Deadly combinations of human resource practices:
The mismatch effect on employee functioning
Master thesis, Msc Human Resource Management University of Groningen, Faculty of Economics and Business
June 14, 2015
ABSTRACT
This study investigates the underlying process between mismatching HR practices and organizational performance. It is hypothesized that mismatching HR practices have a negative effect on employee functioning and, therefore, on organizational performance. Moreover, it is hypothesized that this relationship is mediated by employees’ need fulfilment. Therefore, this study aims at answering how negative synergies affect organizational performance, by performing an experiment and distributing a survey. In general, the results did not fully support the hypotheses. Yet, study 1 and 2 provides evidence that clashing HR practices might have negative impact on employee functioning. It was shown that as the level of mismatching HR practices increased, turnover intentions also increased, as well as normative commitment decreased (study 1). I identify key problems of the current research and make several suggestions intended to aid researchers studying this topic.
Key words: Human Resources, Human Resource Practices, Negative synergies, Employees’ need fulfilment, Employee functioning.
INTRODUCTION
For the past 60 years, globalization has increased the interconnection between markets around the globe. This rapid change in the economic environment, especially the deregulation of markets, has become one of the biggest issues for organizations in order to survive in a competitive world. Organizations must reduce costs, innovate products, and improve quality and productivity to continually boost their performance (Becker & Gerhart, 1996). The globalization process changed the way in which organizations maintain their competitiveness, increasing the importance of people and the way people are managed for competitive success (Pfeffer, 1994). In this sense, the field of Human Resource Management (HRM) is crucial for firm effectiveness.
To achieve their goals, organizations use Human Resource (HR) practices, which are activities that influence employee abilities, motivation, and opportunities (AMO; Delery, 1998; Jiang, Lepak, Han, Hong, Kim, & Winkler, 2012). Therefore, by effectively managing a workforce with adequate skills, organizations can benefit from their human resources (Huselid, 1995; Pfeffer, 1994). However, organizations must combine those practices in a strategic way in order to meet business objectives (Delery, 1998). Organizations often employ multiple HR practices simultaneously and these practices do not function in isolation (Jiang et al., 2012).
To address this gap, I first try to establish a relationship between mismatching HR practices, namely between individual rewards and teamwork, and employee functioning, such as commitment, motivation, and turnover intentions. I argue that mismatching HR practices negatively affect employee functioning. Subsequently, I will connect the clash of HR practices with employees’ need fulfilment, represented by need for autonomy, relatedness, and competence. I argue that mismatching HR practices negatively affects employees’ need fulfilment. Furthermore, I will connect employees’ need fulfilment with employee functioning. For instance, if employees do not feel autonomous, they will lose motivation, and thus, employee functioning is negatively affected (Deci & Ryan, 2000).Following this logic, if employee functioning is negatively affected, and since employees are important assets of an organization (Lepak & Snell, 1999), the organizational performance is also affected in a negative way (Pfeffer, 1994). Put differently, I will examine the process underlying the effect of negative synergies of HR practices on employee functioning directly, and through perceived need fulfilment of employees.
From an academic perspective this study adds value by closing a gap in contemporary literature. Furthermore, it elaborates on the findings of Becker et al. (1997) by investigating the underlying mechanisms through which mismatching HR practices affect organizational performance. From a managerial perspective this study is important, because it identifies a new possible cause for undesirable employee functioning: mismatching HR practices. By identifying the root of the problem, managers can tackle them from the origin. Being aware of the consequences of mismatching HR practices can provide considerable benefits for managers, such as preventing unnecessary costs. This study will benefit researchers interested in the area of HR practices by providing a first insight into how mismatching HR practices affect organizational performance. Additionally, this study will benefit employers and employees involved with HR practices and responsible for employee functioning.
In the next section of this paper I will explicate the theoretical background and provide the logic behind the hypotheses. In the method section I will clarify how I gathered data and performed my analyses. This is followed by the results section, where I will present the outcome of the studies. To conclude this paper I will interpret the findings, provide limitations and recommendations for future research in a general discussion.
THEORETICAL BACKGROUND
Human Resource Practices
According to agency theory, employees and employers differ in their interests (Eisenhardt, 1989). Employees, for example, desire higher compensation and discretion levels, which leads to higher costs for the organization. On the other hand, employers seek superior performance, and to do so it is important to acquire and maintain productive human capital at a lower cost (Glebbeek & Bax, 2004).
In order to achieve their interests, organizations employ HR practices. This does not mean that organizations achieve performance by HR practices, but they do so by retaining, attracting and developing unique and valuable human resources. In this line of thought, HR practices are tools used by organizations in order to develop and sustain the necessary human resources, through affecting different employees’ behaviours under different circumstances (Delery, 1998). Becker et al. (1997: 41) also elaborated a definition for HR practices, which “help to create unique competences that differentiate products and, in turn, drive competitiveness”. As stated by Huselid (1995), HR practices can affect individual employee performance by influencing employees’ skills and motivation.
But what are those practices? They could be performance appraisals, for instance. Ghorpade and Chen (1995) defined performance appraisals as an important tool to account for the differences in contributions of individuals. It is known that “individuals differ concerning how well and how conscientiously they do their work” (Ghorpade & Chen, 1995: 32). Organizations apply performance appraisals in order to improve their performance, through affecting employees’ behaviour. In this sense, appraisals can be associated with building job satisfaction and organizational commitment (Pettijohn, Taylor, & Keillor, 2001). Rewards can be an example of performance appraisals, where employees with good performance will be rewarded (Ghorpade & Chen, 1995). Appraisals can be based on behaviour or results. When they are based on individuals’ behaviours, they focus on the necessary behaviours to perform the job effectively, while appraisals based on results focus on the consequences of those behaviours.
do not understand what makes an organization perform superior, they are facing the causal ambiguity effect, resulting in barriers that make imitation difficult (Reed & Defillippi, 1990; Coff, 1997). Consequently, both social complexity and causal ambiguity limit market competition for resources (Coff, 1997), and this effect enhances organizational performance (Lepak & Snell, 1999). From the above, it becomes evident that combining several HR practices might be beneficial for organizations. Indeed, organizations often form bundles of HR practices that are just an agglomerate of multiple individual HR practices, referred to as HR systems (Jiang et al., 2012). Thus, employees face several HR practices at the same time. These combinations can have several interactive effects in their effectiveness, either additive, substitutive, positive synergies or negative synergies (Becker et al., 1997; Chadwick, 2010; Delery, 1998). Synergies enhance or reduce the effects of another practice, resulting in a “substantially different effect than the sum of their individual effects” (Chadwick, 2010; Delery, 1998: 294). In line with the gap in research identified above, the current research will focus on negative synergistic effects of HR practices. These will be discussed in the following section.
The effect of mismatching HR practices on Organizational Performance
As mentioned before, researchers have focused on the positive synergies among HR practices (for an exception, see Becker et al., 1997). When organizations apply HR practices that are misaligned, they create negative synergistic effects and therefore harm organizational effectiveness (Kepes, Delery, & Gupta, 2008). Chadwick (2010) also defined negative synergies, which he refers to with the term dis-synergies, as interactions between HR practices “that reduce rather than enhance organizational performance”. These types of interactions are also referred to as “deadly combinations” (Becker et al., 1997). They result in poorer performance or in a complete disaster when combined compared to when used in isolation (Becker et al., 1997; Delery, 1998).
Delery and Doty (1996) argued that when organizations implement HR practices that are consistent and combine with their strategy, they allow organizations to achieve performance. This means that when organizations apply HR practices that are not consistent, instead of enhancing, they will reduce the outcome. Along similar lines, Chadwick (2010) described that managers use bundles of HR practices together because they believe them to have synergistic effects on performance. As mentioned above, bundles of HR practices could reduce rather than enhance organizational performance.
practices have negative synergistic effects. This might occur due to the use of various bundles of HR practices. While some bundles have positive synergistic effects, others have negative synergistic effects. When the effect of positive synergies is greater than the effect of negative synergies, the total effect is still positive (Jiang et al., 2012). In this sense, since the total effect is still positive, it can be hard for organizations to recognize that some bundles have negative synergies, and that they are lowering the positive effects of other bundles. Before organizations discover that there are negative synergistic effects, the performance can be significantly affected (Chadwick, 2010).
When discovered, organizations isolate each HR practice and measure the independent impact, and thereafter they measure the effect while added to the sum of HR practices. For instance, if a HR practice has an effect of 2 when used in isolation, organizations expect that the effect would be 2 or greater when they add this specific HR practice to the bundle of HR practices already in place. If this effect is lower than 2, we are facing a negative synergy. In this line of thought and also supported by Becker and Gerhart (1996), human resources can be crucial to organizational effectiveness.
The effect of mismatching HR on employee functioning
Organizations apply HR practices in three main domains, the KSAs domain (knowledge, skills and abilities) (Jiang et al., 2012), the motivation and effort domain, and the opportunities to contribute domain (Jiang et al., 2012). When HR practices focus on this domain, they try to influence the employees’ necessary competences to perform their job. Regarding the motivation domain, the application of HR practices tries to make employees perform their work with more motivation and effort through, for instance, compensation (Jiang et al., 2012).
1995). Following this logic, commitment, employee motivation and employees’ desire to leave the organization highly affects employee functioning. In this research I will focus in these three components.
Employee commitment
Concerning commitment, Arthur (1994) defined HR practices as moulds to employee behaviours and attitudes through psychological links between employee and organizational goals. Researches (Meyer & Allen, 1997; Meyer & Smith, 1998) stated that commitment can take three forms, affective, continuance and normative. Affective commitment reflects the employee identification and involvement with the organization. Continuance commitment “is based on the perceived costs associated with discontinuing employment with the organization” (Meyer & Smith, 1998: 320). Finally, normative commitment occurs when employees feel obligated to maintain their relationship with the organization, through, for instance, written contracts (Meyer & Smith, 1998).
The usage of commitment practices is extremely important because when employees perceive the organization as caring and supportive, or even feel indebted to the organization, they develop stronger levels of commitment. Meyer and Smith (1998) also related commitment to employees’ perception of justice and organizational support. First, if employees perceive the outcomes (distributive justice) and the procedures used to determine those outcomes (procedural justice) as fair, they are more likely to be committed to the organization. Second, if employees perceive the organization as committed to them, they are more likely to be committed in return.
Organizations can fortify employee commitment through HR practices, but not in a direct way. Meyer and Smith (1998) state that employee commitment is based on employees’ perception of the applied HR practices. For instance, when organizations apply HR practices such as benefits they do not influence commitment directly. Those practices influence employees’ consideration of the efforts made by the organization, and therefore they might consider being more committed.
Employee motivation
their jobs and demonstrate greater efforts than those less intrinsically motivated. Employees’ behaviours can also be regulated through outcomes not inherent to the activity itself, such as rewards, for instance. This form of motivation is called extrinsic motivation (Deci & Ryan, 2000; Gillet et al., 2010). Research has shown that the application and effectiveness of HR practices varies according to the employees’ individual perceptions (Kuvaas & Dysvik, 2010; Meyer & Smith, 2010). When negative synergies occur, employees might perceive intrinsic and extrinsic motivators as conflicting (Jiang et al., 2012). For instance, when employees are confronted with a combination of teamwork and individual rewards, they might lose intrinsic motivation. This happens because they could lose the sense of belongingness stemming from the teamwork. But, as I will further explain in the last section, a sense of belongingness is a necessary condition for intrinsic motivation (Deci & Ryan, 2000).
Employee turnover intentions
To finalize employee functioning constructs, I consider employee’s desire to leave the company, or also called, turnover. The term employee turnover is usually referred as a solo definition. However, it involves two forms of turnover, voluntary and involuntary (Shaw, Delery & Gupta, 1998). Involuntary turnover is resulting when an employer decides to terminate the employment relationship. Due to the scope of this research, only voluntary turnover will be discussed, which results when an employee decides to leave the organization, or so-called, turnover intentions (Arthur, 1994; Huselid, 1995; Shaw, Delery & Gupta, 1998). Turnover intentions are manifested when individuals have mental decisions intervening between his or her attitude regarding the job, and decision to stay or leave. Turnover intentions can be an important variable, maybe even more than the actual act of turnover. Especially from the employer’s point of view, because they can better understand individual’s intentions and possibly instate changes to affect those intentions (Jacobs & Roodt, 2008).
(Glebbeek & Bax, 2004). In this sense, voluntary turnover can affect employee functioning, and thus, harm organizational performance.
The effect of mismatching HR practices on employee functioning through employees’ need fulfilment
As introduced above, intrinsic motivation is a necessary condition to achieve performance. A necessary condition to achieve intrinsic motivation is the satisfaction of basic human needs. According to Deci and Ryan’s (2000) Self-Determination Theory (SDT), individuals have three basic psychological needs, namely, autonomy, competence and relatedness. Individuals perceive that they are more autonomous if they have choices and control over their actions. Competence is related to individuals’ perception that they are good at something. And relatedness, or belongingness, means that individuals perceive themselves as connected to others through positive relationships and are cared for. Basically, individuals need to perceive that they matter and are important to others. In order to feel psychologically healthy, individuals need to satisfy all three basic psychological needs.
Although these needs have been long explored in social psychology, they are relatively new in organizational studies. Rosen, Ferris, Brown, Chen, and Yan’s (2014) study can be an example. In their research, they argue that organizations are a social marketplace, whereby employees and employers exchange their resources. On the employers’ side, they seek employee productivity. On the other side, employees seek both concrete (i.e. pay) and symbolic resources, such as socioemotional relationships. When employees perceive the exchange relationship of resources as imbalanced, they are more likely to develop negatives attitudes toward the organization, and therefore, less likely to maintain performance levels. This can be explained through the relationship between the basic psychological needs and intrinsic motivation as explained above. However, those basic needs might affect not only motivation, but also commitment and therefore employees’ desire to leave the organization, which I will try to show in the further course of this paper. This occurs due to the impact that they have on individual well-being. When fulfilment of those psychological needs is thwarted, they have a negative impact on well-being, attitudes and performance (Rosen et al., 2014). Consequently, employees’ need fulfilment presents the mediating variable in this research, and is expected to be responsible for the effect of clashing HR practices on employee functioning.
The present research Overview
When HR practices clash and send conflicting messages to employees, their perception of autonomy, belongingness and relatedness decreases. This happens because employees need to choose between cooperation within the team or being individually rewarded. When they have to choose between both, their autonomy decreases, because they do not have complete control over their actions. Employees’ perception of competence also decreases, due to the impossibility of being good at cooperation and individual performance. Relatedness, or belongingness also decreases. This happens because employees must choose between cooperation with their group, or to be individualistic. If employees choose to be cooperative, their levels of trust within the team members are also negatively affected, since they cannot know if their colleges are being truly cooperative or trying to increase their individual performance to achieve higher rewards.
Conceptual model and hypotheses
The hypothesized relationships between HR practices, employee need fulfilment, and employee functioning are introduced in detail below, together with a summarized conceptual model. It summarizes the present research: negative synergies (operationalized through a clash of HR practices, namely, individual rewards and teamwork) are expected to negatively affect employee functioning (operationalized through employee commitment, motivation and desire to leave the company), and this effect is expected to be mediated by employees’ need fulfilment (operationalized through need for autonomy, competence, and relatedness).
Based on this conceptual model, the relationship between variables can be noted in four hypotheses.
Hypothesis 1. The clash of HR practices is expected to have a negative effect on employee functioning.
Hypothesis 2. The clash of HR practices is expected to have a negative effect on employees’ perceived need fulfilment.
Hypothesis 3. Employees’ perceived psychological need fulfilment is positively related to employee functioning. Put differently, when employees do perceive these needs as satisfied, their functioning is impaired.
Hypothesis 4. The clash of HR practices has a negative effect on employee functioning and is mediated by employees’ need fulfilment (Hypothesis 2 and 3 together).
Study 1 METHOD
Research design
In this first study, scenario-based questionnaires were utilized to investigate the above-mentioned hypotheses. I made use of job descriptions to present the scenarios to the participants. To avoid selection bias in the experiment, the participants were randomly assigned to one of the conditions of a 2 (Individual rewards: present vs. absent) by 2 (Teamwork: present vs. absent) between-subjects design. The participants were not informed to which of the four groups they belonged. The complete scenarios can be found in Appendix A.
Sample
The research was conducted in the laboratory of the Faculty of Economics and Business, University of Groningen. Hence, the participants were students of this faculty. Out of a total sample of 220 participants, 95 (43.2%) were female, 124 (56.4%) male, and one participant, accounting for 0.5%, did not want to reveal his/her gender. Furthermore, 208 participants (94.5%) were between 16 and 25 years, 11 participants (5.0%) were between 26 and 35 years, and one participant did not want to reveal his/her age (0.5%). The participants were equally distributed among scenarios.
work experience and 1 participant did not fill in his/her work experience, accounting for another 0.5% of the distribution.
Procedure
As mentioned before, the participants were students of the University of Groningen. Although participation was voluntary, they received eight research points in exchange for their participation. The experiment was conducted in cooperation with two colleagues over the course of two weeks. Participants were asked to fill in three questionnaires in the time of one hour (approximately twenty minutes per study).
The questionnaire was divided into four parts. The first part explained the scenario in which the participants were asked to place themselves. The second part consisted of a manipulation check (see appendix B). The main body of the questionnaire regarded statements concerning employees’ need fulfilment (see appendix C) and employee functioning (see appendix D). To complete the experiment, personal information about the participants was gathered (age, gender, years of work experience) together with an open question where participants could make suggestions about the experiment and issues that could be improved in future research. All questions were stipulated in accordance with anonymity requirements.
Dependent variables
Manipulation check. To confirm the manipulation of the different job descriptions, I used five single items (see Appendix B). Two items were related to teamwork, which I computed into a single variable named teamwork check. Also, two items were related to individual rewards, which I computed as individual rewards check. The final item represented the difficulty in understanding the reward system in each scenario. In the remaining parts of this thesis this item will be referred to as rewards system difficulty. All items were measured on a 7-point Likert scale, ranging from 1 (not at all true) to 7 (very true).
Employee functioning. As discussed in the theory section, employee functioning is represented by commitment, motivation, and desire to leave the organization. The items and their respective scales used to measure employee functioning can be found in Appendix D.
The construct commitment was divided into three parts: affective commitment (α = .86), continuance commitment (α = .74), and normative commitment (α = .68). The participants encountered in each part eight items, such as “I enjoy discussing about my organization with people outside it”. The scale used for the three constructs of commitment was based on Meyer and Allen’s (1997) article, with a 7-point Likert scale.
Regarding motivation (α = .87), I used three items; an example is “Because I derive much pleasure from learning new things”. Moreover, I made use of a 7-point Likert scale, ranging form 1 (does not correspond at all) to 7 (corresponds exactly), which can be found in the research of Tremblay, Blanchard, Taylor, Pelletier, and Villeneuve (2009).
Finally, to measure turnover intentions (α = .42) I based the statements and scales on Roodt’s (2004) article. The five items used, which were measured on a 7-point Likert scale, anchored at extreme poles (i.e. 1 for “never”, 7 for “always”). Due to the low reliability for turnover intentions, only the item “What is the probability that you will leave you job, if you get another suitable offer?” was considered in the further course of the analysis.
Data analysis
For all items, with the exception of turnover intentions, I computed new variables representing the items mean scores. Additionally, to deal with missing values I used pairwise deletion.
I used the statistical program SPSS in order to investigate the conceptual model and related hypotheses. The results of this statistical analysis will be presented in the next section.
RESULTS Manipulation check
In order to analyse if the manipulation check was effective, I needed to code two new variables, individual rewards present (i.e. =1) or absent (i.e. =0) and teamwork present (i.e. =1) or absent (i.e. =0). These variables, together with individual rewards check and teamwork check, were then subjected to a multivariate analysis of variance.
and for teamwork check, F (1, 215) = 29.93, p < .001, η2 = .12. This means that in the clash condition the participants reported that both individual rewards and teamwork were present, which showed that they understood the job description.
Additionally, in the individual rewards condition (i.e. when only individual rewards was present), individual rewards check was statistically significant (F (1, 215) = 123.34, p < .001, η2 = .37) and teamwork check insignificant (F (1, 215) = .00, p > .05, η2 = .00), meaning that the participants understood that only individual rewards was present in this scenario.
Regarding the presence of teamwork, the manipulation check was different than expected. Both individual rewards check (F (1, 215) = 37.90, p < .001, η2 = .15) and teamwork check (F (1, 215) = 946.45, p < .001, η2 = .82) were significant. This finding shows that the participants reported that both individual rewards and teamwork were present in the teamwork condition (i.e. only teamwork present).
To understand this unexpected finding, I decided to also analyse the reward system difficulty in the different scenarios. Interestingly, the participants from the control condition (i.e. when both individual rewards and teamwork were absent) rated the rewards system as less difficult to understand than the other conditions (M = 1.60, SD = .17), while participants from the individual rewards condition rated the reward system slightly more difficult to understand (M = 1.61, SD = 17). Even more interesting, this difference continues to increase: in the teamwork condition the reward system was rated as more difficult to understand (M = 2.00, SD = .17). Although slightly, the participants from the clash condition considered this scenario more difficult to understand the reward system (M = 2.15, SD = .17) than the participants from the other conditions did.
Independent variable
absent. This suggests that not applying HR practices has a stronger impact on the desire to leave the organization in comparison to the other scenarios.
In order to compare the clash condition with the other conditions, I needed to compute a contrast variable. As explained above, not all means for the control condition were significantly different from the other conditions. However, the differences were still severe enough to interfere with an appropriate grouping of conditions. If this contrast variable would also contain the means from the control condition, the results would not present an accurate comparison. Therefore, in the further course of this analysis, the control condition will not be taken into account. Therefore, the contrast was computed as follows: the clash condition was recoded into 2 and the individual rewards condition and teamwork condition into -1.
Employees’ need fulfilment and employee functioning
In order to test hypotheses 1 and 2, I conducted two separate analyses of variance with the contrast as the independent variable. I assessed the direct effect of mismatching HR practices on employee functioning and employees’ need fulfilment, respectively. Additionally, I conducted a correlation analysis among the clash of HR practices and employee functioning, as well as among clashing HR practices and employees’ need fulfilment. These results are depicted in table 1.
Employee functioning. The results showed that the clashing condition was significantly different from the other two conditions for normative commitment (F (1, 163) = 4.13, p = .044, η2 = .03) and turnover intentions (F (1, 163) = 3.46, p = .065, η2 = .02). In the clashing condition participants felt less obliged to maintain the employment relationship with the organization (M = 3.15, SD = .84) than in the other conditions (M = 3.44, SD = .84). Furthermore, the participants had more desire to leave the organization in the clashing condition (M = 5.51, SD = .92) than in the other conditions (M = 5.56, SD = 1.05). These results are in accordance with the above stated hypothesis 1. However, the results did not show that the effects of mismatching HR practices on affective commitment, continuance commitment and motivation were different from the clashing condition compared to the other conditions, at p > .10.
Table 1 depicts the correlations among the independent variable and employee functioning. As can be seen, the correlations are higher for normative commitment and turnover intentions, although the latter one is only significant at p < .10, as shown above. Therefore, hypothesis 1 is only partially supported.
Employees’ need fulfilment. The results were not statistically significant (p > .10) for all three constructs of employees’ need fulfilment. Therefore, the participants’ perceived autonomy, relatedness to the organization, and competence did not have significant differences in the clashing condition compared to the other two conditions. As depicted in table 1, the contrast variable is not correlated with any of the constructs of employees’ need fulfilment, supporting the idea that clashing HR practices do not affect employees’ need fulfilment. Because of these findings, hypothesis 2 is rejected.
Employees’ need fulfilment on employee functioning
To test hypothesis 3, I correlated the constructs of employees’ need fulfilment with employee functioning. Table 1 also contains the means and standard deviations for, and the correlations among, employees’ need fulfilment and employee functioning.
As can be seen in table 1, autonomy was positively correlated with affective commitment, motivation, and negatively correlated with turnover intentions. This means that as the participants felt more autonomous, their levels of identification and involvement with the organization increased, as well as their motivation levels. As perceived autonomy increased, the participants felt less desire to leave the organization.
Additionally, relatedness was positively correlated with affective commitment, continuance commitment and motivation. As perceived relatedness with the organization increased, the identification and involvement, as well as the perceived costs of discontinuing the employment relationship, increased. Moreover, as participants felt more related to the organization, their motivation levels also increased. Finally, relatedness was negatively correlated with turnover intentions, suggesting that, as participants felt more related to the organization, their desire to leave the organization also decreased.
Competence was positively correlated with affective commitment, continuance commitment and motivation. As the participants’ perceived competence increased, their levels of identification and involvement increased. Additionally, as participants’ had stronger feelings of competence, their perceived costs of discontinuing the employment relationship increased, as well as they felt more motivated. Likewise for autonomy and relatedness, as the participants perceived to be more competent, they had a lower desire to leave the organization.
increase/decrease on normative commitment. Similarly, an increase/decrease in autonomy does not mean an increase/decrease on the perceived costs associated with discontinuing the employment relationship. In sum, hypothesis 3 is partially supported.
Table 1. Descriptive statistics and correlations among the clash of HR practices, employee functioning, and employees’ need fulfilment.
M SD 1 2 3 4 5 6 7 8 1 Contrast 0 1.42 2 Autonomy 3.96 .92 .11 3 Relatedness 4.57 .89 .03 .56** 4 Competence 4.46 1.14 .12 .69** .57** 5 Affective Commitment 3.69 1.11 .01 .56** .59** .64** 6 Normative Commitment 3.32 .83 -.16* .04 .11 .03 .22** 7 Continuance Commitment 4.05 .93 -.12 .07 .16* .20** .29** .17* 8 Motivation 5.5 1.17 .04 .26** .24** .27** .13 -.09 -.15* 9 Turnover Intentions 5.49 1.05 .14 -.35** -.29** -.37** -.43** -.36** -.10 -.02
Note: ** p < .01 (2-tailed), * p < .05 (2-tailed)
The mediating role of employees’ need fulfilment
As it can be seen from the results above, mismatching HR practices do not have significant effects on employees’ need fulfilment. The results of this study suggest that employees’ need fulfilment do not mediate the relationship between clashing HR practices and employee functioning. Therefore, hypothesis 4 is rejected.
DISCUSSION
The results suggested that the participants in the control condition felt less autonomous, less related and less competent than the participants from the other conditions did. Additionally, they also felt lower levels of affective commitment, continuance commitment, motivation, and higher desire to leave the organization. These results indicate that the negative effects of not applying HR practices can be more severe on organizational performance than the negative effects of applying mismatching HR practices, which supports prior research (Jiang et al., 2012).
have negative consequences for organizational performance. In this study it was found that, in general, mismatching HR practices have negative effects on employee functioning. Because negative effects on employee functioning have a negative effect on organizational performance (Meyer & Smith, 1998; Glebbeek & Bax, 2004), these outcomes support what has been said in prior research.
The results also suggested that clashing HR practices do not affect the employees’ perceived autonomy, relatedness and competence, which does not support hypothesis 2. A possible reason for this might be related to the research design, as will be explained below.
In the analysis of hypothesis 3, the results were more positive. In accordance with existing literature (Rosen et al., 2014), as satisfaction of basic psychological needs increased, the constructs of employee functioning also increased, as exception for turnover intentions, which decreased. However, the results showed that an increase/decrease on employees’ need fulfilment did not mean an increase/decrease in normative commitment, contrary to what was stated in the theory section. Because mismatching HR practices appeared to not affect employees’ need fulfilment, autonomy, relatedness and competence did not mediate the relationship between mismatching HR practices and employee functioning. Possible reasons for these results are explained below.
in study 1 is not as accurate as expected, because the artificiality of the setting may produce unnatural behaviours or feelings, which do not reflect the real life situation.
Study 2 METHOD
Research design
In a second study I made use of an online questionnaire to test the above stated hypotheses. In comparison to the first study, which allowed for a precise control of the independent variable, the second study permitted data gathering from participants who were employed. In this sense, I was able to discover if HR practices were employed in organizations and if so, if they were conflicting. Also, contrary to study 1, participants were asked for real life experiences. This allowed participants to demonstrate their opinions about the HR practices employed by their organizations. Following this line of reasoning, and due to the importance of behaviours and feelings to this research, a second study can be a major contribution.
The questionnaire was created with the help of Qualtrics and was aimed at participants with working experience. The participants encountered only one job description: the mismatch of HR practices. In order to prevent misunderstandings, definitions of the relevant concepts were also included in an introductory paragraph. The job description and definitions can be found in Appendix E. The questionnaire was completely in English and all questions stipulated with anonymity requirements.
Sample
To conduct the research, I took advantage of my own network. The participants were mainly from the Netherlands, however some were also from United Kingdom and Portugal. From a total of 60 participants, 28 were male (46.7%) and 32 were female (53.3%). The age of the respondents varied significantly, ranging from 17 to over 66. However, more than half of the participants were older than 36 years.
Concerning the years that participants worked for their current employer, 21 participants worked for over 10 years (35%), 11 for less than a year (18.3%), 18 between 1 and 5 years (30%), 9 between 6 and 10 years (1.7%), and 1 participant was unemployed (1.7%).
A big part of the participants worked for large enterprises (more than 1000 employees), accounting for 25 (41.7%). The second biggest part consisted of participants that worked for small organizations (less than 50 employees), with 16 respondents (26.7%). 10 participants (16.7%) worked for medium organizations (between 50 and 250 employees). Also, 8 participants (13.3%) worked in large organizations (between 250 and 1000 employees), and 1 participant was unemployed (1.7%).
Procedure
Participants were given the information about the length (10 minutes) and the purpose of this research. Afterwards, they encountered a job description (see Appendix E) with an explanation of mismatching HR practices. Then, participants rated three statements about HR practices in their organizations in order for me to understand if and how HR practices are applied throughout their organizations. The questionnaire was identical to study 1 (see Appendix C and D). To finalize, the participants answered to general questions concerning their age, gender, years of work experience, current tenure, and organizational size of their current employer, which are depicted in Appendix G.
Control variables
HR practices at work. The respondents were presented with three items and were asked to rate them on a 5-point Likert scale. The first item assessed if HR practices are applied in the organizations the participants worked for. Additionally, the second item measured the presence or absence of mismatching HR practices in organizations. The third item measured if the respondents perceived the HR practices applied by their organizations as useful tools. The scale used for these items can be found in Appendix G.
Because the statement “The HR practices applied at my organization match (are not conflicting)” measured the perceived mismatch of HR practices at organizations, this will be used as my independent variable in the further course of the analyses.
Dependent Variables
due to low reliability, which might be caused by reversed questions or misinterpretations. More detailed information about the deleted items can be found in Appendix C. As stated before, employees’ need fulfilment has 3 constructs: autonomy (α = .70), relatedness (α = .70), and competence (α = .58).
Employee functioning. The scales used to measure employee functioning were the same as the ones applied in study 1 (see Appendix D). However, due to the low reliability for turnover intentions, one item was deleted as can be seen in Appendix D. Employee functioning was represented by affective commitment (α = .85), normative commitment (α = .71), continuance commitment (α = .74), motivation (α = .84) and turnover intentions (α = .68).
Data analysis
For all items, with the exception of autonomy, competence and turnover intentions, I computed new variables representing the items mean scores. Additionally, to deal with missing values I used pairwise deletion.
I used the statistical program SPSS in order to investigate the conceptual model and related hypotheses. The results of these statistical analyses will be presented in the next section.
RESULTS Control variables
The results showed that more than half of the sample (55%) acknowledged that their organizations applied HR practices, 30 % mention that their organization made almost no use of HR practices, and 9 participants (15%) did not know whether their organizations applied HR practices or not. Additionally, 15 participants (25%) considered that the HR practices applied in their organizations were somewhat conflicting, and 25 participants (41.7%) did not consider the HR practices to be conflicting. The rest of the sample, accounting for 20 participants (33.3%) did not have a formed opinion.
Moreover, the results indicated that 25 participants considered HR practices as useful (41.7%), 17 participants (28.3%) considered them as useless, and 18 participants did not have a formed opinion (30%).
Employees’ need fulfilment and employee functioning
To test hypotheses 1 and 2, I made use of a correlation analysis. This analysis allowed the assessment of the correlation between the independent variable and employee functioning (hypothesis 1), as well as the correlation between the independent variable and employees’ need fulfilment (hypothesis 2). The results for the correlation analysis can be found in table 2.
Employee functioning. The results showed that only the correlation between mismatching HR practices and turnover intentions was significant at p < .05. This result suggests that as the extent to which the clash of HR practices increased, the desire to leave the organization also increased. This result is consistent with the above stated hypothesis 1.
However, for the other constructs of employee functioning, the results were not significant. This means that an increase or decrease in the level of clashing HR practices did not affect affective commitment, normative commitment, continuance commitment, and motivation. Therefore, hypothesis 1 is only partially supported.
Employees’ need fulfilment. Analysis of the correlation among the clash of HR practices and employees’ need fulfilment revealed that the level of clashing HR practices is positively correlated with autonomy, p < .01. In other words, as the degree to which HR practices clash increases, the respondents felt more autonomous. This is contradictory to what was hypothesized above. However, the correlation analysis also showed more encouraging results. As the level of clashing HR practices increased, the respondents perceived that they were less competent at their jobs. The level of clashing HR practices was not correlated with relatedness. This means that an increase or decrease in the level of clashing HR practices did not mean an increase or decrease in the respondents’ perceived relatedness with the organization.
In sum, hypothesis 2 is only supported for the relationship between mismatching HR practices and competence.
Employees’ need fulfilment on employee functioning
commitment this did not verify: the correlation was negative, meaning that as the level of clashing HR practices increased, the perceived costs associated with discontinuing the employment relationship with the organization decreased. Finally, autonomy and turnover intentions were negatively correlated: as perceived autonomy increased, respondents’ desire to leave the organization decreased. There was no statistically significant correlation among autonomy, normative commitment, or motivation.
The positive correlation between relatedness and affective commitment was statistically significant. As the perceived belongingness to the organization increased, the respondents’ identification to the organization also increased. Furthermore, as the perceived relatedness of employees with the organization increased, their desire to leave the organization decreased. Yet, relatedness was not correlated with normative commitment, continuance commitment, and motivation.
For competence, only affective commitment was positively correlated. As the level of perceived competence increased, respondents’ affective commitment also increased. Competence was only negatively correlated with turnover intentions. As respondents perceived to be more competent, their desire to leave the organization decreased.
In sum, the results were mixed, but yet there appears to be a standard. Autonomy, relatedness, and competence were positively correlated with affective commitment and negatively correlated with turnover intentions, as previously hypothesized. However, autonomy was negatively correlated with continuance commitment, which is contradictory to hypothesis 3. Therefore, hypothesis 3 is only partially supported.
Table 2. Descriptive statistics and correlations among the clash of HR practices, employee functioning, and employees’ need fulfilment.
The mediating role of employees’ need fulfilment
Before testing hypothesis 4, I used a correlation analysis that showed that the control variables of age, years of work experience, and years worked for the organization were correlated with some of the constructs of employees’ need fulfilment and employee functioning. Specifically, the results showed that the age was positively correlated with competence (r = .52, p < .01) and affective commitment (r = .28, p < .01). This means that as the respondents’ age increased, they felt more competent and identified more with their organizations. Furthermore, age was negatively correlated with turnover intentions (r = -.43, p < .01), suggesting that as the respondents’ age increased, their desire to leave the organization decreased.
The correlation of years of work experience and competence was significant and positive (r = .41, p < .01), meaning that as years of work experience increased, the respondents’ felt more competent in their jobs. Additionally, years of work experience and turnover intentions were negatively correlated (r = -.40, p = .01). As years of work experience increased, turnover intentions decreased.
Years worked for the organization was positively correlated with competence (r = .45, p < .01), affective commitment (r = .27, p < .05), and continuance commitment (r = .27, p < .05). This means that as the years worked for the organization increased, respondents felt more competent, identified more with their organizations, and perceived that the costs of discontinuing the employment relationship were higher. Years worked for the organization was also negatively related to turnover intentions (r = -.38, p < .01), which suggests that as the years worked for the organization increased, the respondents’ desire to leave the organization decreased.
Because of these results, these variables will be used as covariate variables in the analyses of mediation.
The sobel test showed that the effect of mismatching HR practices on affective commitment was only mediated through autonomy, β = .16, p < .10, Z = 1.87, 90% CI [.11, .45]. The regression coefficient was positive, and therefore it suggests that mismatching HR practices provoked feelings of higher autonomy, and therefore, feelings of higher autonomy resulted in higher affective commitment.
The results also showed that the other constructs of employees’ need fulfilment did not mediate the relationship between the clash of HR practices and employee functioning, at p > .10. In sum, hypothesis 4 is rejected.
DISCUSSION
Study 2 showed mixed results. Supportive of hypothesis 1, as clashing HR practices increased, the employees’ desire to leave the organization also increased. There is some evidence that organizational performance can indeed be negatively affected by mismatching HR practices. This happens due to the positive correlation between clashing HR practices and turnover intentions. Moreover, and in accordance with hypothesis 2, as the level of clashing of HR practices increased, perceived competence decreased. Also, as the level of clashing HR practices increased, perceived autonomy also increased, contrary to what was hypothesized. The other results were not significant for hypotheses 1 and 2.
Contrary to hypothesis 3, as the perceived autonomy increased, the perceived costs of discontinuing the employment relationship with the organization decreased. This result contradicts the existing literature, which stated that the satisfaction of psychological needs influences individual well-being, and thereafter, employees need fulfilment (Rosen et al., 2014). As expected for the other results, more autonomous people identified more and had lower desire to leave the organization. These latter findings are also true for relatedness and competence.
In general, the results for hypothesis 4 are not as expected. A positive mediation is only found true for autonomy, and for the relationship between mismatching HR practices on affective commitment.
For all results, we must not forget that age, years of work experience, and years worked for the organization are correlated with some of the constructs of employees’ need fulfilment and employee functioning. For instance, as age, years of work experience, and years worked for the same organization increased, the desire to leave the organization decreases, and feelings of being competent and related increased. These variables could indeed inhibit the negative effects of mismatching HR practices on employee functioning. For instance, albeit an organization has mismatching HR practices, because older, more experienced and more tenured employees feel more competent and related to the organization, the negative impact of a clash of HR practices on employee functioning and employees’ need fulfilment will not be as strong as it would be for younger, less experienced and less tenured employees.
in their organizations are conflicting. In sum, the sample size is small and makes it hard to generalize the findings.
GENERAL DISCUSSION
In this paper I hypothesized that clashing HR practices negatively affect employees’ need fulfilment and that employee functioning mediated this relationship.
Concerning the relationship between mismatching HR practices and employee functioning, study 1 supported that mismatching HR practices influenced negatively normative commitment and turnover intentions. Study 2 also supported that as the level of clashing HR practices increased, turnover intentions also increased. Because a decrease in normative commitment means a decrease in employee functioning, this is harmful for organizational performance. This finding supports previous research of Becker et al. (1997) that mismatching HR practices are harmful for organizational performance. However, it is important to recall that voluntary turnover can have either positive or negative effects on organizational performance (Glebbeek & Bax, 2004). When in a moderate level, it can beneficial for organizational performance. It can have a sorting effect, meaning that low performance employees decide to leave the organization. This, in turn, reduces costs of laying off low performance employees for organizations. Yet, and because HR practices are usually applied to a large number of employees, the effects of turnover intentions on organizational performance will be negative. That is, both high performance and low performance employees will tend to leave the organization, implying replacement costs and the sunk costs of training that have been provided to the leaving employees.
Although study 1 showed that mismatching HR practices did not affect employees’ need fulfilment, the results for study 2 were different. As the extent to which mismatching HR practices increases, employees perceived to be less competent and more autonomous at their jobs. This seemingly contradictory finding might be explained by looking at the signals that management send to their employees. When HR managers advocate conflicting practices, employees might feel the need to rely on themselves (i.e. more autonomous) to decide between cooperation or choose for individual rewards. This might lead employees to feel less competent, because they cannot adhere to everything that is demanded from them (Jiang et al., 2012).
increased affective commitment, motivation, continuance commitment (as exception for autonomy, which was not correlated) and decreased turnover intentions. In both of the studies, an increase/decrease in the satisfaction of basic psychological needs did not mean a change in employees’ perceived obligation to maintain the employment relationship with the organization. Finally, hypothesis 4 was rejected for both studies. While in study 1 there is no evidence of a mediation effect on the relationship between mismatching HR practices and employee functioning, study 2 suggested that autonomy mediated this relationship, however in a positive way. Because of these findings and the fact that employees’ need fulfilment was correlated with employee functioning, it can be that employees’ need fulfilment acts as a moderator and not as a mediator. In conclusion, the complete conceptual model was not supported by these two studies. However, study 1 and 2 showed evidence that as clashing HR practices increased, turnover intentions also increased. Additionally, study 1 showed that the presence of mismatching HR practices participants felt less obligated to maintain the employment relationship. This is a step further in research and can represent one of the underlying processes of how conflicting HR practices influence negatively organizational performance. Additionally, these results have useful managerial implications. For instance, an organization can face high levels of voluntary turnover, but might not be aware that this can be an outcome of mismatching practices. Therefore, these results provide new insights into possible causes of negative employee functioning. Prompt recognition of what causes negative employee functioning can avoid major costs for organizations, by allowing them to take immediate action.
Besides the limitations that were presented in the discussions above, other limitations need to be addressed. Due to the limited scope of this research, motivation represented both intrinsic and extrinsic motivation. However, it might be that individual rewards increases extrinsic motivation. However, intrinsic motivation can be reduced at the same level due to the clash of HR practices. Therefore, the final result on motivation would be zero, because increased extrinsic motivation would compensate decreased intrinsic motivation (Jiang et al., 2012). Second, the sample size used in the study 2 was too small to generalize, especially because more than half of the participants did not experience clashing HR practices in their organizations or their organizations did not use HR practices.
Moreover, a longitudinal study would be a major contribution to the research. This would be useful in an organization that does not apply clashing HR practices, and afterwards makes use of them, or vice versa. This would facilitate the understanding of how employees’ behaviours change from one situation to another.
Additionally, the researcher should take into account other mediators, or moderators. For instance, age, years of work experience, and years worked for the organization can work as moderators that lessen the negative impact of clashing HR practices on employee functioning. Furthermore, when considering employee functioning, motivation could be divided into intrinsic and extrinsic motivation to address both parts of motivation. Also, other components of employee functioning should be taken into account, such as job satisfaction.
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APPENDICES APPENDIX A:
Scenario 1: Presence of both individual rewards and teamwork.
Human Resource Practices in Organizations survey
In the following, you will read about a situation that you could encounter in your working life. Specifically, we are interested in how the Human Resource practices applied in an organization affects employees’ working life. Therefore, you are asked to read the description below carefully. Try to take the perspective of the employee and try to respond to the described situation as if you really were this employee. Please imagine yourself in the following situation as vividly as possible.
Please read carefully the following situation.
You work for an organization for more than a year now (or your current job). You are satisfied with your job, and you have no reasons to complain. Your payment is monthly and fixed (it does not depend on your extra efforts). You also have normal relationships with your coworkers.
The organization decided to apply some changes six months ago in the way the department you work in functions.
First, they changed the payment structure. Your payment consists now in a base salary (achieving a minimal standard performance level) plus an individual reward. This means that if your individual performance is higher than the required standard, you will receive more. As an example, if your job is to produce 10 shirts a day, that would be the minimum stardard. However, if you produce more than 10 t-shirts, you will be individually rewarded for that extra effort.
Second, you were also required to cooperate with your coworkers. The company wants that you and your coworkers work in teams. So, this mean that you will work with your coworkers, but your performance will be assessed individually, in order to achieve the individual rewards.
Applying the example used before, if you produce T-shirts it will be together with your co-workers (common standard). However, your extra reward will be still made individually.
