Mgmt 570 Course Overview

1. Mgmt 570 Course Overview Agenda Part 1: Course Overview Syllabus Introductions Part 2: Management Epistemologies Part 3: Research Methods

2. WHY A COURSE ON MANAGING EMPLOYEEATTITUDES AND BEHAVIORS? Because… (1) People (human resources) make a difference in “bottom line” outcomes (2) Managers need to do things differently if they want to influence employee attitudes and behaviors (2) The best way is influence employee attitudes and behaviors is to rely on information generated from scientific research

3. (1)People make a difference in “bottom line” outcomes (1)People make a difference in “bottom line” outcomes • A competitive, strategic, and bottom line difference in firm performance.“Facts are in” • We will read articles to support how human resource activities create value • Sears example: Has shown how human resources create value by showing interconnections among investors, employees and customers.

4. Support for employee ideas & innovation helped • make Sears a compelling place to work. Satisfied • employees assisted in making Sears a fun (compelling) • place to shop. And more shopping raised profits, • making Sears a compelling place to invest. • A 5% increase in employee attitudes led to 1.3% • increase in customer satisfaction which in turn led to • 0.5% increase in revenue growth. • This systems perspective represents a change in • thinking for those interested in managing human • resourcesfor competitive advantage (1)People make a difference in “bottom line” outcomes

5. (2)Managers need to do things differently if they want to influence employee attitudes and behaviors (1)People make a difference in “bottom line” outcomes • In Mgmt 507, you learned how to influence perceptions, attributions, & effort. This course focuses on managing job satisfaction, absenteeism turnover and other outcomes • Organizations may fail if they do not realize employee-employer relations have changed dramatically

6. The employer—employee “deal” is changing, …and many employers still don’t get it. Some are stuck in 1911 or with an assembly line mentality: Frederick Taylor introduces “scientific management,” which holds that jobs Should be defined in detail to remove individual discretion.

7. Best Buy Co. allows its office workers to work wherever they want, whenever they want, as long as they get their jobs done. The electronics retailer scores big gains in productivity and employee satisfaction. The employer—employee “deal” is changing, …and many employers still don’t get it.

8. New labor market conditions: Boomers are 40% of the labor force (78 million). There are 3.8 million 35 to 55 year olds. • · Future belongs to Gen X & Y (Millennials) • Turnover in 2006 was ~ 17%. • Unscheduled absenteeism is rising. • Boomer-aged employers & employees are not in sync regarding how pay, health care, retirement plans, and work-life balance programs affect retention. (2)Managers need to do things differently if they want to influence employee attitudes and behaviors

9. Generational Labor Force (Ages 16 – 64)

10. (3)Information derived from science in the best way to influence employee attitudes and behavior (1)People make a difference in “bottom line” outcomes • Our topic for tonight • How Do Mangers Determine the Best Way to Manage People?

11. WHY A COURSE ON EMPLOYEE ATTITUDES AND BEHAVIORS? • Review syllabus • Introductions • BREAK!!!

12. Part 2: Management Epistemologies • How Do Mangers Determine the Best Way to Manage People? • Baseline Quiz • Fads • Review Epistemologies

13. HOW DO MANAGERS DETERMINE THE BEST WAY TO MANAGE PEOPLE? • How do people (managers) determine truth (best way to manage)? Depends on one’s preferred way(s) of determining truth--epistemology preferences • Course will promote science but recognizes it is not the only way to manage. • 3. Where do managers look for guidance? • a. Texts are not the solution • (2 years behind) • b. Internet unreliable • c. Imitating a risky strategy.

14. Management Innovation or “Fad”???? The 1950s The 1960s The 1970s Quantitative Mgmt Managerial Grid Zero-based Budgeting Theory Y T (sensitivity) Groups Strategic Planning MBO Matrix Management Portfolio Mgmt The 1980s The 1990s 2000 & Beyond 1-Minute Manager Downsizing Relationship Marketing Theory Z Reengineering Supply Chain Mgmt Corporate Culture Cycle time ??? JIT, TQM Employee Empowerment “In Search of Excellence”

15. HOW DO MANAGERS DETERMINE THE BEST WAY TO MANAGE PEOPLE? • My goal is to encourage greater reliance on scientific advice on management problems. Like it or not, the cutting-edge ideas are in the journals. • Also, to get you ahead of the curve • by exposing you to original ideas • and encouraging you to be a more • discerning, critical consumer of • advice to managers. Avoid “fads”. • 6. It is NOT my goal to turn you into a scientific researcher but instead to understand the common epistemologies in use.

16. How Do Managers Determine the “Best” to Manage? • Course promotes science but realizes effective mgmt is both an art & science • Managers must act and they rely on multiple ways of determining truth (epistemologies) that may reach different conclusions. • Sick leave policy example

17. EPISTEMOLOGIES USED BY MANAGERS 1. Experience 2. Intuition 3. Common Sense or logic 4. Expert testimony/Higher authority /Consultant 5. History or Tradition 6. Science

18. Why are Epistemologies Important to Mangers? • Skip science for just a second • Know what epistemologies are appealing to you and that you rely on so you can appreciate their strengths and limitations • Appreciate that your preferred epistemology may not be valued by others • A successful change agent will be to “shuttle” across epistemologies (i.e., meet people on their “playing fields”), and be convincing by using more than one

19. CHARACTERISTICS OF SCIENCE 1. Empirical 2. Rational 3. General - predict - explain 4. Cumulative: Seek to achieve a systematic body of knowledge - tentative - replication - self-correcting

20. THE RESEARCH PROCESS Org. Event Desire to Theoretical Operation- Phenomenon Explain Framework alization Problem (high absenteeism) (low perf.) (curious, (consists of fame, $, concepts & solve a propositions) problem) Derive Collect Analyze data Report Hypotheses the Data to test hypo- whether (statements of (where theses (where the data relationships sample & statistics support among variables) research enters) the hyp. design enter) or not

21. RESEARCH PROCESS TERMS Concept: A mental image; abstract but rooted in sense experience Proposition: A statement which links concepts together; it describes how concepts are related Linkages: Words describing the relationship between two concepts Theory: A set of one or more propositions. A simple theory describes how one concept is related (predicts) to another. A more complex (but realistic) theory entails more than one proposition

22. LINKAGES I. Linear Relationships (Straight line relationships) A. There is a direct or positive relationship between X and Y: Hi Job Sat (Y) Lo Lo Hi Job Autonomy (X) B. An inverse or negative relationship between X and Y: Hi Job Sat (Y) Lo Lo Hi Job Autonomy (X)

23. LINKAGES II. Non-Linear Relationships A. Curvilinear, exponential: Hi Job Satisfaction (Y) Lo Lo Hi Job Autonomy (X) B. Curvilinear, logarithmic: Hi Job Performance (Y) Lo Lo Hi Goal Clarity (X)

24. RESEARCH PROCESS TERMS Concept: A mental image; abstract but rooted in sense experience Proposition: A statement which links concepts together; it describes how concepts are related Linkages: Words describing the relationship between two concepts Theory: A set of one or more propositions. A simple theory describes how one concept is related (predicts) to another. A more complex (but realistic) theory entails more than one proposition

25. THE RESEARCH PROCESS Org. Event Desire to Theoretical Operation- Phenomenon Explain Framework alization Problem (high absenteeism) (low perf.) (curious, (consists of fame, $, concepts & solve a propositions) problem) Derive Collect Analyze data Report Hypotheses the Data to test hypo- whether (statements of (where theses (where the data relationships sample & statistics support among variables) research enters) the hyp. design enter) or not

26. OPERATIONALIZATION, DERIVING HYPOTHESES, AND COLLECTING THE DATA Abstract/Conceptual Level [Concepts & props] x y Job Satisfaction Job Performance operationalizaton score on a job satisfaction index sales performance Empirical Level actual score $ profit/month [Variables & hypotheses]

27. THE RESEARCH PROCESS Org. Event Desire to Theoretical Operation- Phenomenon Explain Framework alization Problem (high absenteeism) (low perf.) (curious, (consists of fame, $, concepts & solve a propositions) problem) Derive Collect Analyze data Report Hypotheses the Data to test hypo- whether (statements of (where theses (where the data relationships sample & statistics support among variables) research enters) the hyp. design enter) or not

28. DATA COLLECTION TECHNIQUES • Observation (Direct, video, participation) • Questionnaires, surveys • Interviews (face-to-face, telephone) • Company records (archival)

29. THE RESEARCH PROCESS Org. Event Desire to Theoretical Operation- Phenomenon Explain Framework alization Problem (high absenteeism) (low perf.) (curious, (consists of fame, $, concepts & solve a propositions) problem) Derive Collect Analyze data Report Hypotheses the Data to test hypo- whether (statements of (where theses (where the data relationships sample & statistics support among variables) research enters) the hyp. design enter) or not

30. ANALYZING THE DATA TO TEST HYPOTHESES I. Visually Subject Questionnaire Co. Records (Employee)Mean JS scoreProfits/month 1 12 $3500 2 8 2100 3 10 2500 - -- ----- N 3 1600 II. Via Scatterplot. . . Hi . . . . N = 10 Job Performance .. (Y) . Lo Lo Hi Job Satisfaction (X) III. Statistically

31. STATISTICSA way to summarize relationships among variables For 2 variables in a linear relationship: Pearson r -1 0 +1 (negative) (no relationship) (positive) r = .30 Weak to moderate positive relationship r 2 = .09 (or 9% of the variance explained) For more than 1 independent variable related to a dependent variable: Use a multiple correlation coefficient R

32. THEORIES/MODELS A theory is nothing more than a set of propositions, outlining how a set of factors is thought to “effect” a dependent variable. E.g. A theory of absenteeism: Job Satisfaction Work Group Size Absenteeism Family size Use R summary statistic (Range is from 0 to 1; no direction can be specified)

33. RESEARCH DESIGNS Case study: good for exploratory work, no cause and effect, all “after the fact”, not generalizable Field study or field survey: findings generalizable and realistic but weak on control Lab experiment: strong on control, good for isolating cause and effect relationships, weak on generalizability Potential ethical issues. Field experiment: moderate on control and generalizability, difficult to get companies to participate in. Potential ethical issues.

34. SAMPLING 1. There are many methods of sampling (random, stratified) but first specify the population or universe. What do you want to study? To what do you wish to be able to generalize to? 2. Technically, every unit in the population you wish to generalize to (i.e., infer results to) must have an equal opportunity to appear in the sample. 3. Practically speaking, compromises are always made: POP: Employees of Org. X Sample: Randomly pick 20% to interview POP: American auto workers Sample: Ford, GM, Chrysler employees or Random Sample of just GM employees

35. Support Slides for Readings 1-6

36. Lawler (2009) • Essay on what firms need to move away from a “control-focus” form of organization and better use their human resources • What are some of his suggestions?

37. Lawler (2009) Take-Aways • Demand metrics (measures) that track use and performance of human capital (e.g., wastage turnover rates) • Design “analytics” (ways) to relate the metrics to indicators of organizational performance (e.g., does lower turnover result in higher customer satisfaction, market share, and/or profitability) • An extension of “what gets measured gets done”

38. CascioArticle • Managers and HR professionals must develop quantifiable metrics of their ability to manage people successfully. • These metrics must be able to be communicated to leaders in financial cost/benefit terms. • Be able to show how improvements in employee behaviors and attitudes affect “bottom line” outcome measures.

39. RousseauArticle • Commentary on how science (evidence-based management) is doing in helping managers solve problems. What is evidence-based management? • Managers should rely on valid information (generalizable and repeatable over time) rather than fads, fashions and gurus • Why don’t managers practice evidence-based management?

40. RousseauTake-Aways • To persuade you to value science-based principles related to management • To encourage managers facing a problem to ask, “what does research evidence say about this issue”? • To encourage cause-and-effect thinking (i.e., the use of evidence) in seeking solutions to organizational problems. In other words, to combine evidence with expert judgment.

41. Culbertson Article • A response to Rousseau and Lawler’s calls to more relevant: Translate key research findings in user-friendly ways • Appear in the Academy of Management Perspectives • Introduce the methodology known as “meta-analysis”

42. Culbertson (2009) • “Research Briefs” are a valuable tool • Summary of original research by Brown & Lam (2008) on how employee job satisfaction is related to customer satisfaction • Research is a meta-analysis of 28 studies (next slide) • In general, what did they find? Any surprises? Is job satisfaction more strongly related to customer satisfaction in businesses where services are performed on objects (e.g., car repair) or people (e.g., haircutting)? Also considered single vs. repeat transactions

43. Meta-analysis • A meta-analysis is a quantitative review of the literature • It estimates more accurately the true relationship between two variables by adjusting for such things as measurement and sampling error • The “gold standard” in medicine (e.g., statin use and colorectal cancer) • Upcoming Liu et al (2007) article is a meta-analysis

44. Culbertson (2009) • Higher job sat associated w/ higher customer satisfaction & ratings of service quality • Surprisingly, the relationship between job sat and customer perceived quality was actually stronger in single encounter settings • Job sat → Customer ratings of service quality → Customer satisfaction • What implications or suggestions can be derived from the research? Job satisfaction was more strongly related to customer satisfaction in businesses where services are performed on objects (e.g., car repair) or people (e.g., haircutting)?

45. Support Slides for Readings 7-10

46. Rynes et al. article • Value of the journal; Abstract • Studies confirm that HR practices can improve org performance & profits, but a gap exists between what is known and practiced • Why aren’t managers more knowledgeable about the latest evidence-based advances? • How did authors determine a gap existed?

47. Baseline Knowledge on Managing Employee Attitudes & Behaviors 1. If a company feels it must downsize employees, the most profitable way to do it is through targeted cuts rather than attrition. True False Uncertain 2. Talking about salary issues during performance appraisals tends to hurt morale and future performance. True False Uncertain 3. On average, encouraging employees to participate in decision making is more effective for improving organizational performance than setting performance goals. True False Uncertain 4. Teams with members from different functional areas are likely to reach better solutions to complex problems than teams from a single area. True False Uncertain 5. Most people over-evaluate how well they perform on the job. True False Uncertain 6. Older adults learn more from training than younger adults. True False Uncertain 7. On average, conscientiousness is a better predictor of job performance than intelligence. True False Uncertain 8. Most employees prefer to be paid on the basis of individual performance rather than on team or organizational performance. True False Uncertain 9. Merit pay systems cause so many problems that companies without them tend to have higher performance than companies with them. True False Uncertain 10. In order to be evaluated favorably by line managers, the most important competency for HR managers is the ability to manage change. True False Uncertain

48. Baseline Knowledge on Managing Attitudes & Behaviors: ScientificallyCorrect Answers 1. If a company feels it must downsize employees, the most profitable way to do it is through targeted cuts rather than attrition. True False Uncertain ( ) ( ) ( ) 2. Talking about salary issues during performance appraisals tends to hurt morale and future performance. True False Uncertain ( ) ( ) ( ) 3. On average, encouraging employees to participate in decision making is more effective for improving organizational performance than setting performance goals. True False Uncertain ( ) ( ) ( ) 4. Teams with members from different functional areas are likely to reach better solutions to complex problems than teams from a single area. True False Uncertain ( ) ( ) ( ) 5. Most people over-evaluate how well they perform on the job. True False Uncertain 6. Older adults learn more from training than younger adults. True False Uncertain 7. On average, conscientiousness is a better predictor of job performance than intelligence. True False Uncertain 8. Most employees prefer to be paid on the basis of individual performance rather than on team or organizational performance. True False Uncertain 9. Merit pay systems cause so many problems that companies without them tend to have higher performance than companies with them. True False Uncertain 10. In order to be evaluated favorably by line managers, the most important competency for HR managers is the ability to manage change. True False Uncertain

49. What do HR professionals read? (Table II) • Does what you read make a difference? (Table V)

50. Implications • Practitioners beliefs lag science, especially in selection. HR practices could be more effective if we just practiced what we know • Researchers must communicate in more user-friendly ways. Managers need to read academic journals. • Practitioner outlets pander to fads (graphology) • Learn to love a meta-analysis (p. 166)