opportunity, ability and the mediating role of job satisfaction.

(1)

Employee participation in Continuous Improvement: influence of motivation,

opportunity, ability and the mediating role of job satisfaction.

DD MSc Technology and Operations Management Newcastle University Business School at Newcastle University Faculty of Economics and Business at University of Groningen

Asya Dzhabbarova (109277125 / S2874385)

a.dzhabbarova@ncl.ac.uk

a.dzhabbarova@student.rug.nl

Supervisors:

Dr Ying Yang Dr Stefano Fazi

07/12/2015

(2)

i

(3)

ii

Abstract

Over the past decades, due to extremely competitive business environment, the concept of Continuous Improvement (CI) has become incredibly popular among different companies.

However, despite the rich theoretical support from scholars on best implementation practices, attempts to incorporate CI often fail. This can be explained by insufficient emphasis one of the most vital principle of CI: participation of employees. Managers often neglect this aspect, while stressing attention on process performance rather than workers and behavioural aspects. This can result in unwillingness of employees to participate due to dissatisfaction with their job. This research is aimed at investigation of the relationship between three factors of the popularised Motivation-Opportunity-Ability (MOA) framework and employees’ participation in CI.

Moreover, the effects job satisfaction and its mediating role were also examined. An explanatory quantitative research was performed and collected data was subsequently assessed by means of statistical tests. The outcomes of analyses revealed that MOA factors indeed have significant and positive influence on employees’ involvement in CI. Furthermore, job satisfaction had a mediating effect on the relationship between the constructs of the MOA model and the variable of participation. Current study addressed several literature gaps by combining different areas of research within different domains of Operations Management, Behavioural Operations Management and Psychology. From practical perspective, certain suggestion have been made to managers based on the outcomes of the study. In addition, suggestions for further research were provided.

Keywords: Continuous improvement; employee participation; MOA model; job satisfaction;

Behavioural Operations.

(4)

iii

(5)

iv

v

II.2 Factor analysis (Opportunity). Assumptions, Correlation Matrix, Total Variance Explained .... 67

II.3 Factor analysis (Ability). Assumptions, Correlation Matrix, Total Variance Explained ... 68

II.4 Factor analysis (Job Satisfaction). Assumptions, Correlation Matrix, Total Variance Explained ... 69

II.5 Factor analysis (Participation). Assumptions, Correlation Matrix, Total Variance Explained .. 70

APPENDIX III. SCATTERPLOTS FOR CORRELATION ANALYSIS. ... 71

APPENDIX IV. ASSUMPTIONS FOR SIMPLE AND MULTIPLE LINEAR REGRESSION... 72

VI.1 Simple linear regression. Motivation → Job Satisfaction. ... 72

VI.2 Simple linear regression. Motivation → Participation ... 73

VI.3 Simple linear regression. Opportunity → Job Satisfaction ... 75

VI.4 Simple linear regression. Opportunity → Participation ... 77

VI.5 Simple linear regression. Ability → Job Satisfaction ... 78

VI.6 Simple linear regression. Ability → Participation ... 79

VI.7 Simple linear regression. Job Satisfaction → Participation ... 81

VI.8 Multiple Linear Regression. Motivation + Job Satisfaction → Participation ... 83

VI.9 Multiple Linear Regression. Opportunity + Job Satisfaction → Participation ... 85

VI.10 Multiple Linear Regression. Ability + Job Satisfaction → Participation ... 87

APPENDIX V. PARTIAL CORRELATION ANALYSIS. ... 89

(7)

1 CHAPTER 1. INTRODUCTION

Over the last decades, business environment underwent major transformations due to globalization and technological breakthrough. This lead to an increased demand from more informed customers and emergence of time and quality as key competitive business concepts (Bayraktar et al., 2007). This resulted in rapid pace of innovation, high uncertainty of business environment and fierce rivalry among organizations.

“It takes all the running you can do, to keep in the same place” (Carroll, 1969, p.76) This so-called Red Queen Phenomenon indicates that companies have to constantly develop and evolve in order to survive and remain stable positions on the market (Sanchez and Blanco, 2014).

Hence, Continuous Improvement (CI) is one of the most vital aspects in achieving business excellence for any organization; in despite of the size of enterprise, location and main focus on manufacturing or service industry (Fishman, 2010). Rapid diffusion of this concept was influenced by its low entry barrier due to relatively lower costs of implementation and level of specialized knowledge required in comparison with traditional improvement approaches (Bessant et al., 1994).

However, despite all attractions and benefits by which CI philosophy is characterized, implementation of these practices often fail. Although, there are many theoretical conclusions in terms of requirements for resources, tactics and strategies in the context of CI, little attention is dedicated to the behavioural aspects. Managers often neglect the “soft” aspects of CI, which include people and behavioural factors. While giving most of their attention on production output and performance, employers do not put sufficient emphasis the cornerstone of CI methodology – employees, who should be recognized as the most valuable asset of any organization.

One of the underlining principles of successful implementation of CI practices is participation

and involvement of staff, as workers are considered to be the main source of output (Koo et al.,

1998). All levels of organization from top-management to shop-floor workers are required to

fully participate in improvement programs that are intended to enhance overall organizational

performance. Nonetheless, this aspect is often underestimated, although it has been mentioned in

various researches. Furthermore, there are factors influencing workers’ participation, such as job

satisfaction, investigation of which can throw light on the issue of organizational ability to

encourage involvement of staff in the change. Aspects of job satisfaction have been investigated

before but it is of high interest to examine the relationship between these two aspects in the light

of CI.

(8)

2 It has also been identified that employees’ satisfaction with their job is influenced significantly by other important aspects. Since higher-level managers of the company control almost every aspect of the working process, it is often the case, that their entire focus is concentrated on process output while subordinates are neglected (Womack, 1996). Therefore, in this study, factors that can have an impact on employees’ job satisfaction and participation in CI will be represented by the MOA model (Rothschild, 1999), components of which (Motivation, Opportunity and Ability) have been studied extensively both separately and as parts of different frameworks. Examination of factors influencing job satisfaction through MOA have not been yet researched with relation to participation in CI. Hence, the following Research Questions are addressed in the proposed study:

RQ1: In what way do factors of the MOA model influence employees’ participation in CI?

RQ2: What is the impact of MOA factors on the job satisfaction level of employees?

Since it is anticipated that MOA factors will have impact on workers’ participation and their job satisfaction, it can be also of high interest to see what is the effect of job satisfaction on the relationship between participation and dimensions of the MOA framework. Hence the following question is asked:

RQ3: What is the effect of job satisfaction on the relationship between participation and MOA factors?

Therefore, this research is aimed at the attainment of insights with regards to the relationship between MOA factors and participation, since it is important to consider dimensions that can influence employee involvement in CI on an individual level and take behavioural aspects into account. Moreover, the study will investigate in what ways job satisfaction can influence the relationship mentioned in the RQ1.

The first chapter will provide a theoretical overview on each dimension of this study. Based on this theoretical ground, certain relationships between the constructs of interest will be hypothesised. The following chapter will elaborate on the methodology of this research, where choice of research method will be justified. Furthermore, all variables will be operationalised and data collection procedure will be explained. Subsequently, the quality of collected data will be examined and hypothesised relationships will be assessed using statistical analysis techniques.

The next section will present the outcomes of data analysis and report whether the proposed

hypotheses are supported or rejected. Then the obtained results will be discussed and theoretical

(9)

3 and managerial implications of this study will be examined. Finally, the last chapter will

conclude this report and limitations of this study will be assessed.

(10)

4 CHAPTER 2. LITERATURE REVIEW AND HYPOTHESES DEVELOPMENT

The aim of the following chapter is to provide a theoretical overview on the variables and frameworks that serve as a basis for this study. The first section will introduce the theory of CI and provide details about the context of current research. Subsequent section focuses on the particular aspect of CI, namely, employee participation and explains what are the possible drivers of it. The third part concentrates on the matter of job satisfaction, whereby, the importance of this factor is analysed and different frameworks of influencing dimensions are presented. Finally, the MOA model is introduced and the underpinning conceptual model of this research is demonstrated alongside with the hypotheses of interest.

2.1 Continuous Improvement (CI)

According to De Leede and Looise (1999), Continuous Improvement (CI) is an extremely widespread phenomenon that has been considered as a crucial element for achieving superior business excellence. It has first been adapted within traditional manufacturing-orientated systems that were purely focused on product quality and improvement of production lines in order to reduce waste (Bhuiyan and Baghel, 2005). However, rapid changes of business environment encouraged CI to become an imperative part of the organizational development on a large-scale.

To meet the challenges of the unpredictable and uncertain business environment, the modern approach to the quality management – competitive continuous improvement – should be deployed. In this case, the primary concern for the company is to be flexible, responsive and adaptable to strategical alterations based on the customer feedback and benchmarking against rivals. In order for the organization to acquire all these competitive advantages and attain the capability to instantly adjust its plan of actions towards the changes within the environment, the adoption of a sound strategy of CI is considered to be essential (Kaye and Anderson, 1999).

This led to emergence of CI in new comprehensive management theories and methodologies

such as Lean Management, popularized by Womack at al. (1990); TQM (Ishikawa, 1985),

Theory of constraints (Goldratt, 1990) or Six Sigma (Klefsjo, 2001), which include CI as a basic

and essential aspect. The attractiveness of CI lies in its ability to enable production with greatest

possible emphasis on quality and lowest costs (Bessant et al., 1993). Furthermore, although CI

can be recognised as a key element of quality management programmes, it is also applicable to

other areas such as ethical and environmental issues (Bessant et al., 1994). Nevertheless, despite

the fact that CI has evolved over the course of the time, the basic driving force of this

development is the infinite pursuit of organizations to improve (Bhuiyan and Baghel, 2005).

(11)

5 The importance of CI in real business environment has been reflected and discussed from different perspectives in a broad spectrum of research papers within the academic world. An extensive number of studies focused on the implementation of CI in various organizations and included theoretical propositions of implementation methodologies that have not been tested yet (e.g. Jun et al., 2004).

According to Berger (1997), the concept of CI arises from the Japanese term “Kaizen”, which has been introduced to the management world as the “missing link” that explained superior performance of Japanese competitors. The Japanese experience subsequently served as a blueprint for definitions and concepts that underpin the Western theory of CI (Berger, 1996).

One of the most well-known proponents of kaizen was Masaaki Imai who described the core aspects and principles of this philosophy. The term consists of two aspects: Kai (Change) and Zen (to improve). If the ideal type of kaizen characterised by Imai (1986) is analysed, then the core principles of CI can be determined (Berger, 1997):

1) Process-orientation

“Kaizen is process-oriented, i.e. before results can be improved, processes must be improved, as opposed to result-orientation where outcomes are all that counts” (Imai, 1986, pp. 16-17)

If the process is lacking control and improvement procedures, good results alone are insufficient, since these can be an outcome of other unknown factors. Hence, this principle states that it is important to concentrate on process improvement first rather than focusing solely on the outcomes of the process (Berger, 1997).

2) Continuous maintenance and improvement of standards

“Lasting improvements can only be achieved if innovations are combined with an ongoing effort to maintain and improve standard performance levels” (Imai, 1986, pp. 6-7)

According to Imai (1986), no improvement is possible in the absence of standards. Operational principles within the organization must be maintained and developed through incremental changes that will ultimately lead towards increase in the overall performance. Maintenance is defined as certain activities directed towards upholding current techniques, managerial standards and operations, where such standards are supported through discipline and training.

Improvement, in turn, refers to actions aimed at the elevation of existing standards (Singh and

Singh, 2009). CI is not an independent activity. Conversely, CI represents a “never-ending

journey towards quality and efficiency” (Brunet and New, 2003, p. 1427). It is a cycle of step-

(12)

6 by-step innovations that must be performed over time, as opposed to dramatic, one-time, complex and technologically based changes (Manos, 2007).

3) People orientation

Any improvement process must involve every member of staff within the organization from top- management team to the shop-floor workers. In addition, Imai (1986, p. 40) states: “Kaizen is based on a belief in people’s inherent desire for quality and worth, and management has to believe that it is going to “pay” in the long run”

Therefore, the nature of CI is participative and requires the involvement and intelligence of the workforce to generate not only the benefits of production improvement but also enhance quality of the working life and intrinsic physiological state of employees (Brunet and New, 2003).

Research shows that CI should occur at three organizational levels: at the management, group and individual levels. In order to attain benefits from improvement programmes, CI needs to be applied at each of them. At the management level CI is concentrated on the strategical aspects of the company, group level focuses on problem-solving, while individual level is responsible for the routine tasks (Bhuiyan and Baghel, 2005).

As described by Bessant et al. (1993), there are two distinct features of CI. Essentially, it does not rely on expensive machinery or other capital intensity, but emphasises the importance of harnessing and the development of unrealized creativity and enthusiasm of all employees within the organization. Furthermore, implementation and preservation of CI is recognized as a challenging task for many companies due to necessity of change in organizational culture and a commitment to a process of continuous transformation.

As a result, there is a requirement for steady adaptation of a company to change and need for learning and development at all levels of the organization. Therefore, the role of human resources and its management in the journey of CI should not be underestimated (Bessant et al., 1993). Although management introduces all improvement activities and decides about the goals and resources, without the engagement of employees CI simply will not occur (Swartling and Poksinska

,

2013). Therefore, it is crucial to realise that people are one of the most important assets for companies and their involvement, participation and contribution towards organizational improvement is a vital factor for successful implementation of continuous development programmes (Denton, 1995).

Sanchez and Blanco have conducted a research in 2014 and provided a literature overview on CI

and analyse evolution of the philosophy over the course of 30 years. According to the results of

(13)

7 content analysis of more than 1000 articles (Table 2.1), topics focused on human resources and dedicated to importance of staff participation in CI constitute only 9.8%. Despite the fact that this subject is the third most common topic, articles focused on methodologies and implementation constitute 18.9% and 36.8% respectively. Therefore, although academic literature puts a lot of emphasis on CI philosophy, it falls short on attention to one of the most significant and underlining principles of it.

Table 2.1 Outcomes of content analysis by Sanchez and Blanco (2014)

Topics Number of articles

Implementation 550

Methodologies 279

Human Resources 146

Management Philosophies 166

Culture 101

Control 96

Concept 78

Factors 59

Innovation 20

2.2 Employee Participation in CI

Within the last 30 years, the concept of quality management has changed due to ongoing attempts to find new approaches for improvement of organizational routines and overall performance. Initially, the term “quality” was limited to manufacturing processes and statistical process control, but soon it evolved to include improvement practices aimed at employees and organizational culture (Mellat-Parast, 2013). Nowadays, the turbulences of the external environment force companies to adopt strategies that focus on increase of involvement and participation in innovation by staff members of organization.

Bhatti and Qureshi (2007, p. 54) define employee participation as “a process in which influence

is shared among individuals who are otherwise hierarchically unequal”. Employee participation

may come in a variety of different forms, where no two efforts can be alike. The scope of

participation activities can range from regular suggestion boxes, group-involvement and group

participation up to combined goals setting and subsequent gainsharing (Showalter and

Mulholland, 1992). Also, at one side of the spectrum there are informal and short-term ad hoc

team efforts that are aimed at overcoming certain issues or inefficiencies. On the other hand,

(14)

8 there are self-directed groups of employees that are in charge of making decisions concerning the production process. Between these two extremes, there are participation efforts that include regular team activities with limited authority of employees concerning the identification and solution of problems. However, all these forms of participation will differ from one another as they are structured in a particular way to meet certain conditions and circumstances of the company (Cooke, 1994).

Senge (1992, p. 32) argues that: “Continuous improvement is a natural by-product of people’s commitment”, thereby emphasizing importance of the “soft” side of CI, which is focused on behavioural aspects rather than tools and techniques. However, in reality, most managers and employers neglect this factor aiming most of their attention towards “hard” measurements and control aspects of CI (Wilkinson et al., 1997). Koo et al. (1998) argue that task-orientation of companies must be augmented by behavioural elements. Although shop-floor employee involvement in CI programs is essential, it is often oversighted by both management and consultants, who make tremendous effort to complete the change project but omit to understand the importance of “soft” aspects of the event. Since employees are the primary producer of output, they should be considered as a central figure of successful implementation of CI practices; their personal commitment and participation in CI are essential (Mahadevappa and Kotreshwar, 2004). As Garcia-Lorenzo et al. (2000) highlighted, staff awareness of the need for change and change implementation is not sufficient; active participation acts as a basis for a favourable outcome of the development program. Furthermore, participation and involvement of employees is a necessity and considered to be an integral part of implementation and development of CI practices within organizations (Berling, 2000).

Multiple researchers drew attention to the significance of social aspects integration into the overall organizational CI strategy, since positive relation between employees’ participation and success of CI programmes implementation has been identified during conducted studies.

Empirical research conducted by Powell (1995), indicates that various soft quality practices

concentrated on achieving higher employee involvement in improvement programmes lead to an

increased level of operational performance and sustainable competitive advantage. This is due to

the fact that experience and knowledge held by the lower-rungs employees of the company is the

under-utilized source of novel ideas that can potentially add value to the organization (Yang and

Konrad, 2011). Non-management staff participation is an opportunity to inject relevant

information and knowledge into decision-making process within the higher levels of

organizational hierarchy. An extensive body of knowledge suggests that employees generally are

more familiar with the processes / day-to-day routines and, therefore, possess more competencies

(15)

9 and knowledge, than managers do (e.g. Levine 1990; Miller and Monge 1986). Thus, staff plays a strong complementary role when it comes to planning and scheduling, workflow arrangement, obstacle bypassing and overall quality improvement process (Cooke, 1994).

Despite the fact that staff participation results in increase of operational performance, there are also soft advantages. Cooke (1994) states that a significant benefit of employee involvement is that staff members achieve inherent rewards from work in comparison with traditional forms of management. These positive outcomes can help to build up mutual trust, improve employee- supervisor relationships and encourage workers to attain new production goals and objectives.

Another beneficial consequence is that staff members become more flexible and positive with regards to adjustments of existing organizational policies aimed at both human resources and production process. In addition, participating employees are more prone to apply their power in more productive and positive direction than they otherwise would be (Cooke, 1994).

Although major benefits can be attained through employee participation, there are certain barriers that can inhibit workers’ willingness to be involved in CI programmes. Incorporation of improvement plans can be viewed as an organizational change process which is defined as:

“Planned alteration of organizational components to improve the effectiveness of organizations”

(Cawsey et al., 2012, p.1). Tangible components (e.g. production lines, new positions and departments) are concrete and easier to understand when it comes to pursuing change. However, more deeply imbedded targets, such as willingness of employees to be involved in CI are challenging to achieve. The change leader, who is initiating alteration, can plan to shift towards a more participative culture but taking actions and sequencing those actions is more complicated.

Announcement of new organizational strategy might not lead to significant changes and certain efforts are required to turn new vision into reality (Cawsey et al., 2012).

It is important to consider that incorporation of CI practices has a major influence on all

personnel involved, since establishment of any improvement programmes carries certain

consequences (Hasle et al., 2012). If change leaders take an initiative to change a significant

organizational component, they are shifting something relatively permanent and this can have

major outcomes for the employees. Generally, managers choose to alter certain and concrete

tangible elements since these are more effortless to plan and engineer and the outcomes of such

changes are easier to see (Cawsey et al., 2012). However, as pointed out by Womack (1996),

excessive emphasis on quality and performance improvement can result in disregard of

employees as preliminary critical success factor or even worse, redundancy of workers. In his

article, using the example of lean production, Womack (1996) demonstrates the issues, which

(16)

10 arise when development plan is implemented. For instance, when the process becomes more efficient, managers tend to lay off the workers and this leads to rejection of novel practices on the shop floor and unwillingness to participate. Besides that, an extensive body of knowledge suggests that, restructuring of workplace (routines, policies, schedules) can result in severe health problems (Anderson-Connolly et al., 2002; Babson, 1993; Kochan and Lansbury, 1997);

stress and fatigue caused by increase in workload and intensity (Conti et al., 2006); thus, leading to an overall job dissatisfaction. Consequently, these effects negatively influence subordinates and their willingness to participate in such process decreases dramatically.

However, according to the research of Conti et al. (2006) while the elevated workload and intensity of the job had negative outcomes, practices aimed at employee support resulted in less stress, increased satisfaction and workers’ commitment. The study confirmed that if certain

“humane” or “soft” practices aimed at employees are implemented alongside with alteration of operations process, the issues such as job stress, dissatisfaction, lack of commitment and high labour turnover can be resolved. More importantly, incorporation of such people-orientated programmes did not degrade the performance. Therefore, improvements aimed towards soft practices can be crucial for increase of employee participation in CI and become a strong addition to the overall strategy.

2.3 Job Satisfaction

Locke (1976, p.13000) defines job satisfaction as: "…positive emotional state resulting from the

appraisal of one's job or job experiences". It is suggested that job satisfaction is not a fixed state

but a subject to alteration and modification from both external and internal forces. Internal forces

that influence individual’s perceptions are his or her personal characteristics and the force that

acts outside the individual is the immediate working environment (Baran, 1986). Kalleberg

(1977) specifies that the term “job satisfaction” must be distinguished from the satisfaction with

particular dimensions of the work-role employee is currently occupying. This implies that job

satisfaction is a unitary concept and individuals can be characterized by a defined attitude toward

their overall job situation. However, despite the unitarity of job satisfaction term, it is not

indicated that the causes of this attitude are not multidimensional. Certainly, person can be

satisfied with one aspect of his/her job while being dissatisfied with another. However,

individuals can balance particular satisfactions against specific dissatisfactions and arrive to a

conclusion about the level of satisfaction/dissatisfaction with their job (Kalleberg, 1977).

(17)

11 Over the last 25 years, an extensive body of knowledge has been attained concerning job satisfaction. Although job satisfaction is a major research topic in the field of psychology, a lot of attention has been dedicated to this aspect in the area of operations and production management; satisfaction has been studied through the lenses of different areas and from many perspectives.

Job satisfaction is a significant element of employee’s well-being within the organization, since it has major effect on work outcomes (performance, efficiency etc.) and plays a vital role when it comes to the individual’s mental health and psychological well-being (Hajdukova et al., 2015). It is also considered to be a desired indicator of company’s success (de Menezes, 2012). According to Voon et al. (2011), prosperous firms generally have satisfied employees while lack of job satisfaction can considerably undermine organizational performance. This is due to the fact that level of job satisfaction is a direct indication of employee’s working behaviour. Low level of job satisfaction may result in reduced stability, discipline, responsibility along with decreased stress resistance, lower power and early retirement (Hajdukova et al., 2015). A number of studies investigated the relationship between job satisfaction, performance and employee productivity.

For instance, Miller and Monge (1986) proved that job satisfaction improves productivity through increasing working capabilities of an individual. Other researches state that satisfaction of the needs of employees can be considered as a positive attempt to increase productivity and performance (Petty et al., 1984). Hence, the aspect of job satisfaction is considered to be of high importance, since it is impossible to expect high quality service or product from an employee whose work is not satisfying (Lam, 1995).

Another favourable outcome of employees’ job satisfaction is the positive relation with organizational commitment. According to Guimarates (1996), workers that are satisfied with their job and career are more expected to retain their membership within the organization, because committed employees are less likely to retire, than staff members whose career has been less gratifying. The study of de Menezes (2012), aimed at investigation of job satisfaction impacts across the companies that adopted different quality management programmes, has confirmed that a positive relationship between job satisfaction and organizational commitment can be observed. Therefore, if companies focus on increasing the satisfaction level of their workers, they can confidently strive against high labour costs and employee turnover (Mohr and Zoghi, 2008).

Job satisfaction has been also extensively researched as part of a so-called organizational

citizenship behaviour (OCB), which is defined by Organ (1988, p.4) as: “Individual behaviour

(18)

12 that is discretionary, not directly or explicitly recognized by the formal reward system, and that in the aggregate promotes the effective functioning of the organization”

Numerous studies have been conducted to investigate the relationship between job satisfaction and OCB (e.g. Bateman and Organ, 1983; Puffer, 1987; Organ and Konovsky, 1989). These researches have been conducted across various industrial sectors and indicated that job satisfaction is directly proportional to OCB. Therefore, a satisfied employee is highly capable of contributing toward the overall organizational effectiveness.

Other researches within the field of operations management include examination of the link between job satisfaction and characteristics of job design – autonomy (Hussain and Mujtaba, 2013) and complexity (Chung-Yan, 2010). However, in despite of the substantial amount of academic papers, which indicate the benefits of job satisfaction in various dimensions of operational theory, there are certain obstacles that arise when the company incorporates CI programmes.

Generally, it is expected that different measures of performance and quality management would lead to high levels of job satisfaction. However, it is excessively optimistic to establish a CI programme and anticipate the desired results without attempting to improve the quality of the working life for employees (Lam, 1995). Overemphasizing the “hard” side of improvement can have negative consequences on satisfaction and thus prevent the company from sustaining the long-term improvements that have been initially achieved (Hines et al., 2004). In many cases organizations may become overly focused on driving operational and bottom-line improvements and can neglect aspects of welfare and development of individuals (Fletcher and Williams, 1996). In the study conducted by Fletcher and Williams (1992), lower levels of job satisfaction have been observed when management was mainly concentrated on increasing process output rather than the “soft” side of organization. This is also supported by the research of Rodriguez et al. (2015), who combined lean techniques with human resource practices and demonstrated a significant increase in job satisfaction. Unfortunately, few organizations have established job satisfaction as one the top-priorities and take into account the “people-orientation” feature of the CI philosophy.

Another aspect that should be considered is the fact that introduction of quality improvement

programmes is expected to influence many aspects of employees’ job and work. Implementation

of CI practices may lead to the emergence of new policies, organizational structures, new

operational processes and performance measures and all these may have a significant influence

(19)

13 of employees’ daily routines (Lam, 1995). This, in turn, may result in an increase of work intensity and responsibility, which can cause overall dissatisfaction, subsequent rejection of CI practices and unwillingness to participate.

As for the context of employee participation in CI, there are multiple empirical researches and academic investigations, which focus on the link between worker’s participation and job satisfaction. Different academic papers suggest that job satisfaction is positively related with workers’ participation level in companies. For instance, the study of Mohr and Zoghi (2008) demonstrated that there is a strong positive relationship between the level of participation and satisfaction of employees. They found that increased input from employees or their direct involvement in operational problem solving resulted in greater level of job satisfaction and performance. Based on this conclusion, Rodriguez et al. (2015) conducted an independent research to demonstrate how certain aspects of high-involvement job design (autonomy, feedback, teamwork) can influence job satisfaction in the context of lean production. The outcome of the study revealed that there is significant increase in perceived job satisfaction when high-involvement work design is introduced.

Another example from quality management literature suggests the Job Characteristics Theory (JCT), developed by Hackman and Oldham (1976) who argue that job features such as participation on a par with other job characteristics (learning, autonomy, etc.) will increase satisfaction. However, there are certain pitfalls with regards to using this framework. According to Fried and Ferris (1987), existing empirical evidence of the JCT lacks precision and consistency in using measurement tools to assess each dimension of the model.

It is also worth mentioning that there is another competing theory, whereby academic literature recognises the fact that job satisfaction itself has an impact on employee participation. According to Mohr and Zoghi (2008), although a positive relation between participative practices employed within the organization and evaluative judgement that individuals make about their job in terms of satisfaction can exist; the direction of causality may also run in a different direction.

Academic studies reveal that both direct and indirect relationships have a right to exist. For

instance, Swartling and Poksinska (2013) argue that in order to create a motivational culture that

will encourage employee participation in CI, the factors influencing dissatisfaction must be

eliminated. They state that once causes of employees’ dissatisfaction are removed, the factors,

which build motivation, can contribute towards the establishment of a motivational culture that

influences participation. Thus, an indirect relationship between job satisfaction and participation

in CI has been recognised.

(20)

14 On the other hand, Mohr and Zoghi (2008) suggest that there is a certain possibility that job satisfaction can directly influence employee participation. Their empirical research also aimed to identify the direction of causality and additional estimations revealed unexpected results:

participation did not predict alterations in satisfaction. Although the empirical findings did not provide a definite result, additional estimations presented by the authors demonstrate that the direction of causality was opposite to what has been proposed in the majority of previous researches. Unlike in other studies on job satisfaction, where satisfaction is an outcome of employee participation, this article argued the reverse: satisfied workers were significantly more willing to participate in particular workplace practices than employees, who perceived their job as less satisfying.

Since Mohr and Zogri (2008) indicated that this direction of causality, where satisfaction predicts employee participation, has been lacking attention in the prior literature, it is proposed to take a new approach. This study is aiming to conduct an empirical research that will attempt to investigate the influence of perceived job satisfaction on participation. In addition, as the proposed research is focusing on continuous improvement within organizations, expected conclusions with regards to the aforementioned relationship will be reflected in the light of CI.

In addition, it is also of high interest to investigate the factors that can trigger a positive evaluative judgement that employees make about their job. It is important to find the root cause of the alterations in the level of job satisfaction of the employees in order to develop a powerful framework for coping with unsuccessful implementation of CI practices due to failure of adopting people-orientated practices.

There is an extensive body of academic literature aimed at the investigation of aspects that affect job satisfaction. For instance, the well-known Dual-Factor Model (or Motivation-Hygiene Theory) of job satisfaction and motivation, developed by Herzberg and Mausner (1959). In short, authors of this framework argue that job satisfaction and dissatisfaction are caused by different factors – motivation and hygiene factors respectively. Motivation relates to the inner forces of individual that cause the person to perform, whereas hygiene factors are the aspects of working environment. This theory caught attention of both phycologists and industrial managers who conducted numerous researches on this matter and developed other models with regards to job satisfaction grounding their thoughts on the two-factor theory (House and Wigdor, 1967).

However, the framework has received a lot of criticism since no empirical justification has been

found. First, the methodological ground was a subject to mistrust, since authors did not specify

the measurement of motivation/hygiene factors. Another flaw, according to House and Wigdor

(21)

15 (1967), is the fact that authors failed to take individual differences into account. Moreover, only internal motivating factors were considered.

Another popular framework for explanation of individual’s job satisfaction is Maslow’s (1943) Need Hierarchy Theory (figure 2.3). This framework was initially developed to explain motivation, but was soon adapted to demonstrate the underpinning dimensions of job satisfaction (Dachler and Hulin, 1969; Mobley and Locke, 1970). Maslow’s theory suggests that employee’s needs consist of five levels: basic physiological needs (financial compensation and healthcare);

safety, represented by job security and on-site safety policies; belonging to the workplace in the form of positive relationships with co-workers, which leads esteem, where individual feels respected and appreciated by organization; and, finally, these aspects result in self-actualization depicted by professional growth and development opportunities (Wahba and Bridwell, 1976).

However, despite the initial popularity of the approach, this framework became less utilized due to certain weaknesses. This model received a lot of criticism since it does not account for cognitive processes of employees and, generally, lacks empirical evidence that can support the theory behind it (Spector, 1997).

Figure 2.3 Maslow’s (1943) Need Hierarchy (Mollahan, 2011)

In the context of the present study, another methodology is followed. Factors affecting job satisfaction of the shop-floor employees were conceptualised using other constructs. This study attempts to adapt the widely known MOA framework for this research and determine what the impact of each aspect on job satisfaction is.

2.4 MOA framework

As it was argued before, incorporation of CI practices leads to transformations of routines, which

sometimes can be challenging to accept for employees. Furthermore, resistance to participate

might be caused by dissatisfaction, which in turn can arise from inability of workers to be

engaged in CI programmes due to certain restrictions (e.g. lack of knowledge, understanding,

experience). It is proposed to utilize the popular Motivation-Opportunity-Ability (MOA)

(22)

16 framework as a basis for investigation of possible factors that can have an influence on employees’ job satisfaction level and their willingness to participate in CI.

The MOA framework is a well-established theoretical foundation within the organizational behaviour literature for explanation of work performance (Blumberg and Pringle, 1982;

Boudreau et al., 2003). However, in recent years, this framework has been applied to examine such aspects as effectiveness of Human Resource Management practices (Bos-Nehles et al., 2013); social marketing (Binney, 2003) and various behavioural phenomena: customer’s choice (MacInnis et al., 1991), knowledge management (Argote et al., 2003; Siemsen et al., 2008), and learning (Sterling and Boxell, 2013).

According to Siemsen et al. (2008), MOA framework originated in the field of psychology, where various scholars argue that work performance can be viewed as a function of individual’s motivation and ability to perform a certain behaviour, since motivation alone does not result in high performance (Sinding et al., 2014). Later, opportunity has been added as an explanation of remaining factors that prevent employees from achieving high performance. Therefore, the framework is focused primarily on an individual level and the underpinning principle of the model is the assumption that employees, who have an opportunity to execute the task and who have the requisite skills and incentives to do so, are more likely to perform a certain behaviour than those workers who do not possess these attributes (Buller and McEvoy, 2012). Within this classic MOA framework Motivation (M) is described as an individual’s willingness to act;

Opportunity (O) is represented by contextual or environmental mechanisms, which enable action; Ability (A) corresponds to one’s knowledge base with relation to action (Rothschild, 1999). However, prior to elaborating on different competing variations of the framework that exist, the MOA constructs will be explained.

2.4.1 Motivation

Motivation has a diverse number of drivers and sources. Although motivation is often treated as

a singular concept, academic literature suggests that individuals are encouraged to act by a

variety of different factors. According to Ryan and Deci (2000a): “People can be motivated

because they value an activity or because there is a strong external coercion” (p.69). Therefore,

motivation can be a by-product of internal and personal interests and values or become a matter

of reasons external to the self. In both cases, the amount of motivation does not vary but the

source of it does. This reflects the two distinctive orientations of motivation: intrinsic and

extrinsic motivation. Thus, the more internalized the nature of individual’s motivation, the more

intrinsic it can be considered.

(23)

17 Literature refers to the term of intrinsic motivation as “doing of an activity for its inherent satisfactions rather than for some separable consequence” (Ryan and Deci, 2000b, p. 55). This form of motivation arises from the individual himself and is a natural tendency to learn or explore that does not require any extraneous incentives to do so (Ryan and Deci, 2000b). Ryan and Deci (2000a) argue that comparison between people whose motivation is self-authored to those who are externally controlled for an action revealed, that the former, relatively to the latter, are more creative and interested in performing certain behaviour/task.

Although intrinsic motivation is a very important type of motivation, most people do not perform some activities due to being internally motivated. The form of motivation that contrasts intrinsic motivation and arises from external prods, pressures and rewards is referred to as extrinsic motivation. Extrinsic motivation will emerge when an employee is driven by something outside the work itself, for instance, expected gratitude or rewards (Amabile, 1993).

2.4.2 Ability

The term ability refers to individual’s knowledge of how to perform expected tasks and act in certain conditions or skills and proficiency at solving problems. More precisely, ability can be defined as cognitive and physiological capabilities of an individual that enable him to execute the task. These can be represented by employee’s knowledge, skills, intelligence, level of education and similar variables (Blumberg and Pringle, 1982).

The conception of ability is also linked to the task difficulty and these terms are often self- referenced, where levels of ability and task difficulty are judged in relation to one’s understanding or mastery. A mastery of tasks in which an employee was uncertain of being able to master, due to being difficult, indicates his greater ability (Nicholls, 1984a). Furthermore, research indicates that employees with more abilities require less effort to achieve the equal level of performance or will obtain more with an equal effort in comparison with other individuals (Nicholls, 1984b).

The cognitive and physiological determinants of ability are usually associated with motivational factors to explain the probability of performance. However, there is a third dimension – opportunity – that also plays a strong role in predicting performance.

2.4.3 Opportunity

The construct of opportunity has been majorly overlooked in the theoretical domain of work

performance. Traditionally, it was assumed that performance, in large part, is determined by the

interactive relationship of motivation and ability (Blumberg and Pringle, 1982). However, the

(24)

18 capability of this formulation to account for any additional alterations in performance “has been singularly unsuccessful” (Campbell and Pritchard, 1976, p. 91) and certain shortcomings of this interpretation have been identified. For instance, when attempting to organize what is known about work performance, many variables that predict this construct do not fall under neither motivation nor ability categories (Blumberg and Pringle, 1982).

According to Blumberg and Pringle (1982), theoretical evidence suggests that there are certain environmental factors beyond the employee’s control, which have a significant influence on his or her performance. Therefore, likewise the social, psychological, and physiological aspects of work, there are other determinants, which predict certain behaviour. Although individuals can be sufficiently motivated and possess an appropriate level of ability to perform, consummation of tasks can depend upon presence of circumstances within person’s environment. The circumstances can be represented by physical and technical conditions, actions of co-workers and supervisors, and organizational policies and procedures. All these factors can be classified into two categories namely states of nature and actions of others and be combined under one term of opportunity.

The formal definition of this term provided by Blumberg and Pringle (1982, p. 565) is as follows: “Opportunity consists of the particular configuration of the field of forces surrounding a person and his or her task that enables or constrains that person's task performance and that are beyond the person's direct control”

2.4.4 Variations of MOA framework

In traditional MOA model, individual’s behaviour is predicted by the interplay of three dimensions that are considered to be essential. The model proposes moderate complementarity among three factors by projecting that action is a function of motivation, opportunity and ability.

This means that all aspects M, O and A have to be present to a certain degree in order for the behaviour to occur, otherwise, lower values of any of these variables are hypothesised to strongly reduce action (Blumberg and Pringle, 1982). This interactive interpretation of the model leads to the following specification, namely the multiplicative model (Bos-Nehles et al., 2013):

𝑃 = 𝑓(𝑀 × 𝑂 × 𝐴) (1)

Although the multiplicative model has been subjected to academic research, there is a lack of

empirical evidence that can validate it (Siemsen et al., 2008). Cummings and Schwab (1973)

argue that action can be expected to be extremely limited or non-existent in case of classic

interpretation (if one of the values is zero, overall function is zero). They also suggest that action

(25)

19 can be predicted equally sufficiently and adequately if no complementarity between the components of the MOA model is captured at all, thereby leading to the emergence of another variation of the framework.

Several researches including Boxall and Purcell (2003), Cummings and Schwab (1973) argue that performance is described better by an alternative additive model, whereby, each performance influencing factor has a direct and independent contribution:

𝑃 = 𝑓(𝑀 + 𝑂 + 𝐴) (2)

Unlike in the multiplicative model, where neither motivation nor opportunity nor ability can guarantee the occurrence of the action, such relationship leads to an increased performance when one of the factors is boosted (Bos-Nehles et al., 2013).

In the context of the present study, factors that are expected to have impact on employees’ level of satisfaction with the job will be represented by three constructs of the additive MOA framework. So far, this is the very first attempt to incorporate the MOA model in this kind of research setting. Also, it is of high interest to understand, whether the MOA factors have an indirect influence on the level of employees’ participation in CI through the job satisfaction construct. Bessant et al. (2001) conducted a research aimed at development of evolutionary behavioural model that will influence employees’ involvement in CI and will sustain this involvement as organizational capability. The authors stressed attention on behavioural aspects of CI, similarly to the present study. Their model included aspects of knowledge and resource management, rewards and recognition and activities aimed at employee involvement in every stage of CI. However, it did not take job satisfaction into account, although there is a substantial evidence with regards to importance of this aspect to any organization. Present study will use the job satisfaction term and will investigate its role in employees’ participation in CI.

Since CI implementation can be viewed as a change process, managers are expected to serve as change agents by focusing on such matters as company’s improvement, development and effectiveness. Workers, in turn, are performing the tasks and their goal is to eliminate the discrepancy between intended and actual performance. Facilitation of change agents in achievement of workers’ objectives results in employees’ satisfaction (Tietjen and Myers, 1998).

Hence, if managers ensure that their lower-rung employees are motivated, possessed with

sufficient opportunity and ability to perform the task, thus, facilitating in attainment of staff

members’ goals, level of job satisfaction is expected to increase.

(26)

20 Subsequently, following the line of reasoning proposed by Mohr and Zoghi, (2008), higher levels of job satisfaction will result in workers’ participation in CI. Therefore, it can be anticipated that exogenous variables represented by MOA factors have an indirect impact on the outcome variable of participation via job satisfaction.

Thus, the following hypotheses have been formulated based on the theoretical overview provided:

H1: Motivation is positively related to job satisfaction H2: Opportunity is positively related to job satisfaction H3: Ability is positively related to job satisfaction

H4: Motivation is positively related to employees’ participation in CI H5: Opportunity is positively related to employees’ participation in CI H6: Ability is positively related to employees’ participation in CI

H7: Job satisfaction mediates the effect of motivation on participation in CI H8: Job satisfaction mediates the effect of opportunity on participation in CI H9: Job satisfaction mediates the effect of ability on participation in CI Hence, the underlining theoretical framework of this research is as follows:

Figure 2.4 Theoretical framework of the research

(27)

21 CHAPTER 3. METHODOLOGY

This methodology section begins with an explanation of the research method that was chosen for the current study. Next, unit of analysis and appropriate sample are discussed. Subsequently, operationalization of independent and outcome variables is presented followed by the elaboration on the scaling decision and data collection.

3.1 The choice of research method

In order to answer the earlier formulated research questions and investigate the hypotheses, it is proposed to conduct a quantitative research. Although the behavioural aspects of quality management have been heavily underestimated, there is still a substantive body of knowledge available from other areas in terms of the constructs presented in this study. The knowledge of the concepts and models has been previously articulated in a theoretical form within different academic fields, therefore, there are pre-defined constructs, quantifiable theories and variables that will be utilised to further test the formulated hypotheses. Since the issue that is under investigation in this particular setting is significant for the success of continuous quality improvement management, it is of high importance to obtain findings that can be generalized.

Moreover, in this case, the data collection method should aim at attaining empirical evidence to answer questions like: “how variables are related and to what extent a given relation is present”

(Karlsson, 2009, p.91). Hence, it is suggested to employ a survey research.

The survey method has been used to investigate a variety of phenomena within the Operations Management field. Particularly, the quality management subfield has been widely researched by the use of survey and valuable insights have been gained. In this case, the confirmatory (or theory-testing or explanatory) survey research will be used. This is due to the fact that certain theories and hypotheses have already been formulated in previous sections, and confirmatory research allows to examine whether the hypothesized relationships between the identified constructs hold (Karlsson, 2009).

First and foremost, the advantage of survey research is its versatility. This approach has been used for examination of diverse areas of interest and Operations Management in particular.

Therefore, if a survey is well-designed, it can enhance understanding of nearly any issue.

Another beneficial aspect is efficiency of the method in the way that many variables can be

measured without substantially increasing the time and costs of the research, since data can be

gathered from many people, which leads to another advantage: generalizability of findings. The

generalization capability is one of the main strengths of survey research since it provides the

investigator with ability to collect data from a large sample, unlike other study approaches. It is

(28)

22 one of the main mechanisms that can develop a representative image of the attitudes and characteristics of a large population (Check and Schutt, 2011). Therefore, this type of research is considered to be an appropriate methodology for the setting of the proposed study.

3.2 Unit of Analysis

The unit of analysis (UOA) is a critical component of any research (Tellis, 1997) since it has a major influence on research design (Yin, 2003). According to Benbasat et al. (1987), the research question to be pursued requires thorough examination and investigation to determine a suitable UOA because it is important to assure that UOA is strongly related to the initial research question (Yin, 2003). In survey research, the unit of analysis refers to the level of data aggregation during subsequent analysis. Sample size, data collection methods and even operationalization of constructs will be determined and guided by the chosen UOA (Karlsson, 2009).

As stated in the proposed research questions, the main focus of the study will be employees.

Therefore, the appropriate UOA, which will provide the correct path for the research, are employees in organizations that pursue CI programmes. Due to the fact that workers are the primary source of output, this research will concentrate on staff members, located at lower levels of organizational hierarchy and who are greatly affected by incorporation of CI concepts within the company. Hence, the population frame is based on the commonality of improvement techniques used in the organization and the hierarchical aspects. Therefore, to attain appropriate results, companies were screened and accepted based on certain parameters. It is not of high importance whether the company is within the product or service industry, however, companies in which chosen workers are employed must use CI tools and practices as a matter of improved performance.

3.3 Sample

As described above, the target population elements are represented by the shop-floor employees within different organizations that follow CI practices. Since the previous theoretical section has identified five variables, it is important that sample size is appropriate to collect relevant data and perform subsequent analysis. Therefore, a minimum of 50 participants was required, taking into account the rule of thumb (minimum of 10 observations per variable) (Regts, 2015).

After several companies have been approached, one organization has agreed to participate in the

study. The proposed research has been conducted within an international manufacturing

company located in Russia, which employs Lean Six Sigma practices as a matter of continuous

(29)

23 quality improvement programme. The sample consisted of 123 subjects who are shop-floor staff members within the manufacturing department, where the Lean Six Sigma tools and techniques have been applied. Therefore, the chosen sample is considered to be capable of representing the overall population based on the size and the population frame.

3.3 Operationalization of independent variables

The first step in development of the measurement instrument is to determine a suitable concept that defines variables used within the research. In order to progress from theoretical level to the empirical research, constructs introduced in the theoretical framework were translated into observable and measurable elements. If this step is not performed well, the nominal definitions will not match the operative definitions and the research will be unreliable and can become a subject of mistrust. Hence, questions and statements used in the survey to operationalise the identified constructs were based on the academic literature and previously used measurement scales. This will ensure that one of the aspects related to the measurement error is excluded (i.e.

data derived from the measurements that do not match theoretical dimensions (Karlsson, 2009)).

Since the identified constructs are expected to be measured through people’s perceptions and feelings it has been chosen to use the definitions, which include several elements. This helps to avoid the limitations of unidimensional concepts, where composition of discrete and related components is used to determine the values for each of the variables (Koeske et al., 1994). The multidimensional approach also allows capturing more information about the variable and provides the researcher with an opportunity to “tap all facets of the construct of interest”

(Baumgartner & Homburg 1996, p. 143). First, the three factors of the MOA model were translated into reliable scales by adapting the existing validated measures within other domains.

Table 3.1 shows the operationalization, scales and number of items for each variable of the MOA framework.

opportunity, ability and the mediating role of job satisfaction.

Employee participation in Continuous Improvement: influence of motivation,