assignment organizational behavior case paetecs values lead to a satisfied and committed workforce

Organizational CommitmentOrganizational commitment refers to the degree to which an employee identifies with aparticular organization and its goal and wishes to maintain membership in th

NATIONAL ECONOMICS UNIVERSITY

-ASSIGNMENT Organizational Behavior

CASE: PAETEC'S VALUES LEAD TO A SATISFIED AND

COMMITTED WORKFORCE

Phạm Lê Quỳnh Trang 11226480

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Dương Thị Thu Hằng 11222069

Table of Contents

1 Attitude theory 3

2 Cognitive Dissonance Theory 3

3 Job Satisfaction theory 4

4 Organizational Commitment 4

D PAETEC CASE STUDY 7 1 What values does Chesonis emphasize at PAETEC? 7

2 What factors likely contribute to employee job satisfaction at PAETEC? 9

3 What type of organizational commitment do you think might be prevalent among PAETEC employees and why? 10

4 What kinds of work moods and emotions do you think employees experience at PAETEC and why? 11

E CONCLUSION 13 1 Strengths 13

2 Limitations 13

3 Opportunities 13

4 Threats 13

5 Suggestions 14

A COMPANY INTRODUCTION

Figure 1 PAETEC Communications, Inc Trademark

PAETEC Communications Inc., now known as Windstream Communications, was a telecommunications company based in the United States It was founded in 1998 and was headquartered in Perinton, New York PAETEC provided a wide range of telecommunications services to businesses, including voice, data, and Internet solutions to businesses across the United States

The company initially focused on the provision of long-distance services and became a competitive local exchange carrier (CLEC) by acquiring various regional telecommunications companies PAETEC service portfolio encompassed:

● Local and long-distance voice services for efficient communication within and beyond geographical boundaries.

● Data and internet services, ensuring reliable connectivity for information sharing and internet access.

● Software applications, potentially including solutions to enhance communication workflows or manage other business functions

PAETEC positioned itself as a premier alternative to the Incumbent Local Exchange Carriers (ILECs), the dominant players in the market at the time It offered a nationwide footprint, a broad range of products, and high-quality service, appealing to customers seeking a more competitive option PAETEC service area covered 84 of the top 100 metropolitan areas in the US, signifying a significant presence across the country

From 2005 to 2009, PAETEC has achieved numerous recognitions in this industry:

● In 2007, 2006, 2005: Named Corporate Stewardship Finalist (U.S Chamber of Commerce Center for Corporate Citizenship)

● 2007: Named Most Innovative Competitive Carrier (New Paradigm Resources Group)

● 2008: Received Most Innovative Product Award for the Application of SIP Trunking

(Telephony magazine)

● 2008: Ranked #66 of Top 125 International Training Organizations (Training magazine)

● 2009: Ranked #414 in North America on Deloitte Technology Fast 500 List; one of only

22 companies over $1B to make the list (Deloitte)

● 2009: NOC Named National Back-Office Customer Service Department of the

Year (Stevie Awards)

In 2011, Windstream Corporation, a telecommunications company based in Little Rock, Arkansas, acquired PAETEC in a deal valued at approximately $2.3 billion The acquisition allowed Windstream to enhance its business services capabilities and expand its network reach Following the acquisition, the PAETEC brand was absorbed into Windstream, and the PAETEC name and logo were phased out As a result, PAETEC no longer exists as an independent entity

Today, Windstream continues to leverage PAETEC's established infrastructure and extensive customer base While PAETEC no longer operates independently, its legacy lives on through its contributions to Windstream's offerings

B CASE SUMMARY

PAETEC Communications, a broadband telecommunications firm, has established itself as

a successful company in a challenging industry Starting out with less than 20 employees, today, PAETEC has over 3,600 employees and $1 billion in revenues PAETEC has grown and prospered during a time when the telecommunications industry lost thousands of jobs This can

be attributed to the company's strong core values and the leadership of its chairman and CEO,

Arunas Chesonis Under the leadership of Arunas Chesonis, PAETEC has fostered a caring culture, open communication, unmatched service, and personalized solutions

PAETECvalues its employees as invaluable assets and prioritizes their well-being.CEO Arunas Chesonis understands that when employees feel valued and supported, they are motivated to provide exceptional service to customers The company promotes work-life balance, recognizing and appreciating employees' contributions and achievements, which instills

a sense of pride and dedication

One notable aspect of PAETEC's employee-centric approach is the accessibility of its leadership, Chesonis actively engages with employees, fostering transparency and trust by

making himself accessible for conversations, recognizing accomplishments, and addressing concerns

Open communication and cooperation are encouraged, with minimized boundaries between departments to facilitate knowledge sharing and innovation PAETEC also recognizes employees' lives outside of work by implementing family-oriented policies, such as paid time off for family

emergencies, and organizing celebrations and parties for employees, their families, and customers These initiatives create a sense of community and strengthen employees' commitment

to the organization

PAETEC Communications has established a workplace culture that places employees at the forefront By applying many theories, PAETEC has cultivated a satisfied and committed workforce This, in turn, enables the company to deliver exceptional service to its customers and thrive in the highly competitive telecommunications industry

C RELEVANT THEORIES

1 Attitude theory

Attitude theory proposes that attitudes consist of three interrelated components - the cognitive component comprising beliefs and opinions, the affective component of feelings and emotions, and the behavioral component of intentions to act in a certain way towards the attitude object While the cognitive and affective components shape behavioral intentions, attitudes don't always perfectly predict behavior due to factors like the importance of the attitude and degree of social pressure an individual experiences

2 Job Satisfaction theory

Job satisfaction refers to a positive feeling about one's job resulting from an evaluation of its

characteristics The main causes of job satisfaction are job conditions such as the intrinsic

nature of the work itself, positive social interactions, and supportive supervision Interesting jobs that provide training, variety, independence, and control satisfy most employees Interdependence, feedback, social support, and interaction with coworkers outside the workplace are also strongly related to job satisfaction, even after accounting for characteristics of the work itself Managers also play a big role in employees’ job satisfaction, as employees who feel empowered by their leaders experience higher job satisfaction A manager’s attentiveness, responsiveness, and support increase the employee’s job satisfaction

Personality factors like having positive core self-evaluations (CSEs) and believing in one's

inner worth are also linked to higher job satisfaction Additionally, corporate social responsibility (CSR) initiatives that benefit society or the environment beyond legal requirements can increasingly impact employee job satisfaction It includes environmental sustainability initiatives, nonprofit work, and charitable giving and increasingly affects employee job satisfaction Employees whose personal values fit with the organization’s CSR mission are often more satisfied

Pay comes up often when people discuss job satisfaction Pay does correlate with job

satisfaction and overall happiness for many people, but the effect can be smaller once an individual reaches a standard level of comfortable living Money does motivate people, but what motivates us is not necessarily the same as what makes us happy

Corporate Social Responsibility (CSR): self-regulated actions to benefit society or the

environment beyond what is required by law It includes environmental sustainability initiatives, nonprofit work, and charitable giving and increasingly affects employee job satisfaction CSR is good for the planet and good for people Employees whose personal values fit with the organization’s CSR mission are often more satisfied CSR allows workers to serve a higher purpose or contribute to a mission People who view their work as part of a higher purpose often realize higher job satisfaction However, an organization’s CSR efforts must be well-governed and its initiatives must be sustainable for long-term job satisfaction benefits

3 Organizational Commitment

Organizational commitment refers to the degree to which an employee identifies with a particular organization and its goal and wishes to maintain membership in the organization Factors that can increase organizational commitment include fair rewards, involvement in decision-making, and supportive supervision which foster perceived organizational support (POS)

Organizational commitment in the workplace is the bond employees experience with their organization Broadly speaking, employees who are committed to their organization generally feel a connection with their organization, feel that they fit in and feel they understand the goals

of the organization The added value of such employees is that they tend to be more determined

in their work, show relatively high productivity and are more proactive in offering their support Meyer and Allen (1997, p.106) use the tri-dimensional model to conceptualize organizational commitment in three dimensions namely, affective, continuance and normative commitments These dimensions describe the different ways of organizational commitment development and the implications for employees’ behavior

Figure 2 The three-component model of organizational commitment based on Meyer and

Allen’s (1991, 1997) work

a Affective commitment

The first dimension of organizational commitment in the model is affective commitment, which represents the individual’s emotional attachment to the organization According to Meyer and Allen (1997, p.11) affective commitment is “the employee’s emotional attachment to, identification with, and involvement in the organization” Organizational members who are committed to an organization on an affective basis, continue working for the organization because they want to (Meyer & Allen, 1991) Members who are committed on an affective level stay with the organization because they view their personal employment relationship as congruent to the goals and values of the organization

The strength of affective organizational commitment is influenced by the extent to which the individual's needs and expectations about the organization are matched by their actual experience

Affective commitment development involves identification and internalization Individuals’ affective attachment to their organizations is firstly based on identification with the desire to establish a rewarding relationship with an organization Secondly, through internalization, this refers to congruent goals and values held by individuals and the organization

In general, affective organizational commitment is concerned with the extent to which an individual identifies with the organization (Allen & Meyer, 1990)

b Continuance commitment

The second dimension of the tri-dimensional model of organizational commitment is continuance commitment Meyer and Allen (1997, p.11) define continuance commitment as

“awareness of the costs associated with leaving the organization” It is calculative in nature because of the individual’s perception or weighing of costs and risks associated with leaving the current organization (Meyer & Allen, 1997)

A good example of continuance commitment is when employees feel the need to stay with their organization because their salary and fringe benefits won’t improve if they move to another organization Such examples can become an issue for organizations as employees that are continually committed may become dissatisfied (and disengaged) with their work and yet, are unwilling to leave the organization

Continuance commitment can be regarded as an instrumental attachment to the organization, where the individual's association with the organization is based on an assessment

of economic benefits gained Organizational members develop commitment to an organization because of the positive extrinsic rewards obtained through the effort-bargain without identifying with the organization's goals and values

The strength of continuance commitment, which implies the need to stay, is determined by the perceived costs of leaving the organization (Meyer & Allen, 1984) Best (1994, p.71) indicates that “continuance organizational commitment will therefore be the strongest when availability of alternatives is few, and the number of investments is high” This argument supports the view that when given better alternatives, employees may leave the organization The need to stay is “profit” associated with continued participation and termination of service is a “cost” associated with leaving Tetrick (1995, p.590) supports the profit notion by describing the concept ‘continuance commitment’ as “an exchange framework, whereby performance and loyalty are offered in return for material benefits and rewards” Therefore, to retain employees who are continually committed, the organization needs to give more attention and recognition to those elements that boost the employee’s morale to be effectively committed

c Normative commitment

The last dimension of the organizational commitment model is normative commitment Meyer and Allen (1997, p.11) define normative commitment as “a feeling of obligation to continue employment” Internalized normative beliefs of duty and obligation make individuals obliged to sustain membership in the organization (Allen & Meyer, 1990) According to Meyer and Allen (1991, p.67) “employees with normative commitment feel that they ought to remain with the organization” In terms of the normative dimension, the employees stay because they should do so, or it is the proper thing to do

The strength of normative organizational commitment is influenced by accepted rules about reciprocal obligation between the organization and its members The reciprocal obligation

is based on the social exchange theory, which suggests that a person receiving a benefit is under

a strong normative obligation or rule to repay the benefit in some way This implies that individuals often feel an obligation to repay the organization for investing in them, for example through training and development

Meyer and Allen (1991, p.88) argue that “this moral obligation arises either through the process of socialization within the society or the organization” In either case it is based on a norm of reciprocity, in other words if the employee receives a benefit, it places him or her, or the organization under the moral obligation to respond in kindness

Reasons for the guilt of leaving vary but are often concerned with employees feeling that

in leaving the organization they would create a void in knowledge/skills, which would subsequently increase the pressure on their colleagues Such feelings can, and do, negatively influence the performance of employees working in organizations

D PAETEC CASE STUDY

1 What values does Chesonis emphasize at PAETEC?

The core value that Arunas Chesonis emphasizes and upholds at PAETEC is caring for employees and their overall well-being Chesonis firmly believes that taking excellent care of employees will translate into providing superior service to customers, ultimately leading to the company's success This "caring culture" is manifested through several key practices and initiatives at PAETEC

First and foremost, Chesonis promotes work-life balance and recognizes the importance of employees' family lives outside of work PAETEC provides paid time off for employees to handle family emergencies or illnesses, without any penalties The company celebrates major holidays with parties that include employees' families, fostering a sense of community Fun outings and events are organized throughout the year to allow employees and their families to relax, bond, and have an enjoyable time together On occasions like Halloween, PAETEC embraces a festive atmosphere by allowing children to trick-or-treat in the office while employees dress up in costumes Such initiatives demonstrate Chesonis' recognition that employees have lives beyond work and his commitment to supporting their work-life balance, which can enhance job satisfaction

Secondly, Chesonis places great emphasis on recognizing and rewarding employee contributions and accomplishments PAETEC has instituted several awards and bonuses to appreciate exceptional performance The Maestro Awards are given to employees with significant achievements, ranging from dinner for two to stock options The prestigious John Budney Award, worth approximately $5,000, is presented to employees who have demonstrated outstanding performance over an extended period and can include luxurious rewards like a vacation or a Rolex watch Additionally, employees receive bonuses based on their individual accomplishments as well as the company's overall performance By implementing such recognition and reward systems, Chesonis not only acknowledges the hard work and dedication

of employees but also creates a culture of motivation and job satisfaction, as employees feel valued and appreciated for their efforts

Another core value upheld by Chesonis is fostering an environment of open communication, equality, and respect He is highly accessible to employees, frequently strolling around the headquarters and engaging in casual conversations, commending achievements, and addressing any questions or concerns they may have This open-door policy and approachable leadership style promote a sense of transparency and trust within the organization

Moreover, Chesonis minimizes status differences between managers and rank-and-file employees Special perks for managers are kept to a minimum and pay differentials between different levels are relatively low This egalitarian approach reinforces a culture of respect and equality, where all employees feel valued and treated fairly, regardless of their position or rank Chesonis also encourages open communication and cooperation among employees across different units and departments Boundaries between teams are minimized to facilitate the sharing of expertise and knowledge, fostering a collaborative environment Employees are empowered to come up with new ideas and solutions to better serve customer needs, promoting a sense of autonomy and psychological empowerment

Furthermore, Chesonis actively encourages organizational citizenship behaviors (OCB) by expecting employees to voluntarily help and support each other This emphasis on helping behaviors and cooperation not only enhances teamwork and productivity but also contributes to a positive and supportive work environment, which can increase job satisfaction

By upholding these core values of a caring culture, open communication, equality, respect, and empowerment, Chesonis has created a highly satisfied and committed workforce at PAETEC Employees experience positive job attitudes, feel valued and appreciated, and are motivated to provide excellent service to customers This, in turn, has contributed to PAETEC's success and growth, even during challenging times in the telecommunications industry PAETEC's philosophy aligns with the principles of job satisfaction theory, which emphasizes the importance of positive job conditions, supportive supervision, and recognition in fostering employee satisfaction By prioritizing employee well-being, work-life balance, open communication, and empowerment, Chesonis has created an environment that meets the key drivers of job satisfaction

Moreover, the recognition and reward systems implemented by Chesonis also align with the principles of attitude theory By positively reinforcing desired behaviors and accomplishments, Chesonis shapes the cognitive and affective components of employees' attitudes towards their work and the organization Employees develop favorable beliefs and positive emotions about their jobs, which can translate into beneficial behavioral intentions, such

as increased motivation, commitment, and a desire to provide excellent customer service Furthermore, Chesonis' efforts to foster a caring culture, open communication, and empowerment contribute to enhancing employees perceived organizational support (POS) When employees feel valued, respected, and involved in decision-making processes, they are more likely to develop a strong sense of organizational commitment and loyalty This commitment, in turn, can lead to reduced turnover intentions and withdrawal behaviors, even in the face of job dissatisfaction

Overall, Chesonis' emphasis on caring for employees and their well-being at PAETEC exemplifies the importance of creating a positive and supportive work environment that aligns with the key drivers of job satisfaction, positive job attitudes, and organizational commitment

By consistently upholding these values and implementing practices that resonate with relevant theories, Chesonis has cultivated a satisfied and committed workforce that provides excellent service to customers, ultimately contributing to PAETEC's success and growth