Meaning: - There is confusion over the use of the term ‘morale’. Some considers that morale and job satisfaction are same, whereas, others make a distinction between the two terms. Some considers morale as a group phenomenon and others consider it as an individual factor.
Definition: - “Morale is the general term used to describe group satisfaction. -----------defined by (Keith Davis)
High morale is important to the organization and to the employees. The importance of morale is as follows:

1.       The organization gets the benefit of higher productivity.

2.       The corporate image of the organization improves in the minds of stakeholders due to the committed and dedicated efforts of the employees.

3.       High morale helps to reduce absenteeism and employee turnover.

4.       There is reduction of conflicts and disputes in the organization.

5.       An employee makes efforts to reduce wastages.

6.       Employees may come up with innovative ideas, which will help the firm to gain competitive advantage in the market.

7.       There are good relations between the management and the employees and also among the various departments in the organization. There is environment of ‘esprit de corps’ in the organization.

8.       The employees are motivated and rewarded with higher incentives. Due to higher gains resulting out of productivity increases.

Note: -Students need to explain the above points, if separate question is asked on importance of morale. Otherwise don’t.