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ORGANIZATIONAL COMMITMENT OF MANAGERIAL EMPLOYEES: A UNIFIED THEORY AND ANTECEDENTS

A dissertation submitted by Abdul M Baksh, PhD, MSc In partial fulfillment of the award of Doctor of business Administration Faculty of Business, University of Southern Queensland

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ABSTRACT

Much has been written about organizational commitment in the past twenty five

years and these studies have significantly contributed to the extant understanding of

the concept. However, these efforts have also contributed to the confusion,

inconsistencies, and disagreements about the meaning of the concept that seem to

characterize the organizational commitment literature. This milieu required, as a

matter of necessity, that the disparate conceptualizations of organizational

commitment be reconciled and synthesized to form a unified, comprehensive

theory. This situation and the apparent need to focus on those organizational factors

that function as antecedents of managerial commitment to organizations provided

the impetus for the present study.

In keeping with the above purpose, this study has developed a comprehensive

unified theory of organizational commitment that was tested using structural

equation modeling. The study shows that the theory of organizational commitment

is based on six separate parent theories, including attitudes, psychological

ownership, psychological contract, values, certain aspects of the three-component

model of Meyer and Allen (1991), and social exchange, which makes it a multi-

disciplinary theory. The theories of attitudes and psychological ownership

constitute the psychological ingredient of the affection employees manifest to their

organization and provide the theoretical foundation of the affective dimension of

organizational commitment. Similarly, the theories of psychological contract,

values and organizational culture provide the corner stone for the feelings of moral

obligation employees display toward the organization, and concomitantly, the moral

dimension of organizational commitment. Finally, social exchange theory and labor

market forces define a socio-economic relationship between each individual and the

organization and provide the basis for the continuance dimension of organizational

commitment.

The research problem identified for this study was the lack of a unified theory of

organizational commitment that is needed to identify the antecedents of managerial

commitment to organizations. Thus, the purpose of the study was to examine the

state of the theory of organizational commitment and propose a unified socio-

psychological theory that provided the theoretical foundation to identify the

antecedents and dimensions of the organizational commitment of managerial

employees. Therefore, the research question that the study answered is: what are the

antecedents and dimensions of managerial commitment in organizations? In

addition to this, the study investigated six related issues: (a) the socio-psychological

theories providing the theoretical foundations of a unified theory of organizational

commitment, (b) the principal dimensions of a new unified theory of organizational

commitment, (c) the predictors and causes of managerial commitment, (d) the

degree to which perceived pay equity, socialization tactics, opportunities for

development, organizational trust, and job satisfaction act as predictors of

organizational commitment, (e) the variable or variables which moderate and/or

mediate the impact of the predictors of organizational commitment and, (f) the

relationships among the five predictors named above.

The study was justified on the basis of its potential to make significant contributions

to both management practice and theory. From the perspective of management

practice, the study has provided evidence that should enhance the ability of

organizations to: (a) promote feelings of assonance and minimize feelings of The

study was justified on the basis of its potential to make significant contributions to

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both management practice and theory. From the perspective of management

practice, the study has provided evidence that should enhance the ability of

organizations to: (a) promote feelings of assonance and minimize feelings of

dissonance among their managerial employees through equitable pay, (b) increase

the level of managerial job satisfaction and concomitantly elevate the trust levels of

managers, (c) integrate the interests of managers with those of the organization

through effective socialization tactics and provide managerial employees with

opportunities for development in order to enhance their moral obligations to the

organization. Moreover, the study provides evidence and tools which organizations

may use to engender in their managerial employees strong feelings of ownership for

their organizations, enhance managers‟ trust levels, and minimize their inclinations

to leave their organizations. Theoretically, the study has analyzed and evaluated the extant theories of

organizational commitment, reconciled differences among the various models,

synthesized the multitude of disparate theories, models, concepts and definitions

found in the literature of organizational commitment as a means of conceptualizing

a new theoretical socio-psychological model of organizational commitment. In

essence this effort should make a solid contribution to knowledge in the field and

provide the foundation for future research in managerial commitment.

Methodologically, the data used in this study were collected from four different

organizations at two different time periods of three months apart. Both descriptive

statistical analysis using SPSS 12 and structural equation modeling using AMOS 16

were used to analyze the data. The SEM analysis determined the predictive strength

of the selected independent variables/antecedents, and Barron and Kenny‟s

moderator and mediator analysis identified the moderator and mediator effects of

the independent variables on the dependent variable. The outcome from these

analyses is a model which fits the two sets of data. Apart from other fit indices, the

computations indicated insignificant Chi-sq. values of 16.113, p=.065 and 8.037,

p=.442 for the two sets of data respectively. This particular finding confirms that

the model is theoretically sound and is perhaps a unique development in the field of

organizational commitment.

The results of the study confirm that organizational commitment is a multi-

dimensional theory with three major domains-affective, continuance, and moral

commitment, each of which has a distinct conceptual foundation. The study also

confirms that: (a) affective commitment is based predominantly on psychological

factors; (b) moral commitment is founded on philosophical, ethical and sociological

factors; and (c) continuance commitment which is socio-economic by nature

focuses predominantly on risk, economic losses, economic gains and labor market

conditions that indicate the availability/non-availability of suitable alternative

employment. Additionally, the study indicates that pay equity, developmental

opportunities and socialization tactics act as both moderators and mediators of job

satisfaction and organizational trust which in turn are the two independent variables

predicting the three dimensions of organizational commitment.

In the final analysis, the findings of this study should: (a) be significantly beneficial

to future research in the field of organizational commitment, (b) provide

organizations with critical information for human resource policy formulation and,

(c) contribute meaningfully to knowledge in the field. No other known study in

organizational commitment has gone through such indepth analysis, particularly the

elaborate process of theory building.

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CERTIFICATION OF DESERTATION

I certify that this dissertation is entirely my own effort, except where

otherwise acknowledged. I also certify that the ideas, research, results,

analyses, software and conclusions reported are original and have not been

previously submitted for any award, except where otherwise acknowledged.

__________________ _____________________

Signature of Candidate Date

ENDORSEMENT

_______________ ____________________

Signature of Principal Supervisor Date

___________________________ _______________________

Signature of Associate Supervisor Date

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ACKNOWLEDGEMENT

I am very pleased to express my sincere gratitude to several people who have

contributed to the completion of this research project. First, I am profoundly

grateful to my Supervisor, Dr. Ray Gordon who has provided very incisive

criticisms, highly relevant and useful recommendations, and above all, patience

with my tendency to delve into excessive details. Indeed, the quality of this

document owes much to Dr. Gordon‟s very insightful and valuable contribution.

I also wish to express my gratitude to Professor Erwee who, particularly in the

early stage in the development of this document provided me with very useful

insights and guidance.

I must also thank the four organizations that greatly assisted me in gathering the

data used in this study. Without their willingness to let me have access to their

managerial employees as participants of this project, this document may still be

in its developmental stages.

Finally, I want to express my gratitude to the Examiners who undoubtedly spent

hours pouring over this document from which they ably provided me with

valuable recommendations for its improvement.

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Table of Contents

Abstract

Certification of the Dissertation

Acknowledgements

Table of Contents

List if Figures

List of Tables

List of Appendices

CHAPTER ONE--INTRODUCTION 1

Background to the study 1

Research problem, purpose and issues 7

Justification for the study 8

1 Contribution to Management Practice 9

2 Contribution to Theory 11

Research design and methodology 14

Outline of this dissertation 16

Definitions 17

Delimitations and scope 18

Conclusion 18

CHAPTER TWO--LITERATURE REVIEW 19 Theoretical foundations 19

Parent theories of organizational commitment 23

1. Attitude-Behavior Theory 24

2. Psychological Ownership Theory 28

3. Psychological Contract Theory 32

4. Theory of values and commitment conflict 37

5. The Three-Component Model 43

6. Social Exchange Theory 52

Dimensions of organizational commitment 58

Several versus one comprehensive theory of organizational commitment 58

Theoretical framework 60

Antecedents of organizational commitment 63

1. Perceived Pay Equity 63

2 Socialization Tactics 67

3 Organizational Trust 76

4 Opportunities for Development 79

5 Jobsatisfaction 83

Chapter Summary 90

CHAPTER THREE--RESEARCH METHODOLOGY 92 Overview Of The Study Design 92

Methodology 92

1. Population 92

2. Data collection and analysis 93

3. Sampling design and strategy 93

4. Level and unit of analyses 94

5. Scales 94

5.1 Organizational commitment of managerial employees 95

5.2 Perceived pay equity 96

5.3 Opportunities for development 97

5.4 Socialization tactics 98

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5.5 Organizational trust 99

5.6 Jobsatisfaction 100

Data Screening 102

1. Reliability 102

2. Validity 105

3. Other Issues 106

Procedures 109

1. Ethical Clearance 109

2. Piloting the Questionnaire 109

3. Sampling Strategies and Procedure 109

4. Security and Safety of Completed Questionnaires 110

Data Analysis 110

1. Structural Equation Modeling 110

1.1.The Measurement Model 111

1.2.The Structural Model 112

2. The moderator/mediator research model 112

3. Model fit criteria and model fit indexes 116

4. Testing model fit 120

5. Alternative Models 121

6. The Four-step Process 121

7. Parameter Estimates 122

8. Model Specification 123

9. Model Identification 124

10.Model Assessment 128

Scope and Limitations 128

CHAPTER FOUR: RESULTS 130 Demographics 130

1. Population 130

2. Response rate 130

3. Age distribution of respondents 130

4. Educational attainments of respondents 131

5. Gender distribution of respondents 131

Data Screening 131

1. Reliability 132

2. Validity 132

3. Non-normality Issues 134

4. Resolving missing data 134

5. Resolving Outlier Problems 134

6. Resolving multicollinearity issues 134

Findings: Sample 1 136

1.The structural equation model 136

2.Goodness-of-fit indices 137

3.Alternative models: Sample 1 data 138

4.Parameters estimates 139

Findings: Sample 2 140

1.Structural equation model 141

2.Goodness-of-fit indices 141

3.Alternative models: Sample 2 data 142

4.Parameter estimates 142

Model Specification 144

1.Factor loadings 144

2.The independent clusters basis 145

Model Identification 145

1.Identifiability of the measurement model 146

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2.Identifiability of the path model 146

3.Identifiability and scaling 146

4.Other measures 147

Summary of Results 147

CHAPTER FIVE: DISCUSSION AND CONCLUSION 149

Introduction 149

Research problem 150

Research purpose 152

Research question 154

Research issues and implications for theory 162

1.Theoretical Foundations 162

1.1.Commitment as a manifestation of attitudes 162

1.2.Commitment as an expression of ownership 164

1.3.Commitment as fulfillment of psychological contract 166

1.4.Commitment as a manifestation of values 168

1.5.Commitment as social exchange 169

1.6.Commitment as Culture 171

2.Dimensions of organizational commitment 172

3.Predictors of organizational commitment 173

3.1.Perceived pay equity 174

3.2.Socialization tactics 175

3.3.Organizational trust 177

3.4.Opportunities for development 178

3.5.Jobsatisfaction 179

4.Correlates of the three commitment dimensions 181

5.Moderators and mediators 183

6.Relatiionships among the predictor variables 185

Implications for policy 187

1.Perceived pay equity 187

2.Socialization tactics 188

3.Organizational trust 189

4. Opportunities for development 191

5.Jobsatisfaction 192

Implications for management practice 193

Limitations 197

Implications for future research 199

REFERENCES 204

APPENDICES 231

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List of Figures

Figure 2.1 Relationships between cognitions, feelings and behavior 25

Figure 2.2 Theoretical model for the theory of relational cohesion 55

Figure 2.3 Unified theoretical framework of managerial commitment to organizations 60

Figure 2.4 The dynamic nature of organizational commitment 62

Figure 2.5 A model of organizational socialization 75

Figure 3.1 The moderator model 112

Figure 3.2 Application of the moderator model 113

Figure 3.3 The mediator model 114

Figure 3.4 Path diagram combining mediation and moderation 115

Figure 3.5 Approach to performing SEM analysis 122

Figure 3.6 Recursive CFA model relating independent and dependent variables 127

Figure 4.1 Recursive SEM model showing relationships between independent and 136

dependent variables

Figure 4.2 Recursive SEM model showing relationships between independent and 146

dependent variables

Figure 5.1 Framework for the new unified theory of organizational commitment 186

List of Tables

Table 1.1 Partial list of studies 2

Table 2.1 Partial list of studies indicating inconsistencies 20

Table 2.2 Typology of psychological contracts 34

Table 2.3 Comparison of four decision types on levels of motive forces and avoidability 51

Table 2.4 Categorization of socialization tactics 68

Table 2.5 Results of regression analysis of socialization outcomes 69

Table 2.6 The five-factor personality model and job satisfaction 86

Table 3.1 Comparison of alpha coefficients of socialization tactics 99

Table 3.2 Composite reliabilities by dimension and response mode 100

Table 3.3 Relationships between expectations, experiences and met-expectations 101

Table 3.4 Burnham and Anderson‟s scale for interpreting the BCC AND AIC 121

Table 4.1 Age distribution of participants 130

Table 4.2 Respondents‟ Educational level 131

Table 4.3 Gender distribution 131

Table 4.4 Reliability statistics of sample 1 participants 132

Table 4.5 Reliability statistics of sample 2 participants 132

Table 4.6 Results of factor analysis for sample 1 data 133

Table 4.7 Results of factor analysis for sample 2 data 133

Table 4.8 Means, standard deviations, and correlations of sample 1 factors 135

Table 4.9 Means, standard deviations, and correlations of sample 2 factors 135

Table 4.10 Goodness-of-fit statistics: sample 1 data 138

Table 4.11 Alternative models generated by AMOS: sample 1 data 138

Table 4.12 Estimated loadings: sample 1 data 139

Table 4.13 Regression weights, standard errors, critical ratios and P labels: sample 1 139

Table 4.14 Standard covariances and correlations: sample 1 data 139

Table 4.15 Variances: sample 1 140

Table 4.16 Goodness-of-fit statistics for sample 2 data 142

Table 4.17 Alternative models generated by AMOS for sample 2 data 142

Table 4.18 Estimated loadings: sample 2 143

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Table 4.19 Regression weights, standard errors, critical ratios and P labels: sample 2 143

Table 4.20 Standard covariances and correlations: sample 2 data 143

Table 4.21 Variances: sample 2 144

Table4.22 Ratio of chi-square to degrees of freedom 147

Table 5.1 Moderator/mediator effects of job satisfaction shown in Figures 4.1 and 4.2 183

Table 5.2 Moderator/mediator effects of organizational trust shown Figures 4.1 and 4.2 184

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List of Appendices

1. Appendix A: Questionnaire: Survey of Managerial Employees

2. Appendix B: Results of factor analysis for sample 1 and sample 2 data