CULTURE AND INSTITUTIONS
CULTURE OF EXPANDING INTERNATIONAL FIRMS AND ITS
INFLUENCE ON THE HEALTH OF THE EMPLOYEES
12-6-2015
Master Thesis, International Business Management University of Groningen
Faculty of Economics and Business Marèl Bos – S2357402 Violierstraat 81, 7601 GR Almelo
Tel: +31641391414
ABSTRACT
International retail firms are expanding in the Dutch market, due to its attractiveness. The Netherlands is an exciting retail market due to its low unemployment rate and high purchasing power. In the Netherlands organizational cultures are by large flat, low hierarchical and feminine. Which differs from the organizational cultures of most international retail firms that come to the Netherlands. Consequently, the organizational differences can affect the firm performance and employee productivity. This research will investigate a possible relation between organizational cultures and employee health. Learnings can be applied not only to international retail firms in the Netherlands but also to firms expanding in other markets, as they will face the same issues.
TABLE OF CONTENT INTRODUCTION ... 4 LITERATURE REVIEW ... 7 Central concept ... 7 Organizational culture ... 7 Leadership ... 10 National culture ... 12
Organizational culture and national culture ... 15
Health of employees ... 17
METHODOLOGY ... 19
ANALYSIS & DISCUSSION ... 22
CONCLUSION ... 29
Limitations ... 31
Future research ... 32
REFERENCES ... 33
INTRODUCTION
Nowadays, more and more firms seek international expansion in order to enhance their reach. To keep growing and expanding business, many organizations are using new distribution channels, they create new products and they enter new markets. When firms are entering new markets they have to take a couple of factors in mind: the demographic environment, the economic environment, the legal and regulatory environment, the political environment, the competitive environment and the social and cultural environment (Johnson, Scholes & Whittington, 2008). The latter one is often forgotten by many firms, but previous research (Frost, Moore, Louis, Lundberg, & Martin, 1985; Hofstede 1991) has indicated that this is a very important factor when it comes to internationalization. Because, when forgotten, it can lead to failure of the desired results of internationalization.
When internationalizing, firms often transfer their organizational culture to the new organization in the new, foreign country. Many researchers found that the culture within organizations is formed by the influences of the cultural and institutional context of the country of origin of the organization (Kattman, 2014; Sorge, 1991). Organizational cultures can be transferred from one country to another when national cultures are similar. Difficulties arise when national cultures are significantly different (Ryan, Windsor, Ibragimova, & Prybutok, 2010).
Recently, employees suffering from harsh working conditions have been all over the news. The company that was the center of all the attention is Foxconn, an electronics manufacturing company which is one of the main suppliers of Apple. The main reason that Foxconn was in the news was due to a high number of suicides amongst their employees. Foxconn claimed to be unaware of the causes of these suicides. Several companies have investigated the suicides and came to the conclusion that job stress was one of the main causes of the suicides. The main causes of the suicides were; inhumane and abusive management style, health and safety issues in the factories, employee mistreatment, excessive shifts of more than sixteen hours a day, and insufficient pay, which led to employee stress and depression (Fair Labour Association, 2012). Ultimately, this led to 18 attempted suicides and 14 deaths. We can say that the health of the employees of Foxconn was physically and mentally affected due to work.
The successfulness and profitability of the firm is mostly determined by the employees of the firm (Dhobale, 2009). Stress at the workplace can lead to suffering of employees, as is shown by the Foxconn example. It can also lead to suffering of the firm. Hwang, Lee, Park, Chang, & Kim (2014) researched the influence of job stress on employee's turnover intention in the luxury hotel segment. They use the definition for turnover intention of Tett and Meyer (199 p. 262), and they define turnover intention as “the last in a sequence of withdrawal cognitions, a set to which thinking of quitting and intent to search for alternative employment also belong”. The results of the Hwang et al. (2014) research show a significant effect on turnover intention for all measured job stress factors. They found a couple of things that influence turnover intention: unfair treatment, problems related to task and pay, shortage of support, organizational culture and problems related to private situations. Employee stress can lead to decreased loyalty towards the firm, absenteeism and decreased productivity (Dhobale, 2009). Stress at the workplace can be caused by many factors, one of them could be the differences between the national and organizational culture of the new country and those of the firm’s country. However, this possible influence has never been researched and that is where this research adds value to the existing literature.
A lot of previous research has paid attention to the influence of cultural differences in all kinds of the organizational field, like innovation (Mosurović & Kutlača, 2011; Büschgens, Bausch & Balkin, 2013), human resource management (Heijltjes, Witteloostuijn, Sorge, 1996; Theriou & Chatzoglou, 2014), and knowledge management processes (Shu-Mei Tseng, 2010). Research has been done about job stress in cross-cultural contexts (Kahn, Wolfe, Quinn, Snoek & Rosenthal, 1964; Liu & Spector, 2004; Liu, Nauta, Spector & Li, 2008; Peterson et al., 1995). But little attention has been paid to research about the influence of national and organizational culture of companies on the health of employees when entering new, foreign markets.
Kingdom, a comparison will be made between firms from the Netherlands and firms from the United Kingdom.
The central research question of this paper is: “How is the health of employees of international firms operating in the Netherlands affected by organizational and national cultural differences?”
The following sub questions have been formed to help answering the central research question:
1.1 How is the productivity of international firms operating in the Netherlands affected by cultural and organizational differences?
1.2 How do the health of employees of international firms operating in the Netherlands compare to local firms?
The results of this paper will be important for managers and owners of companies that are planning to internationalize. The study findings will help them to understand and avoid the pitfalls the company can experience regarding cultural differences.
LITERATURE REVIEW
This chapter provides an overview of the existing literature towards the main concepts in this study. First, the central concept and the conceptual model will be explained. Followed by the organizational culture. Third, national culture will be elaborated on. Then, a connection will be made between organizational culture and national culture. Finally, the health of employees will be described.
Central concept
Figure 1 shows the conceptual model of this paper. There is a direct relationship between organizational culture of international expanding firms and the health of employees within organizations, this is moderated by national culture. The independent variable of this central concept is organizational culture of international expanding firms. National culture is the moderator and health of employees is the dependent variable. The independent variable affects the dependent variable in a negative way, meaning that an organizational culture that does not correlate with the national culture of the country of the firm will decrease the health of the employees within the firm. The next chapters will elaborate more profoundly on the three variables.
Figure 1 - Conceptual model Organizational culture
Multiple authors have tried to define organizational culture. Hofstede, Neuijen, Ohayv, & Sanders (1990) indicated that there is no consensus about the definition of organizational culture. They acknowledged six important characteristics of the organizational culture, namely that it is: holistic, historically determined, related to anthropological concepts, socially constructed, soft, and difficult to change. Pareek and Rao (1999) defined organizational
Organizational culture of international expanding
firms
culture as “Cumulative, crystallized and quasi stable shared lifestyle of people as reflected in the presence of some states of life over others, in the response predispositions towards several significant issues and phenomena (attitudes), in the organized ways of filling time in relation to certain affairs (rituals), and in the ways of promoting desired and preventing undesirable behavior (sanctions)”. Schein (1985) defines organizational culture as “A pattern of basic assumptions – invented, discovered, or developed by a group as it learns to cope with its problems of external adaptation and internal integration – that has worked well enough to be considered valid and, to be taught to new members as the correct way to perceive, think and feel in relation to those processes”. Daft (2007) defines organizational culture as a set of key values, beliefs, and norms shared by members of an organization. According to Daft (2007) organizational cultures serve two functions. They incorporate employees so that they know how to relate to one another, and they help the organization to better adapt to the external environment. All these definitions describe organizational culture, but they do not get the essence of describing it completely.
This paper will use the definition of Cameron and Quinn (2011), “an organization’s culture is reflected by what is valued, the dominant managerial and leadership styles, the language and symbols, the procedures and routines, and the definitions of success that make an organization unique”. The organizational cultural represents “the ideology that people carry inside their heads. It conveys a sense of identity to employees, provides unwritten and, often, unspoken guidelines for how to get along in the organization, and enhances the stability of the social system that they experience” (Cameron and Quinn, 2011). The organizational culture describes “how things are around here” (within the organization).
represents a different organizational culture (Cameron & Quinn, 2006). Table 1 shows the characteristics for each dimension.
Figure 2 - Organizational Culture Assessment Instrument. Source: Cameron & Quinn (2011)
TABLE 1 Organizational cultures
Clan Culture Adhocracy Culture
A friendly workplace that feels like an extended family
Leaders are considered mentors
Loyalty and tradition are what holds the organization together
Commitment among employees is high
The organization emphasizes the long-term benefit of individual development
High solidarity
Morale is important
The organization emphasizes teamwork, participation, and consensus
(Cameron & Quinn, 2006)
A dynamic, entrepreneurial, and creative workplace
Work hard and take risks
Effective leadership is visionary, innovative, and risk-oriented
Experimentation and innovation are important
The emphasis is on being at the leading edge of new knowledge, products, and services
Employees have to be ready for change and they need to meet new challenges
The organization’s long-term emphasis is on rapid growth and acquiring new resources
Hierarchy Culture Market Culture
A formalized and structured workplace
Formal rules and policies are important
Procedures determine what employees have to do
Effective leaders are good coordinators and organizers
The organization has to be smooth-running
The long-term concerns of the organization are stability, predictability, and efficiency
(Cameron & Quinn, 2006)
A results-oriented workplace
Leaders are hard-driving producers and competitors
Working here is tough and demanding
An emphasis on winning
The long-term concern is on competitive actions and achieving stretch goals and targets
Market leadership is important (Cameron & Quinn, 2006)
A strong organizational culture increases profitability (Cameron & Quinn, 2006). Previous studies have shown that performance increases when individual and organizational cultures match (Cameron & Quinn, 2006). “When the values, orientations, definitions, and goals stay constant - even when procedures and strategies are altered - organizations [and individuals] return quickly to the status quo” (Cameron & Quinn, 2006). Unfortunately, many organizations have little understanding of the organizational cultures they have at their home country. The understanding of the organizational culture of the foreign country is even less.
Leadership
“Organizational cultures may have visible attributes, or hidden meanings, such as one’s business attire, or communication styles, or even management methods” (Kattman, 2014). Organizational culture is correlated with leadership. As described in Cameron & Quinn’s (2006) dimensions, different leadership styles are part of different types of organizational cultures.
that directive leadership fits within the characteristics of the hierarchical organizational culture.
Empowering leadership is “the process by which leaders share power with employees by providing additional responsibility and decision-making authority over work and resources as well as the support needed to handle the additional responsibility effectively” (Martin et al., 2012). Empowering leaders are characterized by: they share responsibilities (delegation), they express confidence in employees, they assist in building employee capabilities, and they involve their employees in decision making. These characteristics are more associated with the clan culture of Cameron & Quinn (2006).
The research of Martin et al. (2012) was about the effect of leadership on how employees’ satisfaction with their leaders and the effects of leadership on unit proficiency and proactivity. Their main results suggested that leaders need to inspire and intrinsically motivate their employees in order to increase performance. When we look at the definitions of the two leadership types, empowering leadership should be most effective. Martin et al. (2012) found in their research that empowering leadership can improve employee performance in a high power distance culture. Their findings suggest that empowerment is successful for high power distance cultures, because employees are not used familiar with this kind of leadership and they will take advantage of the opportunity.
Houghton, Carnes, and Ellison (2014) state that there is a current trend that shifts from directive, more hierarchical leadership towards empowering leadership. They call this phenomenon self-leadership, as the focus is more on how employees can inspire and lead themselves. Due to the high education and the high motivation of today’s workforce, employees tend to lead themselves. Critical leadership roles are shared by employees instead of being filled by one leader (Pearce and Manz, 2005; Houghton et al., 2014). This is important to keep in mind, as this trend of leadership has influence on the organizational culture. When we compare this trend with the organizational culture dimensions of Cameron & Quinn (2006) we can say that the shift from directive to empowering is a shift from hierarchical cultures towards clan cultures.
type, they found that there were variances in the change among the countries they examined (the United States, China, German and Portugal). This could indicate that in countries with different national cultures there are still differences in leadership and organizational culture which can lead to conflicts for employees.
National culture
There are multiple dimensions of national culture, but they all have the same basics, therefore this research will use the definition of Geert Hofstede. Hofstede (1991) has defined culture as “the collective programming of the mind distinguishing the members of one group or category of people from another”. The “category” can refer to nations, regions within or across nations, ethnicities, religions, occupations, organizations, or genders. A more simplified definition is “the unwritten rules of the social game”. With this definition Hofstede, initially, developed a framework with 4 dimensions with which he ranked the cultures of countries. To better understand the Dutch national culture, this framework will be used in this research. Hofstede’s framework has been chosen because the it is organizational oriented and therefore the dimensions of the framework can be easily linked to organizational culture.
The first dimension is Power Distance. “Power distance is defined as the extent to which the less powerful members of institutions and organizations within a country expect and accept that power is distributed unequally” (Hofstede, 2014a). The second dimension is Individualism. “Individualism on the one side versus its opposite, collectivism, is the degree to which individuals are integrated into groups” (Hofstede, 2014a). The third dimension is Masculinity. “Masculinity versus its opposite, femininity, refers to the distribution of emotional roles between the genders which is another fundamental issue for any society to which a range of solutions are found” (Hofstede, 2014a). The fourth dimension is Uncertainty Avoidance. According to Hofstede (2014a) “Uncertainty avoidance deals with a society's tolerance for uncertainty and ambiguity. It indicates to what extent a culture programs its members to feel either uncomfortable or comfortable in unstructured situations. Unstructured situations are novel, unknown, surprising, different from usual”.
obligations” (Hofstede, 2014a). The second one is Indulgence. “Indulgence stands for a society that allows relatively free gratification of basic and natural human drives related to enjoying life and having fun. Restraint stands for a society that suppresses gratification of needs and regulates it by means of strict social norms” (Hofstede, 2014a).
In this paper the Dutch and British culture is studied. Based on the national culture, an overview of the organizational culture of that country can be formed. To get a good overview, the Dutch and British national culture will be described based on Hofstede’s national cultural dimensions. Figure 3 shows the scores for each dimension. Table 2 describes what the values of each score mean for the Netherlands and the United Kingdom.
Figure 3: Dutch and British national culture by the dimensions of Geert Hofstede. Source: Hofstede (2014b, 2014c)
TABLE 2 National cultures
Cultural dimension
The Netherlands United Kingdom Power Distance Score: 38
Low Power Distance
Power is decentralized
Managers count on the experience of their team members
Employees expect to be consulted
Control is disliked
Contact between employees and
Score: 35
Low Power Distance, but division
PD is low amongst the higher class
PD high amongst the working classes
Cultural dimension
The Netherlands United Kingdom Power Distance managers is informal and on first
name basis.
Communication is direct and participative (Hofstede, 2014b) Individualism / Collectivism Score: 80 Individualistic society
The relationship between the employer and employee is based on a contract.
Drive for mutual advantage, hiring and promotion.
Decisions are made in order to make profit
Management focuses on individuals (Hofstede, 2014b)
Score: 89
Individualistic society
Children are taught to think for themselves
Children are supposed to find their unique purpose in life and how they can contribute to society
The route to happiness is through personal fulfillment High consumerism ‘ME’ culture. (Hofstede, 2014c) Masculinity / Femininity Score: 14 Feminine society
Caring for others and guardianship are important
Life/work balance is important
An effective manager is supportive to his/her people, and decision making is achieved through involvement
Managers strive for consensus and people value equality, solidarity and quality in their working lives.
Conflicts are resolved by
compromise and negotiation, the objective is to reach consensus (Hofstede, 2014b).
Score: 66
Masculine society
Material success and progress are important
Highly success oriented and driven. Although they have a culture of modesty there is an underlying success driven value system in the culture.
People in the UK live in order to work and have a clear
performance ambition. (Hofstede, 2014c)
Uncertainty avoidance
Score: 53
Slight preference for uncertainty avoidance.
Emotional need for rules
Time is money, people have an inner urge to be busy and work hard
Precision and punctuality are the norm
Innovation may be resisted
Security is an important element in individual motivation
Score: 35
Low Uncertainty Avoidance
Happy to wake up not knowing what the day brings
Change plans as new information comes to light
Comfortable in unfamiliar situations
Little rules
Cultural dimension
The Netherlands United Kingdom Uncertainty
avoidance
(Hofstede, 2014b) clear
High level of creativity and strong need for innovation
What is different is attractive!
Heavy consumerism for new and innovative products (Hofstede, 2014c) Long-term focus / Short-term focus Score: 67
Long-term focus society
People believe that truth depends very much on the situation, context and time
Ability to easily adapt traditions to changed conditions
A strong propensity to save and invest
Strong drive to achieve results (Hofstede, 2014b)
Score: 51
The shore is intermediate so there is no dominant preference. (Hofstede, 2014c)
Indulgence Score: 68
Indulgent society
Give in to impulses and desires
Focus on enjoying life and having fun
Positive attitude
Tend towards optimism.
Leisure time is important
Act as they please and spend money as they wish
(Hofstede, 2014b)
Score: 69
Indulgent society
Give in to impulses and desires
Focus on enjoying life and having fun
Positive attitude
Tend towards optimism.
Leisure time is important
Act as they please and spend money as they wish
(Hofstede, 2014c)
Organizational culture and national culture
cultures. His research showed that performance was dependent on how well the organizational culture would fit in the economic and institutional environment of a country and how much the organizational culture would match the national culture in terms of human resources, strategy and work organization (Sorge, 1991).
Kattman (2014) researched whether cultural differences, national or organizational, have impact on how effectively the continuous improvement process was received within the supply chain. At the beginning of his article he states that the difference between organizational cultures and national cultures is that organizational cultures are often learned in one’s adult life and not as deep as national cultures (Kattman, 2014). In contrary, his research found that organizational culture was more influential than national culture when it comes to improvement processes (Kattman, 2014). This means that although the organizational culture is influenced by the national culture, the organizational culture is more dominant than the national culture. Kattman (2014) finds that differences between organizational and national culture decrease overtime, but as this takes years this can sometimes take too much time for some companies. Although, leaders can play an important role in decreasing the influence of the national culture. Leaders can create an organizational culture which can dominate or overtake the beliefs someone has due to their national culture, but this is only in the case of very strong leadership (McLaurin, 2008).
The two countries do not differ with regard to power distance, although there is a power distance division within the United Kingdom. The higher class in the British society has a low power distance, which is in contrary to the working class where there is a high power distance. The industry examined in this paper is part of the working class and has a high power distance. This is the complete opposite of the Netherlands, which is a low power distant society. High power distant societies are characterized by a lot of hierarchy and people accept power inequalities. People with a lot of power have more benefits in society than people with little power. (Hofstede, 1991) This high level of power distance goes together with masculinity and the characteristics of a hierarchical organizational culture.
On the other hand, we have the Netherlands which is a feminine society. In feminine societies the focus is on the wellbeing of people. Warm relationships are important and therefore, care for the employees and a good relationship between employer and employee is considered as important. Goals and achievements are less important. In the Netherlands the stress at work is on equality, solidarity and quality of work life. Dutch managers use intuition and strive for consensus. There is an emphasis on negotiation and consultation between employees and managers. This corresponds to the empowering leadership style and the accompanying clan organizational culture.
Health of employees
Research has shown that job stress affects both the employee and the company. The employee can get physical and mental health problems, which can lead to employee dissatisfaction, absenteeism, reduced motivation and depression (Dhobale, 2009; Parker & De Cotiis, 1983). The organization is affected by the well-being of the employee due to the absenteeism (sick leave) and reduced motivation which both affects the turnover of the company (De Croon et al., 2004; Parker & De Cotiis, 1983). Job stress also causes the employees spending a lot of time and energy coping with their stress, which affects their performance (Jamal, 2005). This shows the necessity of a good health of employees, because a good health improves their performance at work.
In the case of this research, it is very likely that work-related stress can be caused due to frictions between the national culture of employees and the not correlating organizational culture of the company where they work. Managers and employees of different cultures get conflicts due to miscommunications that are caused by cultural differences. Furthermore, a different organizational culture can demand more from an employee. The newness of the organizational culture can also be the cause of a too high demand and conflicts between employees and managers.
The previous discussed literature leads to formulation of the following hypothesis:
METHODOLOGY
The development of the hypothesis of this research is based on already existing theory which is common at a deductive research approach. The type of research approach determines which research method is used. A characteristic of a deductive research approach is that it uses quantitative research methods. The most common quantitative research methods are: an experiment, a survey, a case study and action research. The chosen research method for this research is a survey. This method was chosen because this research method is very useful when causative data needs to be empirically examined. Due to time constraints the survey was the only research method used and the survey was conducted cross-sectional instead of longitudinal.
The methods of conducting the survey are by means of self-completion questionnaires online and on paper. Both methods have certain advantages and disadvantages. The advantages and disadvantages of internet are: medium/low response rate, medium/high response quality, medium/high sample size, good dispersed groups, medium/high unit costs (Thomas, 2004). The main disadvantage of handing the surveys over in person is the presence of an interviewer, as this can cause interviewer bias that will distort the data (Thomas, 2004). This should be taken into consideration when the results will be analyzed.
The survey was first tested among five people to see if it was understandable for respondents and to receive feedback about the questions. After this trial the survey was spread among people that fitted the respondents’ criteria. The criteria included that the respondents had to be Dutch, they had to work for a Fashion retail company in the Netherlands and the company they worked for had to be founded in the Netherlands (NLHQ) or the United Kingdom (UKHQ). The survey was spread via Fashion Retail LinkedIn groups, via Facebook, via E-mail and it was handed personally to the respondents. The first method was chosen to give the respondents a more anonymous feeling as they could fill the survey in behind a computer screen. The latter method was used to increase the number of respondents, as online there were only few respondents that filled in the survey and in real life the respondents could be “forced” to spend a little time on filling in the survey.
Ultimately, 223 respondents filled in the survey. 22 items were deleted from the sample as the data from the respondents was not filled in completely, which led to a final sample of 201 respondents, with 114 respondents from firms founded in the Netherlands and 87 respondents from firms founded in the United Kingdom. Kotrlik & Higgins (2001) wrote an article about how you can determine your appropriate sample size. In their article they describe that the minimum required sample size for continuous data for a population of more than 10,000 at a “t” of 1.96 should be 119. As the sample size of this research is 201, the criteria for the required sample size are met.
high satisfaction with the agreements, which means that the perceived job stressors are low. Originally, is Likert scale data considered as ordinal data. As the Likert scale data is converted into an index this means that the data is now continuous.
The reliability of the survey was tested by using Cronbach’s alpha. The Cronbach’s alpha checks for the consistency of the variables. When the respondents give consistent answers to the questions, the alpha will be high. The closer the value of Cronbach’s alpha is to 1, the more consistent and therefore the more reliable the survey is. The minimum required value for the variable to be reliable is a Cronbach’s alpha of 0.700 (Nunnally, 1967).
As a survey is a quantitative method of research a quantitative method of analysis has to be used. Because the idea of this paper was to make a comparison between two groups an independent T-test was used. This test measures the means between two groups. With an independent T-test the independent variable needs to be categorical and the dependent variable needs to be continuous. The independent variable is the location of the headquarters of the company. The dependent variables are job stress and four job stressors. The Independent T-test was conducted by the use of SPSS.
ANALYSIS & DISCUSSION
Five variables were used to measure the degree and causes of job stress in fashion retail firms in the Netherlands. The means, standard deviations, and reliability coefficients of each variable are presented in table 3. The reliability coefficients are tested by the use of Cronbach’s alpha. The reliabilities of the variables for both countries are varying from 0.630 till 0.974. The minimum required value for the variable to be reliable is a Cronbach’s alpha of 0.700 (Nunnally, 1967). All the variables, except for one, have a value above 0.700. The variable supervisor performance for the Dutch sample has a Cronbach’s alpha of 0.630. When we look at table 4 “Cronbach’s alpha when items are deleted”, there is no item that can be deleted to increase the alpha up to 0.700 or higher. The table shows that the questions about fair reviews and knowledgeability of the supervisor about the work are most consistent. The same variable for the UKHQ sample does have an alpha above 0.700. This difference could be caused by Dutch respondents that misunderstood questions. However, an alpha of 0.630 is not substantially lower than 0.700 and is therefore still acceptable for this thesis.
Table 3 Group statistics
An independent T-test was used to test the hypothesis. Job stress and job stressors were used to test whether there is a difference in the perceived stress between employees working for a Dutch company and employees working for a company from the United Kingdom. The results are presented in Table 5 and 6. Before the T-test was calculated, Levene’s test for equality of variances was performed. This test examines whether the variances in the two groups are equal. If the test is significant (p>0.05) then the row “equal variances not assumed” can be
N Mean Std. Deviation Std. Error Mean Cronbach's alpha NLHQ 114 2,0614 ,57661 ,05400 ,707 UKHQ 87 2,8161 ,89285 ,09572 ,817 NLHQ 114 2,8694 ,47653 ,04463 ,713 UKHQ 87 3,0958 ,65694 ,07043 ,809 NLHQ 114 2,5307 ,71731 ,06718 ,841 UKHQ 87 3,0517 1,24133 0,13308 ,974 NLHQ 114 2,4890 ,56088 ,05253 ,630 UKHQ 87 2,6379 ,73508 ,07881 ,731 NLHQ 114 3,6417 ,72174 ,06760 ,879 UKHQ 87 3,3519 ,78136 ,08377 ,904 General Appreciation Supervisor Supervisor Performance Job Stress Group Statistics
In which country is the mother base of your company?
General Satisfaction
used. Levene’s test turned out to be not significant for the variable job stress as the p value was higher than 0.05 (p=0.348). This means that equal variances can be assumed. The test was significant for all the job stressor variables as the p values were lower than 0.05 (general satisfaction: p<0.001, company characteristics: p=0.023, general appreciation supervisor: p<0.001, supervisor performance: p=0.002). Which means that equal variances cannot be assumed.
Table 4
Cronbach’s alpha when items are deleted
The independent T-test indicated that there is a significant difference between NLHQ and UKHQ when job stress is measured (t-value = 2.721, p=0.007). Which means that employees working for UKHQ (M = 3.35, SD = 0.78) experience more job stress than employees working for NLHQ (M = 3.64, SD = 0.72). Although the means of the two groups are very close to each other, the T-test shows a significant difference. Therefore, the hypothesis of this paper is supported.
The job stressor variables are evaluated to help determining the causes of job stress. The t-test for these variables showed that there is a significant difference between NLHQ and UKHQ when general satisfaction (tvalue = 6.867, p<0.001), company characteristics (tvalue = -2.715, p=0.007) and general appreciation supervisor (t-value = -3.495, p=0.001) are measured. Which means that employees working for UKHQ (general satisfaction: M = 2.82,
SD = 0.89, company characteristics: M = 3.10, SD = 0.66, general appreciation supervisor: M = 3.05, SD = 1.24) do experience more job stressors than employees working for NLHQ (general satisfaction: M = 2.06, SD = 0.58, company characteristics: M = 2.87, SD = 0.48,
general appreciation supervisor: M = 2.53, SD = 0.72). There was no significant difference between employees from the Netherlands (M = 2.49, SD = 0.56) and the United Kingdom (M
= 2.64, SD = 0.74) with regard to the job stressor supervisor performance. From this can be
Scale Mean if Item Deleted Scale Variance if Item Deleted Corrected Item-Total Correlation Cronbach's Alpha if Item Deleted
My supervisor gives me fair reviews 7,56 4,018 ,208 ,678
My supervisor has reasonable expectations of my work
7,70 3,362 ,608 ,472
My supervisor is knowledgeable about my work 7,52 3,048 ,362 ,603
My supervisor takes time to listen to me 7,09 2,293 ,564 ,429
Item-Total Statisticsa
concluded that the influence of the supervisor is very important and is not subjective to organizational and national cultural differences.
Table 5
Independent samples T-Test for Job Stress
Table 6
Independent samples T-Test for the Job stressors
Previous research already indicated that national culture is embedded in organizational culture (Kattman, 2014; Sorge, 1991). This was also concluded after the comparison of the organizational cultures of the Netherlands and the United Kingdom based on Hofstede’s dimensions. Ryan et al. (2010) wrote that organizational cultures can be transferred to other countries, but this will be difficult when national cultures are different. The results of the
Lower Upper Equal variances assumed ,885 ,348 2,721 199 ,007 ,28980 ,10650 ,07979 ,49981 Equal variances not assumed 2,692 177,260 ,008 ,28980 ,10764 ,07738 ,50222 df Sig. (2-tailed) Mean Difference Std. Error Difference 95% Confidence Interval of the Job Stress
Independent Samples Test
Levene's Test for
Equality of Variances t-test for Equality of Means F Sig. t Lower Upper Equal variances assumed 19,888 ,000 -7,259 199 ,000 -,75469 ,10396 -,95970 -,54968 Equal variances not assumed -6,867 138,760 ,000 -,75469 ,10991 -,97200 -,53738 Equal variances assumed 5,273 ,023 -2,831 199 ,005 -,22639 ,07996 -,38406 -,06872 Equal variances not assumed -2,715 150,469 ,007 -,22639 ,08338 -,39114 -,06164 Equal variances assumed 47,932 ,000 -3,739 199 ,000 -,52102 ,13934 -,79580 -,24624 Equal variances not assumed -3,495 129,039 ,001 -,52102 ,14908 -,81598 -,22606 Equal variances assumed 9,693 ,002 -1,629 199 ,105 -,14890 ,09139 -,32912 ,03133 Equal variances not assumed -1,572 155,966 ,118 -,14890 ,09471 -,33598 ,03819 Mean Difference Std. Error Difference 95% Confidence Interval of the General Satisfaction
Independent Samples Test
Levene's Test for
independent T-test also confirmed this observation. As expected in the hypothesis the data revealed a difference between Dutch employees in Dutch firms and Dutch employees in firms from the United Kingdom regarding job stress. Employees working for a firm from the United Kingdom experienced more job stress than employees working for a firm from the Netherlands. So, circumstances within the firm from the United Kingdom cause job related stress with the employees, which therefore affects their health.
The hypothesis is confirmed by the results of the independent T-test. To go further into answering the research question and to see what causes the job stress of employees. Pearson correlations are used, the results can be found in table 7 and 8.
TABLE 7
Pearson correlations for NLHQ
We first look at the correlations between the variables for the NLHQ. There are no correlations that can be called very strong as there are no correlations above 0.700. Although there are some correlations that come very close to this value. The first one is between the number of years the employee has worked for the company and the age of the employee. This correlation is positive which means that the older the employee the more years he or she has been working for the company. This sounds like a logical correlation. The second strong correlation is between age and job stress, this is a negative correlation. This means that the stress decreases as the age of the employee increases. This is a very interesting correlation,
Department Years worked for
the
company Gender Age
Highest level of completed
education Job Stress
General Satisfaction Company Characteris tics General Appreciatio n Supervisor Supervisor Performanc e Department 1 ,035 -,096 ,167 ,053 -,035 -,075 ,073 -,098 ,076 Years worked for the
company ,035 1 ,010 ,695** ,262** -,517** ,199* -,177 ,373** ,151 Gender -,096 ,010 1 -,121 -,072 ,205* ,004 -,115 ,232* -,065 Age ,167 ,695** -,121 1 ,189* -,643** ,265** -,109 ,138 ,136 Highest level of completed education ,053 ,262** -,072 ,189* 1 -,255** ,441** ,057 ,303** ,220* Job Stress -,035 -,517** ,205* -,643** -,255** 1 -,281** ,171 -,068 -,252** General Satisfaction -,075 ,199* ,004 ,265** ,441** -,281** 1 ,271** ,632** ,488** Company Characteristics ,073 -,177 -,115 -,109 ,057 ,171 ,271** 1 ,205* ,236* General Appreciation Supervisor -,098 ,373** ,232* ,138 ,303** -,068 ,632** ,205* 1 ,556** Supervisor Performance ,076 ,151 -,065 ,136 ,220* -,252** ,488** ,236* ,556** 1 Pearson Correlation
**. Correlation is significant at the 0.01 level (2-tailed). *. Correlation is significant at the 0.05 level (2-tailed).
and this can be very interesting for future research. This correlation also appears in the sample of the United Kingdom but this correlation is less strong.
TABLE 8
Pearson correlations for UKHQ
The third correlation is between supervisor performance and general appreciation supervisor. This is a logic correlation as these variables both concern questions about the supervisor. Two other strong correlations are between general satisfaction and supervisor performance and, general satisfaction and general appreciation supervisor. It is known that the supervisor is very important for the organization. When an employee does not like the supervisor the employee will overall be unsatisfied with the job and the organization.
There are some other less strong correlations in the sample of employees from NLHQ. The level of completed education positively correlates with the satisfaction in general and with the appreciation of the supervisor in general. So, the higher the level of completed education, the higher the level of satisfaction. Interestingly, the department where the employee is working does only correlate weakly with the other variables, for both NLHQ and UKHQ. Therefore, the department within the company has no influence on job stress or job stressors.
Age and job stress show a strong negative correlation for NLHQ. Which means that job stress decreases as the age of the employees increases. UKHQ shows this correlation as well, but the correlation is weak for this sample. A cause of this could be that as the UKHQ firms are rather
Department Years worked for
the
company Gender Age
Highest level of completed
education Job Stress
General Satisfaction Company Characteris tics General Appreciatio n Supervisor Supervisor Performanc e Department 1 -,166 ,070 -,204 -,019 ,146 ,128 ,099 ,206 ,228* Years worked for the
company -,166 1 -,088 ,269* ,115 -,250* -,380** -,359** -,015 ,035 Gender ,070 -,088 1 -,080 ,056 ,022 ,121 ,107 -,032 -,024 Age -,204 ,269* -,080 1 -,003 -,306** -,251* -,130 -,124 -,115 Highest level of completed education -,019 ,115 ,056 -,003 1 -,257* ,333** ,269* ,197 ,069 Job Stress ,146 -,250* ,022 -,306** -,257* 1 -,366** -,131 -,236* -,443** General Satisfaction ,128 -,380** ,121 -,251* ,333** -,366** 1 ,752** ,667** ,602** Company Characteristics ,099 -,359** ,107 -,130 ,269* -,131 ,752** 1 ,330** ,214* General Appreciation Supervisor ,206 -,015 -,032 -,124 ,197 -,236* ,667** ,330** 1 ,828** Supervisor Performance ,228* ,035 -,024 -,115 ,069 -,443** ,602** ,214* ,828** 1
a. In which country is the mother base of your company? = The United Kingdom
Correlationsa
Pearson Correlation
new in the Netherlands, the job is also rather new for the employees. Therefore they are not as common with the job and perceive higher levels of job stress.
For UKHQ the number of years an employee has worked for the company correlates negatively with general satisfaction. Which means that the employees that work the least amount of years for the company are more satisfied in general and with the job characteristics. General satisfaction and company characteristics have a correlation above 0.700 in the UKHQ sample, which means that they correlate very strong. A strong general satisfaction means a strong satisfaction with the company characteristics. Interestingly, this correlation is weak for NLHQ, which means that the company characteristics do not influence the overall satisfaction.
There are two correlations that can be easily explained. The correlation between job stress and general satisfaction and the correlation between job stress and supervisor performance. The correlations are both negative which means the less general satisfaction or the less satisfaction with the supervisor performance, the more job stress the employees perceive. It sounds logic that employees that perceive a lot of job stress give a low overall satisfaction rating. Furthermore, employees that are not satisfied with their supervisor will perceive a high level of job stress as the supervisor has a huge influence on the day to day work of the employee. There are a couple of correlations in the UKHQ sample that match with those from NLHQ. The level of completed education positively correlates with the satisfaction in general. So, the higher the level of completed education, the higher the level of satisfaction. This is the same as for NLHQ but the correlations are less strong. Another similarity is the correlation between general appreciation supervisor and supervisor performance, this is even a very strong correlation for UKHQ. The countries also have similar correlations between general satisfaction and general appreciation supervisor and general satisfaction and supervisor performance.
CONCLUSION
A comparison between countries based on perceived job stress and influenced by organizational and national cultures has never been made and that is where this research adds value to the existing literature. The aim of this paper was to answer the research question “How is the health of employees of international firms operating in the Netherlands affected by organizational and national cultural differences?”. It was hypothesized that foreign retail companies operating in the Netherlands would have more job stress among employees than employees of Dutch retail firms. As described earlier in this paper job stress is one of the main causes of health problems among employees. That is the reason why job stress is chosen to measure the effect of organizational and cultural differences on employees.
As expected in the hypothesis, the data revealed a significant difference in job stress between Dutch employees in NLHQ firms and Dutch employees in UKHQ firms. Dutch employees working for UKHQ experienced more job stress than Dutch employees working for a firm from NLHQ. Overall, the employees of UKHQ were less satisfied with their job than the employees of NLHQ. Employees from UKHQ are less satisfied with company characteristics as salary, flexibility of working hours, pension plans and other benefits. UKHQ employees are also less appreciative of their supervisor in general. This dissatisfaction is caused by the different organizational culture the UKHQ firm uses. NLHQ firms are, due to their feminine origin, more oriented towards the employee, rather than focusing on achieving goals and making profits. When the performance of the supervisors is evaluated, there are no big differences between NLHQ and UKHQ. The results of the T-test were not significant for this variable. This means that the importance of the supervisor does not depend on culture. The Cronbach’s alpha of the supervisor performance for NLHQ did not reach the required minimum of 0.700. Which means that the employees are less consistent in giving answers, especially with regard to the questions about fair reviews and knowledgeability of the supervisor about the work.
have worked for no longer than five years for the firm. In comparison, for NLHQ many employees have worked for the firm from five till more than ten years.
In the NLHQ sample age and job stress show a strong negative correlation. Which means that job stress decreases as the age of the employees increases. This correlation does appear in the UKHQ sample, but it is a weak correlation. An explanation for this could be that as the UKHQ firms are rather new, the job is also rather new for the employees, therefore they are not common with the work and perceive higher levels of job stress. The UKHQ sample has a very strong correlation between general satisfaction and company characteristics, for NLHQ this correlation is weak. Thus, for UKHQ employees, company characteristics are very important for the general satisfaction. While, for NLHQ employees company characteristics are not very important for the overall satisfaction. The T-test showed that UKHQ employees are less satisfied with the company characteristics in contrary to NLHQ employees. Although, their rating of company characteristics has little influence on job stress.
The mix of Dutch and British employees on the work floor is what mostly causes job stress in UKHQ firms, as two different cultures are in direct contact with each other. British firms use British supervisors that have already worked for the company, to transfer the values of the company to the employees of the new country. This is understandable from the company’s point of view, however it would be recommendable to create a good mixture of Dutch and British managers. By this means the values of the company will not be lost or changed and the well-being of the employees will be improved. The Dutch supervisors can learn from the British about the company and the British supervisors can learn from the Dutch about the culture. Ultimately, the ideal situation would be an organizational culture, which suits both the British and the Dutch.
This study provides practical implications for managers in large retail organizations. The findings of this paper will be important for organizations, as the findings will help them to better succeed when they want to expand to the Netherlands or possible other countries. The study findings will help to understand and avoid the pitfalls the company can experience regarding cultural differences. As well as the implications the national culture can have on the organizational culture and the effect this has on the wellbeing of the employees.
Limitations
As is the case with most empirical research, several constraints were placed on the design of this study which may affect the interpretation and generalizability of results. The first limitation concerns the national culture variable. National culture is described in this paper by using the six dimensions of national culture by Geert Hofstede. As only the view of Hofstede is used, a limited view of national culture has been given. The same limitation accounts for organizational culture. As only the model of Cameron & Quinn is used, a limited view of organizational culture has been given.
other countries than the United Kingdom operating in the Netherlands do not perceive other levels of job stress as employees from the Netherlands. This is all subjective to how much the dimensions of Hofstede differ between the countries. This limitation of generalization also accounts for the number of companies used. As there are only few companies used, future research should validate if the results are the same when more companies from the United Kingdom and the Netherlands are used in the sample.
Future research
As previously described, this research only used the theory of Hofstede and Cameronn & Quinn. It could be interesting for future research to focus on others views of cultural and organizational dimensions. In addition, it can be worth to examine whether the results are generalizable. Future research could investigate the differences between other countries than the Netherlands and the United Kingdom and other industries could be investigated as well. Another suggestion for future research is to examine the cause of the negative correlation between age of an employee and job stress. Why do older employees experience less job stress? Is it because they care less about their jobs as they grow older or is it caused due to a decrease of ambition? Furthermore, it could be possible that there is a link between the age of an employee, job stress and the number of years worked in the company. The correlations in this paper show that UKHQ has a weak correlation between age and job stress. However, as the UKHQ firms are rather new in the Netherlands, the jobs are rather new for the employees as well. An employee that works for a company for more than ten years also has a higher age, and perceives less job stress according to the correlations. Could it be that the number of years that the employee works for the company actually the determinant for job stress?
A final suggestion for future research concerns the link between the highest level of completed education and general satisfaction. This correlation appears in both samples and it shows that the higher the level of completed education is, the more satisfied the employees are. Future research could investigate the cause of highly educated people being more satisfied.
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APPENDIX A Dear contestant,
My name is Marèl Bos and I study International Business Management at the Rijksuniversiteit Groningen. I am currently writing my Master Thesis, a part of this thesis is the investigation of job satisfaction within international organizations. This survey is anonymous and your responses will be held in the strictest confidence. Completing the survey takes no more than 5 minutes of your time. Thanks in advance for your cooperation!
Kind regards,
Marèl Bos
Company
Please select the department you are working for within your company
Customer Service General Administration Marketing Management Human Resources Sales ICT
Other (Please Specify)_________________________________________________________ How long have you worked for your company?
Less than 1 year
One to three years
Three to five years
Five to ten years
More than ten years
In which country is the mother base of your company?
__________________________________________________________________________________ General satisfaction: Very sa tisfied Sa tisfied N eutral u n satisfied Very u n satis fied
Overall, how satisfied are you with your company?
Company characteristics
Please rate your level of satisfaction with the following: Very sa tisfied Sa tisfied N eutral u n satisfied Very u n satis fied Workload
Connection between pay and performance
Pension plans
Salary
Other benefits
Access to company sponsored education and training
Job security
Opportunity for advancement
Flexibility of work hours
Supervisor Very sa tisfied Sa tisfied N eutral u n satisfied Very u n satis fied
How satisfied are you, in general, with your
supervisor?
How satisfied are you, in general, with the relationship
with your supervisor?
Please indicate how well the following statements apply to your supervisor.
Stro n gly ag ree Ag ree N eutral D isag ree Stro n gly d isag ree
My supervisor gives me fair reviews
My supervisor has reasonable expectations of my work
My supervisor is knowledgeable about my work
Job characteristics
Please indicate how strongly you agree with the following statements. Stro n gly ag ree Ag ree N eutral D isag ree Stro n gly d isag ree
I have felt restless or nervous as a result of my job Working here makes it hard to spend enough time
with my family
My job gets to me more than it should
I spend so much time at work, I can't see the bigger
picture
There are lots of times when my job asks too much
from me
Working here leaves little time for other activities Sometimes when I think about my job I get a tight
feeling in my chest
I frequently get the feeling I am married to the
company
I have too much work and too little time to do it in
I feel guilty when I take time off from job
I sometimes turn off my phone because I’m afraid I
might get a job-related call/message
I feel like I never have a day off
Too many people at my level in the company get
burned out by job demands
Personal data
What is your gender?
Male
Female What is your age?
__________________________________________________________________________________
What is your highest level of completed education?
No diploma High school Vocational Education College Bachelor University Bachelor University Master
