addition to these industries, the Kingdom is a pioneer country in
Impact of Workplace Flexibility on Employees’ Performance in Industrial Sector
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manufacturing food products such as dairy products and edible oils (Al-Shabib, Husain, & Khan,
2017).
Knowing that the industrial sector in the Kingdom of Saudi Arabia is massive, there
should be large workforces in the country. With the high demand on the Saudi industries, such as
oil and petroleum, the workplace characteristics are a crucial to be studied. Moreover, the quality
of work circumstances, work flexibility, and workers satisfaction rates are a core point of the
overall performance of the Saudi factories and big industrial groups. Governments across the
world likewise desire more flexible economies and labor markets where individuals can work
more easily (Bal, & Izak, (2020).
1.6. Research approach
This research will follow the quantitative research approach, where the results of the
questionnaires made will be analyzed using statistical methods as excel to conduct numerical
results. A quantitative research approach is a vital tool of research since it provides researchers
with numerical results that are easy to compare to conduct a final result (Ochoa & Merceron, 2018).
This research will use questionnaires as a data collection tool. Questionnaires are shown to have
higher effectiveness than face-to-face interviews (Van Gelder et al., 2017). Participants from
Aramco, SABIC, and the Saudi Electricity Company will be the research sample; a research
sample is adequate when it reflects the real population. Choosing these three big Saudi industrial
companies will help to reflect the reality in the Saudi Arabian industrial workplaces. The data
analysis type is descriptive analysis.
1.7. Companies (Aramco, SABIC, Saudi Electricity Company)
This research will focus on three large manufacturers in the Kingdom. Three chosen
companies are known globally, especially Aramco and SABIC, which export products to all
around the world, benefiting from the Saudi Arabian Petroleum wealth. Aramco is an oil company,
and SABIC is a chemical industrial company, while Saudi Electricity Company is the only
electricity provider in the Kingdom of Saudi Arabia. Reflecting on the workplace characteristics
in these three companies is a key strategy because these companies are very large, and they have
a lot of manpower and human resources.
Impact of Workplace Flexibility on Employees’ Performance in Industrial Sector
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1.8. Sampling
The sampling method that is going to be followed in this research is stratified sampling.
The stratified method is being used because it simplifies the sampling process by managing the
population to subgroups or strata (Zhao, Liang, & Dang, 2019). From the three companies, four
strata are identified are: education level, years of experience, hierarchical position within the
respective industrial companies, and level of remuneration amongst all the industrial workers.
1.9. Conceptual Model and Hypotheses
The author designed a conceptual model named the relationship between workplace
flexibility, employee satisfaction, and employee performance in the industrial sector in Saudi
Arabia. It was tested using survey research. The conceptual model consisted of three levels;
workplace flexibility, employee satisfaction, and employee performance. It is hypothesized in the
conceptual model that workplace flexibility increases employee satisfaction while employee
satisfaction increases employee performance. Technology, employer awareness, and type of
works were variables identified that hypothesized to influence workplace flexibility. In
comparison, bonuses for employees were hypothesized to influence employee satisfaction
negatively. These are the hypothesis of the research:
•
H1: In the industrial sector in Saudi Arabia, advanced implementation of technology
supports workplace flexibility.
•
H2: In the industrial sector in Saudi Arabia, the nature of work affect workplace
flexibility. Some works are more suitable for flexible words than others.
•
H3 In the industrial sector in Saudi Arabia, high employer awareness supports workplace
flexibility.
•
H4: In the industrial sector in Saudi Arabia, enhanced workplace flexibility increases
employee satisfaction.
•
H5: In the industrial sector in Saudi Arabia, giving employees bonuses increase their
satisfaction at the workplace.
•
H6: In the industrial sector in Saudi Arabia, higher employee satisfaction elevates the
level of employee performance.
Impact of Workplace Flexibility on Employees’ Performance in Industrial Sector
Chapter 2: Literature Review
13
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2. Literature Review
2.1. Introduction to the Literature Review
Workplace flexibility is becoming more studied in the literature recently since it is a factor
that may enhance the performance of employees. As an example, research on workplace flexibility
had increased after the covid-19 pandemic. According to Travis (2020), workplace flexibility is a
topic for research after the pandemic had changed the nature of the work. Mainly, workplace
flexibility is about having a supportive workplace for employees where they can perform their best
with minimal pressures in the workplace. The literature is rich with researches about workplace
flexibility, its forms, examples, and impact on the employees’ performance and organizations’
performance. As an example, Ma (2018) suggested that “workplace flexibility has a significantly
positive correlation with job satisfaction.” However, the research that had specified workplace
flexibility in the Kingdom of Saudi Arabia is limited. Adham & Hammer (2019) had said that there
is a gap in workplace flexibility research in KSA. This chapter aims to review and organize the
published literature that had discussed workplace flexibility and its possible impacts on the
employees’ performance in the world and specifically Saudi Arabia.
2.2. What is the Industrial Sector?
The industrial sector is the working sector that produces final products, and it is also called
the secondary sector (Taylor et al., 2019). The industrial sector is vital for the economy because it
transforms raw or first materials into final products. The industrial sector is very wide, and it is
highly branched. That is because the industrial sector presents finished materials that can be very
simple as a pen or a bar of chocolate or can be very complex and complicated such as massive
chemical products, cars, and even airplanes.
The industrial sector is a crucial part of any country’s economy. Besides agriculture, the
industrial sector impacts the country’s GPD and employment rates (Li & Zhang, 2020). As long as
the country has a high amount of factories and industrial cities that produces heavy and complex
industries, the country’s GDP will be higher, and the employment rates will be higher too. The
importance and impact of the industrial sector can be seen in the impact that the industrial
revolution 1760-1830 had made in the world. After the industrial revolution, the world chad
changed and developed in an unbelievable way. As an example, The industrial sector that is nonfarm is offering higher employment rates than other sectors such as farming in the United States
Impact of Workplace Flexibility on Employees’ Performance in Industrial Sector
15
(Charts related to the latest “The Employment Situation” news release | More chart packages,
n.d.). Mao, Xu, & Zou (2018), mentioned that the industrial sector is a growing sector in most
countries that will increase employment with time.
The industrial revolution had enabled humans to manufacture goods on a large scale by
using machines and power sources. The industrial revolution was the economic transformation
beginning in northwestern Europe in the 18th century. (McCloskey, 1981). Before the industrial
revolution, humans depended on agriculture and handcrafts only for the economy. At the same
time, the introduction of the industrial sector had changed the concept of manufacturing and had
led to many inventions. In the modern world, the industry is irreplaceable since it is the reason
why most products people buy and trade on an everyday basis present, such as cars, food industries,
clothes, machines, etc. As an example, the car industry is very significant to the Japanese economy
(Genther, 2020).
So, the industrial sector has a great volume in any country’s economy. Workplace
characteristics should be extensively studied because there are millions of workers who work in
the industrial sector who has rights and obligations (Anner, 2020). The industry is an area that
every country focuses on to make it larger and more complex since complex industries increase
the rank of the country in the industrial aspect.
2.3. What are the Conditions of a Suitable Workplace in the Industrial Sector?
Before discussing workplace flexibility, it is essential to discuss the conditions of suitable
work in the industrial sector. A suitable workplace is a workplace that respects workers’ rights,
including safety (Moyce, & Schenker, 2018). Unfortunately, the industrial sector is one of the
sectors that are linked to high employee injuries due to the possible use of toxic material, heated
objects, or harmful machines (Moyce, & Schenker, 2018). Hence, big industrial companies are
responsible for ensuring that the workplace is set to be safe in the workplace. According to Flin &
Yule (2004), leadership for effective safety management is the focus of research in the industrial
sector, especially in the energy and manufacturing sector.
A suitable workplace is a workplace that respects human rights, women’s rights, and
workers’ rights (Brooks, 2017). So, industrial factories must apply the human rights act in their
workplace in addition to the women’s rights act (Brooks, 2017). According to Workers Rights
Impact of Workplace Flexibility on Employees’ Performance in Industrial Sector
16
(n.d.), here are examples of implementing human rights, women’s rights, and workers’ rights
include the following:
•
A workplace must apply fair wages according to the country’s regulations.
•
A workplace should enable workers to have medical insurance.
•
A workplace must enable workers to have paid annua
