The impact of cost saving on service quailty

Abstract

The aim of all companies is continuously to improve their products and/or services. Managers need to understand what service quality entails and what measures to take to ensure that quality is upheld and employees are satisfied. Cost-saving initiatives often require certain changes to take place within the organisation. In the event of such changes, the psychological contract is often violated, which may have a positive or negative effect on the affected individuals. Management expects to get more work done with fewer employees, who in turn are expected to keep up the service quality. The current shortage of medical technologists in the country has made it impossible for them to cope with the heavy workload. As a result, many leave the profession and venture into something completely different. Those that are left become completely demotivated; they experience less job satisfaction and show less commitment to their work. However, some may even embrace the changes because to them it may mean bigger and better challenges. The aim of this study is to identify which approaches management took to ensure cost saving and how these approaches impacted on the behaviour of employees. A literature review was conducted to determine what the theory reveals about cost saving and its impact on employee behaviour. This was followed by an empirical survey conducted within the National Health Laboratory Services in the Ibhayi region. Finally, the practical findings and literary theory were compared to make recommendations to management on how to ensure positive employee behaviour and boost employee morale