The importance of employee participation in determining pay system effectiveness

Managing pay systems is one of the most controversial and hotly debated areas of human resource management in which contingency theory approaches have dominated over the past few decades. The paper exposes the inadequacies of contingency approaches to pay system design and implementation and assesses the implications of more recent 'best practice' approaches, debating the role of pay within the HR bundle. It then reviews research evidence on the objectives and outcomes of different forms of variable pay, with close attention devoted to the role of employee participation in achieving pay system effectiveness. The significance of employee perceptions of distributive, procedural and interactional justice is explored as a means of explaining why employee participation in pay system management appears to be such a critical success factor. The paper concludes by arguing that we need to move away from a fixation with 'best practice' to a focus on 'best process' as a lens through which to investigate the design, implementation and management of pay systems.     

Kinship ties and employee theft perceptions in family-owned businesses

Family business research typically views family firms using the frameworks developed for non-family businesses (e.g., agency theory, institutional theory). Thus, using an evolutionary perspective on family may help address gaps in the family business literature, particularly regarding deviance. In the current study, we use kin selection theory to predict that family members receive preferential treatment and this history of privileges can create entitlement and lead genetically-related employees to misuse company resources. Using an experimental vignette methodology and data from 161 people recruited from an online panel, we found that the participants’ purported genetic relatedness to the owner of a business increased their theft intentions and decreased their expected severity of sanctions and likelihood of being reported. Biological sex moderated the relationships between genetic relatedness and theft intentions, as well as between expectations of punishment and theft intentions. Specifically, when females expected higher severity of sanctions or likelihood of whistleblowing, they were less likely to report theft intentions, compared to males. The results of this study suggest that family business owners should protect against theft by all employees, including genetic relatives. Future research using field samples would help provide context for these findings.     

Dynamic capabilities and employee participation: The role of trust and informal control

While burgeoning research has shown the relevance of dynamic capabilities in terms of managers identifying and pursuing business opportunities, much less is known about the role of involving employees without managerial status in those activities. In this paper, we examine the impact of employee participation on the enactment of dynamic capabilities. The results of our survey-based linear regression analysis show that employee participation is positively related to the dynamic capabilities of a firm. Furthermore, we hypothesize and find that managers can facilitate employee participation through both trust in and informal control of subordinates. Our findings also suggest a positive relationship between informal control and dynamic capabilities, and point to employee participation as a mediator in the relationship between trust and dynamic capabilities. Our results extend the literature on dynamic capabilities by highlighting and demonstrating the important role of employee participation in identifying and pursuing business opportunities through dynamic capabilities as well as the relevance of trust and informal control therein.     

The relative importance of participative versus decisive behavior in predicting stakeholders' perceptions of leader effectiveness

Today's leaders are often faced with resolving paradoxes stemming from interrelated, yet contradictory demands. One example is the tension between participation and decision speed because, despite its advantages, stakeholder involvement often slows the decision-making process. Theory and research suggest that a “both-and” approach in which leaders simultaneously harmonize competing demands is associated with effectiveness. Consistent with this reasoning, we hypothesized that leaders rated higher in both participative and decisive behavior are perceived as most effective. Additionally, however, we hypothesized that stakeholders place different importance on these behaviors, with direct reports emphasizing participation and supervisors emphasizing decisiveness. Using a large 360-degree feedback dataset, several analyses conducted both within and between stakeholder groups supported these predictions. These results add needed nuance to the leadership literature, suggesting that a “both-and” approach may paradoxically result in some behaviors that are less predictive of effectiveness for certain stakeholders.     

How environmental communication supports employee participation: A case study of EMI music

Environmental management is an artful mix of technology, clarity of vision, and working with your people to get the job done. Each component can not stand alone; rather, it is the job of the leader to find the right combination of employee communication, participation, feedback and recognition to make consequential change. In these further lessons from Europe, International Istitute for Management Development, research associate Catherine Ramus details the results of EMI Music, the best performer in a recent benchmarking survey that shows how these efforts lead to increased business value.     

Workplace trust as a mechanism of employee (dis)advantage: The case of employee socioeconomic status

Early work on trust in social science highlighted how the lack of trust between individuals can cause social division, contribute to social stratification, and reduce economic opportunities for people from all social groups. We integrate this work with organizational research on antecedents of trust to generate predictions explaining when and why low employee socioeconomic status (SES) can be a barrier to trust. We discuss how this process can impair the success of both organizations as well as their lower-SES employees. We present a model, and data, suggesting that lower-SES employees will be both more distrusted as well as more distrustful relative to their higher-SES colleagues. This, in turn, locks them out of potentially advantageous social and economic exchanges. Our theory adds precision in detecting when and why lower-SES employees face barriers to success in organizations, as well as provides a blueprint for studying the impact of trust on socially disadvantaged groups in organizations.     

The longitudinal development of employee well-being: a systematic review

This article reports a systematic review of findings on the long-term development of employee well-being, taking into account the effects of time lag, age, and job change. High-quality quantitative empirical studies focusing on employee affective well-being based on the circumplex model and utilizing measurements at more than two points in time were searched from eight databases. The systematic analysis of the 40 studies revealed that the level of employee well-being was generally high but not fixed – instead changes in mean levels over time were typical. In addition, the stability of well-being was found to be relatively low, as the explained variances were below 50%. Age and change of job were the major factors influencing stability: younger employees and job changers tended to display larger across time changes in well-being than older employees and job stayers, both at the mean level and in terms of their position relative to others. The findings of this review suggest that the indicators of employee affective well-being studied here (i.e. burnout, engagement, and job satisfaction) can meaningfully be applied in future research in measuring changes in employees’ well-being. In conclusion, based on the designs, methodologies, and main findings of the reviewed studies, seven avenues for future longitudinal research on employee well-being are proposed.     

The green company: A case of labor management and employee empowerment in a small business

The basis of this teaching case is a small nursery and landscape business in the Northeast United States. The case describes how the company attempted to implement a decentralization and employee empowerment program to move relevant decision-making closer to the work site. It illustrates that shifting from a centralized top-down style of management to a decentralized incentive driven style can create many challenges for a small business. Moreover, top management should be cautious about delegating responsibilities to line managers. Not all employees will be successful in this new environment, and without procedures for monitoring and control, significant learning may be necessary as employees move into this environment.     

Customer negative events and employee service sabotage: The roles of employee hostility,personality and group affective tone

Abstract

In the service industries, customer negative events towards a service provider, such as unreasonable demands or low-quality interpersonal treatment, might trigger service sabotage behaviours by the employee in response. Mitigating the problems associated with customer negative events is therefore an important issue for both practitioners and researchers. In the present study, we incorporate the perspectives of affective events theory into our research framework to clarify the mechanisms and boundary conditions of the customer negative event–service sabotage relationship in the context of face-to-face service. Specifically, we theorize and examine whether customer negative events lead to employee service sabotage through emotional reactions of the service worker (i.e. state hostility) and whether their personality traits (i.e. extraversion and neuroticism) and the work unit context (i.e. group affective tone) moderate this process. The sample was composed of 195 hairstylists and 61 managers from 61 hair salons in Taiwan. The results of hierarchical linear modelling showed that hairstylists' state hostility mediated the negative event–sabotage relationship. In addition, hairstylists' neuroticism and the affective tone of the unit moderated the relationship between negative events and state hostility, which in turn predicted service sabotage. The theoretical and practical implications of the findings are also discussed.     

The mediating effect of organizational commitment and employee empowerment: how transformational leadership impacts employee knowledge sharing intention

This study examined the underlying process through which transformational leaders provide an influence on employees’ knowledge sharing intention by concentrating on mediating roles of psychological empowerment and employees’ commitment to organizations. The direct and indirect impacts of transformational leadership on knowledge sharing were explored. In order to test the proposed hypotheses, structural equation modelling analysis was conducted with a sample of 426 full-time employees in South Korea. The results of this study showed a significant direct effect of transformational leadership on psychological empowerment and organizational commitment, which in turn had a significant influence on employees’ knowledge sharing intention. Transformational leadership had only an indirect effect on knowledge sharing intention among employees. These results bring out the importance of mediating roles of employee’s attitudes, especially organizational commitment, for promoting knowledge sharing intention among employees.     

Economic crisis and the employee: The effects of economic crisis on employee job satisfaction,commitment, and self-regulation

Greece has been suffering a severe crisis starting in about 2009. This paper examines the impact of the recent economic crisis in Greece on employee work-related attitudes via changes in regulatory focus. We collected data in a large and heterogeneous sample of employees (N = 1024) during the crisis and compared them with a matched sample of employees surveyed (N = 882) half a decade earlier, i.e., before the crisis. Participants reported their job satisfaction, organizational commitment and their self-regulatory focus. Results show, as expected, that participants after start of the crisis were lower in extrinsic job satisfaction, affective organizational commitment and were also (unexpectedly) lower in normative commitment, while these attitudinal changes were explained by decreased promotion orientation and increased prevention focus. Rather unexpectedly, pre-crisis and crisis samples did not differ in levels of continuance commitment. This paper makes a relevant contribution by showing that the threatening crisis event does not only have negative effects on work-related outcomes, but also that changes in regulatory foci occur and explain attitudinal change indicating an adaptive mechanism to the threatening situation of an economic crisis.     

The impact of restructuring on employee well-being: a systematic review of longitudinal studies

This is a review of published longitudinal empirical research on the impact of restructuring on employee well-being. We investigated whether restructuring accompanied by staff reductions impacts differently on worker well-being than restructuring without staff reductions, and the differences between short- and long-term effects of restructuring. Furthermore, we investigated the mechanisms that explain these effects. We conducted a literature search on longitudinal, peer-reviewed, English-written studies from the period 2000–2012. Thirty-nine papers fulfilled the inclusion criteria. We found that restructuring events, with and without staff reductions, mainly have a negative impact on the well-being of employees. The majority of studies showed negative changes over time, in the short and the long term. Some groups of workers reacted less negatively: for example, workers with a high organizational status before a merger and workers who underwent a change in workgroup. Variables that intervened in the relationship between restructuring and well-being were physical demands, job control, communication, provision of information, training, procedural justice, job insecurity and change acceptance. Further high-quality longitudinal research is needed to get more insight into the impact of restructuring over time and into the part played by intervening variables.     

The impact of participation on management in Germany

The German experience with the two-tier board system is outlined. In industry, where the supervisory board consists of one third elected worker-directors, the system appears to work satisfactorily, but it is less successful in the mining and steel industry, where they constitute half the board.     

The relationship between training outsourcing and employee commitment to organization

In many countries, the human resource practice of training outsourcing has emerged as one of the fastest growing segments of the broader business process outsourcing industry. In spite of the growing popularity in professional practice, training outsourcing continues to be subjected to critical review and ongoing debate with most attention focused on the decision to ‘outsource’ or ‘not to outsource’. However, there exists a shortage of research on training outsourcing as a human resource development (HRD) practice and the potential relationships with desired organizational outcomes including employee commitment. This exploratory international study extends previous research that has examined the relationship between training and organizational commitment by focusing exclusively on outsourced training. Data were collected from information technology firms in two countries: India and the United States. Results showed positive relationships between specific measures of employee perceptions of quality, usefulness and supervisor support for outsourced training with organizational commitment. Recommendations are made for future research as well as for professional practice to guide HRD practitioners involved in the rapidly growing global practice of training outsourcing.     

The contribution of supervisor behaviour to employee psychological well-being

Many employees affirm that supervisors affect employee well-being, and research has demonstrated associations between supervisor behaviour and employee psychological well-being. However, what hasn't been clear is the extent to which the association with supervisor behaviour compares with that of other variables known to affect well-being. This exploratory study addresses that issue. Our hypothesis was that supervisor behaviour can contribute to the prediction of psychiatric disturbance beyond the contribution of other influential variables. We created a new, questionnaire-based instrument to measure supervisor behaviour. We tested our hypothesis using stepwise regression with a convenience sample of 167 men and women working in a variety of organizations, occupations, and industries in the USA. Results supported our hypothesis: supervisor behaviour made a statistically significant contribution to the prediction of psychiatric disturbance beyond a step-one variate comprised of age, health practices, support from other people at work, support from home, stressful life events, and stressful work events. This provides additional evidence that supervisor behaviour can affect employee well-being and suggests that those seeking to create healthier workplaces should not neglect supervision. We believe that there is now ample justification for those concerned with psychosocial working conditions to consider supervisor behaviour as a potentially influential variable.

Furthermore, we believe that we have presented a new instrument for assessing supervisor behaviour that has the potential to be of value in future studies.     

Business planning and employee democracy in Yugoslavia

Conceptions of the role of planning in the socio-economic system have changed in the past 30 years. During the period 1946–1950 the concept of administrative planning was prevalent. From 1954 to 1976 it was planning the main economic proportions; and from 1976 to the present day the concept of self-managing social planning has been prevalent. The efficiency of planning depends in large part on the matching and co-ordination of all participants in the process, and particularly on the participation of workers in self-managing bodies taking planning decisions. Annual plans are to be treated as integral parts of mid-range plans and enterprises are obliged to analyse the implementation of their mid-range plan every year and to develop in detail activities for the next year. The principle of continuous planning is an important feature of self-managing social planning.     

Corporate social responsibility as a source of employee satisfaction

Corporate social responsibility has received an increasing amount of attention from practitioners and scholars alike in recent years. However, very little is known about whether or how corporate social responsibility affects employees. Because employees are primary stakeholders who directly contribute to the success of the company, understanding employee reactions to corporate social responsibility may help answer lingering questions about the potential effects of corporate social responsibility on firms as well as illuminate some of the processes responsible for them. To begin our chapter, we provide a brief history of scholarship on corporate social responsibility and highlight some of the major challenges researchers in this area currently face. We then discuss why corporate social responsibility may represent a special opportunity to influence employees’ general impression of their company. Next, we identify four distinct paths through which corporate social responsibility may affect employees’ relationship with their company that correspond to four universal psychological needs: security, self-esteem, belongingness, and a meaningful existence. Finally, we offer an agenda for micro-level research on corporate social responsibility.     

The contribution of supervisor behaviour to employee psychological well-being

Many employees affirm that supervisors affect employee well-being, and research has demonstrated associations between supervisor behaviour and employee psychological well-being. However, what hasn't been clear is the extent to which the association with supervisor behaviour compares with that of other variables known to affect well-being. This exploratory study addresses that issue. Our hypothesis was that supervisor behaviour can contribute to the prediction of psychiatric disturbance beyond the contribution of other influential variables. We created a new, questionnaire-based instrument to measure supervisor behaviour. We tested our hypothesis using stepwise regression with a convenience sample of 167 men and women working in a variety of organizations, occupations, and industries in the USA. Results supported our hypothesis: supervisor behaviour made a statistically significant contribution to the prediction of psychiatric disturbance beyond a step-one variate comprised of age, health practices, support from other people at work, support from home, stressful life events, and stressful work events. This provides additional evidence that supervisor behaviour can affect employee well-being and suggests that those seeking to create healthier workplaces should not neglect supervision. We believe that there is now ample justification for those concerned with psychosocial working conditions to consider supervisor behaviour as a potentially influential variable.

Furthermore, we believe that we have presented a new instrument for assessing supervisor behaviour that has the potential to be of value in future studies.     

Hypermaps: a representation of perceptions in conflicts

An approach to the modelling of conflicts, which is based upon personal construct psychology, is described. Use is made of the idea of cognitive mapping as a way of representing individual perceptions of a situation, and the relationships between the maps held by individuals who are in conflict are expressed by introducing the concept of ‘hypermaps’. The resulting implications for applications of the hypergame approach in practical studies are discussed     

Time management as a moderator of relations between stressors and employee strain

The purpose of this study was to examine whether time management behaviours moderated relations between stressors (role conflict, role overload, work-family conflict, and family-work conflict) and strain, as measured by scores on the General Health Questionnaire. It was predicted that use of time management behaviours would be negatively associated with strain. These relations, however, were expected to be mediated by feelings of control over time. It was further predicted that the use of time management behaviours would attenuate stressor-strain relations. Data collected from 525 employed men and women indicated, as predicted, that use of time management behaviours was negatively associated with strain. These relations were partially mediated by feelings of control over time. Moderator tests failed to provide support for time management behaviour as a moderator of stressor-strain relations. Implications of findings are discussed and future directions for time management research are suggested.