MASTER THESIS
MSc Human Resource Management
University of Groningen, Faculty of Economics and Business
“Retaining knowledgeable employees: Employees’ perceptions of human
capital development practices and their regulatory focus”
19.01.2019 Clara Groß-Heitfeld Student number: S3451941 Akerkhof 43-5 9712BC Groningen c.s.gross-heitfeld@student.rug.nl
Supervisor: Prof. Dr. Onne Janssen University of Groningen
1 ABSTRACT
Given the valuable asset of employees and the rising concern about staff retention, organizations are interested in the ability to retain their human capital. Accordingly, it is remarkable that existing research on human capital focuses mainly on intended human capital development practices, rather than on the important role of employee perceptions. This research examines the employee perceptions of human capital development practices and the effect on turnover. Two contrary theoretical perspectives, the social exchange theory and perceived organization-specific human capital theory are consulted, to understand the impact of employee perceptions of human capital on their leaving attitude. In addition, the moderating influence of employees’ regulatory focus on these relationships is examined. Data was gathered through a primary research with an online questionnaire with 177 participants. After testing the moderated-mediation model, the findings confirmed the hypothesis that employees perceiving general human capital development practices develop a higher inter-organizational career self-efficacy. Furthermore, evidence is provided that employees perceive organization-specific human capital development practices as a resource of social exchange, and subsequently, reciprocate with higher affective organizational commitment and retention. Results are discussed in the context of the extant literature. This study contributes to the up-to-date limited research on employee perceptions and provides organizations with the valuable suggestion to focus on developing skills that are perceived as organization-specific human capital, considering employees enhanced commitment and mitigated turnover.
Keywords: Perception of human capital development practices; organizational commitment;
2 INTRODUCTION
The keyword in human resource management is retention (Campbell et al., 2012). In highly competitive business environments with global skill scarcity concerns and tight job markets, employees have become a central asset for organizations and drive among other aspects their sustained competitive advantages (Campbell et al., 2012; Coff & Raffiee, 2015). With the focus on the human element, organizations have expended great effort on retaining employees and preserving their human capital (employees knowledge, skills and abilities) (Huselid, 1995; Lepak & Snell, 1999). Within the literature, training programmes are acknowledged as a relevant instrument to enhance employees’ human capital and reduce voluntary turnover (Benson et al., 2004; Firth et al., 2004; Lepak & Snell, 1999). This conclusion can be drawn especially, if development practices focus on organization-specific human capital (Benson et al., 2004; Firth et al., 2004). Predominant human capital theorist, such as Becker (1975) and Mincer (1974) distinguish between two types of employee human capital, knowledge and skills that are more organization-specific (organization-specific human capital, hereafter ‘OSHC’) or more generic (general human capital, in the following ‘GHC’). Generally it is assumed that GHC is easily transferable to other firms whereas OSHC is most valuable within the organization where it was originally developed (Becker, 1975; Benson et al., 2004; Mincer, 1974). Therefore, these theories propose to reduce GHC training and rather focus on enhancing OSHC, in order to constrain employees’ turnover (Becker, 1975; Mincer, 1974).
3 Stuart, 2003). The question that appears is, how does the individual perceptions of OSHC and GHC affect their turnover behaviour? The aim of the present study is to delve into the employees’ perspective by focusing on their perceptions of human capital development practices (hereafter called ‘HCD practices’). In addition, this study intends to depict the underlying process mechanism that might drive the perceptions of HCD - turnover linkage, by consulting two contrasting theoretical frameworks.
First, the social exchange theory is considered to argue that organization’s investment in either OSHC, as well as GHC may be reciprocated by the employee with a positive perception of the organization and a guaranteed employment (Blau & Boal, 1989; Ployhart et al., 2014). Training programmes were found to affect employees’ loyalty and commitment, which will lead to an increased intention to stay (Alfes et al., 2013; Cropanzano & Mitchell, 2005; Lee & Bruvold, 2003). Following this line of reasoning, this perspective provides a contradicting turnover prediction for GHC than formal macro human capital theories. To explain this contrasting outcome, affective organizational commitment is introduced as a mediator in the relationship between employee perceptions of organization-specific and general HCD practices with turnover intention.
4 However, to clarify the perceptions of HCD - turnover linkage, other factors that might buffer the relationship, have to be considered. By introducing the theoretical framework of regulatory focus theory, it is proposed that employees may differ in how they perceive and evaluate human capital development in relation to the turnover or retention question (Higgins et al., 1997). The type of regulatory goal (promotion focus versus prevention focus) for which employees strive, may regulate why rather a higher organizational commitment or a higher inter-organizational career self-efficacy, is developed (Judge & Ilies, 2002; Lockwood et al., 2002). Higgins et al. (1997) suggested that prevention-focussed employees attempt to prevent negative outcomes and strive to secure their existing workplace. It is proposed that the relationship between perceived HCD practices with affective organizational commitment and further retention, might be stronger for employees with a higher prevention focus (Higgins et al., 1997; Judge & Ilies, 2002). Promotion-focussed employees, in contrast, strive to develop themselves and concentrate on advancements (Higgins et al., 1997). As such, it is reasonable to assume that the relationship between perceived HCD practices with inter-organizational career self-efficacy and further turnover, might be stronger for employees with a higher promotion focus. This present study intends to present additional insights into the existing body of literature by including chronic prevention focus and chronic promotion focus as moderators in the relationship between employee perceptions of HCD practices and their turnover intentions, mediated through affective organizational commitment and inter-organizational career self-efficacy.
6 THEORETICAL FRAMEWORK AND HYPOTHESIS DEVELOPMENT
Human capital and employees’ turnover intention: The traditional human capital perspective
Human capital is a synonym of knowledge, skills and abilities (in the following ‘KSA’), competencies, and experiences embedded in individuals (Ployhart et al., 2014). Build on the resource-based theory, competitiveness and success of an organization depend to a great extent on the employees’ level of unique and explicit tacit KSA (Mitchell et al., 2001; Ployhart et al., 2014). Unlike other organizational resources, employees cannot be owned by the company (Campbell et al., 2012; Wang et al., 2009). Therefore, the retention of valuable and productive employees is highly relevant (Firth et al., 2004; Lee & Bruvold, 2003). Employee retention can be defined as a systematic and voluntary effort by an organization, to create “an environment that encourages current employees to remain employed by having policies and practices […] that address their diverse needs” (Yamamoto, 2013). The empirical studies of Griffeth et al. (2000) and Huselid (1995) recognised that employees identify development opportunities as key motivational variables that directly influence their actual retention in the organizations. By understanding the employees demands and desires, organizations invest in practices, such as seminars, informal trainings with supervisors and co-workers and self-guided instructions, to equip the employee with enhanced KSA (Becker, 1975; Eisenberger et al., 1990).
7 2009). The knowledge of an organization’s proprietary technology or social landscape illustrates for instance OSHC (Chew & Chan, 2008). Even if mobility occurs, employees with organization-specific skills are unlikely to apply these skills successfully without sacrificing the productive value of their KSA (Benson et al., 2004; Loewenstein & Spletzer, 1999). As a result, developing its employees with a narrow lens of knowledge specificity is associated with an isolating mechanism that hinders the employee from transferring the generated KSA to another organization (Campbell et al., 2012). Thus, OSHC is rather associated with the employee retention (Alfes et al., 2013; Crook et al., 2011; Koster et al., 2011; Wang et al., 2009).
However, organizations that are too specialized, may become inefficient (Crook et al., 2011; Loewenstein & Spletzer, 1999). These organizations lack GHC, accordingly, capitalizing generic knowledge and basic cognitive abilities is essential for the success of an organization (Ployhart et al., 2014). GHC are skills that are not specific to a task or a company and provide employees with better problem-solving abilities, improved decision-making abilities and enhances the quality and consistency of their delivered work (Loewenstein & Spletzer, 1999; Mincer, 1974). However, the skills are broadly valuable and transferable to a plurality of outside organizations without any restrictions (Becker, 1975; Benson et al., 2004; Loewenstein & Spletzer, 1999). Therefore, the employees turnover intention increases (Alfes et al., 2013; Crook et al., 2011; Ployhart et al., 2014; Wang et al., 2009). The literature authenticates that turnover intentions stem from employee's deliberate intention to leave the organization at some future time and consequently, is utilized as a determinant of actual withdrawal (Griffeth et al., 2000; Muchinsky & Morrow, 1980).
8 2014). The predominantly reflected macroeconomic point of view does not accurately consider the employee perceptions (Campbell et al., 2012; Coff & Raffiee, 2015). Perception describes thereby, not necessarily something based on reality, rather the perspective an individual has manifested by experiences and education (Coff & Raffiee, 2015; Piening et al., 2014; Santos & Stuart, 2003). Accordingly, perceptions an individual employee has of its human capital may differ from the organizations objections and KSA can be perceived as less specific or general (Coff & Raffiee, 2015; Piening et al., 2014; Santos & Stuart, 2003). This can have meaningful repercussions for the employee’s turnover intention (Koster et al., 2011; Piening et al., 2014) . The literature, prior examined that for the effectiveness and outcome of organizational development efforts, it is essential to consider the individual perceptions and therefore, the micro foundations of human capital (Coff & Raffiee, 2015; Piening et al., 2014; Santos & Stuart, 2003). As such, in the present study the focus is shifted to investigate the role of employee perceptions of HCD practices and, thereby builds on the study by Coff & Raffiee (2015). To explore the causal mechanism in the relationship between employee perceptions and their turnover intention, two competing perspectives, namely the social exchange perspective and the perceived organization-specific human capital perspective are consulted.
A social exchange perspective on the relationship between human capital and employees’ turnover intention
10 The three-component model of Allen & Meyer (1990) addresses observed differences in the organizational commitment literature. The main distinction is characterized by the differing mindsets, which are labelled as: affective commitment (the affective attachment to the organization), normative commitment (the obligation to remain), and continuance commitment (the perceived cost of leaving) (Allen & Meyer, 1990). Commitment and connection to the organization is identified as a direct influence of employees’ retention intention (Blau & Boal, 1989; Chew & Chan, 2008). Previous studies of Blau & Boal (1989) and Yamamoto (2013) have indicated that a high degree of organizational commitment could reduce the tendency of leaving among the workforce. A low or lack of organizational commitment, in contrast, is associated with the employee’s intention to quit (Chew & Chan, 2008). To draw on the idea that training and development provided by the organization, can retain employees, this study focuses on affective organizational commitment, the emotional bond to the focal organization.
Based on the examined literature, this research hypothesizes that employees may perceive organization-specific and general HCD practices as an investment in their development. Therefore, they reciprocate with affective organizational commitment and further with retention in the incumbent firm. Thus, it can be implied that the factor affective organizational commitment mediates the relationship between employee perceptions of organization-specific and general HCD practices and turnover intention:
Hypothesis 1: Employee perceptions of organization-specific (1a) and general (1b) human capital development practices positively relate to affective organizational commitment
11
Hypothesis 3: Affective organizational commitment mediates the indirect relationships of employee perceptions of organization-specific (3a) and general (3b) human capital development practices with turnover intention
A perceived organization-specific human capital perspective on the relationship between human capital and employees’ turnover intention
12 search efforts, inside or outside the focal organizations (Coff & Raffiee, 2015). The literature stated that multiple career development opportunities within the focal firm or other organizations, increase one's confidence to have the required KSA to be successful in any organization, namely the individual’s inter-organizational career self-efficacy (Betz & Hackett, 1981; Lent & Hackett, 1987; Yamamoto, 2013). Thus, it is expected that general, as well as organization-specific HCD practices may enhance the employee’s inter-organizational career self-efficacy.
A high exchange value, similar in other organizations is recognized to have a negative influence on the employee’s turnover intention (Yamamoto, 2013). The results of preceding meta-analyses identified a positive correlation between alternative job opportunities (a similar concept to inter-organizational career self-efficacy), turnover intention and the actual resignation of the employee (Griffeth et al., 2000; Yamamoto, 2013). The study of Yamamoto (2013), for instance observed a positive relationship between issues of career development within the focal organization, and increasing turnover intention. The study of Mitchell et al. (2001) supports these investigations by identifying that employee perceptions of better job alternatives influence a higher intention to leave, disregarding a greater voluntary turnover. Therefore, employees with a strong inter-organizational career self-efficacy are expected to be more likely to develop an intention to change their current organization.
13 employee’s inter-organizational career self-efficacy mediates the indirect relationships of perceived OSHC and GHC with turnover intentions.
Hypothesis 4: Employee perceptions of organization-specific (4a) and general (4b) human capital development practices positively relate to inter-organizational career self-efficacy
Hypothesis 5: Inter-organizational career self-efficacy positively relates to turnover intention
Hypothesis 6: Inter-organizational career self-efficacy mediates the indirect relationships of employee perceptions of organization-specific (6a) and general (6b) human capital development practices with turnover intention
The moderator role of regulatory focus
14 towards their work, their environment and especially, how they strive for setting goals (Higgins, 1997; Judge & Ilies, 2002; Lockwood et al., 2002). Considering that self-regulatory processes are partly a reflection of the employees’ working motivation, their behaviour and accordingly, their intention to stay or leave the organization, it implies a key variable determining HCD practices outcomes. The two regulatory foci are not to be considered as opposites, rather as independent from each other, such that individuals can be high or low on either focus or on both foci at the same time (Higgins et al., 1997).
15
Hypothesis 7: Chronic prevention focus moderates the positive relationship of employee perceptions of organization-specific (7a) and general (7b) human capital development practices with affective organizational commitment, such that these relationships are more pronounced for employees who are high rather than low on chronic prevention focus.
Hypothesis 8: Chronic prevention focus moderates the indirect relationships of employee perceptions of organization-specific (8a) and general (8b) human capital development practices with turnover intention through affective
organizational commitment, such that these indirect relationships are more pronounced for employees who are high rather than low on chronic
prevention focus
16 react to HCD practices by enhanced inter-organizational career self-efficacy that will result in a strong positive association with turnover:
Hypothesis 9: Chronic promotion focus moderates the positive relationships of employee perceptions of organization-specific (9a) and general (9b) human capital development practices with inter-organizational career self-efficacy, such that these relationships are more pronounced for employees who are high rather than low on chronic promotion focus
Hypothesis 10: Chronic promotion focus moderates the indirect relationships of employee perceptions of organization-specific (10a) and general (10b) human capital development practices with turnover intention through inter-organizational career self-efficacy, such that these indirect relationships are more pronounced for employees who are high rather than low on chronic promotion focus
The components and relations of this study are graphically depicted in figure 1 and are based on the previous sections.
17 METHODOLOGY
Sample and procedure
A questionnaire research, collecting primary data was conducted to test the formulated hypotheses (the questionnaire can be found in Appendix A). Several employees were contacted face-to-face, by phone, e-mail, or social media channels such as LinkedIn and Facebook, in order to raise interest in this research and distribute the survey. In addition, the questionnaire was translated into English, German, Dutch and Italian adopting a double-blind back-translation procedure. The participants were invited to participate voluntarily. The attached cover letter included the purpose of the study, the necessary fill-out time of approximately fifteen minutes, an informed consent, an insurance of privacy, anonymity and strict confidentiality. In a period of four weeks, data of 197 employed individuals were gathered by operating a simple random sampling technique. Twenty participants failed to complete the questionnaire which led to a final sample of 177 participants. Thereof, 118 participants were female (67%) and 59 were male (33%). The age distribution revealed 134 participants (76%) with a relatively low age between 20-29 years. The majority of the respondents (85 participants, 48 %) were working in their current working position since a relatively short amount of time, accounting for one to three years. 80 participants (45%) worked between one to three years in their organization. Moreover, 93 participants, the majority with 53 % are working in large organizations with above 500 employees.
Measurement
Perceived organization-specific and general human capital development practices; the
18 & Nordhaug (2002). In this research, it is assumed that the employee perceptions of HCD practices can be differentiated by GHC and OSHC. Therefore, two subscales were designed to measure the perception of organization-specific or general HCD practices, with respectively four questions and the prime statement “During development and training practices in my current organization, I have learned and acquired”. Sub questions for perceived organization-specific HCD practices included, for instance “Knowledge, skills, and abilities that are organization-specific to this organization […]”, whereas sub questions regarding general HCD practices stated, “General interpersonal working skills […]”. Respondents were asked to rate scale items along a 6-point Likert response scale ending with ‘1’ (Not at all) and ‘6’ (To a very great extent).
A factor analysis (Appendix B) analysed if the variance among the observed variables can be reduced into a lower number of latent variables (“perceptions of OSHC” or “perceptions of GHC”). The Kaiser-Meyer-Olkin value (KMO= 0.816) confirmed the applicability of the data in a factor analysis. The two components, OSHC and GHC accounted 70% of the total variance, although one had a higher value with 51.1%, than the other one. The original factor matrix did not provide clear direction to understand and analyse the factors. Thus, rotation was applied. As a result of the rotated Component matrix, a clear distinction between OSHC and GHC was confirmed. Both subscales are reliable (OSHC α= .81, GHC α= .87).
Regulatory focus was assessed by applying the General Regulatory Focus Measure
19 preventing negative events in my life”. All items were rated on a 5-point scale with endpoints labelled ‘1’ (not at all true for me) and ‘5’ (very true for me). Both subscales are reliable (promotion focus α= .85, prevention focus α= .85), and are not correlated with one another (r -.02, p. .82).
Affective organizational commitment (α= .83) was measured in this study, by
implementing an eight-item scale of the Organisational Commitment Questionnaire, originally developed by Allen & Meyer (1990). According to Allen & Meyer (1990), the affective organizational commitment scale estimates the extent to which individuals identify themselves and are emotionally attached to their organisation. The higher the score, the greater is their affective organizational commitment (Allen & Meyer, 1990). Each question was accompanied by a Likert type five scaled tool, ranging from ‘1’= strongly disagree to ‘5’= strongly agree.
Inter-organizational career self-efficacy was measured, applying the inter-organizational
career self-efficacy scale, newly established in the study of Yamamoto (2013). Thereby, the individual's belief in his or her capacity to successfully adapt its knowledge and skills outside of its organization, is assessed (Yamamoto, 2013). The participants were asked to rate their level of confidence in five questions, such as ‘My knowledge and skills about work is useful immediately even after job change to another organization’. All items were rated on a five-point scale with endpoints labelled ‘1’ (strongly disagree) and ‘5’ (strongly agree). Based on these five items is α= .83.
Turnover intention was applied as a retention index in this study, since it shows an
20 & Chan, 2008). Thereby, questions such as ‘As soon as I can find a better job, I will leave my organization’ were assessed. Although, this scale does not show a specific time to leave the organization, it refers to the three particular elements in the withdrawal cognition process (i.e., thoughts of quitting the job, intention to search for a different job, and intention to quit) (Muchinsky & Morrow, 1980). To measure the strength of the respondent’s intentions to leave, two items adapted of the Intent to leave scale of Walsh et al. (1985) were included. These assed, for instance: ‘I intend to leave my job within the next 6 months’. Each question was accompanied by a five-point Likert response scale with end points of ‘1’ (strongly disagree) and ‘5’ (strongly agree). The internal consistency of the coefficients is α= .92.
Control variables, such as gender, age, experience in its current working position, size of
21 Data Analysis
22 RESULTS
Descriptive Statistics
23
Table 1: Descriptive Statistics and Intercorrelations
24 Hypotheses testing
Hypothesis 1a stating that employee perceptions of organization-specific HCD practices positively relates to affective organizational commitment, is supported. Consistent with this hypothesis, table 2 indicates a significant positive relationship (B= .199, SE= .06, p= .00). Hypothesis 1b suggested that employee perceptions of general HCD practices positively relates to affective organizational commitment. The results of the performed regression analysis show a non-significant relationship (B= .07, SE= .06, p= .26). Thus, the hypothesis cannot be confirmed.
Hypothesis 2 proposed that affective organizational commitment relates negatively to turnover intention. The results presented in table 2, confirm that affective organizational commitment is significantly and negatively associated with turnover intention (B= - .999, SE= .09, p= .00). Hypothesis 2 is supported by the data.
Hypothesis 3a stated that affective organizational commitment mediates the indirect relationship between employee perceptions of organization-specific HCD practices and turnover intention. Adopting Hayes (2013) PROCESS model 4, this hypothesis is confirmed. The mediation of affective organizational commitment showed a significant indirect effect of -.198 (CI: -.34 to -.07). However, hypothesis 3b suggesting that affective organizational commitment mediates the indirect relationship between employee perceptions of general HCD practices and turnover intention, is not supported. The mediation of affective organizational commitment had an insignificant indirect effect (indirect effect= -.0651; CI: -.19 to .05).
25 this hypothesis. Nevertheless, hypothesis 4b proposed that employee perceptions of general HCD practices positively relates to inter-organizational career self-efficacy. In conformity with the hypothesis, the result show a significant positive relationship, suggesting that employee perceiving general HCD practices have an increasing inter-organizational career self-efficacy (B= .16, SE= .04, p= .0002). Thus, hypothesis 4b is supported.
Hypothesis 5 suggesting that inter-organizational career self-efficacy positively relates to turnover intention, cannot be supported. As table 2 presents, the regression of inter-organizational career self-efficacy on turnover intention demonstrates a non-significant relationship (B= .0007, SE= .13, p= . 99).
26
27
Notes: based on 5.000 bootstrap interval; GHC= employee perceptions of general HCD practices, OSHC= employee perceptions of organization-specific HCD practices
28
Table 3: Hierarchical regression analysis for testing hypothesis 7
Notes: N=177; † p< .10. * p< .05. ** p< .01; dependent variable: affective organizational commitment; standardized coefficients are reported; OSHC= employee perceptions of organization-specific HCD practices, GHC= employee perceptions of general HCD practices
29 Hypothesis 8a proposed that chronic prevention focus moderates the indirect relationships of employee perceptions of organization-specific HCD practices with turnover intention through affective organizational commitment, such that these indirect relationships are more pronounced for employees who are high rather than low on chronic prevention focus. The results of the PROCESS model 7 regression analysis are shown in table 4 (Hayes, 2013). Closer examination of the conditional indirect effects reveal that the indirect relationship is significant regardless of low (prevention focus= -1SD; 95% CI: -.41 to -.05), mean (prevention focus= M; 95% CI: -.37 to -.95), or high level of chronic prevention focus (prevention focus= +1SD; 95% CI: -.42 to -.05). Nevertheless, as the results of hypothesis 7a show, prevention focus does not have a significant moderating effect on the relationship between employee perception of organization-specific HCD practices and affective organizational commitment. Thus, hypothesis 8a cannot be supported by the data.
Table 4: Moderated-mediation analysis for testing hypothesis 8a
Note: based on 5.000 bootstrap interval
30 indirect relationships are more pronounced for employees who are high rather than low on chronic prevention focus. As the results in table 5 project, all confidence intervals of the conditional indirect effects contain zero (prevention focus= -1SD; 95% CI: -.11 to .19), (prevention focus= M; 95% CI: -.17 to .06), (prevention focus= +1SD; 95% CI: -.33 to .05).
Table 5: Moderated-mediation analysis for testing hypothesis 8b
Note: based on 5.000 bootstrap interval
31
Table 6: Hierarchical Regression analysis for testing hypothesis 9
Notes: N=177; † p< .10. * p< .05. ** p< .01; dependent variable: inter-organizational career self-efficacy; standardized coefficients are reported; OSHC= employee perceptions of organization-specific HCD practices, GHC= employee perceptions of general HCD practices
32
Table 7: Moderated-mediation analysis for testing hypothesis 10a
Note: based on 5.000 bootstrap interval
33
Table 8 Moderated-mediation analysis for testing hypothesis 10b
34 DISCUSSION
This paper targeted to make a contribution to the extant body of literature by theorizing and testing employee perceptions of organization-specific and general HCD practices and determining if it affects their turnover intention, through the underlying processes of affective organizational commitment and inter-organizational career self-efficacy. In addition, it contributes to the regulatory focus literature by examining the moderating influence of chronic promotion focus or chronic prevention focus on these established relationships.
The results of this study exhibit that employees perceive OSHC and GHC as two different types of organizational investment in the development of their KSA. Organization-specific HCD practices are perceived and reciprocated with affective organizational commitment. This finding underlines previous studies by social exchange theorists, acknowledging that employees interpret development practices as indicators for the organization’s assets in them (Cropanzano & Mitchell, 2005). The more employees perceive OSHC enhancing practices, the higher they are committed to their organization (Despres & Hiltrop, 1995; Yeung & Berman, 1997). Contrary to the expectations, the perception of general HCD practices does not result in affective organizational commitment. A possible explanation for this insignificant result might be identifiable in the employee perceived human capital theory (Coff & Raffiee, 2015). Although employees participate in GHC enhancing practices, they might not identify them as development practices provided by the organization. This association could occur, if the new KSA is received through informal training practices, such as talks with supervisors or co-workers (Eisenberger et al., 1990; Jiang et al., 2012). Consequently, the trainings might not be interpreted as a resource in the social exchange relationship .
35 higher inter-organizational career self-efficacy. Agreeing with the existing literature, the growth of skills and knowledge through development practices might provide an employee with the confidence of being able to change jobs to other organizations or industries (Lent & Hackett, 1987; Yamamoto, 2013). Nevertheless, the findings show a non-significant relationship between employee perceptions of organization-specific HCD practices and inter-organizational career self-efficacy. The insignificant relationship is reasonable, considering that employees may perceive OSHC as too organization-specialized (Coff & Raffiee, 2015; Santos & Stuart, 2003). By enhancing these skills, a potential career in another organization is not considered.
According to the analysis of the data, affective organizational commitment results in employees’ intention to stay in their organization. These findings correlate with the theory presented in this paper, illustrating that employees with a high affective organizational commitment continue their employment in the focal firm (Despres & Hiltrop, 1995; Yeung & Berman, 1997). Inter-organizational career self-efficacy, on the other hand, showed an insignificant relationship with turnover intention. Inter-organizational career self-efficacy is associated with an individual’s confidence to have a high level of applicability after changing to another organization (Lent & Hackett, 1987; Yamamoto, 2013). This confidence does not necessarily indicate that the individual intends to leave its organization, which may reason the insignificant relationship.
36 Boal (1989), stating that organization provided trainings reduce the turnover probability of committed employees. The mediating role of affective organizational commitment in the relationship between perceiving general HCD practices with turnover intention, could not be supported by the study. Furthermore, the data do not show a mediator effect for inter-organizational career self-efficacy. Therefore, the relationships between perceived organization-specific HCD practices and turnover intention, as well as perceived general HCD practices with turnover intention, are not mediated by inter-organizational career self-efficacy.
37 This study could present, neither evidence for the relationship between employee perceptions of organization-specific and general HCD practices and turnover intention, mediated by inter-organizational career self-efficacy and moderated by chronic promotion focus.
Implications for theory and practice
The findings presented in this study offer a number of salient implications for the existing theory and practice. First, to investigate the scant researched effect of employee perceptions of human capital on turnover intention, the study considered the social exchange theory (Cropanzano & Mitchell, 2005). It was examined that employee perceptions of organization-specific HCD practices are associated positively to affective organizational commitment. By demonstrating that the employee’s perception of HCD practices can create a resource in the exchange relationship, additional insight into the existing social exchange theory is provided. Translating these results to practical implications guides organizations to take cognizance of the critical role of perceptions while developing HCD practices. Organizations, aiming employees’ loyalty and commitment, should focus on enhancing skills, which will be perceived by employees as OSHC.
38 Third and last, this present study takes an alternate view on the existing retention literature by analysing the effect employees’ regulatory focus has on turnover intention, after perceiving HCD practices. Even though, no support for the hypotheses could be found, the results established a marginal significant effect of chronic prevention focus on the relationship between general HCD development practices and affective organizational commitment. This indicates that personal factors, such as the individual’s motivation have to be considered as moderators, investigating the perceptions of HCD - turnover linkage. While implementing HCD practices, organizations should consider that their employees vary in their motivational factors, which might influence their organizational commitment or inter-organizational career self-efficacy.
Limitations and future research
39 commitment or normative organizational commitment, could provide new evidence for the investigated relationships.
The existing study concentrated on evaluating the effect of employee perceptions of HCD practices on turnover intention through affective organizational commitment and inter-organizational career self-efficacy. Other factors, personal or work related might affect the linkage between perceived HCD practices and employees’ turnover intention (Huselid, 1995; Jiang et al., 2012). As the literature depicts, satisfaction with training programs has a high impact on organizational commitment, and in turn on turnover intention (Jiang et al., 2012; Lee & Bruvold, 2003). Further research could evaluate this factor by considering it, as an underlying process. By identifying the employees’ satisfaction with the provided HCD practices, these trainings might provide greater effectiveness and in turn, higher workforce commitment and retention. Thus, an analysis of the employee’s perceptions of organization-specific and general HCD practices on their turnover intention through training satisfaction and commitment, could provide the existing literature with further insights.
40 more salient, they may experience stronger prevention orientations (Lockwood et al., 2002). Therefore, this analysis can solely permit inferences based on a primarily young sample. Future testing of this model could pay attention of an equal age distribution, when targeting participants. A representative number of participants in every age group could influence the results and generate differences in the employees’ perceptions and turnover relationship.
41 CONCLUSION
This study aimed to provide further insight into the employee perceptions of HCD practices – turnover relationship, by investigating the mediating role of affective organizational commitment and inter-organizational career self-efficacy, and the moderator employee regulatory focus. The paper has consulted two underlying process mechanism, the social exchange theory and the perceived OSHC theory to evaluate the influence of employee perceptions of HCD practices on turnover intention. In agreement with the extant literature, employees perceiving organization-specific HCD practices commit to their organization and remain employed. Furthermore, general HCD practices perceived by employees, result in a higher inter-organizational career self-efficacy. Although no support for the other hypotheses could be established, the marginal significant relationship between chronic prevention focus and perceived general HCD practices, indicate the relevance to consider employees' perceptions and regulatory focus while evaluating turnover intentions. The absence of further evidence of results in this study present numerous potential directions for future research on the impact of employee perceptions of HCD practices on their turnover intention.
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47 APPENDIX
APPENDIX A: Questionnaire
Perceived human capital development practices Scale Items (adapted “firm specific technical competence” and “employees self-assessed level of competence” scale of Døving & Nordhaug (2002)
(1) During development and training practices in my current organization, I have learned and acquired:
a. Knowledge, skills, and abilities that are specific to this organization (e.g. the organization’s culture; communication channels within the organization, general procedures in the organization, the organization’s strategy and goals; different subunits and their working conditions, etc.)
b. Specialized tools that are specifically crafted for this organization (e.g. data systems, CRM systems, etc.)
c. Specialized knowledge and skills enabling me to perform necessary job duties in this organization
d. Without the provided training I would be unable to perform my current job e. General interpersonal working skills (e.g., general negotiation skills, ability to
communicate and to cooperate with others in a business environment)
f. Skills about work that are transferable to other organizations (e.g. ICT skills; leadership skills; general project management skills)
48 h. Abilities I can take with me when I make a transition to a new job or career in
another organization
(2) In my organization, enough time is allocated for development practices (3) In my organization, enough development practices are offered
(4) I think a person with the same education and experience as I have, coming from another organization in the same industry, will need many hours of training to gain my level of knowledge in my organization
Regulatory focus Scale Items (General Regulatory Focus Measure of Lockwood et al. (2002) (1) In general, I am focused on preventing negative events in my life
(2) I am anxious that I will fall short of my responsibilities and obligations (3) I frequently imagine how I will achieve my hopes and aspirations (4) I often think about the person I am afraid I might become in the future (5) I often think about the person I would ideally like to be in the future (6) I typically focus on the success I hope to achieve in the future (7) I often worry that I will fail to accomplish my professional goals (8) I often think about how I will achieve professional success
(9) I often imagine myself experiencing bad things that I fear might happen to me (10) I frequently think about how I can prevent failures in my life
(11) I am more oriented toward preventing losses than I am towards achieving gains (12) My major goal at work right now is to achieve my professional ambitions (13) My major goal at work right now is to avoid becoming a professional failure
49 (15) I see myself as someone who is primarily striving to become the self I “ought” to be—
to fulfil my duties, responsibilities, and obligations
(16) In general, I am focused on achieving positive outcomes in my life
(17) I often imagine myself experiencing good things that I hope will happen to me (18) Overall, I am more oriented toward achieving success than preventing failure
Organizational Commitment Scale Items ( Original Commitment Scale of Allen & Meyer (1990))
(19) I would be very happy to spend the rest of my career with my organization (20) I enjoy talking about my organization to people outside it
(21) I feel as if my organization’s problems are my own
(22) I think that I could easily become as attached to another organization as I am to this one
(23) I do not feel as if I am a ‘part of the family’ at my organization (24) I do not feel ‘emotionally attached’ to my organization
(25) My organization has a great deal of personal meaning for me (26) I do not feel a ‘strong’ sense of belonging to my organization
(27) I am not afraid of what might happen if I quit my job without having another one lined up
(28) It would be very hard for me to leave my organization right now, even if I wanted to (29) Too much in my life would be disrupted if I decided to leave my organization now (30) It wouldn’t be too costly for me to leave my organization now
50 (33) One of the few serious consequences of leaving this organization would be the scarcity
of available alternatives
(34) One of the major reasons I continue to work for this organization is that leaving would require considerable personal sacrifice (another organization may not match the overall benefits I have here)
Inter-organizational career efficacy Scale Items (Inter-organizational career self-efficacy of Yamamoto (2013)
(35) My knowledge and skills about work are useful immediately even after job change to another organization
(36) My current capability and skills can be used in another organization (37) The level of my job-specialties is accepted generally
(38) I have specialized knowledge and skills which I can use elsewhere in another organization
(39) I have enough knowledge and skills in order to obtain a certain income outside my organization
Turnover intention Scale Items (3-Items of Michigan Organizational Assessment Questionnaire (Chew & Chan, 2008) and 2-items of Intent to leave scale (Walsh et al., 1985))
(40) As soon as I can find a better job, I will leave my organization; (41) I am actively looking for a job outside my organization
(42) I am often thinking about quitting my job and leaving my organization. (43) I intend to leave my job within the next 6 months
