the impact of board characteristics and ownership ...

JIMS, Volume 15, Number 2, 2015

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JOURNAL OF INTERNATIONAL MANAGEMENT STUDIES ®

EDITOR-In-CHIEF

David D. Stinson, MEd. Director, Equity of Access and Learning Resources, Trinity Western University

A Publication of the

International Academy of Business and Economics®

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IABE ORG

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EDITORIAL BOARD: Dr. David Ward, European School of Economics, Milan, Italy Dr. Moshe Zviran, Tel Aviv University, Tel Aviv, Israel Dr. Cheick Wagué, South Stockholm University, Stockholm, Sweden Dr. William P. Cordeiro, California State University Channel Islands, CA, USA Dr. Ricarda B. Bouncken University of Bayreuth, Germany Dr. Bhavesh Patel, Ahmedabad University, Ahmedabad, Gujarat, INDIA Dr. Fred N. Silverman, Pace University, White Plains, New York, USA Dr. Benoy Joseph, Cleveland State University, Cleveland, Ohio, USA Dr. Ben-Jeng Wang, Tunghai University, Taichung, Taiwan, ROC Dr. Xiaolin Xing, National University of Singapore, Singapore Dr. Chun Hung Roberts Law, Hong Kong Polytechnic University, Hong Kong, China Dr. Fang-Fang Tang, Chinese University of Hong Kong, Hong Kong, China Dr. C.B. Claiborne, Texas Souther University, Houson, Texas, USA Dr. Byron J. Hollowell, Pensylvania State University, Pensylvania, USA Dr. Michael Benham, European Business School, Germany Dr. Ernesto Noronha, Indian Institute of Management, Ahmedabad, INDIA Dr. Dale H. Shao, Marshall University, Huntington West Virginia, USA Dr. Lokman Mia, Griffith University, Brisbane, Queensland, Australia Dr. Marek Cwiklicki, Cracow University of Economics, Krakow, Poland Dr. Wilson Almeida, Catholic University Of Brasilia, Brasilia, Brazil Dr. George Heilman, Winston-Salem State University, Winston-Salem, North Carolina, USA Dr. Riccardo Sartori, University of Verona, Verona, Italy Dr. R. Raghavendra Kumar Sharma, Department of Industrial and Management, Engineering, IIT, Kanpur, India Dr. Flores Isaura, University of North Texas at Dallas, Texas, USA Dr. Nashwa Geroge, Larry L. Luing School of Business, Accounting and Finance, Faculty, Berkeley College, USA Dr. Mauro Paoloni, University TRE Rome, Business Studies Department, Italy Dr. Jose Sanchez-Gutierrez, Head of Department of Marketing and International Business, Universidad de Guadalajara, Mexico Dr. Farrokh Mamaghani, School of Business, St. John Fisher College, Rochester, NY Dr. Liang-Chieh (Victor) Cheng, College of Technology, University of Houston, Texas, USA Dr. Neil Terry, Dean of the College of Business & Professor of Economics, West Texas A&M University, USA Dr. Ruby L. Beale, Chair, Department of Business Administration, Hampton University, VA, USA

JIMS is a Registered Trademark of the IABE. All rights reserved. ©2015 IABE. Printed and Published in the USA.

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A Welcome Note from the Editor-In-Chief: The global stage is increasingly integrated and complex. Challenges range from economic and political instability to philosophical and religious divides that make it difficult for organizations to thrive. Businesses are challenged on every side, and navigating well through this pivotal time in history will take ingenuity and creativity.

Within this broad context full of challenge and opportunity, we introduce the Journal of International Management Studies (JIMS) Volume 15, Number 2, 2015. It is a compendium of articles steeped in research, detailed observation, and strategic application related to business, economics and public administration. As scholars, teachers and practitioners grapple for solutions to current global challenges, this edition of JIMS will stimulate valuable conversation by exploring various aspects of world financial markets, challenges of economic globalization, ethics and the identification of new and emerging guidelines in the global marketplace.

Each paper submitted to the JIMS has gone through a rigorous blind review process of experts in the functional areas of business, economics and public administration. We are infinitely grateful to each author who submitted their work and to the anonymous reviewers and board members who contributed to shaping this issue of JIMS. We invite you to contribute to this global discussion in future issues!

Warmest regards, David D. Stinson Editor-In-Chief

Disclaimer: IABE/AIBE or its representatives are not responsible any error(s), validity of data/conclusion(s) or copyright infringements in any article published in the journal. Author(s) is/are solely responsible for the entire contents of the paper published in the journal.

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TABLE OF CONTENTS COMPULSIVE BUYING BEHAVIOR AS A WAY TO COPE

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Mehrnaz Kalhour, Nanjing University of Aeronautics and Astronautics, China Jhony Choon Yeong Ng, Nanjing University of Aeronautics and Astronautics, China GREEN HRM PRACTICES: A CASE STUDY

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Jenny Dumont, University of South Australia, Adelaide, Australia Jie Shen, Shenzhen University, Shenzhen, China Xin Deng, University of South Australia, Australia THE LIMITATIONS OF CONVENTIONAL MOTIVATION THEORIES IN THE CONTEXT OF THE ARGUMENT THAT MOTIVATION IS ‘A SURROGATE FOR MEANING’

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Adem Ogut, Selcuk University, Konya, Turkey Melis Attar, Selcuk University, Konya, Turkey MITIGATING OPERATIONAL RISK THROUGH KNOWLEDGE MANAGEMENT

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Wissam AlHussaini, Lebanese American University, Beirut, Lebanon Silva Karkoulian, Lebanese American University, Beirut, Lebanon ACCELERATING THE PACE OF INNOVATION THROUGH UNIVERSITY-INDUSTRY COLLABORATION ENHANCEMENT: IN SEARCH OF MUTUAL BENEFITS AND TRUST BUILDING

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Sophie Veilleux, Université Laval, Québec, Canada Johanne Queenton, Université de Sherbrooke, Québec, Canada RELIABILITY REVISITED: TOWARD AN ENLIGHTENED NOTION OF COMMAND AND CONTROL IN HIGH HAZARD INDUSTRIES

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Evan H. Offstein, Frostburg State University, Frostburg, Maryland, USA Rebecca M. Chory, Frostburg State University, Frostburg, Maryland, USA D. Robin Bichy, Excelerated Leadership Partners, Ashburn, Virginia, USA Raymond Kniphuisen, Excelerated Leadership Partners, Ashburn, Virginia, USA THE EFFECT OF PAY SATISFACTION ON TURNOVER INTENTION: MEDIATING ROLE OF JOB SATISFACTION AND ORGANIZATIONAL COMMITMENT

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Davoud Hayati, National Iranian Oil Company, Iran Morteza Charkhabi, University of Verona, Italy Dariush Kalantari, National Iranian Oil Company, Iran Francesco De Paola, University of Verona, Italy IN SEARCH OF PEDOSYNERGY EFFECT IN TEACHING INTERNATIONAL BUSINESS STUDENTS Vitally Cherenkov, Graduate School of Management, Saint-Petersburg State University Natalia Cherenkova, Economic English Department, Saint-Petersburg State Economic University

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COMPULSIVE BUYING BEHAVIOR AS A WAY TO COPE Mehrnaz Kalhour, Nanjing University of Aeronautics and Astronautics, China Jhony Choon Yeong Ng, Nanjing University of Aeronautics and Astronautics, China

ABSTRACT The literature indicates that people engage in compulsive behavior to get rid of their feeling of anxiety. We propose that individuals engage in compulsive buying behavior as a form to cope. Individuals could potentially engage in such behaviors to distract themselves from the negative circumstances that they are in. Practitioners should consider going for the source of the behavior rather than focusing their attention of the surface compulsive buying behavior. Marketers also have a responsibility to help to alleviate the conditions of compulsive buyers. Keywords: Compulsive Buying Behavior; Coping; Personality Disorder

1.

INTRODUCTION

On April 1900, Paris held a world trade fair, which brought together people from different consumer markets to celebrate past technological achievements and gain an insight into potential futuristic developments. The trade fair portrayed the potential of the then and future civilizations to deploy technology, creativity, and innovation to create more consumables to better the life of the future generations. The trade fair set the foundation for availing more products and services in the marketplace. Primarily, products are availed in the markets for consumers to buy and the buying behaviors are subject to various factors. However, in many situations, consumers do not understand their reasons for purchasing certain products. The academic trend in studying compulsive buying behaviors views them as personality disorders. This approach assumes that consumers purchase products compulsively due to anxiety or depression that is associated with not buying the same products. We beg to differ. We believe that rather than taking them as forms of compulsive disorders, compulsive buying could potentially be a new form of lifestyle. A lifestyle that is shaped by societal forces. Shopping is an essential component of daily life (Li, Unger & Bi, 2014). However, purchasing without considering its consequences is impulsive, which may lead to anxiety and unhappiness. The main challenge arises when it becomes frequent and uncontrollable. We believe that the adoption of this perspective toward the topic of compulsive behavior offers a different way for formulating policies and programs for industries for promoting their products by designing and marketing products and services to meet the lifestyles leading to purchases. 2. LITERATURE REVIEW 2.1 Compulsive buying behavior Shopping is an important aspect of people’s daily lives. While this aspect is a normal behavior, challenges emerge when people overindulge in it without paying attention to its consequences. When consumers cannot control their shopping cultures, it becomes driven rather than being whimsical. Hence, we tend to focus more on buying behaviors that are related to compulsive purchasing, as it has negative consequences for individuals. The underlying assumption of this approach is that the dealing of certain challenges affecting people’s lives starts with the identification of the causes of the problems before attempting to cure them. Neuner, Raab, and Reisch (2005) support this assertion, and they believe the greater emphasis on the research on compulsive purchasing behavior is due to the view that it is more prevalent among consumers of all demographic characteristics.

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Dittmar, Long, and Bond (2007) suggest that people experiencing compulsive purchasing behaviors have higher probabilities of experiencing strong buying desire. One which overcomes the fear of the financial harms that such compulsion could inflict on one’s social life. Faber and O’Guinn (1992) added that such people do not possess the mechanism for differentiating between abnormal and normal buying behaviors. So the question is: what is the antecedent of such behaviors? Behaviorism is one of the important schools of thought that explains why some people engage in some behaviors and not others. The big five traits theory also explains the differences among people in decision-making. Experimental analysis of people’s behaviors suggests that interactions with the environment influence one’s personality. However, Goodstein and Lanyon (2009) argued that cognitive and affective factors had a greater influence on individual personality. Studying compulsive behavior from the perspective of behavioral psychology had its limitations. For example, traditional psychologists tested how behaviors influence personality through animal experimentation. They believed that animals and people shared similarities in terms of the learning process. However, as Goodstein and Lanyon (2009) had argued, human learn progressively. This aspect implies that old learned behaviors can be substituted with new ones. The psychological behavioral theory explains the dynamic process of obtaining the new learning. If some learned behaviors could be substituted with new behaviors, then behavior could influence personality via de-learning. Relating this assertion with compulsive buying behavior amounts to a personality problem as it can be changed by learning new behaviors, thus leading to impulsive purchasing behavior. Goodstein and Lanyon (2009) had suggested that the emotional responses individuals have toward a stimuli could potentially change the person’s personality. As learning continues, it slows down the personality, thus causing stabilization. This assertion implies that people experience stable responses towards a give environmental stimulus (Stricker, Widiger & Weiner, 2003). Influenced by this pedagogy, marketers deploy classical conditioning to enhance the consumption of their products. This aspect explains the divergent views on how conditioning influences behaviors. Neuner et al. (2005) argue that emotions do not affect operant conditioning (behaviors). The authors emphasize that behaviors should be studied from paradigms of environmental influences. Psychological behaviorism holds that classical coupled with operant conditions play significant roles in influencing people’s behaviors. Human behavior elicits similarly conditioned response for an unconditioned stimulus that is similar to the conditioned stimulus (Pachauri, 2001). How then do emotions influence compulsive buying behavior? Several factors may contribute to people’s emotional responses. These constitute the thoughts, beliefs, and perceptions affecting people’s emotional responses to the specific stimulus. Physiological behaviorism links emotions demonstrated by individuals with responses to the biological and environmental stimuli. These emotions can be affirmative or negative toward different stimuli. For example, a positive pulse to a food stimulus or a negative emotion in response to the stimuli causes dislike and unwanted feeling. This aspect suggests that microtonal responses can help in increasing a purchasing behavior of a given products. Can then compulsive buying behaviors be conditioned through emotional stimulation? Li et al. (2014) define compulsive buying behavior as chronic tenancy for purchasing products and services in response to negative conditions and feelings. Literature documents no successful attempts to stimulate this behavior through any mechanism including classical conditioning. The behaviors encompass an unconditioned response towards desires for goods or services and feelings of depression due to anxiety. This aspect implies that the desire to purchase specific types of services or goods leads to the development of compulsive behavior. The absence of these products or services induces stress or anxiety, which induces the compulsive buying behavior.

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The five-personality dimension theory may also influence people’s behaviors, viz. the compulsive purchasing behavior. Indeed, Mueller, Mitchell, Claes, Faber, Fischer, and De Zwaan (2011) believe that personality plays important roles in influencing compulsive buying behavior. Personality refers to “the sum total of ways in which an individual reacts and interacts with others” (Goodstein & Lanyon, 2009, p. 291). It is measured by the traits that people exhibit. Research on personality in an organizational context has focused on labeling various traits, which describe employees and customer behaviors. Some of the personality traits that have been established by various researches as having the ability to influence the behavior of people include ambition, loyalty, aggressiveness, agreeableness, submissiveness, laziness, assertiveness, and being extroverted among others. Kihlstrom, Beer, and Klein (2002) posit, “Neuroticism, extraversion, openness, agreeableness, and conscientiousness comprise the big five personality traits” (p. 84). These traits can define factors characterizing consumer behavior as a personality type. Literature considering roles of big five-personality traits theory in compulsive buying theory depicts incompatibilities in their results. However, consciousness encompasses an important trait, which can explain the differences in compulsive behaviors among different consumers. Mueller et al. (2011) argue that although consciousness may be important in explaining differences in consumption behavior, which is important in predicting compulsive buying behavior, neuroticism does not relate to the behavior. Borrowing from the work of Otero-López and Pol (2013), consumers fall into three groups, viz. high, medium, and low propensity in terms of their buying behaviors. The groups having the highest propensity possess the highest levels of neuroticism and lowest consciousness. The group also features the highest level of neuroticism, which includes anxiety, depression, and impulsiveness. Conversely, the group has relative to medium and low compulsive buying behaviors. Propensity groups have the weakest extraversion assertiveness, positive emotions, and self-consciousness. 2.2 Compulsive buying behavior: a personality disorder Compulsive purchasing behavior encompasses an excessive dysfunctional consumption behavior, which aggravates people’s lives emotionally, financially, and mentally (Koran, Faber, Aboujaoude, Large & Serpe, 2006). Compulsive buying behavior manifests itself through psychological problems like depression and anxiety. This aspect makes theorists like Faber and O’Guinn (1989) to consider it as a personality disorder. Personality disorder describes perennial maladaptive ways of thinking, feeling, and behaving amongst individuals. However, Dittmar et al. (2007) argue that in defining compulsive buying behavior, it is critical to recognize that all disorders and perceptions of abnormality have cultural norms’ influences apart from considering disorders, which can be managed clinically. The 2013 version of the Diagnostic and Statistical Manual of Mental Disorders (DSM-V) classifies disorders into five annexes. Personality disorders fall under annex 2 in cluster C. This group comprises disorders like depression and schizophrenia. It also entails less maladaptive disorders characterized by anxiety and dependent personality or obsessive-compulsive disorders. In the manual, compulsive buying behavior does not appear. Despite the non-inclusion of compulsive buying behavior in the list of Diagnostic and Statistical Manual of Mental Disorders, many psychologists contend that it should fall under the anxiety personality category due to its characteristics of anxiety coupled with negative feelings amongst people suffering from it. However, this contention attracts controversies. For example, Li et al. (2014) argue that the behavior encompasses an obsessive-compulsive disorder since it has symptoms similar to it. Black (2001) suggests that it becomes compulsive due to lack of impulsive control. Studies like Faber and O’Guinn (1992) attempt to highlight the relationships between compulsive buying behaviors and personality traits coupled with family lifestyles. This aspect suggests that the literature on compulsive buying behavior mainly focuses on analyzing it as a personality disorder. An important gap exists in the attempt to relate the behavior with people’s lifestyles The current research approaches the problem of compulsive buying behavior as a lifestyle problem rather than a personality disorder. In achieving this concern, it is also important to study it from the pedagogy of obsessive compulsion. Indeed, studies based on self-reports indicate that compulsive buyers experience similar symptoms to people with obsessive-compulsive disorder. This aspect includes high anxiety and

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stress that eventually lead to buying unneeded goods with anticipation for the reduction of negative feelings. The satisfaction of desires influences anxiety and stress levels for a limited period so that compulsive buying becomes a repeated action. This aspect suggests a relationship between compulsive buying behaviors with obsessive-compulsive behaviors. People suffering from compulsive disorders have possibilities of having experienced situations in life, which led to mistrusts of their priorities coupled with their abilities. The obsessive-compulsive disorder is conceptualized from the paradigms of pursuance of eliminating the anxiety and stressful thoughts in executing certain individual acts. Similarly, experiencing anxiety, depression, and stress are typical symptoms of compulsive buying behavior leading to the development of the urge to engage in compulsive buying. Faber and O’Guinn (1992) argue that this behavior is an abnormal consumption behavior. It is abnormal to the extent that after purchasing to reduce stress and negative experiences, people often regret due to its repercussions like ensuing financial challenges. Black (2001) suggests that for persons with the compulsive behavior disorder, their attention and thoughts give rise to anxiety and compulsions to reduce discomforts associated with failure to purchase products and services they desire urgently. Obsessions entail negative feelings experienced by people before they engage in compulsive behavior in a bid to reduce anxieties, which encompass feeling of guilt for not engaging in a given act. Amid the established relationship between obsessive behavior and compulsive behaviors including compulsive buying behavior, Koran et al. (2006) classify it under impulsive control disorder. People become susceptible to impulsive control disorder when they cannot control different urges. Koran et al. (2001) assert that people with compulsive buying disorder often think about shopping as opposed to thinking about its consequences or the objective of purchasing products and services. For example, if a woman purchases cosmetics and clothing in a bid to satisfy her self-esteem, she may do so without thinking about this objective. It is also impossible to recognize that the buying behavior subjects her to vulnerabilities of suffering from compulsive buying. This aspect suggests the importance of developing an appropriate scale for measuring compulsive purchasing behavior so that individuals can know when developing the problem. Faber and O’Guinn (1989) made one of the earliest attempts to develop a scale for measuring compulsive buying behavior. The scale aimed at differentiating compulsive buyers from non-compulsive ones. Attempts have been made to improve on the scale by incorporating mechanisms for identifying the attitudes toward product categories, processes of acquisition, and post-purchase feedbacks like positive or negative emotions as remorse after spending. The most recent edition of the scale assesses the spending patterns coupled with behaviors, emotions, and feelings of people towards the desired products and process of acquisition. Indeed, finance management through cash or credit cards constitutes some of the good examples of progressive precision in conceptualizing the compulsive buying disorder. The Faber and O’Guinn (1989) scale for differentiation of compulsive buyers from non-compulsive buyers has some limitations. It entails a binary approach to measurement, which introduces challenges of measuring the propensity of the behavior. However, the scale is crucial as it forms the foundation for the development of scales for measuring people’s compulsive buying behavior. For example, Edwards (1993) developed a scale for measuring the behavior based on Faber and O’Guinn’s scale. Through the incorporation of spending behaviors as the dependent variable, the scale permits researchers to rate compulsive buying behaviors depending on their propensity. It classifies consumption behaviors into non-compulsive, low compulsive, medium compulsive, and high compulsive (Edwards, 1993). The compulsive spending model identifies five factors related to compulsive purchasing

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behaviors. These are the “tendency to spend, compulsion to spend, feeling about shopping and spending, dysfunctional spending, and post-purchase guilt” (Koran et al. 2006, p. 1810). From the 1980s, there has been an incredible scholarly research on compulsive spending behavior among consumers. For instance, Koran et al. (2006) argue that more than 5 percent of Americans are dealing with compulsive purchasing behavior. Kukar, Ridgway, and Monroe (2009) reckon that the trend has now increased by about 4 percent to stand at more than 8.5 percent. However, there is no scholarly contention on factors leading to the increasing compulsive buying behavior among the Americans and other people across the globe. Almost all researches on this subject deploy personality disorder to construct their hypothesis. This aspect excludes many other factors like lifestyles, which may account for the increasing behavior. Irrespective of the improvements in the mechanisms of detecting mental disorders, the conceptualization of the disorder is incomplete. For example, the definition of normal and abnormal behaviors is not straightforward. Gaps remain on what amounts to a normal consumption behavior. Parts of these gaps are due to the view that people’s behaviors are subject to culture and living styles, but not necessarily a mental disorder. The latest edition of the DSM-IVTR is composed of five axes for diagnosis based on the Western masculine ideals for a ‘healthy” person. It is likely to define the normal typical behavior of people, especially women, from other cultures as the abnormal behavior. In such cultures, their behaviors are considered as normal in all aspects as they fit within their norms and cultural value systems. This aspect suggests that what amounts to a normal behavior in a multicultural context is a contentious issue. Compulsive buying behavior varies with respect to different demographic characteristics of people. For example, it varies according to gender with women having high prevalence levels for the behavior (Maraz et al., 2014). This assertion confirms the validity of an earlier study by Neuner et al. (2005), indicating higher prevalence levels for the behavior among women as compared to men. However, Koran et al. (2006) hold that compulsive purchasing transcends gender and it can be viewed as a common personality disorder affecting women and men in equal thresholds. These discrepancies may be accounted for by the perceptions of normal and abnormal behaviors. For example, masculine purchasing behavior may be labeled normal while feminine purchasing behaviors are labeled abnormal. Methods and theories for measuring prevalence may also have prejudices in terms of what amounts to a normal behavior. Amid the discrepancies of the prevalence of compulsive buying disorder, an important interrogative explains the different prevalence levels. Eren, Eroglu, and Hacioglu (2012) suggest that women are one and a half times more likely to experience anxiety disorders as compared to men. The comorbidity of the disorder arises due to the women’s position in society, which is characterized by power imbalances. For example, discrimination against women exposes them to threats of chronic anxiety disorders. Apart from gender, inconsistency in research on compulsive buying behaviors exists based on other demographical dimensions like age and income levels. For instance, Black (2001) found a negative correlation between income and compulsive buying density. Conversely, Mueller et al. (2011) found “no relationship between income and compulsive buying behavior” (Mueller et al., p. 1310). 3. DISCUSSION AND CONCLUSION Several studies confirm multi-dimensional aspects of compulsive purchasing behavior. Faber and O’Guinn (1992) note that buyers can be grouped into different scales. A Canadian measurement scale for compulsive purchasing behaviors identified three main dimensions of the behavior, viz. spending tendency, reactive aspects, and guilt after purchasing.

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Many of the literature assumed that compulsive buying is a form of illness. It is a form of abnormal behavior. However, we should remember that everything happens for a reason. We propose that individuals might engage in compulsive buying as a form to cope. When individuals engage in compulsive buying, their minds would be taken off the undesirable environment that one is in. At the moment when the buying took place, they might feel the short term gratifications. Then, when the impulse is over, they would feel the post-purchase guilt. Together with the initial bad feelings that they have, they would have a stronger urge to buy more things to get rid of the negative feelings. This process would result in a spiral of spending that gets individuals trapped in the negative situation. Compulsive buying entails a behavior that erodes the people’s financial management discipline by engaging in excessive purchasing of commodities to reduce anxieties. We should come up with ways to help these folks who have problems with compulsive buying. However, we believe that by focusing our efforts on the behavior itself and the cognition and affection of the consumer itself would be unlikely to result in fundamental behavioral changes. We believe that one should go beyond the behavior, look into the cause of the behavior, and fix it. For example, in one of our ongoing research, we interviewed several individuals who have problems with their spending behavior. One of them reflected her spending behavior as excessive. Although she felt something wrong about the behavior, and her children had been trying to help her, she could not help but to spend more. After some interviews, we found that she was having some very serious family issues. Their investments were caught in a bad asset, and her old husband was having some serious illness. She tended to buy expensive household equipments that she could “play around” during the day. We believe that this is a typical example of one trying to avoid one’s negative contexts by distracting oneself with compulsive buying behavior. One would buy things to play around with to distract one’s attention. Marketers also have a responsibility to alleviate the conditions of compulsive buyers. Marketers have an influence on the purchasing behavior of customers. While marketers have a duty of care to their employers to bring profits for the company, we argue that they also have a duty of care to their stakeholders – the customers. Future research should be conducted on how these duties could be balanced.

REFERENCES: Black, D. “Compulsive Buying Disorder: Definition, Assessment, Epidemiology and Clinical Management”, CNS Drugs, Volume 15, Number 1, Pages 17–27, 2001. Dittmar, H., Long, K. and Bond, R. “When A Better Self Is Only A Button Click Away: Associations Between Materialistic Values, Emotional and Identity-Related Buying Motives, and Compulsive Buying Tendency Online”, Journal of Social and Clinical Psychology, Volume 26, Number 3, Pages 334-361, 2007. Edwards, A. “Development of a New Scale for Measuring Compulsive Buying Behavior”, Financial Counseling and Planning, 4(2), 67-85, 1993. Eren, S., Eroglu, F. and Hacioglu, G. “Compulsive Buying Tendencies through Materialistic and Hedonic Values among College Students in Turkey”, Social and Behavioral Sciences, Volume 58, Number 1, Pages 1370 –1377., 2012/

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Faber, J and O’Guinn, C. “A Clinical Screener for Compulsive Buying”, Journal of Consumer Research, Volume 19, Number 3, Pages 459–469, 1992. Faber, R. and O’Guinn, C. “Compulsive Buying: A Phenomenological Exploration”, Journal of Consumer Research, Volume 16, Number 2, Pages 147–157, 1989. Finlay, L. “Rigor, Ethical Integrity or Artistry” Reflexively Reviewing Criteria For Evaluating Qualitative Research”, British Journal of Occupational Therapy, Volume 69, Number 7, Pages 319-326, 2006. Freshwater, D., Sherwood, G. and Drury, V.”International Research Collaboration: Issues, Benefits and Challenges of the Global Network”, Journal of Research in Marketing, Volume 11, Number 4, Pages 295-303, 2006. Goodstein, L. and Lanyon, R. “Application of Personality Assessment to the Work Place”, Journal of Business and Psychology, Volume 13, Number 3, Pages 291-313, 2009. Kihlstrom, J., Beer, S. and Klein, B. Self and Identity as Memory, New York, NY: Guilford Press, 2002. Koran, L., Faber, R., Aboujaoude, E., Large, M. and Serpe, R. “Estimated Prevalence of Compulsive Buying Behavior in the United States”, American Journal of Psychiatry, Volume 16, Number 3, Pages 1806-1812, 2006. Kukar, M., Ridgway, N. and Monroe, K. “The Relationships Between Consumers’ Tendencies To Buy Compulsively and their Motivations to Shop and Buy on the Internet”, Journal of Retailing, Volume 85, Number 3, Pages 298-307, 2009. Li, S., Unger, A. and Bi, C. “Different Facets of Compulsive Buying Among Chinese Students”, Journal of Behavioral Addiction, Volume 3, Number 4, Pages 238-245, 2014. Maraz, A., Eisinger, A., Hende, B., Urbán, R., Paksi, B., Kun, B. and Demetrovics, Z. “Measuring Compulsive Buying Behavior: Psychometric Validity of Three Different Scales and Prevalence in the General Population and in Shopping Centers. Psychiatry Research, Volume 225, Number 2, Pages 326-334, 2014. Mueller, A., Mitchell, J., Claes, L., Faber, R., Fischer, J. and De Zwaan, M. “Does Compulsive Buying Differ Between Male and Female Students?”, Personality and Individual Differences, Volume 50, Number 3, Pages 1309-1312, 2011. Neuner, M., Raab, G. and Reisch L. “Compulsive Buying in Maturing Consumer Societies: An Empirical Re-Inquiry”, Journal of Economic Psychology, Volume 26, Number 4, Pages 509–522, 2005. Otero-López, J. and Pol, E. “Compulsive Buying and the Five-Factor Model of Personality: A Facet Analysis”, Personality and Individual Differences, Volume 55, Number 1, Pages 585-590, 2013. Pachauri, M. “Consumer Behavior: A Literature Review”, The Marketing Review, Volume 2, Number 1, Pages 319-355, 2001. Saunders, M., Thornhill, A. and Lewis, P. “Research Methods for Business Students”, New York, NY: Prentice Hall, 2009. Scott, S. “Research Methodology: Sampling Techniques”, Journal of Scientific Research, )Volume 2, Number 1, Pages 87-92, 2011.

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Stricker, G., Widiger, T. and Weiner, I. Handbook of Psychology: Clinical Psychology, Hoboken, NJ: John Wiley and Sons, 2003.

AUTHOR PROFILES: Mehrnaz Kalhour is currently an undergraduate student at the Nanjing University of Aeronautics and Astronautics. She did an internship in an Italian sailing school, Utopia. During her internship, she conducted crisis management research during a Regatta competition on team safety and communication. Kalhour is interested in using grounded theory research to study individual behavioral issues in the virtual world. She is also interested in investigating the antecedents to social anxiety disorder. Dr Jhony Choon Yeong Ng (Ng Choon Yeong, Jhony) obtained his Doctor of Business Administration (DBA) from the Southern Cross University in 2014. He is currently an Assistant Professor in the Nanjing University of Aeronautics and Astronautics. In 2011, he received the Furama Gold Medal from the National University of Singapore and the National HR Award from the Singapore Ministry of Manpower. His research interests are: organizational culture, entrepreneurship, innovation and personality disorder.

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GREEN HRM PRACTICES: A CASE STUDY Jenny Dumont, University of South Australia, Adelaide, Australia Jie Shen, Shenzhen University, Shenzhen, China Xin Deng, University of South Australia, Australia

ABSTRACT Green Human Resource Management (Green HRM) is a contemporary management construct, initially designed and developed because of its potentiality to influence employee green behaviours. Thus far, the concept has chiefly attracted conceptualisation interest, rather than any extensive empirical attention. However, it has begun to gain traction and increased academic interest within the management field, because of its prospective contribution to improving corporate environmental performance, and its implicit influence over employee workplace behaviours. This case study extends the current theoretical notion of the construct, and explores how one organisation interprets, assigns and administers practices aligned with green HRM. This undertaking enables researchers to move toward empirically exploring green HRM - a promising management approach to address corporate environmental sustainability. Keywords: Green Human Resource Management, HRM practices, employee workplace behaviour, case study

1. INTRODUCTION Green HRM began its journey through the milieu of green management applications, in order to address the growing concern from corporate stakeholders in response to the negative impacts of organisational operations on the environment (Waddock, 2004). By embracing green management processes and green HRM practices and activities, firms are expected to receive direct and peripheral gains such as increased sales, productivity gains and competitive advantages (Wee & Quazi, 2005), beneficial employee behaviours (Shultz & Holbrook, 1999), and enhancements in firm efficiencies including improvements in water and energy usage (Klassen & McLaughlin, 1996). However, to date little is empirically known about what and how green HRM practices are implemented in enterprise. In light of this, the intent of this study is to highlight the potential of the concept and increase our knowledge of green HRM, but more importantly, this qualitative study proposes to answer the question: “What green HRM practices would a firm adopt in order to implement a green strategy?”

2. GREEN HRM The materialisation of socially responsible practices in both academic research and corporate policy agendas, have emerged in response to calls from activist groups and the growing awareness and attitudes of the public toward corporate irresponsibility (Jabbour & Santos, 2008; Waddock, 2004). As such, corporate social responsibility (CSR) was created. CSR is a multi-aspect construct that encompasses economic and non-economic (e.g. diversity) corporate concerns (Lis, 2012) and is defined by McWilliams, Siegel and Wright (2006, p. 1) as: “situations where a firm goes beyond compliance and engages in actions that appear to further some social good, beyond the interests of the firm and that which is required by law”.

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Since 2008, academics and psychologists have been actively calling for pioneering research into how organisations can effectively promote employee green behaviours (Renwick, Redman & Maguire, 2013), with green HRM identified as a likely emancipator of such employee level outcomes. Despite this, there is an absence of evidentiary HRM research that explores what and how HRM practices are adopted to implement organisational green strategies (Ehnert & Harry, 2012). Human resource management (HRM) is defined as a set of: “distinct but interrelated activities, functions, and processes, directed at attracting, developing, and maintaining (or disposing of) a firm’s human resources” (Lado & Wilson, 1994, p. 701). It is from within the parameters of HRM, that green HRM was conceptually developed, because of HRM’s distinct approach to people management, and the anticipated influence that green HRM practices are likely to exert over employee workplace behaviours (Daily & Huang, 2001).

3. GREEN HRM PRACTICES Despite the claims of the importance of employees to organisational performance, most organisations have ignored the contributions and the potential of key HRM practices to achieve a firm’s green goals (Carmona-Moreno, Cespedes-Lorente & Martinez-del-Rio, 2012). Muster and Schrader (2011) state it is important for organisations to transform green aspirations and mere good intentions to genuine organisational policy and workplace behaviour reform, if organisations expect to improve the firm’s environmental performance. Put succinctly, Wehrmeyer (1996, p. 7) states that, “if a company is to adopt an environmentally-aware approach to its activities, the employees are the key to its success or failure”. Dubois and Dubois (2012, p. 801) argue that human resource (HR) practices are the key ingredient to embedding environmental sustainability programs into an organisation requires HR managers to be: “design architects for the varied HRM systems, policies and activities that are needed to prepare employees to engage and contribute meaningfully to the accomplishment of environmental sustainability goals”. Carmona-Moreno et al. (2012) suggest that HRM facilitates the achievement of environmental objectives through green HR activities such as appropriate rewards systems, targeted recruitment and training, and promotional opportunities. Renwick et al. (2013) analysed appropriate environmental management (EM) and HRM literature and constructed a list of green HRM activities. The list of green HRM practices (see Renwick et al., 2013, p. 9) highlighted what are considered to be the key HRM practices that are most likely to advance employee green workplace behaviours: recruitment and selection; training and development; performance management; and rewards and compensation.

4. RESEARCH METHOD As the research is exploratory, a qualitative approach was adopted. Qualitative research is regarded as the most effective way in which researchers formulate their understanding of: “peoples’ motivations, reasons, actions, and the context for their beliefs and actions in an in-depth way” (Myers, 2013, p. 5).

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This approach offered what was considered to be the best option to thoroughly explore a company and its policies and HR activities. The research was implemented using a single case study in early 2014. Although the case study method has been questioned due to concerns regarding its methodological rigour in terms of its ability to meet validity and reliability standards, case studies have provided researchers with tools to explore, generate and test theories within the strategic management fields (Gibbert, Ruigrok & Wicki, 2008). Gibbert et al. (2008) claim that case studies represent an effective methodology that is ideally suited to creating knowledge within the management sphere. Yin (1994, p. 13) describes the scope of a case study as: “……… an empirical inquiry that investigates a contemporary phenomenon within its real-life context, especially when the boundaries between phenomenon is broad and complex, where the existing body of knowledge is insufficient to permit the posing of causal questions, when a holistic, in-depth investigation is needed, and when a phenomenon cannot be studied outside the context in which it occurs”. A case study approach to qualitative research typically combines multiple data collection methods such as interviews, observations, questionnaires and documentation, which can generate qualitative or quantitative data (Dubé & Paré, 2001), and has three design types: explanatory, descriptive and exploratory (Yin, 1981). This study utilises an exploratory case study approach to investigate: “a relatively new field of scientific investigation in which the research questions have either not been clearly identified and formulated or the data required for a hypothetical formulation have not yet been obtained” (Streb, 2010, p. 373). The Company (hereinafter the Company) is a wholly owned subsidiary of an Australian food paperpackaging company. The Company has three production plants in China with 650 workers employed th across the three plants. In 2015, the Company will mark the 20 anniversary of its Chinese operations. The Company employs around 3000 employees across 15 countries. In addition to Australia and China, the Company has manufacturing facilities in Indonesia, South Africa and Vietnam, with a global sales network servicing all continents. The primary objective of this study was to get detailed opinions and information from the people within the Company who were directly involved in the development and implementation of green HRM practices. In total four key managers were interviewed between the periods of September 2013 - December 2013. Interview questions were semi-structured, with further clarifications sought through phone and/or email.

5. RESEARCH FINDINGS The senior HR manager advised during interviews early in the process that: ‘at this point in time, the Company does not have a recruitment strategy that targets employee’s with strong environmental knowledge or skills. However, it is possible that in the future the Company will incorporate this component in to our recruitment and selection strategies to align with the Company’s overall CSR and environmentally sustainable agenda’ (Senior HR Manager). Despite the Company not formally requiring employees to have green knowledge or skills prior to employment with the Company, the Company does make newly appointed employees aware of the Company’s sustainability and environmentally focussed values through their induction process and subsequent induction sessions, which involves specific training and education activities aimed at improving safety and environmentally related knowledge and skills.

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Training and development The responsibility of training and development rests with the HR department, with specific training generally implemented in line with corporate strategies. EM is a part of the Company’s environmental strategy, with the Senior HR Manager advising that: ‘general environmental management training is offered to all employees’. The Company openly identifies as a socially responsible entity, and as such, it has developed a cogent induction process and employee development programs that advances key capabilities aligned with environmental responsibility, with the Senior HR Manager advising that: ‘new employees undergo a rigorous training schedule that, if their job requires them to learn these skills, they will undertake: 1) basic environmental, health and safety training for all employees as per company policies; 2) clean production program training, which is a local government initiative 3) training regarding the safe use and disposal of chemicals in line with company policy and government regulation 4) specific training and performing drills in regards to the spill and treatment of chemicals 5) training and handling of hazardous waste in line with company policy and government regulation’ (Senior HR Manager) In addition to training at the induction process stages, as advised above, the Company keeps abreast of government regulation and customer demands, and: ‘conducts regular, or when necessary, training and updates to environmental laws and procedures for supervisors and senior managers, as these are key personnel who should be informed and lead by example. If managers and supervisors do not have the knowledge to enact green policies and procedures, employees will resist, or not see the significance and importance of adhering to environmental policies. In addition, all employees are required to participate in further environmental training if new or updated regulations are applied, and when employees have been identified by their managers as needing to update their skills or knowledge, or remind employees of the need to adhere to the Company’s environmental policies and practices ’ (Senior HR Manager). Performance management and appraisal As the literature identifies in reviews such as Renwick et al. (2013), performance management is a key process that contributes to the achievement of green outcomes by developing performance indicators that assess environmental risk. Compliance to regulatory requirements and customer demands is a priority for the Company, with a range of initiatives and activities that are implemented to measure the performance of employees in the workplace. The Senior HR Manager advised that: ‘over the past few years we have significantly expanded our performance management and appraisal system to be more aligned with similar policies as the parent company. Specifically, the Company measures:

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1) how much waste employees are producing on their machines, with employees largely working in a group environment 2) levels of efficiency, such as the running speeds of the machines (slow speeds mean less products produced in a given period) 3) the amount of downtime on machines, (i.e. how long machines are stopped for the machinist to have a cigarette) 4) cost control regarding printing inks, tapes and plates, (i.e. not expending more than standard usage) 5) machine break downs, and how long the machine is out of action (i.e. speediness of the repairs) 6) lost time injury (LTI), refers to an injury where the employee was unable to complete their shift due to the injury. The Company aims for zero injuries during shifts‘ (Senior HR Manager) These performance indicators are applied during the performance review process, to determine if employees have achieved the outcomes as identified in their KPIs. The outcomes of the above items are later used to determine the appropriate application of rewards and compensation. Rewards and Compensation The next step in the process, after developing performance management indicators, is to develop a set of equitable company rewards and compensation agreements available to employees who meet, or exceed their individual (or group) performance targets or KPIs. According to Senior HR Managers, the Company: ‘has a number of specific rewards and compensation payments available to all employees who meet their individual performance targets. Specifically, 1) employees who achieve performance management targets as stated above, are eligible to receive monthly and quarterly KPI payments 2) in addition, employees are also eligible for an end of year performance review and bonus payment, if performance has been outstanding for the year and all KPI’s were achieved th

3) all employees receive a bonus payment, in the form of a ‘13 ’ month additional payment. This is paid prior to Chinese New Year in recognition of continual service to the Company, which is a payment that is in line with expectations in the Chinese community 4) the Company has also introduced a ‘green’ suggestion box, for employees to suggest ways in which the Company can improve its environmental footprint. If the suggestion from the employee is deemed to be useful and valuable, and verified through its implementation, the employee will receive an additional bonus in addition to their monthly KPI’ (Senior HR Manager).

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6. DISCUSSION Results of this research identified that the Company at the centre of this study already had a number of internally developed green HRM initiatives, although the organisation was not aware of the term ‘green HRM’. Increasing pressures from external stakeholders, key account customers, and a strong compliance by the Company to local environmental laws and parent company expectations had prompted the implementation of these green initiatives. Subsequently, the Company has created a workplace environment, where environmental compliance is enforced and individual environmental motivations, and green values are recognised and overtly encouraged. This positivity has occurred through the implementation of a number of green HRM practices including training and development, performance management, and rewards and compensation.

7. CONCLUSION Overall, the research found that the Company already had a number of green HRM practices in place, albeit they were not formally recognised as green HRM, but rather encompassed within the Company’s general CSR strategy. Confirming the presence of these practices with Company personnel, alongside conceptually identified green HRM practices, confirms the probability of green HRM practices being widespread within organisations. However, because little empirical research has formally explored green HRM or its consequences, organisations are unaware of the potential possibilities that a targeted application of the might construct offer. As this research focuses on a singular case study company with operations in China, there are limitations in the generalisability of its findings. As such, it is considered that more large-scale, multi-level research studies are required that can fully capture the interpretations and application of green HRM practices in a multitude of companies across different sectors and cultures.

REFERENCES: Carmona-Moreno, E., Céspedes-Lorente, J. & Martinez-del-Rio, J., "Environmental human resource management and competitive advantage", Management Research: The Journal of the Iberoamerican Academy of Management, Volume 10, Number 2, Pages 125-142, 2012. Daily, B.F. & Huang, S., "Achieving sustainability through attention to human resource factors in environmental management", International Journal of Operations & Production Management, Volume 21, Number 2, Pages 1539-1552, 2001. Dubé, L., & Paré, G., “Case research in information systems: Current practices, trends, and recommendations”, Cahier Du GReSI Volume 1, Number 12, Pages 1-36, 2001 DuBois, C.L. & Dubois, D.A., "Strategic HRM as social design for environmental sustainability in organization", Human Resource Management, Volume 51, Number 6, Pages 799-826, 2012. Ehnert, I. & Harry, W., "Recent developments and future prospects on sustainable human resource management: introduction to the special issue", Management Revue, Volume 23, Number 3, Pages 221-238, 2012. Gibbert, M., Ruigrok, W. & Wicki, B., "What passes as a rigorous case study?" Strategic Management Journal, Volume 29, Number 13, Pages 1465-1474, 2008.

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Jabbour, C.J.C. & Santos, F.C.A., "The central role of human resource management in the search for sustainable organizations", The International Journal of Human Resource Management, Volume 19, Number 12, Pages 2133-2154, 2008. Klassen, R.D. & McLaughlin, C.P., "The impact of environmental management on firm performance”, Management Science, Volume 42, Number 8, Pages 1199-1214, 1996. Lado, A.A. & Wilson, M.C., "Human resource systems and sustained competitive advantage: A competency-based perspective", Academy of Management Review, Volume 19, Number 4, Pages 699-727, 1994. Lis, B., "The Relevance of Corporate Social Responsibility for a Sustainable Human Resource Management: An Analysis of Organizational Attractiveness as a Determinant in Employees' Selection of a (Potential) Employer", Management Revue, Volume 23, Number 3, Pages 279295, 2012. McWilliams, A., Siegel, D.S. & Wright, P.M., "Corporate social responsibility: Strategic implications”, Journal of Management Studies, Volume 43, Number 1, Pages 1-18, 2006. Muster, V. & Schrader, U., "Green work-life balance: A new perspective for green HRM", Zeitschrift für Personalforschung (ZfP), Volume 25, Number 2, Pages 140-156, 2011. Myers, M., Qualitative Research in Business & Management, Sage, London, 2009. Renwick, D.W., Redman, T. & Maguire, S., "Green Human Resource Management: A Review and Research Agenda", International Journal of Management Reviews, Volume 15, Number 1, Pages 1-14, 2013. Shultz, C.J. & Holbrook, M.B., "Marketing and the tragedy of the commons: A synthesis, commentary, and analysis for action", Journal of Public Policy & Marketing, Volume 18, Number 2, Pages 218229, 1999. Streb, C.K., "Exploratory case study", Encyclopedia of case study research, Volume 2, Pages 373-375, 2010. Waddock, S., "Parallel Universes: Companies, Academics, and the Progress of Corporate Citizenship", Business and Society Review, Volume 109, Number 1, Pages 5-42, 2004. Wee, Y.S. & Quazi, H.A., "Development and validation of critical factors of environmental management", Industrial Management & Data Systems, Volume 105, Number 1, Pages 96-114, 2005. Wehrmeyer, W., Greening people: Human resources and environmental management, Greenleaf, New York, NY, 1996. Yin, R.K., Case Study Research: Design and Methods, 2nd Edition, Sage, Beverley Hills, CA, 1994. Yin, R.K., "The case study crisis: some answers", Administrative Science Quarterly, Volume 26, Number 1, Pages 58-65, 1981.

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AUTHOR PROFILES: Jenny Dumont, PhD Candidate – University of South Australia, Australia Dr. Jie Shen – Professor of Human Resource Management, Shenzhen University, China Dr. Xin Deng – Lecturer in Economics, University of South Australia, Australia

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THE LIMITATIONS OF CONVENTIONAL MOTIVATION THEORIES IN THE CONTEXT OF THE ARGUMENT THAT MOTIVATION IS ‘A SURROGATE FOR MEANING’ Adem Ogut, Selcuk University, Konya, Turkey Melis Attar, Selcuk University, Konya, Turkey ABSTRACT In today’s business, human factor attracts great attention due to its core significance for the success of the organization as a whole. As long as individuals work, produce and consume, the market cycle will not be disturbed and thus will keep going. This signifies the dependence of organizations on individuals such that if there is no individual working for a company, then that company has no existence. Therefore, almost all organizations are concerned with managing their employees’ motivation in order to sustain continuity and they impose restrictions on them for the sake of order and efficiency. Motivation theories are used to realize these purposes by providing analytical tools. Unfortunately, these conventional theories could not go beyond being a tool for shaping, influencing and manipulating human behaviour. In the light of these arguments, by looking from a philosophical perspective it is reasonable to assume that whole notion of motivation is the genuine problem itself. This article will argue that whenever the meaning is lost from work, motivation theories emerge to recreate the meaning and become a “surrogate” for it. This stimulates the denial of death and thus reinforces the notion of immortality of organizations. In response, this illusion makes the present meaningless leading the way to deter the meaning to some future state. The idea behind this movement to future states hides in itself the notion of progress and improvement continuously. From managerial perspective, the article will discuss that programmes such as total quality management are applied to almost every part of the organization – work, product, service – and even to the people, to measure the achievement towards future goals and to sustain control; in the end, resulting in loss of motivation. Keywords: Motivation, Conventional Theories, a Surrogate for Meaning, Meaning at Work, Loss of Motivation

1. INTRODUCTION In today’s work organizations, human factor attracts great attention due to its core significance for the success of the organization as a whole. As long as individuals work, produce and consume, the market cycle will not be disturbed and thus will keep going. This signifies the dependence of organizations on individuals such that if there is no individual working for a company, then that company has no existence. Therefore, almost all organizations are concerned with managing their employees’ motivation in order to sustain continuity and they impose restrictions on them for the sake of order and efficiency (Shultz, 2014). Motivation theories are used to realize these purposes by providing analytical tools. Starting with the emergence of Taylorism, many approaches to motivation have been put forward with the aim of improving the drawbacks of scientific management. Unfortunately, these conventional theories could not go beyond being a tool for shaping, influencing and manipulating human behaviour. There are further criticisms about the simplistic character, homogeneous assumptions and the mechanistic content of motivation theories. Novak (cited in Sievers, 1994: 3) argues in the context of American Society that: “the overriding myth of American Society appears to be the myth of the machine – the mechanical model of human relationships, of human identity, of human interchange. Where this myth is absorbed into the processes of conscious life, men become alienated from themselves: mere objects subject to prediction and control, whether by themselves (each man now divided into controller and controlled) or by others.” (Sievers, 1994: 3)

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In the light of these arguments, by looking from a philosophical perspective it is reasonable to assume that whole notion of motivation is the genuine problem itself. As Sievers (1994) points out, whenever the meaning is lost from work, motivation theories emerge to recreate the meaning and become a “surrogate” for it. This stimulates the denial of death and thus reinforces the notion of immortality of organizations. In response, this illusion makes the present meaningless leading the way to deter the meaning to some future state. The idea behind this movement to future states hides in itself the notion of progress and improvement continuously. To measure the achievement towards future goals and to sustain control, programmes such as total quality management, reengineering (Sievers, 2007) are applied to almost every part of the organization – work, product, service – and even to the people; thus resulting in loss of motivation.

2. CONVENTIONAL MOTIVATION THEORIES AND THEIR LIMITATIONS Most early theories of motivation have focused on recovering from the negative effects of scientific management with an attempt to improve the employee performance. Scientific management deals with the analysis and the control of employees’ activities in the same way as the engineers’ analysing and controlling machines. Central to Taylor’s system is “the notion of the economic man” (Fulop and Linstead, 1999: 255). Under this belief, the primary point of interest is the individual worker pursuing individual goals and motivated by incentive payments (Sheldrake, 1996: 23) – simply money. Undoubtedly, Taylor’s simplistic view of human motivation is criticised by its effects of deskilling, increased absenteeism, poor morale, increased rates of labour turnover and strikes (Fulop and Lintead, 1999: 256). To overcome these problems many motivation theories have emerged in different names but with modified contents in order to improve the employee motivation. The break with Taylorism - the management literature of the early 1900s - is first seen in Hawthorne experiments conducted by Elton Mayo and the others. As an unintended consequence of these studies, the human social dimension is added to the field of management research (Sorge and Warner, 2001: 502). Contrary to the Taylor’s calculating individuals, Mayo suggests “a view of social man” (Fulop and Linstead, 1999: 257). Mayo argues that people need to feel that they are part of a community – informal groups - and that managers should give attention to employees’ social needs. Nevertheless, both scientific management and human relation theories share the same fate: “Both were assumed to increase motivation and performance, and both could be said to fail on the basis of ignoring the effects of the assumption traps they produce: scientific management via assumptions of coercion through economic rationality and the managerial appropriation of control and expertise, and human relations through the assumption that managers would give anything but lip-service to employee participation in decision making.” (Thompson and McHugh, 2002: 295) The further study of human needs is developed by Maslow (1943). According to him, human needs arrange themselves in hierarchies (Sheldrake, 1996: 136). There are five levels of needs from lower-order to higher-order – physiological need (hunger, thirst), safety need, need to belong (group acceptance), need for self esteem, need to achieve self-actualisation. Maslow suggests that the emergence of a higher-order need depends upon the fulfilment of a lower-order need. According to Rose (cited in Sheldrake, 1996: 141), this argument is far from convincing in the sense that between people and across cultures, the order of needs may vary. In collectivist cultures, for instance, harmony with the group will be the supreme need rather than self-actualisation (Sorge and Warner, 2001: 201). Also ranking the esteem need over ‘belongingness’ as a motivator, Maslow assumes a masculine culture excluding the feminine role from the scene. Rose further questions the existence of needs and if they are assumed real, how many needs there are (Sheldrake, 1996: 141). Despite these critics, Maslow’s theory is influential in the development of other content theories such as Alderfer’s modified needs theory (1972) and Herzberg’s Two-factor theory (1950) and widely used by management books because of its simplicity and plausibility. Alderfer attempts to overcome some of the weaknesses of Maslow’s theory by reducing the list of needs to existence, relatedness and growth and suggesting a continuous progress rather than a rigid,

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systematic one, however, his theory does not go beyond the idea of being a rising hierarchy (Naylor, 1999: 542). When it comes to satisfaction of human needs in the context of work environment, Herzberg comes into picture with his motivation-hygiene theory. He questions what people want from their jobs and concludes that: “people are made dissatisfied by bad environment, the extrinsics of the job. But they are seldom made satisfied by what I called the hygienes. They are made satisfied by the extrinsics of what they do, what I call the motivators.” (Sheldrake, 1996: 145) Herzberg believes in job enrichment - more responsibility, growth and achievement of worker and argues that jobs maintaining feelings of achievement succeed to motivate workers. Only improving work conditions and pay will not have an impact on motivation and satisfaction. This will only make the employee not dissatisfied – the opposite of dissatisfied. The emphasis on obtaining the intrinsic motivation from work can be seen as an attempt to consider the human side of the motivation. However, it can be argued that by separating the motivation into two simple measurable factors (motivators-hygiene), Herzberg fails to recognise the complexity of motivation. Ironically, even the definition of motivation is consisting of at least three notions – direction, effort and persistence (Höpfl, 2003: 1). Assuming that there are universal and fixed needs for all employees and failing to explain the changing needs and wants, Herzberg falls into the same trap with Maslow and Alderfer. They all ignore in their theories the concept of variation – different personal traits, cultural diversity and situational factors. With a desire to overcome these limitations, McGregor (1960) in Theory X and Theory Y and McClelland (1961) in ‘Achievement Motivation’ included the social influence dimension, however, by doing so they do not achieve anything more than being a modified version of previous instrumental theories that believe in manipulating individual motivation to fulfil organisational ends. McClelland believing that some needs such as ‘need to achieve’ can be learnt rather than being innate makes an interesting attempt nevertheless, his artificial connection between the strength of needs and business success remains naive. His studies on motivation are further criticized by Geert Hofstede that ‘achievement motivation’ takes different forms in different cultures due to diverse senses of individuality (Fulop and Linstead, 1999: 276). Therefore, McClelland’ theory including other motivation theories are problematic in the sense that they cannot be applied cross-culturally with hundred percent confidence. The continuous effort for the integration of human dimension into the work process as in the case of the content theories can also be seen in the process theories of motivation such as expectancy theory of Vroom and equity theory of Adams (Thompson and McHugh, 2002: 301). These theories almost focus only on the assumption that individuals maximize their personal utility rationally. For instance, according to expectancy theory, motivation is a combination of the value employee places on a reward and the probability of achieving that reward. Same cognitive and calculative explanations of human behaviour exist in the equity theory, which proposes that employees compare their input/outcome ratio with others and then determine their attitudes accordingly. Thompson and McHugh pose the following questions: “Can we assume that individuals make rational calculations based on their cognitive input in deciding whether to act in a particular way? ....., do these form the major determinant factor in their subsequent actions?’’ ( Thompson and McHugh, 2002: 302) Langer (cited in Thompson and McHugh, 2002: 302) discusses these questions in the context of acting in a ‘mindless manner’. According to this notion, individuals follow ‘unconscious scripts’ that at first hand they consider the various alternatives available to them about being successful in a task but as a result they follow the scripts learned to be appropriate to that specific situation (Thompson and McHugh, 2002: 302).

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As a critical consequence, existing theories of motivation not only put the blame on the individual for not being motivated but also suggest simplistic ways and cognitive equations to manipulate their performance to increase motivation. The mechanistic content that regard employees as machines having program buttons on to be selected by the controller – the manager – according to the appropriate task makes these theories fail in reliability. Finally, they may not well be generalized due to their lack of cultural relativity.

3. MOVING BEYOND THE MOTIVATION THEORIES It can be argued that by only criticising the conventional motivation theories in terms of their strength more deeply again and again, one falls into the trap of repeating oneself without finding the real problem underlying them. Instead, as Sievers (1994) mentions, the real problem to be questioned is the whole notion of motivation itself. He offers the following hypothesis: “Motivation only became an issue – for management and organisation theories as well as for the organisation of work itself – when meaning disappeared or was lost from work; that the loss of meaning of work is immediately connected with the increasing amount of fragmentation and splitting in the way work has been and still is organised in the majority of our western enterprises. In consequence, motivation theories have become surrogates for the search for meaning.” (Sievers, 1994: 9) It appears that as soon as the work itself has lost its power to act as a source of meaning, scientific models comes into picture and serves for management to impose power and coercion on employees in order to achieve uniformity in organizations. Not only by reducing the relationship between motives and behaviour into causal explanations but also by reducing the relationship between people and their work organizations into an ultimate concern of optimal fit for optimal outcome, motivation theories and the management who uses them as a means of influence oversimplify the complexity of the notion of motivation (Sievers, 1994: 3-7). The basic idea behind the motivation theories (either hierarchy of needs, expectancy or equity) is the separation of managers and workers as if managers do not have to work and workers do not have to manage, further encouraging the split of authority, responsibility and knowledge (Sievers, 1994: 13). The complete knowledge and power of those at the top are taken for granted; however, the workers instead are regarded as having no ability and strength to cope with by themselves. Sievers discusses in his article “A surrogate for meaning” that this leads to the fragmentation of work into more pieces and further destroy the intrinsic meaning of work. Work becomes an aim to economically survive instead of a relation with the outside world and people. In Taylor’s work model, workers are alienated from work in terms of its usefulness or execution. ‘’Through the continual differentiation and fragmentation of work in contemporary organizations, worker’s activities are not only reduced to the smallest job components such as ... the mere eye movement to control an automatic production process, but the notion of work itself has been converted into jobs and job performance’’ (Sievers, 1994: 18). Since “Job is a label for what is left of work after all satisfying and managerial aspects are removed”, the content of the job is no more a big concern for management, but instead they aim to manipulate job performance by artificially enriching the job by motivation theories such as job design, job-enlargement, job-enrichment (Sievers, 1994: 19). Although there are increasing attempts to improve the quality of working life, they could not go further than being a substitute of one fragmentation with another, “the fragmentation of work into jobs with a fragmentation of life into working life and the remainder of it” (Sievers, 1994: 21). Moreover, in organizations the split of life and death become visible reinforcing the notion that organizations are immortal. This immortality belief is in fact another way of ignorance and concealing of death. One can see ironically that “death” is neither included in Maslow’s hierarchy of needs

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theory or any other motivation theories that emphasis the “work/consumption path” as one possible way for a good and useful life. Then how can one explain this mutual coalition of organizations with their favoured motivation theories in terms of excluding death from the scene? Motivation theories, invented as a surrogate for those who were not able to give meaning to their lives and their work anymore (Sievers, 1994: 26), are used by the work organizations in the meaning making process as a management tool for continuity and commitment. Howard Schwartz (cited in Gabriel, 1999: 189) in his psychoanalytic argument about corporate narcissism suggests that individuals in their organizational context recreate the notion of mother that protects them from anxiety and pain by being a shelter for hostility. Thus, as a member of a successful organization, individuals fantasize themselves being successful making the organizational model basis of their self-identity and sustaining their addiction to their organization (Gabriel, 1999: 189). In return, organizations grasp the ontological function of individuals that helps them to answer the question ‘Who am I?’, (Fulop and Linstead, 1999: 275), by creating meaning for them to give a sense of feeling that they are part of the institution (Sievers, 1994: 30). This fictitious meaning provides a guideline for the isolated employee who has lost the real intrinsic meaning from the work itself. The social reality is constructed such that there is a meaningful and “business-as-usual” sense of what is real (Willmott, 2001: 650). In order to maintain the coherence and security of self-identity of employees as well as the organization identity as a whole, institutions deny mortality due to its symbolic significance. This significance exists in its threat to the meanings invested in the projects as well as to the taken-for-granted assumptions upon which the society is organized (Willmott, 2001: 651). What organizations fear is that if there is the anticipation of death then all meaning they artificially created is lost. This equals to the death of the organization itself. Therefore they quest for meaning in the boundaries of organization by using motivation theories with their limited and uncreative suggestions of living in the expense of forgetting the collective interrelatedness of meaning in work and individual life (Sievers, 1994: 34). “…work can only have meaning in its fundamental sense when it is not just regarded as a dimension of the employing institution, but also as a part of an individual’s life and of our collective lives. Since meaning can only be understood from outside the frame of life itself, the meaning of work has to be qualified by the fact of human mortality. … through mortality comes humanity… mortality makes human. … the acknowledgement of mortality as a fact of life is the prerequisite of any attempt at humanizing work and working life.” (Sievers, 1994: 34) To be clear, the awareness of mortality is significant as an advisor to understand the ‘transpersonal and existential value of life-projects’ (Willmott, 2001: 652) and one should accept death as the inescapable fact of life in order to face the real meaning and stay away from the artificial surrogates of it (Sievers, 1994: 46). Looking from a different critical perspective, Boje and Rosile (2001) points out that motivation models as a whole see the work as the core of the satisfaction of life without concerning that this view leads the way for the addiction to work and consumption. Real happiness is related to how much one works, produces and consumes. Furthermore, the focus of the motivation theories is the employees and their continuous motivation for continuous effectiveness. The more employees are motivated, the more they work. The more they work, the more they produce and consume. This is the endless cycle. Once you are in, you cannot find the other way out. According to Boje and Dennehy (cited in Boje and Rosile, 2001: 2), motivational theory is all about heroic cultural myth and ignores the death, desire and addiction of work and consumption. “The main plot of this myth is: work/consumption is the path to the good life, an escape from death (Boje, 2001). Motivation theory is a double bind; it teaches us to measure our self-worth by our work, our sacrifice of family and self, and then rewards us with an addiction to consumption as a substitute for a meaningful life.” (Boje and Rosile, 2001: 2)

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4. MOTIVATION AND MOVEMENT TO FUTURE STATES Organizations’ attitude towards death not only takes away the present meaning from work but also makes people deter meaning to some future state. Organization members, by believing that the organization has an endless life, tie their destiny to this artificial reality and as Heather Höpfl mentions (2002a); they disregard the meaning of moment ‘in the favour of some hypothetical future state’. The illusion that one will live forever constitute a meaningless present leading the way, in turn, for a concern with motivation theories to enhance this lost meaning. “When organizations declare specific objectives, outcomes, points of arrival and so forth, they throw forward an ordering into future time. This is the way in which the notion of “creating a vision for a desired future state of the organization” functions to neutralise the moment, to cancel the present other than as a bench mark for assessing progress” (Höpfl, 2000: 21). The idea behind this movement to future states hides in itself the notion of progress and improvement continuously. The illusion of endless future due to the denial and elimination of death feeds the ambition for continuous enhancement. Paradoxically, since there is assumed to be no definite ends, then there are no limits. In return, this creates the need for measurement in order to determine whether there is any achievement or not towards future goals (Höpfl, 2002a: 11). For measurement purposes, organizations believe that they have the ability to plan, analyse, predict and monitor the work in their quest for the ‘purposive rationality’ and in their belief in reproducing themselves with writing (Höpfl, 2002a: 18). They further express this “purposive and questing behaviour” in their literature of strategy such as total quality management and human resource management (Höpfl, 2002a: 18). Schwartz (cited in Gabriel, 1999: 185) argues this organizational control in the notion of ‘totalizing’ : “Totalizing control implies that today’s organizations have or at least aim for total control over their employees, their hearts and minds (i.e., their emotions and their ways of thinking) as well as of their bodies (physical appearance, facial expressions).” (Gabriel, 1999: 185) Programmes such as total quality management (TQM) are consequences of this organizational totalitarianism and they seek to reinforce the corporate culture by demanding loyalty and by suppressing criticisms (Gabriel, 1999: 186). In TQM, individuals are expected not only to wear corporate ‘masks’ whatever the situation is for the total satisfaction of customers but also to conceal their emotions with this mask to ensure order by removing ‘unpredictable behaviour’ (Fulop and Linstead, 1999: 280). The idea is that every individual with different characteristics wears an identical mask and mimics certain behaviours so that the predetermined work targets of the organizations can be reached with clear-cut steps. This seems all right from the organization stand point, nevertheless, the individual not only suffers from this strategy but also cannot express his/her creativity. Heather Höpfl (2002b) parallels this argument to acting on stage before an audience and suggests that since an outstanding acting requires playing the specified role by detaching the self from it, ironically, a desirable work performance also needs that ‘dual personality’. As a result, continuous repression of the real self in the site of the work performance may well have a negative impact on motivation since the individual is left no choice but to manage two different personalities at the same time in the same body.

5. CONCLUSION Motivation is a fantasy that is being enjoyed by most of the today’s work organizations. It is used as a tool for controlling the individual through manipulating the human conduct and for imposing power in order to achieve organizational goals in the expense of the individual ones. The exercising of this extensive control includes hearts, bodies and minds of the individuals. Further, motivation theories suggest an

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addiction to work and in return to consumption via the denial of death. The effects of this have been most marked in the meaning of work. Since the mortality belief is deleted from the scene and organizations are assumed to have an endless future, the present meaning is lost from work and postponed to some future states. Subsequently, conventional motivation theories are used to cover up this lost meaning by their simplistic, homogeneous and mechanistic assumptions and therefore problematize the existing dilemma more. To sum up, the awareness of death’s significance will provide a more realistic portrayal of motivation since the real meaning of work can be restored not necessitating the substitutes of it in effect. Besides, this understanding can largely eradicate the growing doubt about the value of work and plus life projects.

REFERENCES: Boje, D. and Rosile G., ‘‘Death, Terror and Addiction in Motivation Theory’’, Critical Management Studies Conference, Manchester School of Management, UMIST, England, July, 2001. Fulop, L. and Linstead, S., Management: A Critical Text, Basingstoke, Macmillan, 1999. Gabriel, Y., ‘‘Beyond Happy Families: A Critical Re-evaluation of the Control-Resistance-Identity Triangle’’, Human Relations, Volume 52, Number 2, Pages 179-199, 1999. Höpfl, H., ‘‘On Being Moved’’, Studies in Cultures, Organizations and Societies, Volume 6, Number, 1, Pages 15-25, 2000. Höpfl, H., ‘‘Corporate Strategy and the Quest for the Search for the Primal Mother’’, Human Resource Development International, January 2002, Pages 11-22, 2002a. Höpfl, H., ‘‘Playing the part: Reflections on Aspects of Mere Performance in the Customer-Client Relationship’’, Journal of Management Studies, Volume 39, Number 2, Pages 255-267, 2002b. Höfpl, H., ‘‘Motivation and Movement’’, Lecture notes presented to AC 913 class, Essex University, England, October, 2003. Naylor, John., Management, Great Britain, Prentice Hall, 1999. Sheldrake, J., Management Theory “From Taylorism to Japanization”, London, International Thomson Business Press, 1996. Shultz, T., ‘‘Evaluating Moral Issues in Motivation Theories: Lessons from Marketing and Advertising Practices’’, Employee Responsibilities and Rights, Volume 26, Number 1, Page 1-21, 2014. Sievers, B., Work, Death, and Life itself, Essays on Management and Organization, Berlin, Walter de Gruyter, 1994. Sievers, B., ‘‘It is new, and it has to be done!’: Socio-analytic Thoughts on Betrayal and Cynicism in Organizational Transformation’’, Culture and Organization, Volume 13, Number 1, Page 1-21, 2007. Sorge, A. and Warner, M., The IEBM Handbook of Organizational Behaviour, London, Thomson Learning, 2001. Thompson, P. and McHugh, D., Work Organizations, Great Britain, Palgrave, 2002.

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Willmott, H., ‘‘Death. So What? Sociology, Sequestration and Emancipation’’, Sociological Review, Volume 48, Number 4, Page 649-665, 2001.

AUTHOR PROFILE: Dr. Adem Ogut earned his Ph.D. by a joint program at Ankara University and Selcuk University in year 2000. Currently he is a professor of business management and Dean of Economy and Administration Science Faculty at Selcuk University, Konya. Dr. Melis Attar earned her Ph.D at Selcuk University, Konya, Turkey in 2014. Currently she is an assistant professor in International Trade Department of Economy and Administration Science Faculty at Selcuk University, Konya.

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MITIGATING OPERATIONAL RISK THROUGH KNOWLEDGE MANAGEMENT Wissam AlHussaini, Lebanese American University, Beirut, Lebanon Silva Karkoulian, Lebanese American University, Beirut, Lebanon

ABSTRACT The purpose of this paper is to demonstrate a profound correlation between Operational Risk (OR) that subsists in Banking industry and Knowledge Management (KM). The research aims to provide empirical evidence with regards to whether KM mitigates OR or has no considerable effect on it. The variables under study, along with their distinct dimensions, are subjected to linear regression to obtain verifiable results. The results show that a significant relationship exists between the KM dimensions and the different OR dimensions. The findings verify that some of the KM elements mitigate some of the OR aspects. Hence, management must strive to implement KM techniques throughout the whole organization in an attempt to alleviate OR; provided that operational risk cannot be entirely purged. Culminating operational risk ultimately leads to amplified return on investments and, thus, improved profitability. Keywords: Knowledge Management, Operational Risk, Banking Industry

1. INTRODUCTION For decades, operational risk has been dwelling in most banking institutions. However, the instability of the economy and the brutality of the business competition have nourished operational risk to become a perilous threat that most banks dread and struggle to avoid. Thus, the urging need for effective measures to defy operational risk has escalated; provided that it cannot be completely eradicated. To further illustrate the latter, Société Générale, considerably one of the principal European banks, suffered from more than $7 billion in operational losses in January 2008, as a result of a series of deceiving and fictitious acts of a rogue employee. Further, the former chairman of NASDAQ was charged for securities fraud that resulted in $50 billion losses. Not to mention the losses incurred by Banks outside the United States (Rose, 2009). In this paper, the researcher seeks to demonstrate that Knowledge Management is an effective mitigate of operational risk that subsists in banks and that there exists a profound correlation between Operational Risk (OR) and Knowledge Management (KM). The study provides empirical evidence with respect to whether KM mitigates OR or has no considerable impact on it. In order to examine the relationship among KM and OR, the following research problem should be addressed: What is the effect of Knowledge Management on Operational Risk in a bank?

2. LITERATURE REVIEW Operational risk is a wide-ranging discipline that impacts reputation, customer satisfaction, and shareholder value. It basically condenses the risks an organization takes on when attempting to function within a given field or industry, increasing business instability and unpredictability. Operational risk, as defined by the Basel Committee on Banking Supervision (2006), is the risk of a value loss caused by failure of people, systems, and internal as well as external events. As long as people, systems, and processes are imperfect, this unwillingly-occurred risk cannot be wholly eradicated and laid off (Credit-Suisse Group, 2003). The identification of operational risk from the Basel Committee of Banking Supervisors as a distinct risk management facet has endorsed concentrated and

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fruitful discussions in the past years on how operational risk can be managed and mitigated. Martin and Beans (2000) identify operational risk “as all of those items that can lead to risk due to a break down in processes and actions of people both internally and externally”. Additionally, Restrepo and Medina (2012) agree that operational risk prevails in every activity of any firm. Moreover, Castillo (2008) asserts that operational risk is the likelihood of financial losses in organizations which can emerge from failure in decision making, business strategies, activities of employees, and the technology used. However, Castillo (2008) does not consider any loss resulting from unforeseen changes in the economical, political, and social environment, connoting that there is no implication to external events. In response to the vast increase in operational risk, regulatory requirements have been imposed to abstain the threat and to ensure the sustainability of business firms, such as the Sarbanes-Oxley Act in 2002 (Scandizzo 2007; Chernobai et al., 2007; Lewis 2003). To minimize operational risk, organizations attempt to obtain advanced technology assets, employ smart and industrious people, and build inventive business processes. In addition to this, managing knowledge is considered a chief constituent for the effectiveness of organizations in responding to disasters while operating in a fast and turbulent changing environment (Yates and Paquette, 2011). Knowledge management is the process which engrosses acquiring, sharing, and effectively using organizational knowledge. Li et al. (2008) simply defines knowledge as the “power” that forms the most vital asset in an organization. This knowledge can be either general or specific. General knowledge is shared among all firms in a certain industry, whereas specific knowledge forms the imperative competences and, hence, the competitive advantage possessed by a particular firm (Stonehouse et al., 2000). Moreover, knowledge can be divided into two fundamental types: tacit and explicit. Explicit knowledge can be documented and commonly shared among individuals in an organization; it is generally conscious, externalized and structured (Duffy, 2000; Haldin-Herrgard, 2000; Martensson, 2000). On the other hand, tacit knowledge is personal such that it subsists in an individual’s brain, context-sensitive and cognitive (Gore and Gore, 1999; Guth, 1996) and is relatively difficult to document (Nonaka and Takeuchi, 1995). Making the best use of knowledge is considered an approach to attaining a firm’s objectives (Davenport, 1994, and Alavi and Leidner, 2001). According to Despouza and Paquette (2011), successful organizations are able to control knowledge, link different parts of knowledge together, and leverage it towards achieving their objectives. Thus, organizations tend to compete on their knowledge-based assets. The curiosity and interest in knowledge management among scholars, academics, and business people started in the mid-1990s (Ibrahim and Reid, 2010). With time, knowledge management itself has been broken down to various parts, each with its own subject of discussion. Knowledge acquisition (KA) is part of knowledge management and encompasses acquiring knowledge from books, documents, and diverse people, including experts. Gamble and Blackwell (2001) claim that external knowledge sources are imperative and therefore a holistic outlook of the value chain should be taken. Following this, knowledge sharing (KS), according to Teng and Song (2011), has been an essential concern in knowledge management research and practice. Knowledge sharing is the exchange of information, skills, or expertise amongst people who belong to a certain group. In the context of an institution, Frost (2014) believes that knowledge sharing depends on the culture of the organization and its capability to promote honesty, trust, and openness.

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Furthermore, Ölçer (2007) states that there are several hurdles to Knowledge Management. One important barrier is the lack of communication between employees. Additionally, Szulanksi (1994) brought into light four obstacles to successful knowledge sharing. These comprise ignorance on both ends of the transfer, absorptive capacity, lack of relationship between the giver and receiver, and a slow rate of adoption. Serban and Luan (2002) affirm that the possessed knowledge by individuals is vital and helpful to a firm’s function and continued existence. Nevertheless, getting to the point where employees willingly share what they know is one of the hardhitting things that organizations have to deal with. Even though technology has made it reasonably effortless to post and share information, this transfer of knowledge is sometimes seen as time consuming and as a danger to the individual employee’s viability (Bukowitz and Williams, 1999). Unless the organizational culture rewards and encourages sharing, the intact endeavor to institutionalize a knowledge management structure will fail (Serban and Luan, 2002). Yang (2007) avers that KS leads to organizational learning advancement and ultimately to the fortification of organizational effectiveness. Conversely, sharing the knowledge is not the end of knowledge management. The crucial test of following a knowledge management system is its use. Knowledge utilization (KU) is the application of knowledge by integrating it into the firm’s products and services (Karadsheh et al., 2009). Giving attention to each of KM’s components alone, consequently, is critical. Results of a study conducted by Fugate et al. (2009) shows a positive association between the complete knowledge management process and operational performance. However, an investigation by Chen and Sherif (2008) demonstrates that knowledge utilization is the strongest contributor to the general performance of a business. Different organizations compete on the basis of adopting an effective knowledge management process to achieve a competitive advantage. This phenomenon is to a great extent becoming visible in banking institutions. According to Mohsen et al. (2011), KM is available in almost every bank since it simplifies the transfer of effective information which is used in all the processes of planning, controlling, decision making and evaluation. The augmentation of the knowledge management infrastructure has amplified the competition amongst the banks which has resulted in strategies that have improved customer satisfaction and performance (Prodromos & Vraimaki, 2009). Danish et al. (2014) found that the leaders at banks are the foremost stream for knowledge flow support. According to Uğurlu and Kızıldağ (2013), bank managers consider the knowledge management strategies significant when they recognize the importance of making an outcome difference with knowledge. Results of a study to examine the extent of knowledge management application in the banking sector in the UAE reveal that effective practices of KM are still absent in some of their operations (Alrawi and ELKhatib, 2009). Moreover, a study by Mohsen et al. (2011) discloses that banks in Bahrain show an ample amount of spending on knowledge management projects. Likewise, the outcome of an investigation by Uğurlu and Kızıldağ (2013) illustrates that banks in Turkey make investments in information technologies with the intent of creating efficient and effective knowledge management strategies. In addition to this, it is worth mentioning that Rodriguez and Edwards (2008) conducted a pilot study for the retail banking sector and results showed that there exists a positive relationship between Knowledge Sharing and the perceived value of OR Management.

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Furthermore, according to Mainelli (2002), banks are usually satisfied with their management of risk, but they can still set to learn a lot about managing operational risk. There are at least three lessons that can be taught to banks. These cover the usage of activity-based costing variances to quantify operational risk, the linkage of operational risk to external prices through an enterprise risk/reward management system, and the establishment of measures to govern an enterprise risk/reward unit (Mainelli, 2002). In the past decade, the business world has witnessed a steep rise in magnitude and frequency of Operational Risk (OR) losses; particularly in the banking and finance industry (Chernobai et al. 2007; Moosa 2008). Longo (2009) asserts that banks and other institutions ought to assess the possibility of knowledge, with its various divisions, in generating operational risk events as well as consider the way knowledge can essentially be used to evade undesirable events. Using this as a starting point, it is possible to identify the associations between the knowledge management components and the mitigation of operational risk.

3. HYPOTHESIS DEVELOPMENT The literature discussed earlier lucidly depicts KM and OR. Nonetheless, the question of whether there exists a significant negative relationship among both variables remains. Should management adopt KM to effectively mitigate OR? In order to answer the latter, the researcher has devised the following four hypotheses that address the key dimensions of OR and their relation to KM variables. Hypothesis 1: KA is negatively related to the variables of OR (People, Systems, Processes and External Risk). Hypothesis 2: KS is negatively related to the variables of OR (People, Systems, Processes and External Risk). Hypothesis 3: KU is negatively related to the variables of OR (People, Systems, Processes and External Risk).

4. METHODOLOGY Research Design The study is quantitative for the results were measured numerically and analyzed using statistical software SPSS. Moreover, the paper is an explanatory study since the research establishes a causal relationship between knowledge management and operational risk. Operational Risk is addressed in terms of People, Systems, Processes and External Risks. Knowledge Acquisition, Knowledge Sharing and Knowledge Utilization are used as the key dimensions of Knowledge Management. This paper assesses the relationship between Operational Risk and Knowledge Management and determines whether KM mitigates Operational Risk or not. The research is a crosssectional study since it involved a one-time interaction with the sample. Sample & Questionnaire The target population of the research is employees who work in medium and large sized banks. A questionnaire was distributed to bank employees in Lebanon. The self-created questionnaire included questions of both Choice-Determinant and Likert Scale types. It encompassed 49 questions, divided into three parts. The first part was targeted to collect demographic data. These comprise gender, age, level of

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education, years of employment, working experience, organizational level, and the size of the bank. The second part contained questions pertaining to the four basic dimensions of Operational Risk: People (Q.1-Q.7), Systems (Q.8-Q.16), Processes (Q.17-23), and External Risks (Q.24-27). The third part included the Organization for Economic Cooperation and Development scale (OECD) relating to the three elements of Knowledge Management: Knowledge Acquisition (Q.28-Q.32), Knowledge Sharing (Q.33Q37), and Knowledge Utilization (Q.38-Q.42). Content Validity In order to validate the content of the survey, a content validation questionnaire was generated that comprised of the twenty seven questions related to Operational risk. They were evaluated according to a three-point scale: “1= not necessary”; “2 = useful but not essential”; “3=essential”. A total of twenty banking experts identified on the basis of their daily work and involvement in the banking operations were approached. Subsequently, the content validity questionnaire was sent to them via email. Responses from all the experts were then collated by counting the number of essential response for each item in the questionnaire. For each item, a content validity ration (CVR) was estimated and evaluated for a statistical level of significance of 0.05. Items that were not significant were eliminated. Out of the twenty seven questions in the OR and KM survey, the experts deemed that twenty four were essential to include in the final questionnaire. The average CVR value for all constructs fell between a minimum of 0.35 and a maximum of 0.886. Thus, the questions in the survey possessed a high level of content validity and are representative of the case at study.

5. STATISTICAL ANALYSIS Descriptive Analysis The majority of the survey participants were males (56.7%) and 43.3% were females. Most of the respondents fell into the age category of 20 to 29 years old (59.2%), 30.8% were between the ages of 30 and 39, 5.8% were between 40 and 49 years old, and only 4.2% fell into the age category of 50 to 59 years old. Moreover, 44.2% of the participants were holders of a BA/BS degree, whilst 50% had a Masters degree. Regarding years of work experience, most of the respondents (38.3%) had 2 to 5 years of experience, 31.7% had 6 to 10 years of experience, while 28.3% had over 10 years of work experience. In addition to this, 43.3% had been employed at the bank for 2 to 5 years, 30.8% had been employed between 6 to 10 years, and 24.2% had been working at the bank for over 10 years. Pertaining to the organizational level, the majority of the participants (43.3%) were in non-management positions, 20% belonged to the operational management, 22.5% occupied middle management positions, and 10.8% of the survey participants were in senior management positions. Relating to the size of the bank, the majority of the respondents (63.3%) worked in a bank with over 500 employees, 11.7% worked in a bank with 250 to 500 employees, another 11.7% worked for a bank with 100 to 249, and 10% worked for a bank with 50 to 99 employees.

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Regression Analysis: In order to test the relationship between the first dimension of operational risk ‘people’ and each of the three elements of knowledge management, KA, KS, and KU, the ANOVA test was conducted. A regression equation is attained with people as the dependent variable, and KA, KS, and KU as the independent variables. The overall model is significant, resulting in an F-value of 157.759 and a p-value of 0.000. This is shown in Table 1 below. The regression equation obtained is: People = 0.665 + 0.424KA – 0.030KS + 0.449KU The significant variables are KA and KU with p-values of 0.000. However, KS is not significant at a 0.05 level of significance, with a p-value of 0.672, as illustrated in Table 2 below. Table 1: ANOVA; People and KA, KS, and KU Sum Squares

Model 1

of df

Mean Square F

Sig. .000

Regression

94.229

3

31.410

Residual

46.987

236

.199

Total

141.216

239

157.759

a

a. Predictors: (Constant), kUtilization, kSharing, kAcquisition b. Dependent Variable: people

Table 2: Coefficients; KA, KS, and KU Standardized Unstandardized Coefficients Coefficients Model 1

B

Std. Error

(Constant)

.665

.193

kAcquisition

.424

.052

kSharing

-.030

kUtilization

.449

Beta

t

Sig.

3.438

.001

.467

8.212

.000

.072

-.020

-.424

.672

.057

.428

7.908

.000

a. Dependent Variable: people

Similarly, a regression equation is obtained with the second dimension of operational risk ‘systems’ as the dependent variable, and each of the knowledge components, KA, KS, and KU as the independent variables. Results disclose that the overall model is significant as it shows an F-value of 49.758 and a pvalue of 0.000. The attained regression equation is: Systems = 2.369 + 0.238KA – 0.032KS + 0.251KU KA and KU are significant with p-values of 0.000. Nevertheless, KS is not a significant variable at a 0.05 level of significance, with a p-value of 0.653. Likewise, the ANOVA test was applied to examine the relationship between the dependent variable ‘processes’ and each of the independent variables KA, KS, and KU. Results reveal that the overall model is significant, with an F-value of 152.520 and a p-value of 0.000.

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The regression equation obtained is: Processes = 0.854 + 0.513KA + 0.151KS + 0.175KU KA, KS, and KU are all significant with p-values of 0.000, 0.026, and 0.001, respectively. Correspondingly, a regression equation is attained with the last aspect of operational risk ‘external risk’ as the dependent variable, and each of the knowledge components, KA, KS, and KU as the independent variables. The results display that the overall model is significant as it shows an F-value of 3.516 and a pvalue of 0.016. The obtained regression equation is: External Risk = 2.578 – 0.135KA + 0.330KS – 0.042KU KS is the only significant variable with a p-value of 0.002. Nonetheless, KA and KU are not significant at a 0.05 level of significance, with p-values of 0.082 and 0.618, respectively. Therefore, the above mentioned results provide strong evidence that Knowledge Acquisition is positively related to people, systems, and processes, even though it is negatively related to external risk. The results also offer evidence that a positive relationship exists between Knowledge Sharing and processes and external risks, but a negative relationship is existent between KS and people and systems. Additionally, the results present evidence that Knowledge Utilization is positively related to people, systems, and processes, but it is negatively related to external risk. Hence, the Knowledge Management dimensions mitigate some aspects of Operational Risk.

6. CONCLUSION The risk of incurring losses from inadequate systems, people, processes, or from external events, known as operational risk, is a chief concern for organizations which struggle with attempting to minimize it and grow their asset value. The notion that knowledge is critical for value creation of organizations is being recognized more with each passing day. Knowledge management is acquiring, sharing, and effectually using knowledge. It is yet another major concern in today’s management topics. This paper discussed the linkage between Knowledge Management and Operational Risk, targeting the improvement of understanding this elusive connection. The findings of this research proved that a relationship exists between the different dimensions of KM (KA, KS, and KU) and the OR elements (people, systems, processes, and external risk). The KM elements mitigate some of the OR aspects. For this reason, management ought to do its utmost to implement KM techniques throughout the organization in order to reduce OR. This study, however, only took one country, Lebanon, into consideration. Future research should attempt to consider more than one nation. This allows for a comparison of KM and its effects on OR across different countries and cultures. Moreover, a longitudinal study can be performed in order to investigate the long term effects of KM.

REFERENCES: Alavi, M.,and Leidner, D. E. 2001. Review: Knowledge management and knowledge management systems: Conceptual foundations and research nos. MIS Quarterly, 25 (1), 107-136.

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Alrawi, K., and Elkhatib, S. 2009. Knowledge management practices in the banking industry: Present and future state-Case study. Journal of Knowledge Management Practice, 10 (4). 1-15. Basel Committee on Banking Supervision 2006, paragraph 644, p. 144. Bukowitz, W. R., and Williams, R. L. 1999. The Knowledge Management Fieldbook. Upper Saddle River, N.J.: Financial Times, Prentice Hall. Castillo, M. A. 2008. Diseño de una metodologia para la identificación y la medición del riesgo operativo en instituciones financieras. Revista Universidad de Los Andes, 45-52. Chen, L., and Sherif, M. 2008. Contribution of knowledge management activities to organisational business performance. Journal of Engineering, Design and Technology, 6(3), 269-285. Chernobai, A.S, Rachev, S.T., and Fabozzi, J. 2007. Operational risk: A guide to Basel II capital requirements, models, and analysis. John Wiley & Sons, Inc., Hoboken, New Jersey. Credit-Suisse Group. 2003. Operational risks in financial services an old challenge in a new environment. Basel, Switzerland. Available at: https://www.credit-suisse.com/governance/doc/operational_risk.pdf Danish, R., Asghar, A., and Asghar, S. 2014. Factors of knowledge management in banking sector of Pakistan. Journal of Management Information System and E-commerce, 1 (1), 41-49. Davenport, T.H. 1994. Saving IT’s soul: Human centered information management. Harvard Business Review, 72 (2), 119-131. Desouza, K.C., and Paquette, S. 2011. Knowledge management : An introduction. Published by NealSchuman Publishers, Inc. 100 William St., Suite 2004 New York, NY 10038 Duffy, J. 2000. Knowledge management to be or not to be? Information Management Journal, 34 (1), 6470. Frost, A. 2014. A Synthesis of Knowledge Management Failure Factors. Fugate, B., Stank, T., and Mentzer, J. 2009. Linking improved knowledge management to operational and organizational performance. Journal of Operations Management, 27 (3), 247-264. Gamble, P. R., and Blackwell, J. 2001. Knowledge Management: A State of the Art Guide, Kogan Page, London. Gore, C. and Gore, E. 1999. Knowledge management: the way forward. Total Quality Management, July. Guth , R. 1996. Where IT cannot tread. Computer World, 30 (4), 72. Haldin-Herrgard, T. 2000. Difficulties in diffusion of tacit knowledge in organizations. Journal Intellectual Capital, 10 (4), 357-65 Ibrahim, F., and Reid, V. 2010. Unpacking knowledge management: Management fad or real business practice? Enterprise risk management, 2 (1), 24-38.

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Karadsheh, L., Mansour, E., Alhawari, S., Azar, G., and El-Bathy, N. 2009. A theoretical framework for knowledge management process: Towards improving knowledge performance. Communications of the IBIMA, 7, 67-79. Lewis, M.A. 2003. Cause, consequence and control: towards a theoretical and practical model of operational risk. Journal of Operations Management, 21, 205-224. Li, J., Brake, G., Champion, A., Fuller, T., Gabel, S. and Hatcher-Busch, L. 200.Workplace learning: the roles of knowledge accessibility and management Longo, E. 2009. The Knowledge Management Role in Mitigating Operational Risk. ResearchGate Mainelli, M. 2002. Industrial strengths: operational risk and banks. Balance Sheet, 10 (3), 25-34. Martensson, M. 2000. A critical review of knowledge management as management tool. Journal Knowledge Management, 4 (3), 204-216. Martin, P., and Beans, K.M. 2000. Enterprise-Wide Rm. Journal of Lending and Credit Risk Mangement, 6, 82. Mohsen, Z.A., Ali, M., and Jalal, A. 2011. The significance of knowledge management systems at financial decision making process. International Journal of Business and Management, 6 (8), 130142. Moosa, I.A. 2008. Operational Risk: A Survey. Financial Markets, Institutions & Instruments, 16 (4), 167220. Nonaka, I. and Takeuchi, H. 1995. The Knowledge Creating Company, Oxford University Press, New York, NY, pp. 8, 10, 44-5, 238-9.

Ölçer, F. 2007. Practices of knowledge management in companies: A Turkey survey, Proceedings of IKNOW ’07, Graz, Austria, September 5-7. Prodromos D. C. and Vraimaki, H. 2009 . Knowledge-sharing behavior of bank employees in Greece. Journal Business Process Management, 15 (2), 245-266. Restrepo, J., and Medina, S. 2012. Estimation of operative risk for fraud in the car insurance industry. Global Journal of Business Research, 6(3), 73–83. Rodriguez, E., and Edwards, J. 2010. People, technology, processes and risk knowledge sharing. Electronic Journal of Knowledge Management, 8 (1), 139 – 150. Serban, A. M., and Luan, J. 2002. An Overview of Knowledge Management.University of Kentucky. Retrieved 17 April 2013. Scandizzo, S. 2007. The Operational Risk Manager’s Guide: Tools and Techniques of the Trade. Riskbooks, London. Stonehouse, G.H., Barber, C.E. and Pemberton, J.D. 2000. Bases and sources of competitive advantage – an alternative analytical framework”, under review

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Szulanksi, G. 1994. Intra-Firm Transfer of Best Practices Project. Houston: American Productivity and Quality Center. Teng, J. T. C., and Song, S. 2011. An exploratory examination of knowledge-sharing behaviors: Solicited and voluntary. Journal of Knowledge Management, 15(1), 104-117. Uğurlu, Ö., and Kızıldağ, D. 2013. A comparative analysis of knowledge management in banking sector: An empirical research. European Journal of Business and Management, 5 (16), 12-19. Yang, J. 2007. The impact of knowledge sharing on organizational learning and effectiveness. Journal of Knowledge Management, 11(2), 83-90. Yates, D., and Paquette, S. 2011. Emergency knowledge management and social media technologies: A case study of the 2010 Haitian earthquake. International Journal of Information Management, 31 (1), 6-13.

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ACCELERATING THE PACE OF INNOVATION THROUGH UNIVERSITY-INDUSTRY COLLABORATION ENHANCEMENT: IN SEARCH OF MUTUAL BENEFITS AND TRUST BUILDING Sophie Veilleux, Université Laval, Québec, Canada Johanne Queenton, Université de Sherbrooke, Québec, Canada

ABSTRACT Given the ever-changing landscape of R&D and the boundaries of science and technology, innovation through partnerships has become unavoidable at both the national and international levels. As a result, the time has come to explore various avenues that foster the growth and success of university-industry collaboration (U-I collaboration). The development of such collaboration is seen as a key issue in a competitive knowledge-based economy (OECD, 2002). This qualitative study contributes to the literature on U-I collaboration management. The results reveal the need to review current collaboration methods and procedures and to consider stakeholder motivations in order to achieve a greater consensus with regard to the sharing and fulfilment of their interests. Furthermore, instilling a stronger climate of trust within U-I collaboration projects will help projects materialize and further the development of innovation ecosystems, the economy and society in general. Keywords: university-industry collaboration, academic researchers, R&D cooperation, roles of intermediaries, success factors, motivations, trust

1.

INTRODUCTION

OCDE countries have seen a significant increase in the number of R&D projects carried out in collaboration with colleges or universities through industry funding (OECD, 2011). These types of partnerships are indeed increasingly common and sought after (Boardman, 2009). Furthermore, in a knowledge-based economy, where scientific and technological pathways (nanotechnology, biotechnology, genomics, etc.) progress very quickly and crossover among disciplines is accentuated (engineering, genetics, computational biology, nutrigenomics, etc.), university-industry R&D projects are deemed to represent the best transfer of knowledge strategies to fuel innovation (Burnside and Witkin, 2008; D'Este and Patel, 2011). Thus, fundamental scientific research, which is usually conducted in university laboratories, can now be more quickly driven toward commercial applications and lead to regional, national or even international innovations. In recent years, the debate as to whether universities should engage in a third mission focused on economic development, in addition to research and teaching, has received much attention (Johnson, 2008; Lai, 2011; Mueller, 2006; Perkmann and Walsh, 2009). It is generally understood that universities are the fuel that propels knowledge-based economies (Comacchio et al., 2012; Perkmann and Walsh, 2009; Woolgar, 2007). This mission focused on economic development, through collaborations with industry, provides a very significant mechanism to generate economic benefits. R&D interactions between universities and industry, where both parties engage in a collaborative effort, represent the type of link by which the main influence of science on economy is carried out (Morandi, 2011; Mueller, 2006). Several studies have established a connection between collaborating with a university and the capacity of a firm to innovate (Boardman, 2009; Mueller, 2006; Spithoven and Knockaert, 2012). As important providers of knowledge, universities are essential partners in the creation of inventions and the development of innovations. Thus, in this era of a knowledge-based economy, universities are called upon to exercise a third mission focused on economic development. Most States attempt to generate economic development based on the latest scientific and technological discoveries by involving

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universities in their initiatives (e.g. human genomics) in order to promote the growth of high-technology clusters (Geiger and Sa, 2008). Despite the significant role universities play in technological innovation (Bozeman, 2000; Thune, 2007; Vuola and Ari-Pekka, 2006) and despite the growing number of U-I collaborations, numerous challenges remain. Firstly, motivations and expectations differ in terms of the outcomes of those collaborations. Generally speaking, the university system is focused on creating knowledge that is public and accessible to everyone for the benefit of the global economy (Ahrweiler et al., 2011; Zukauskaite, 2012). In contrast to the open system of universities, industries aim to take ownership of the economic value of new knowledge to gain a competitive market advantage. Universities focus on long-term research based on academic objectives, whereas firms face a changing environment, which requires them to focus on shorter-term research (Kyoung-Joo, 2011). Those differences can obviously lead to conflict. Instilling a climate of trust between two partners who operate in different realities, namely the worlds of academia and private enterprise, is also problematic. The different outcomes sought by each party create tension regarding intellectual property rights, the dissemination of knowledge, issues of confidentiality, trade secrets and the sharing of knowledge that may be exclusive to either party. Thus, the degree of trust between partners is a significant factor in collaborative R&D projects, especially in situations where each partner knows little about the other (Christiansen and Vendelø, 2003). This study thus aims to provide a better understanding of the U-I collaboration process in order to identify the success factors and areas that require further examination of the challenges related to motivations and trust in this type of collaboration. Both Agrawal (2001) and Perkmann and Walsh (2007) have in fact postulated that further empirical research should be conducted to shed light on the impact of various contextual factors in the creation of effective U-I collaborations. To that effect, the Faculté des sciences et de génie (FSG – Faculty of Science and Engineering) at Laval University was selected for study based on its involvement in regional economic development. More specifically, we investigated the points of view of academic researchers, industry representatives and governmental agents regarding university-industry collaboration. In particular, the following research questions were examined: 1. How can profitable U-I collaborations that meet the expectations of both parties be established? 2. How can a climate of trust between partners be established in U-I collaborations? These questions are relevant for three reasons. Firstly, despite the increasing significance of U-I collaborations for the advancement of knowledge, the propulsion of leading edge technology and innovations, the new role of universities as participants in economic development requires further investigation (Bercovitz and Feldman, 2008; Etzkowitz, 2010). Indeed, this role is not always adequately and sufficiently defined by political decision makers, which creates a number of ambiguities for the management of knowledge and obstacles to the creation of profitable U-I collaborations. In other words, if the commercialization of university research is a significant aspect of a knowledge-based economy, new practices that enable academic researchers to dedicate time to those U-I collaborations will have to be institutionalized, and this work will have to be recognized and valued as part of their academic duties (Rafferty, 2008; Charles, 2003; Geiger and Sa, 2009; Mowery and Sampat, 2006). Furthermore, attention will have to be given to structuring U-I collaborations in order for them to be productive and generate expected results (Kyoung-Joo, 2011; Perkmann et al., 2011). Secondly, the essential importance of U-I collaborations to the development of innovation requires further examination of the mutual benefits that both researchers and industry stakeholders can reap from those collaborations (Azagra-Caro et al., 2006). It is not suggested here that universities become an extension of corporate R&D departments. We must further investigate the motivations that may unite partners from very different worlds. Furthermore, in the context of a knowledge-based economy and in the search for a

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regional and even national competitive advantage, strategies that facilitate U-I collaborations must be considered. Thus, by examining the very foundations of how productive collaborations are created, a certain reflexive basis is brought to light and, in so doing, underscores a number of significant advantages of U-I collaborations, which could result in even higher numbers of such collaborations, since partners understand their validity and importance and share certain values with regard to their achievement. Lastly, certain core procedures in the establishment of U-I collaborations may perhaps generate a higher degree of trust between partners. Interventions by intermediary stakeholders with a good understanding of the situation of both parties facilitates communication, in particular by virtue of their roles as filters, validators and legitimizers (Ankrah et al., 2013; Comacchio et al., 2012; Wright et al., 2008; Johnson, 2008). Few studies, however, have focused on this aspect of U-I collaboration (Bjerregaard, 2010). This article is structured as follows. The section below outlines this study’s key concepts: U-I collaboration, U-I motivations, the respective roles of intermediary organizations and trust, followed by a presentation of our methodology and data collection. Sections 4 and 5 provide an analysis and discussion of the results. The final section presents the conclusions and implications of our study.

2.

UNIVERSITY-INDUSTRY COLLABORATION

In a world of extraordinarily rapid developments in technology, firms cannot afford to innovate in a vacuum. As a result, R&D collaborations have become significant development avenues (Spithoven and Knockaert, 2012; Bjerregaard, 2010). We define U-I collaboration as a relationship between a private enterprise and a university characterized by a mutual commitment to achieving a common R&D objective, either by pooling their resources or by coordinating specific research activities. The current complexity of problems and the need for multidisciplinary approaches require an interaction of ideas and an exchange of knowledge. The exchange of information between universities and industries is bi-directional (Barbolla and Corredera, 2009; Lai, 2011). Industry problems and market needs are fundamental to research objectives in the university environment. The results of this research are then directed to firms in the form of solutions that can be implemented for the benefit of the industry and the economy overall. This relationship with firms also provides researchers with a better understanding of how the technology is applied within the market, and with it, new knowledge. Most of the economic benefits derived from university research are generated by inventions developed by the private sector based on scientific and technological advances created by university researchers (Burnside and Witkin, 2008). The process of transferring knowledge between a university and an industry is carried out through multiple channels (Lai, 2011; Coviello et al., 2011). This transfer of knowledge is defined as the process by which technology and knowledge, developed in a given environment by a university, are adapted and applied to another context to support the development of an innovation to meet the requirements of the firm (Wu, 2010). The three transfer of knowledge channels most often referred to in the literature are collaborative research, research contracts and consultation (Mueller, 2006; Mueller, 2006; Perkmann and Walsh, 2009). Collaborative research studies are formal agreements entered into for the purpose of conducting joint R&D. Such studies are often subsidized through public funds. Research contracts are defined as research studies directly mandated by firms and conducted by a university. Lastly, consultation refers to a service provided by a researcher, on an individual basis, for a firm. Among the various types of instruments used to transfer technology from a university to an industry, collaborative research remains among the most significant (Wu, 2010). Investments in research and U-I collaborations generate new and innovative products and processes, which in turn result in high returns and a positive impact on the labour market (Perkmann and Walsh, 2009; Morandi, 2011). International competition, changes in and the increasing complexity of technology as well as tight development deadlines and short product life cycles encourage increasing numbers of firms to collaborate with external entities in their R&D efforts (Morandi, 2011). According to a survey

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conducted by Lee (2000), the most important reasons for collaborating with universities are access to new research and knowledge, the development of new products and a desire to maintain relationships with university researchers. It has been shown that technological SMEs mainly use links with universities to solve problems related to the firm’s essential and core activities, whereas larger firms mainly use those links to develop competencies in other related fields. Thus, a collaboration contract represents a real tool that allows for the transfer of knowledge (Wright et al., 2008). Some authors also claim that the desire to reap profits from their R&D funding also constitutes a motivation for firms (Zukauskaite, 2012). Several countries have government programs that provide funding to firms that collaborate with universities. Furthermore, such collaboration enhances the reputation of a firm in that environment and helps with employee recruitment (Johnson, 2008). Barbolla et Corredera (2010) developed a model that highlights the characteristics sought by firms when transferring technology with a university. The four characteristics they identified are technological maturity, perceived usefulness of the project, the capacity of the firm to incorporate the results into its value chain and confidence in the university team and its results. Other authors stipulate that firms focus on the availability of research resources, the emphasis placed on entrepreneurship and the quality of previous research by the universities to gauge their willingness to collaborate with them (Lai, 2011; Johnson, 2008; Coviello et al., 2011). From the university point of view, studies have identified the reasons that lead them to agree to enter into a relationship with an industry. Several universities consider access to funding, applicability and commercialization of research, access to skills and industrial facilities and the desire to remain up to date with current problems facing the firm as significant sources of motivation (Theodorakopoulos et al., 2012; Lai, 2011; Morandi, 2011). Other authors indicate that universities are motivated by the desire to find new research ideas and diversified sources of funding (Johnson, 2008; Mueller, 2006). Effective collaboration with industry enhances the reputation of a university, which can help attract new students (Yusuf, 2008). The criteria used by universities to collaborate with firms have been studied by numerous authors (Johnson, 2008; Cosh and Hughes, 2010). These characteristics are the age and size of the firm, industry sector, R&D activities conducted by the firm and its openness to new ideas. Within innovation ecosystems, intermediary organizations become involved to foster the growth and success of U-I collaborations. These intermediaries may be internal or external to the university (Wright et al., 2008). External organizations may be public, non-profit or private and may take various forms, such as science parks, business incubators, regional development agencies or industrial associations (Comacchio et al., 2012). There is a great diversity of such organizations, which generally work together as their contribution varies according to the role they play (Johnson, 2008; Spithoven and Knockaert, 2012; Yusuf, 2008; Landry et al., 2013). Through their knowledge of both the academic and industrial environments, mediating intermediaries are in a position to identify, qualify and select collaboration opportunities. Their neutral role enables them to build bridges between two institutional, cultural and social realities (Yusuf, 2008). In light of the needs identified, the intermediaries instill a climate of trust, stimulate the search for solutions via the transfer of knowledge and, in so doing, reduce transaction costs (Ankrah et al., 2013; Kodama, 2008). Their human capital and social skills enable them to amalgamate multidisciplinary teams to coordinate collaborations (Comacchio et al., 2012; Theodorakopoulos et al., 2012; Lai, 2011). Their contribution is of particular benefit to SMEs and low-tech entreprises (Comacchio et al., 2012). Some organizations even become sponsors through financial contributions to the collaboration project (Johnson, 2008). The cultural differences mentioned above between universities and the industry are sometimes the source of obstacles in their exchanges (Kyoung-Joo, 2011; Spithoven and Knockaert, 2012; Theodorakopoulos et al., 2012; Zukauskaite, 2012). These divergent objectives may result in a lack of trust between partners, which may hinder the success of the relationship. The research subject, the timetable, and the way in which the results are revealed often lead to conflict between partners (Ahrweiler et al., 2011; Wu, 2010). Such conflicts occur due to inappropriate partner selection or poorly defined structural governance (Boardman, 2009; Burnside and Witkin, 2008). Since a large number of obstacles

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found in university-industry agreements are rooted in divergent objectives and the different organizational cultures of both parties, collaborative agreements must be structured and managed adequately in order for them to be productive and yield the expected results (Zukauskaite, 2012; Kyoung-Joo, 2011). In order for a collaboration project between a university and a firm to be successful, it is important that common principles and clear procedures be established (Spithoven and Knockaert, 2012). This means building an efficient and productive team by clearly defining the roles of each party, establishing fixed deadlines and organizing face-to-face meetings in order to create team cohesion among the members of the university and the firm. It is also essential to come to an agreement regarding expected outcomes and the means to achieve them right from the start of the collaboration (Wu, 2010). Collaborating on R&D projects requires that both parties learn to work with an organization whose reality, structure and mission are different by developing specific operational methods and practices so as to manage expectations regarding results and production and development timeframes (Ahrweiler et al., 2011). These procedures become better developed with experience. A high degree of trust between two parties helps reduce the fear of opportunistic behaviour (Kyoung-Joo, 2011). Trust allows universities and firms to work together to solve problems (Kodama, 2008). This obviously also shows a willingness to understand and adjust one’s behaviour to align with the needs and expectations of one’s partners. A serious commitment on the part of every team member is also necessary.

3. METHODOLOGY AND DATA COLLECTION This study attempts to deepen our understanding of the U-I collaboration phenomenon and, more specifically, the underlying motivations, trust relationships and the role of intermediary organizations. It aims to infer conclusions on the success factors and obstacles to collaborations by answering the following questions: 1. How can profitable U-I collaborations that meet the expectations of both parties be established? 2. How can a climate of trust between partners be established in U-I collaborations? The research approach used to investigate these research questions was a case study, conducted in compliance with the recommendations of Yin (2009). This approach was deemed the most appropriate to provide a thorough understanding of complex, multi-facetted and little-analyzed processes such as motivational factors, expectations, and the degree of trust between partners in U-I collaboration projects. This type of methodology is also appropriate when searching for answers to “how”-type questions concerning a set of events over which the researcher has little or no control. In this study, a case study is defined as an empirical investigation that (1) investigates a current event in a real context; where (2) the boundaries between the phenomenon and the context are not clearly evident and (3) several sources of evidence are used. The analytical technique used focused on drafting an explanation of the case to generate a significant theoretical contribution. This analytical perspective was selected because, although U-I collaborations are difficult and filled with paradoxes and challenges, great achievements have been realized as a result of such cooperation (Barbolla and Corredera, 2009). In the event that answers to the initial research questions would lead us toward other factors, we attempted to draft a new analysis directed toward our rival research explanations, as mentioned above. Our intention was to provide sensitizing concepts, as defined by Blumer (1954) in Bowen (2006): “Whereas definitive concepts provide prescriptions of what to see, sensitizing concepts merely suggest directions along which to look”. According to Bowen (2006), sensitizing concepts may be effective in providing an analytical framework for empirical data and, ultimately, developing a deeper understanding of a given phenomenon. It is essential, however, to move beyond a merely descriptive level into an interpretation and explanation of the themes. The case under study is an illustration of a network of effective U-I collaborations by the FSG at Laval University. In the Québec City area in the Province of Québec, Canada, Laval University is a true

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economic engine that is dedicated to its community. Laval University is ranked among the top 10 Canadian research universities by Research Infosource Inc. It employs 1,350 professors and its student body includes nearly 4,300 students registered in 150 graduate research programs, in addition to 400 post-doctoral interns and 700 research professionals. Over the last five years, it has focused its research development on partnerships with the business environment, in particular with firms located in Québec City’s technological park. This strategy has generated an increase of $20 million in research funding and 35% in partnership chairs for a total of $307 million in research funding and 68 partnership chairs, with more than 800 private and public investors. The FSG distinguishes itself, in particular, through its network of U-I collaborations. A total of 250 professors manage $84 in annual research funds and supervise more than 1,100 graduate students. The Faculty owns 23 active licences covering technology borne of the work of 19 principal researchers and students. With the exception of one licence granted to an external research centre, the licences were granted to 21 private, mostly technological SMEs. It should be noted that several of these licences are the result of a transfer of technology through spin-offs. In order to allow triangulation to ensure the validity of the study and to obtain a more comprehensive and accurate view of the topic, data were collected from multiple sources of secondary information (university, faculty, intermediate organisation websites, university databases, corporate documentation, media), and structured interviews with academic and institutional actors (industry and governmental representatives). The former were considered as initiators of discoveries and/or innovations and the latter as actors who supported innovation projects. Statements were collected via 60-minute interviews. The interview protocol was based on the review of literature and written material on current and past FSG university-industry collaborations. The data collected in this case study were subsequently used to answer the two research questions. In order to obtain the point of view of researchers on U-I collaborations, a stratified sample of one professor per department was used, i.e. the professor with the most collaborations with the industry where at least one such collaboration was still valid in the previous 12 months. In total, seven professors, six full professors and one associate professor were interviewed at their offices. Industry representatives and economic development agents, who were the institutional actors, were targeted as industry opinion leaders. Their position enables them to get opinions from numerous business leaders on R&D collaborations with university researchers on a daily basis. They were selected by nonprobabilistic sampling per cluster. In this specific case, the population was composed of all of the organizations identified as active in the high technology value chain in the Québec City area (n=78). From this number, organizations were selected through non-probabilistic sampling by rational selection in order to retain those that were most affected by connections between universities and firms (n=24). In the end, 9 stakeholders from government agencies, valuation agencies, non-profit organizations and entrepreneur associations were met at their offices.

4. UNIVERSITY-INDUSTRY COLLABORATIONS: MOTIVATIONS, SUCCESS FACTORS AND OBSTACLES This section presents the results of the main factors that have shaped the creation, execution and fulfilment of U-I collaborations at the FSG. The results illustrate the U-I collaborations conducted at the FSG over the last three years and, more specifically, those of the academic respondents. We have noted motivational differences among U-I collaboration partners, but we have also noted a degree of

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convergence with regard to certain expectations. Lastly, other factors do not foster the growth of U-I collaborations and should be re-examined in terms of their current functional structure. 4.1 Collaboration Project Descriptions This study focused on the FSG, in which 5,500 students are enrolled annually, 1,100 of whom are graduate students. The department’s 250 professor-researchers manage $84 million in annual research funding. The Faculty is home to 32 research chairs, 14 centres and institutes, 16 groups and laboratories, 1 excellence centre network and 1 strategic network. Over the last three years, the FSG has obtained 16, 11 and 14 patents respectively. Table 1 describes the FSG’s U-I collaboration projects carried out since 2013. These contributions are growing both in terms of their numbers and their combined in-kind and monetary value. The number of firms and professors involved in such agreements is also on the increase. Table 1: Description the FSG’s University-Industry Collaboration Projects Description 2013 2014 No. of U-I collaborations 125 145 Collaboration value ($ + in kind) $8,769,760 $8,958,207 No. of firms that funded at least one 138 147 project No. of professors with at least one U-I 186 196 collaboration project

2015 (underway) 55 $5,198,982 81 114

The FSG is also recognized for the high quality of its U-I collaborations. The Natural Sciences and Engineering Research Council of Canada gives out the annual Synergy Awards for Innovation in recognition of collaborations that serve as models of effective partnership between industry and universities. Winners of this prestigious award receive a $200,000 research subsidy. In 2013, an FSG researcher received the award in the “Large Companies” category, and another FSG researcher received the award in the “Two or More Companies” category in 2014. The Faculty owns 23 active licences covering technologies borne of the work of 19 principal researchers and students. The most common type is the exclusive licence (70%), far ahead of the user licence (13%) and other types (17%). Other than one licence granted to an external research centre, the licences were granted to 21 private firms, most of which are technology SMEs. Nearly half (10) are located in the Québec City region. It should be noted that several of these licences are the result of a transfer of technology through spin-offs, five firms of which are still active. One of those firms has 1-5 employees, three have between 11 and 25 employees and the fifth employs between 26 and 29 people. The FSG’s greatest success was the collaboration with the Creaform company, which resulted in the development of its first line of products. This company continues to collaborate with the FSG to this day. It has invested one million dollars over five years for the creation of a research chair on three-dimensional digitization. In 2013, the company was acquired by Ametek, an international manufacturer of electronic instruments and electromechanical devices that currently employs nearly 250 people in the Québec City region. 4.2 Motivations Of University Researchers Motivations to collaborate with the industry expressed by the academic respondents were categorized on the basis of the number of times they were mentioned. The main motivation among researchers involved the possibility of conducting research in an industrial environment. This opportunity allows them to find a practical application to their research and deepen their understanding of the field. In a less significant proportion, training and preparing students for the labour market also figured among the motivations

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expressed by researchers. Research infrastructure funding and fueling their teaching also ranked as motivations equal to personal advancement and surpassing oneself. In a context of scarcity of financial ressources, partnerships with private firms are seen as alternatives to traditional funding by granting agencies in order to maintain or buy costly equipment to stay at the cutting edge of technology. As for its impact on teaching, it allows professors to stay on page with industry needs and realities, to give current and concrete examples opening to industrial carreer perspective. Lastly, personal economic gain provided by research contracts with the industry and meeting personal challenges were also raised as indicators, but in a lesser proportion. 4.3 Motivations Of University Researchers From The Institutional Actors’ Point Of View According to the institutional actors, the principal motivation of researchers to establish collaborations is to find a practical application for the research results and better understand the field. Obtaining a financial leverage to conduct their research efforts ranks second among their motivations. In a lesser proportion, gaining visibility for their research is also perceived as a motivation specific to researchers, followed by the desire to create intellectual property that can be transferred to the firm to contribute to economic development. Visibility is particularly obtained through publications either in academic or professional journals. Lastly, the institutional actors view training and personal issues (ego or economic gain) as motivations of lesser importance for researchers. 4.4 Motivations Of Entrepreneurs From The Institutional Actors’ Point Of View When asked about the motivations of entrepreneurs to collaborate with university researchers, the institutional actors mentioned the following factors equally most frequently: benefitting from the unique expertise of the researcher, his or her network and infrastructures, lower costs and long-term collaboration possibilities. The cost saving motivation can be explained while compared to consultant fees or the constitution of a specialised team inside the firm, especially when it is a punctual need of expertise. Governments also offer grants as incentives to U-I collaborations. Next in order of importance, access to interns and qualified labour represented real motivations in a context of human resources shortage. In addition, student trainees are perceived as more flexible than full time employees. Lastly, firms are motivated by the competitiveness they can gain through this type of collaboration, as well as the possibility of transferring knowledge to employees once the project ends and the researcher leaves. Understanding an unexplained phenomenon through fundamental research and becoming familiar with the possibilities of joint research are less frequently mentioned motivations. In the presentation of the most determinative motivations, we noted some striking similarities. Thus, although the principle motivations of researchers and entrepreneurs are different, they are not contradictory. Furthermore, we noted a relative understanding of the incentives on both sides that may facilitate the approach to eventual university-industry collaborations. 4.5 Success Factors In The Establishment And Deployment Of University-Industry Collaborations When asked about the success factors for U-I collaborations, researchers gave the highest ranking to the importance of benefiting from the technical support of professionals who are in a position to deal with the business sector in terms of drafting and preparing the documents related to their collaboration. This success factor was also raised by the firms, as indicated by the institutional actors. According to the institutional actors’ point of view, seeking collaboration where everybody wins right from the start appears to be a determinative success factor. For firms, such collaboration translates into an equal partner approach where deadlines are determined, methods of functioning and deliverables are clearly defined and a transparent agreement on the sharing of intellectual property is entered into. All of

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these factors are facilitated by regular coordination meetings to foster mutual understanding of everyone’s interests. For one-third of the researchers interviewed, it is also crucial that expectations and deliverables be clarified from the very beginning. Another factor deemed determinative by the institutional actors was taking inspiration from best practices to stimulate opportunities and activities that foster closer contact between researchers and entrepreneurs. In addition, streamlining the administrative and decision-making structures stemming from university bureaucracy is a success factor raised in equal proportions by both parties. Developing and maintaining healthy relationships between researchers and entrepreneurs also appears to be a determinative factor in the eyes of researchers. Forentrepreneurs, it is important that researchers be able to benefit from the tools designed to help them tightly manage their projects and budgets and that showcase technological projects be prioritized to stimulate collaboration. Although the factors mentioned above by the various parties illustrate some differences, we noted some convergence with regard to certain concerns shared by researchers and entrepreneurs about streamlining administrative structures to simplify the deployment of collaboration agreements. Furthermore, better communication that fosters the sharing of visions and the interests of all parties also appears to emerge among the success factors mentioned by both parties. These factors are summarized in Table 2 below. Table 2: Success Factors For University-Industry Collaborations University Researchers Institutional Actors 1. Benefiting from the technical support 1. Seeking, from the start, a U-I collaboration of professionals capable of dealing where everyone wins. with the business sector; preparing 2. Implementing in-house liaison officers involved and drafting the required documents. with the industry and entrepreneurs. 2. Making sure from the start to clarify 3. Creating opportunities that foster closer contact expectations, deliverables and between researchers and entrepreneurs by contracts. taking inspiration from best practices. 3. Ensuring better coordination between 4. Streamlining administrative procedures; the various university authorities to decentralizing the decision-making authority to streamline the decision-making facilitate collaboration. process. 5. Helping researchers to tightly manage projects 4. Developing and maintaining a healthy and respect budgets. relationship between the researcher 6. Prioritizing and promoting showcase and representatives of the firm. technological projects. 4.6 Obstacles To University-Industry Collaborations Table 3 clearly indicates that the cumbersome administrative procedures involved in negotiating and managing collaboration contracts is a major obstacle for researchers. According to institutional actors, entrepreneurs believe that universities are not adapted to the industrial environment and that there are two speed lanes – one for universities and another for firms – which are viewed as major irritants. The heavy bureaucracy is also perceived as an obstacle by firms, but to a lesser degree than by researchers.

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Table 3: OBSTACLES TO UNIVERSITY-INDUSTRY COLLABORATION Researchers Institutional Actors 1. Cumbersome administrative procedures; 1. Perception that the university is not confusion regarding procedures and adapted to the industrial environment. deadlines. 2. Different rhythms between firms (often 2. Overhead costs are an irritant for firms. more rapid) and research activities. 3. Overly complex negotiations of intellectual 3. Perception of cumbersome administrative property rights. procedures in the collaboration process. 4. Difficulties coordinating timing between 4. Negotiations of intellectual property rights the research conducted by the researcher can lead to friction. and the firm’s strategy. 5. Lack of knowledge about researchers and their structures, which makes initial contact difficult. 6. Divergent interests with regard to the publication of the results of the collaboration. 7. Difficulty on the part of firms to accept the advice of a researcher. 8. Lack of technical expertise within the firm, which hinders the transfer of knowledge once the collaboration has ended. 9. Cost of researchers and related fees charged by universities deemed too high. Both entrepreneurs, as stated by institutional actors, and researchers claim to be equally concerned by the complexity surrounding negotiations of intellectual property rights in a collaboration agreement. In addition, divergent interests between entrepreneurs and researchers with regard to the publication of the collaboration results are a factor perceived as bothersome mainly by firms. In addition, the issue of related fees charged by the university is seen as an obstacle for firms, and researchers also view this aspect as a hindrance in their collaborations. According to the institutional actors surveyed, the lack of technical expertise within the firm may hinder the transfer of knowledge once the collaboration has ended. Furthermore, firms sometimes have difficulty accepting the advice of a researcher. For researchers, coordinating the timing between research and the firm’s strategies is often difficult, which represents an additional irritant. In brief, we have noted that the contextual differences in which researchers and firms operate give rise to several obstacles and hinder or, at the very least, slow down U-I collaboration.

5.

DISCUSSION

5.1 Motivations of University-industry collaboration partners The data analysis has revealed that the motivations of U-I collaboration partners are consistent with several theoretical foundations previously reviewed. With regard to university researchers, the data clearly show that access to funding and the applicability of university research are significant sources of motivation (D'Este and Patel, 2007; Loof and Brostrom, 2008; Morandi, 2011). However, other motivational factors of a more intrinsic nature were revealed in this study. In other words, the data suggest that additional factors to those previously indicated in the literature contribute to the success of U-I collaboration, which shows that other factors can rally partners in U-I collaborations. It should be mentioned that learning and surpassing oneself, as well as personal challenges (motivational factors mentioned by university researchers) constitute sensitizing concepts that must be taken into account in the U-I collaboration phenomenon. Also to be considered is the point of view of institutional actors on the

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motivations of university researchers. Those actors also mentioned two intrinsic motivations: visibility of the researcher and contributions to the development of society. However, it is interesting to note that the researchers interviewed were long-term veterans of U-I collaborations, and are in fact viewed as success models by their university. Thus, despite the fact that they have acquired a certain degree of experience and success with U-I collaborations, the intrinsic motivations identified remain significant in the establishment and selection of R&D projects with the industry. Fundamentally, it appears that the motivations raised by the FSG researchers to cooperate with the industry are centred around support for their research rather than potential commercialization (D'Este and Patel, 2007). At the very least, this aspect did not clearly emerge from the reported motivations. This may suggest that those elements must be taken into consideration in the structural bases for U-I collaborations. With regard to the motivations of entrepreneurs as reported by the institutional actors, they are similarly corroborated in the review of the literature. The convergent factors revealed in this study and the theoretical elements that were previously identified are the following: the desire to maintain a relationship with university researchers (Lee, 2000); the transfer of knowledge (Wright et al., 2008); cost-sharing and R&D (Perkmann et al., 2011); obtaining leading-edge technology and the quality of the researcher (Barbolla and Corredera, 2009); and easier recruitment of specialized labour (De Fuentes and Dutrenit, 2012). Thus, no new motivational factors were revealed in our results analysis. This therefore confirms the main reasons that lead entrepreneurs to collaborate with university researchers. Lastly, it may be understood that both U-I collaboration partners share certain motivational factors, such as funding research infrastructures and R&D as well as student training and placement in an industrial context. 5.2 success factors and obstacles in the establishment and deployment of university-industry collaboration agreements Firstly, certain elements found in the literature regarding success factors were raised by both the university researchers and the institutional actors during the interviews. The analysis supports the importance of establishing, right from the beginning, a set of common principles, clear procedures and a definition of each partner’s respective roles (Burnside and Witkin, 2008). Respondents were in unanimous agreement on this point. The determination of outcomes to work toward and the various subsequent steps (strict management of the projects and deliverables) are replies we obtained that Barbolla and Corredera (2009) also deemed essential factors for a successful partnership. Management of the agreements was underscored and must translate into streamlined and simplified administrative and decision-making structures in terms of university bureaucracy and the deployment of collaboration agreements (Kyoung-Joo, 2011). Both categories of respondents made specific reference to simplifying the decision-making processes, administrative procedures and decentralizing decision-making authority in order to facilitate U-I collaborations. As part of an attempt to answer our first research question (how to establish profitable U-I collaborations?), it may be suggested that the current state of the U-I collaboration system fails to meet partner expectations. As a result, this situation also fails to generate a climate of trust between the partners (answer to Question 2). It bears repeating that the results are from interviews with individuals who have experience with U-I collaborations and that they confirmed the theoretical concepts that had previously been identified. This led us to shift our analysis toward our rival explanations, that there are other factors rallying partners and there is a new model of U-I collaboration merging. Thus, it may be understood that the success factors identified by the respondents, which are consistent with the literature, suggest that new modalities should be considered in order to increase the number of U-I collaborations and the degree of trust between partners. For example, in the search for sensitizing concepts to explain the U-I collaboration phenomenon, we have witnessed the role intermediary organizations can play in bringing parties closer together in order to foster this type of cooperation (Yusuf, 2008). As neutral stakeholders who are familiar with the motivations of both parties, they may also succeed in reconciling their respective

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expectations (Ankrah et al., 2013). In so doing, they can also help develop and maintain healthy relationships between researchers and industrial actors, foster opportunities for a rapprochement, and assist in the management and promotion of R&D products (Comacchio et al., 2012). Thus, perhaps the time has come to institutionalize new practices by decentralizing, for instance, the establishment and management of U-I collaboration projects toward intermediary organizations that are neutral and independent from the university and industrial systems. Proposal 1: Other factors can rally partners in U-I collaborations Proposal 2: Different structural bases for a new U-I collaboration model Secondly, the analysis of the data on obstacles to U-I collaborations is consistent with the key success factors identified. The streamlining of administrative structures and the decision-making process advocated by the respondents as a success factor becomes an identified obstacle when they refer to the cumbersome administration and confusing university system as it applies to the management of U-I collaborations (Kyoung-Joo, 2011). However, another sizeable challenge was corroborated in this study and the review of the literature: managing intellectual property in U-I collaboration. As indicated by Morandi (2013), this is a crucial element that requires particular attention. The possibility exists that a trade/industrial secret be eventually transferred as part of subsequent collaboration with another firm. Faced with this serious issue, firms are obviously justified in finding means to prevent such an occurrence. This issue was in fact raised as a concern on the part of the firms in our study. For their part, researchers essentially perceived intellectual property as an element of negotiation. The fundamental problem, as was initially identified in this study, is that the system that governs the academic world is different from the system that governs industry (Bruneel et al., 2010). On this subject, the OCDE (2002) suggests that countries review the frameworks that govern intellectual property rights. Once again, we have noted that additional factors explain the obstacles to U-I collaborations and the lack of trust between partners (Question 2). In its recommendation, the OECD suggests, in particular, that clear rules be established with regard to intellectual property rights stemming from U-I collaborations by providing enough independence to research institutions. A good practice may be to grant intellectual property rights to an effective research organization while ensuring that researchers receive a fair share of the resulting royalties (OECD, 2002). To do so, a specific agreement on the sharing of intellectual property is strongly recommended. Although this is a complex issue that generates a low level of trust in universities on the part of firms, it is crucial that we continue to examine ways in which a consensus among national partners can be reached. Failure to do so could result in an increasing trend toward the creation of agreements with foreign universities (Kramer, 2008), with the negative consequences to be expected in terms of the economy and technological innovation. In this era of a knowledge-based economy, in which technological innovations are crucial in providing a competitive advantage on both the national and international levels, finding governance mechanisms for U-I collaborations to create winning conditions for cooperation between partners is essential. We have noted that university researchers essentially enter into U-I collaborations to pursue their research efforts and establish their scientific reputation. In other words, despite the recognized importance of commercializing research, the university system continues to function under the auspices of a model that is more or less adapted to this new reality (Bercovitz and Feldman, 2011; Bruneel et al., 2010). For example, university researchers may rest their reputation on the number of publications produced and the amount of research grants they have received. These are in fact the very criteria on the basis of which they will be judged in terms of their contribution to their institution and the future of their academic career. Therefore, if we wish to further develop productive and profitable U-I collaborations, to the satisfaction of all partners and in a climate of trust, the current mode of functioning will need to be revised. It is possible to suggest that intermediary organizations could take the reins from university institutions to implement collaborations under a different mode of

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governance, where the expectations of each partner are well-defined from the beginning. This study has revealed that the degree of trust in university researchers on the part of entrepreneurs, according to the point of view of the institutional actors, is very low. This situation is also confirmed in the literature (Howells et al., 2012). Intermediary organizations, acting as guardians of the relationships between universities and industries, could build a base of trust for firms right from the beginning through various means, while taking great care to define the tangible outcomes targeted by the collaboration project, such as joint research papers, joint research publications, doctoral dissertations, patents, patent applications or new products or processes (Santoro and Saparito, 2003). They should also make sure to establish and maintain frequent communications between researchers and industrial partners; communications that inform both parties about progress and results, and that such communications be personalized. Gopalakrishnan and Santoro (2004) have indeed found that trust is the adhesive that binds U-I collaborations and creates a climate that facilitates joint activities and positive outcomes. Lastly, it should also be noted that, regardless of the fact that a new mode of governance for U-I collaborations appears to be a promising solution for the future, universities will nevertheless be required to review their incentive systems, which currently do not necessarily foster R&D projects geared toward the production of market-bound innovations (Howells et al., 2012). In other words, if we wish to see increasing numbers of researchers interested in taking part in U-I collaborations, an appropriate incentive system in which intrinsic and extrinsic motivations are taken into account, whether in terms of the researchers’ reputation, their visibility, monetary incentives, career advancement or a vocation as an academic entrepreneur and partner in the economic development of their region and country will be required.

6.

CONCLUSIONS AND IMPLICATIONS

This study provided an opportunity to conduct interviews with researchers and industry professionals to gain perspective on the convergence and divergence of various points of view concerning motivations, obstacles and the success factors of U-I collaboration as presented above. University-industry partners share motivational factors, namely, research funding and infrastructures, as well as student training. In addition, university researchers’ motivations include access to funding, applicability of research, learning, surpassing oneself, personal challenges, visibility, and contributing to the development of society. Enhanced university incentives and recognition systems would further stimulate researchers’ interest. As for entrepreneurs, they wish to maintain a relationship with university researchers, have access to high-quality research and leading-edge technology through the transfer of knowledge, share R&D costs, and recruit specialized labour more easily. Elements from the literature were raised to highlight the determinative actions that must be included in future collaborations so as to foster profitable researcher-industry partnerships in a climate of trust. Firstly, future collaborations must allow for an initial contact between researchers and entrepreneurs, given that the latter have little knowledge of the available research expertise in most cases. Simplified university administrative procedures that aim to streamline the negotiation process and the establishment of contracts between researchers and industry are required. This will help in preventing this obstacle from growing in scale. Future collaborations must foster the sharing and convergence of interests by implementing methods that enable healthy understanding. Promoting communication before and during the collaboration project is also necessary. Lastly, future collaborations must provide for professional accompaniment in the project’s management and budgetary supervision, essentially for the benefit of researchers. Intermediary organizations are therefore called upon to play a more prominant role in light of their neutrality to guide stakeholders through their initial contact, expose their mutual expectations, define the project’s targeted outcomes, reach a consensus for the sharing of intellectual property, and manage their innovation project, particularly by ensuring that information is shared on a regular basis between partners.

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This study’s limitations with regard to its context and data collection method pave the way for future research. A multi-site or even multi-country study with a larger sample of professors, entrepreneurs and intermediaries, in particular by conducting a survey, could provide statistical generalization of this study’s conclusions. An examination of the networks that exist within targeted regional ecosystems could provide an assessment of the impact of the position of researchers on the degree of trust the industry harbours toward them. Conversely, by analyzing past links between entrepreneurs and academic researchers, the influence of the degree of trust on the part of researchers could be measured. Further refinement of the statements on the basis of collaboration types, their scope in terms of value and the number of researchers involved, as well as the size of the industrial partner, would expand our knowledge of such relationships. This study has shed light on the opinions and needs of both researchers and industry. Knowledge about the respective motivations and selection criteria could enable both parties to assert themselves and establish connections with each other and thus better manage the relationship on the basis of mutual expectations. The results should enable teaching establishments that would like to see their researchers develop collaborations with industry to identify new valuation approaches to encourage such initiatives. Furthermore, depending on their organizational context, certain anticipated obstacles can be avoided. By applying the suggested methods and procedures, an increase in successful transfer of knowledge through university-industry collaborations will enhance the new role of universities in economic development. Intermediary organizations can also take inspiration from these results as they implement their training and networking activities to expand the number of contacts between the academic and industrial worlds in order to promote the benefits and growth of such collaborations. A new business model for such organizations appears to be emerging in response to a need expressed by both parties, thereby allowing these organizations to play a more prominent role in the ecosystem. The support of policy makers toward such initiatives will play a decisive role in the enhancement strategies of U-I collaborations to reach the goal of developing a regional and national competitive advantage. Armed with the knowledge of the conditions that are favourable to successful university-industry collaboration, all actors within the innovation ecosystems can work together to promote the socio-economic development of their territory.

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Thousand Oaks, California: Sage

Yusuf, S., "Intermediating Knowledge Exchange between Universities and Businesses", Research Policy, Volume 37, Number 8, Pages 1167-74, 2008. Yusuf, Shahid, "Intermediating Knowledge Exchange between Universites and Businesses", Research Policy, Volume 37, Number 8, Pages 1167-74, 2008. Zukauskaite, Elena, "Innovation in Cultural Industries : The Role of University Links", InnovationManagement Policy & Pratice, Volume 14, Number 3, Pages 404-15, 2012. AUTHORS’ PROFILE Dr. Sophie Veilleux graduated with a Ph.D. from Université du Québec à Montréal in 2008. She is currently an Assistant Professor of Technology and International Entrepreneurship at Université Laval, Québec, Canada. Dr. Johanne Queenton earned her Ph.D. at Université du Québec à Montréal in 2004. She is currently an Associate Professor of Strategy and Innovation Management at the Faculty of Business in the Department of Management and Human Resources, and Director of the Innovation Management Research Team at Université de Sherbrooke, Canada.

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RELIABILITY REVISITED: TOWARD AN ENLIGHTENED NOTION OF COMMAND AND CONTROL IN HIGH HAZARD INDUSTRIES Evan H. Offstein, Frostburg State University, Frostburg, Maryland, USA Rebecca M. Chory, Frostburg State University, Frostburg, Maryland, USA D. Robin Bichy, Excelerated Leadership Partners, Ashburn, Virginia, USA Raymond Kniphuisen, Excelerated Leadership Partners, Ashburn, Virginia, USA

ABSTRACT High risk and high reliability organizations found in high hazard industries deserve rigorous scholarly and applied attention as the consequences of failure are often catastrophic. Given the ramifications of poor performance, at best, or failure, at worst, it is surprising that inquiry into these special organizations is rather muted compared to the vast amount of conceptual and empirical study found within the broader organizational theory literature. Moreover, the preponderance of research over the 30 years since the Bhopal gas tragedy has overwhelmingly focused on such domains as organizational learning, network analysis, and organizational/management systems. Ironically, and quite unlike the general organizational theory literature, leadership receives scant attention within the context of high risk/high reliability organizations (HROs). We begin to address this absence by applying some conceptual rigor to the dominant logic and leadership style found in most HROs—the Command and Control persona and approach. We contend that traditional conceptualizations of command and control may, indeed, work against the reliability of HROs. Instead, we offer a more enlightened notion of command and control that, if implemented, should reduce risk and hazard within these unique organizations. Keywords: Organization Reliability, Leadership, High Hazard Industries

1. INTRODUCTION High hazard industries contain high risk/high reliability organizations (HROs) that produce considerable social benefits. When operating as expected, HROs provide energy, transport citizens, allow for free flow of trade, and even provide for national defense. Such organizations include but are not limited to nuclear power plants, oil refineries, airlines, investment banks, and aircraft carriers and submarines. Unlike traditional organization archetypes, inherent in the fabric of HROs is their potential to kill or injure considerable numbers of people or destroy wide swaths of the environment (Roberts, 1990). Unfortunately, over the last several decades, breakthrough events such as the Bhopal disaster, the Deepwater Horizon event, and the Chernobyl and Fukushima meltdowns provide ample evidence of the consequences of HROs failing. While much of the research agenda on HROs focuses on such topics as organizational learning, organizational knowledge and cognition, and systems theory, the After Action Reviews of all major mishaps point to an additional failure—that of leadership (Marcus, Bromiley, & Nichols, 1989a; Marcus et al., 1989b; Shrivastava, 1986). In this paper, we offer a critical examination of the dominant leadership logic found in many HROs—Command and Control. Toward that end, we extend the thinking and offer a more nuanced conceptualization of command and control leadership styles that should enable safer and more reliable HROs. HRO research as a percentage of the entire tome of organizational research is low, despite the outsized impact on society and a variety of stakeholders that occurs when these organizations fail to operate as expected (Roberts, 1990). Even within the realm of HRO research, a disproportionate amount of attention is focused on effectiveness (Cameron & Whetton, 1983; Goodman & Pennings, 1977) without adequate study of this notion of performance reliability (Roberts, 1990). Importantly, reliability, i.e., the ability to perform reliably (and flawlessly) over time, is the primary concern of HRO executives and leaders (Roberts & Bea, 2001). Roberts (1990) also criticizes HRO research as overly journalistic, with scholarly

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inquiry retaining some of this journalistic flavor. More specifically, she connotes an ex post facto orientation that offers causal reasoning only after an accident occurs. Such attempts to study HROs are understandable, as traditional a priori hypothesis-testing approaches are often untenable here. In HRO research, the phenomenon to be predicted is usually organizational failure, and by their very design, HROs fail at an exceedingly low rate. For that reason, much of the HRO research is case-based and qualitative in nature. As a consequence, conceptual clarity and rigor are especially important in theory building surrounding HROs.

2. HIGH RELIABILITY ORGANIZATIONS (HROS) HROs differ from traditional organizations along several lines. First and foremost, they pose special and unique challenges that make them more difficult to lead and manage (Carroll & Cebon, 1990; Offstein, Kniphuisen, Bichy, & Childers, 2013, 2014; Perin, 1995, 1998). A defining characteristic of HROs is their inherent contradictions, tensions, and paradoxes. For instance, Offstein and colleagues (2014) found that after a major disaster (e.g., Fukushima), HROs, especially poorly performing ones, and sometimes entire industries, face greater regulatory oversight, which adds to organizational complexity. However, this focus on large-scale disasters works against the imperative of detecting simple failure “signals” amidst the “noise,” which is critical in avoiding catastrophes (Caroll & Cebon, 1990). For instance, in many of the major breakthrough events in HRO history, such as the Union Carbide event in Bhopal, India or NASA’s Challenger explosion, simple signals were present and readily available, but missed (Carroll & Cebon, 1990; Shrivastava, 1986). Roberts (1990) highlights another paradox. HRO technology is “special and unique” and characterized as advanced and complex, which requires specialized knowledge and understanding. At the same time, these organizations require significant amounts of coordination and a heedful and collective understanding of how operating subsets fit into the larger whole (Roberts, 1990; Weick & Roberts, 1993). Roberts (1990; 161) captures the contradictory nature of HROs when she remarks that “HROs are characterized by both advanced technology (requiring specialist understanding) and high degrees of interdependence (requiring generalist understanding).” Again, the key descriptors of HROs would invariably contain the following language: tightly coupled, highly complex technologies, working in changing environments, and influenced by a host of often conflicting human and technical factors (Offstein et al., 2013; 2014; Perrow, 1984; Roberts & Bea, 2001). What is particularly remarkable, though, is that while the technology is complex, it tends to be uniform (Carroll & Cebon, 1990; Offstein et al., 2014). For instance, nuclear reactor technology, while complex, is consistent across most utilities—even spanning continents. HROs are entirely unlike the high-technology sector that derives its competitive advantage from technology advances and innovation (e.g., Silicon Valley). Differences in performance in HROs, such as oil refineries, nuclear power plants, aircraft carriers, or jet airlines, can be traced to leadership and managerial expertise (Offstein et al., 2014). It is this leadership orientation, in general, and the notion of command and control, in particular, that is the essence of our conceptual inquiry.

3. COMMAND AND CONTROL (C2) ORIGINS On the surface, it may appear that command and control (C2) is a simplistic notion with a rather straightforward definition. Many legacy definitions and preconceptions of this construct have been popularized in war and action hero movies (Alberts & Hayes, 2006; Ryan, 2006). Despite media portrayals and historical fact and fiction informing understanding of this construct, considerably less empirical research and scholarship is available on the topic. Legitimate authorities on C2 are not many

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and those without a strong military orientation are even fewer. This leaves many unanswered questions about the C2 construct. For instance, is C2 leadership a trait-based leadership style or a leadership strategy used in certain situations? Similarly, is C2 continuous, as in “always on,” or is it triggered only by certain events? Irrespective of whether C2 is a trait- or state- based leadership posture, can it co-exist with other leadership orientations such as transformational, contingency, situational, and entrepreneurial perspectives or models? In regards to long-held management principles, is C2 the domain of the planning phase or is it situated more in the realm of organizational execution, or can it be found in both? 3.1 Military Roots Contracted by the United States Department of Defense, scholars Alberts and Hayes (2006) assert that the very ontological roots of C2 are military in nature, begging the question as to whether C2 can be successfully applied to non-military contexts. Some doubts surface in this regard. While scholars such as Alberts and Hayes are likely to contend that the military, itself, is a mega HRO, the military is still quite different from HROs found in the private and civilian sectors. Perhaps an appropriate launch point to best understand these differences is to return to this notion of contradictions, paradoxes, and tensions popularized by Roberts (1990), Offstein and colleagues (2013, 2014), and others. 3.2 HROs versus the Military Notably, HROs are designed to prevent catastrophes and, ultimately, the loss of life. Any serious injury or loss of life is unacceptable in all HROs. In contrast, military organizations bear one of the most difficult and ultimate of missions—to devise plans and execute operations that could result in death. Even within their own units, some loss of life is tolerated, if not accepted, by military leaders. Reduced to its core, and in the broadest of conceptualizations, the mission of the military, the venue in which C2 is widely encouraged and showcased, is to wage and win all wars, or more tactically, to win battlefield engagements. HROs have a quite different mission and operate with different constraints. For instance, leaders in HROs must deal with a panoply of stakeholders, including regulators, shareholders, taxpayers, and the public, at large. Not only must leaders guard the safety of their employees, they must also answer to such clarion calls as to protect the environment and the surrounding public, where many utilities, power stations, and investment banks operate. One could easily contend that the conflicting, competing, and varying stakeholder views introduce tension into HROs not found in other organizations to include military units (Offstein et al., 2013, 2014; Perin, 1998; Perrow, 1984). Put differently, HROs must accommodate powerful and pluralistic voices, internal and external, in their everyday operation. Thus, an open question remains—how well does this notion of C2, often the expected posture of the military, generalize to other organizational environments? As mentioned previously, empirically researching leadership and organizational behavior in HROs is difficult. Thus, theorizing and rigorous conceptualizing are necessary to produce meaningful insight into these phenomena. Alberts and Hayes (2006) begin by categorizing and defining core planks of C2. One core tenet of C2 is establishing boundary conditions for execution to take place. Alberts and Hayes (2006) also describe C2 as focusing individuals to accomplish a set purpose (e.g., to put the plant in a safe condition). Assessing the effectiveness of C2 has been problematic in that historically, and, again, from a military perspective, the criterion was whether the mission was accomplished (Alberts & Hayes, 2006). Not surprisingly, this approach highlights another difference between HROs and military units. In HROs, profitmaking and production co-exist with the mission of safe operations; therefore, HROs are required to seriously consider efficiency in decision-making (Roberts & Bea, 2001; Shrivastava, 1986). In contrast, efficiency is not, if ever, a prime consideration of military tacticians or strategists (United States Army FM 5-0, Army Planning and Orders Production, 2005).

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Alberts and Hayes (2006) provide a nod to the “received” or traditional view of C2, i.e., the form that is probably practiced on a more routine basis. Traditionally, C2 is considered a directive process with a decidedly and firmly held authoritarian leadership style. C2 may also be marked by unity of command (a single individual in charge), the presence of hierarchical relationships characterized by significant power distance, and an explicit understanding of roles, decision-making authority, and control of subordinate behavior (Alberts & Hayes, 2006: 9). Below, we examine this traditional embrace of C2 as a directive and authoritarian leadership orientation meant to control the situation through condition setting, order-giving, and more autocratic decision-making within the high hazard context. Moreover, we wish to examine this phenomenon at its extremes. For instance, how would or could HROs respond under conditions of heavy, authoritarian C2 leadership? We offer these as assertions only in the hope of generating more sophisticated, nuanced, and detailed debate regarding the interplay of HROs and C2.

4. COMMAND AND CONTROL (C2) AND AUTHORITARIAN LEADERSHIP When many contemplate the characteristics of execution of C2, they default to an authoritarian leadership world-view (e.g., DeSmet, Schaninger, & Smith, 2014). This is hardly surprising as both the popular press and scholarly research suggest that leaders and followers conflate the two (DeSmet et al., 2014; Rosener, 1990; Ryan, 2006; Tannenbaum & Schmidt, 1958). Typically, C2 is characterized as male, traditional, and executed through formal authority (position power) and the control of resources (rewards and punishments), people, and decision-making in large organizations (Pfeffer, 2003; Rosener, 1990). Moreover, there is anecdotal evidence suggesting that many leaders who use C2, abuse it, or are at least perceived as doing so. For instance, leaders who constructively debate the merits of an issue versus attack others’ self-concepts in disagreements (Infante & Rancer, 1982), may nonetheless be perceived as threatening or aggressive (Gorden, Infante, & Graham, 1988) by followers. Early leadership research showed that when organizational members had first-hand experience with total participation in decision-making (including leaders giving up power and followers being responsible for goal setting and methods), they later perceived supervisors who made decisions without it as authoritarian (Tannenbaum & Schmidt, 1958). 4.1 Effects of Extreme C2 At its extremes, C2 can surge beyond the “directive” to a leadership style characterized as abusive (Tepper, 2000), aggressive (Infante & Gorden, 1985), rude (Johnson & Indvik, 201), uncivil (Andersson & Pearson, 1999), or bullying (Lutgen-Sandvik, 2006) in nature. Severely autocratic or aggressive leadership styles have been shown to be correlated with a rash of negative organizational consequences, including lower follower satisfaction (Infante & Gorden, 1985), lower organizational commitment (Infante & Gorden, 1991; Johnson & Indvik, 2001; Pearson, Andersson, & Porath, 2000), higher turnover (Johnson & Indvik, 2001; Lutgen-Sandvik, 2006; Pearson et al., 2000), poorer performance (Johnson & Indvik, 2001; Pearson et al., 2000), lower worker productivity (Johnson & Indvik, 2001; Lutgen-Sandvik, 2006; Pearson et al., 2000), and declines in follower physical and mental health (including anxiety and depression; Coombs & Holladay, 2004; Johnson & Indvik, 2001) and job-related exhaustion (Grandey, Kern, & Frone, 2007). These health issues, as well as employee fear of future abuse, lead to higher levels of absenteeism and less time spent at work (Hoobler & Swanberg, 2006; Johnson & Indvik, 2001; Pearson et al., 2000). Aggressive leadership is also associated with followers filing lawsuits (Coombs & Holladay, 2004; Johnson & Indvik, 2001) and grievances (e.g., with unions) (Lutgen-Sandvik, 2006) against the leader or organization.

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Contrary to assumptions that heavy C2 leadership inspires respect from followers, employees with aggressive supervisors tend to think such supervisors are less competent, have lower ethical character, and care less about followers (Cole & McCroskey, 2003). Aside from damaging followers’ perceptions of leaders, overly aggressive C2 leadership styles have also been shown to predict followers behaving antisocially toward leaders. For instance, when superiors do not treat their subordinates with politeness, dignity, or respect, subordinates are more likely to obstruct the work of their superiors, be aggressive toward them (Chory& Hubbell, 2008), and complain to colleagues (Goodboy, Chory, & Dunleavy, 2008). Bullying, uncivil, and rude leaders induce anger in followers (Johnson & Indvik, 2001), incite or escalate conflict (Andersson & Pearson, 1999), and tend to drive their followers to retaliate against them (Johnson & Indvik, 2001; Lutgen-Sandvik, 2006; Pearson et al., 2000). Whether leaders are aware or even care about their destructive leadership tendencies seems immaterial; organizational outcomes such as poor firm financial performance are often a by-product of overly aggressive and destructive leaders (Schyns & Hansbrough, 2010). Indeed, negative follower satisfactions, hostile reactions, and poor productivity seem to accompany aggressive, hostile, and subversive leadership (Pearce, & Sims, 2002; Podsakoff & Todor, 1985; Podsakoff, Barman, Todor & Grover, 1982; Thoroughgood, Hunter, & Sawyer, 2011). These negative outcomes impact all organizations. Within HROs, C2 perceived by followers as aggressive or bullying in nature can negatively impact and potently degrade the reliability of HROs. 4.2 HRO-Specific Effects of Extreme C2 The operationalization of abusive and aggressive C2 leadership can take many forms. These include verbal “dress downs” in public and private, humiliation, and threats to job security. Keep in mind that this communicative style need not be yelling or screaming. Rather, research shows that similar effects can be gleaned from leader sarcasm, swearing, rudeness, or aggressive nonverbal behaviors (Andersson & Pearson, 1999; Grandey et al., 2007; Lutgen-Sandvik, 2006). Regardless, leaders that embrace and adopt this leadership orientation invariably create a culture of fear (Ashforth, 1997; Infante & Gorden, 1989; Pfeffer, 2003). This is particularly damning within HROs. 4.2.1 Raising Safety Concerns Because of the complexity and tight coupling of systems, all employees within HROs are expected to be on the watch for even the smallest deviations from pre-determined mechanical expectations (Roberts & Bea, 2001). When deviations or imperfections are observed (e.g., hearing a steam leak from a valve), HRO employees are expected to raise the concerns, behavior consistent with the primary goal of ensuring safe and reliable operations. For instance, nuclear power plants, perhaps the most important of all HROs, strive to maintain a Safety Conscious Work Environment (SCWE). Put plainly, a SCWE maintains a culture in which any employee can raise any concern related to safety without fear of reprisal or retaliation. In fact, SCWE documents specifically use phrases such as “free of fear.” Thus, when leaders cross the line from C2 leadership to autocratic to aggressive and bullying behaviors, they are likely creating a culture of fear, which, in some cases, may discourage employees from expressing concerns related to plant safety and reliability (Pfeffer, 2003). 4.2.2 Challenging Solutions, the Spiral of Silence, and the Echo Chamber Government and quasi-government agencies realize that HROs, because of their complexity, tight coupling, and tight interdependence, require a diversity of ideas and solutions to solve mechanical and systems problems (INPO SOER 10-2; Roberts & Bea, 2001). In other words, a workforce comprised of employees with extremely similar mental models is unlikely to anticipate or detect all potential threats to this complicated system. It is unlikely, if not impossible, that a single mental model can offer a singular decision or solution that will work in all cases.

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For that reason, HROs are expected to develop and foster a culture in which problem statements and solutions are questioned and challenged (Roberts & Bea, 2001). Again, within the domain of nuclear power plants, there is widespread recognition that the best performing stations apply the highest levels of rigor to challenging possible fixes (INPO SOER 10-2). The value placed on this challenging orientation is so extreme within nuclear power plants that they actually convene “Challenge Boards” to apply courses of action to a ruthless and rigorous challenge. This questioning and challenging cultural orientation is at risk, however, in the presence of C2 leadership that goes “off the track” towards a bullying or aggressive approach. Even in the best of cases, challenging authority is difficult; it is fraught with trepidation, requires courage, and is a common fear that subordinate leaders deal with. When the authority to be challenged is a bully, these fears are extreme. The research is conclusive in this regard; in the face of a bully, it is the norm for victims and bystanders not to question or challenge the bully since humiliation and retaliation are often deployed at those who take the risk to challenge (Crawford, 1997; Langan-Fox & Sankey, 2007; Lutgen-Sandvik, 2006). Likewise, followers may publicly affirm a leader’s point-of-view, although they believe it to be wrong, just to curry favor or to stay on his/her “good side” (Ashforth, 1997; Langan-Fox & Sankey, 2007). Taken to an extreme, this lack of dissension may create a spiral of silence (Noell-Neumann, 1991) in which employees wrongly assume that others agree with the leader’s point of view. When no one speaks up or disagrees with the leader, his/her point of view, however faulty, is perpetuated. Because of their complexity, HROs fail in the presence of such silence. It tears at the very fabric of HRO reliability. Safe operations of HROs require strong ethics, uncompromising integrity, an essential need for factual information and observations, and a pursuit of the hard fix instead of the “easy answer” (INPO SOER 10-2; Offstein et al., 2014; Roberts, 1990). HROs require rich, diverse, collaborative communication (INPO SOER 10-2; Roberts & Bea, 2001). Predictably, when authority cannot be questioned or there is agreement based on fear and selfpreservation, insular thinking and decision-making tends to dominate. In contrast to a healthy culture in which trust, integrity, and diversity of thought can thrive, this leadership orientation can spur the “Echo Chamber” effect. This phenomenon emerges when the same or similar voices and logic are constantly recycled throughout the organization. In summary, C2 leadership that morphs into or is conflated with bullying and aggressive behavior, inhibits, if not destroys, the questioning and challenging culture that is needed for HROs to effectively function. 4.2.3 Creative Problem-Solving and Brain Drain In a related vein, the quality of decision-making suffers under aggressive C2 leaders because followers lose their initiative under such circumstances (Ashforth, 1997), withdraw their efforts, and stop using their knowledge to benefit the organization (Pfeffer, 2003). In such situations, HROs miss out on the creative and innovative solutions workers may have otherwise contributed to problem-solving. Talented workers who have been demotivated and disengaged by authoritative C2 leadership are also more likely to exit the organization (Pfeffer, 2003), exacerbating the problem further. In HROs, failure to identify the most effective solutions to problems and make the most informed decisions can result in loss of life. 4.2.4 Self-Preservation and Turning on Team Members Apart from the lack of questioning, challenging, and creative contribution, abusive C2 leadership also threatens the trust, teamwork, and coordination necessary for HROs to function. With their interdependent and tightly coupled sub-systems, HROs, more than any other organizational type, require an abundance of trust and coordination to avoid accidents and injury (Myers & McPhee, 2006; Robert, 1990; Weick & Roberts, 1993). Indeed, leading scholars suggest that top performing HROs foster a collective mind that breaks from a “silo” mentality, is expansive, and is rooted in a collegial approach to problem solving (Weick & Roberts,

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1993). In contrast, tyrannical, overly controlling leaders foster unpredictable organizational environments (Ashforth, 1997) that tend to encourage suspicion, distrust, competition, and conflict among employees (Langan-Fox & Sankey, 2007). As a result, organizational members become self-interested and focused on self-preservation (Pfeffer, 2003). Empirical research shows that under such conditions, work groups are less cohesive and more fragmented (Ashforth, 1997). Two ways HRO employees may seek to protect themselves in these uncertain environments are through deflection and blaming, strategies that erode trust among coworkers, break down teamwork, and cultivate an “us” versus “them” environment. Often, the modus operandi of followers is to avoid targeting from a bullying leader (Lutgen-Sandvik, 2006). One way to accomplish this is by deflecting, or trying to avoid being held accountable for a certain decision or action. Because strong accountability cultures in which people “own the problem at the source” are a hallmark of top performing HROs (Roberts, 1990; Roberts & Bea, 2001), any deflection detracts from reliability. A close, but even more damaging correlate of deflection, is blaming (Offstein, 2006; Buell, 2006), or shifting the spotlight from one’s own poor performance to another’s. Consistent with the motive of selfpreservation, employees of aggressive C2 leaders may blame others to protect themselves (Buell, 2006). 4.2.5 Unethically Concealing Problems While deflection and blaming occur, they pale in comparison to the penultimate destructive force— immoral and unethical behavior. Aggressive, bullying behavior attaches negative consequences (e.g., verbal and physical attacks, public humiliation) to not adhering to performance standards (Namie & Namie, 2000). To avoid these punishing consequences, many subordinate leaders and individual contributors feel compelled to hide or “sweep problems under the rug” to avoid detection by the aggressive leader (Offstein, 2006). When this behavior emerges and fosters an unethical culture, and there have been cases (Offstein, 2006), core and critical processes specific to HROs weaken, putting the entire system at risk. For instance, most HROs maintain a corrective action program designed to catch and fix small problems before they can snowball. Some industries, such as nuclear, refer to this as PI&R (Problem Identification and Resolution). The logic should be readily accessible. When problems are purposely ignored or inadvertently overlooked, they cannot be addressed, leaving them to balloon into something much bigger (Roberts & Bea, 2001; Perrow, 1984). The likelihood of developing from a small problem to a much more serious one is very high due to HROs’ tightly coupled systems (Roberts, 1990; Roberts & Bea, 2001; Perrow, 1984). Also, the small problems can line up like “holes in Swiss cheese” to lead to a breakthrough event (Roberts & Bea, 2001). For this reason, top performing HROs almost purposefully treat even the smallest problems or the slightest weakening of operational margin as serious issues. When those issues are unethically hidden, the processes, to include the corrective action program, are rendered ineffective. 5. COMMAND AND CONTROL AND “STRONG” LEADERSHIP Retreating from these extreme scenarios of bullying and aggressive behavior that may co-occur with C2, negative outcomes may still result from the influence of a “strong” leader. Notably, the media and journalistic caricature of many of our current and historical leaders of interest almost invariably point to a very strong command presence (e.g., MacArthur, Patton, Nick Saban, Bobby Knight). Tough, macho, “lean and mean,” or hardheaded personalities seem to be an endogenous contributor to a strong command presence and are often perceived as a necessary condition for effective C2 (Pfeffer, 2003). In some sectors, this type of persona may add considerable value. In HROs, however, such boisterous leaders can detract from an organization’s reliability posture. We base this assertion along several distinct lines of logic.

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5.1 Diverting Employee Attention First, HROs almost invariably require the use of complex machinery and/or technologies (Perrow, 1984; Roberts, 1990; Roberts & Bea, 2001). One could make a strong case that these organizations are the exemplars of human-technical systems. Put differently, nuanced and superb human interface with mechanical equipment and technology is required for safe and reliable operations. The significance of mechanical systems in HROs is without dispute, evidenced by an overriding emphasis on such metrics and programs relating to equipment reliability (INPO 10-004). When a strong leader is also charismatic, a cult of personality-type phenomenon emphasizing the singular leader (versus all organizational parts) can develop. It is not implausible to imagine a strong, charismatic leader diverting organizational attention away from the technical and mechanical systems and sub-systems toward himself/herself. When organizational monitoring and trending is levied at a singular leader, as opposed to the complexities of mechanical systems, the risk posture of the entire organization increases. 5.2 Creating Organizational Vulnerability Second, strong commanders and the concomitant embrace of decisive C2 often means that these leaders enjoy, if not relish, making decisions. Strong C2 is often associated with centralized decisionmaking by a singular leader (Pfeffer, 2003; Rosener, 1990). Decision-making confined to a sole person is problematic in that it creates a single-point vulnerability in the organization. In other words, if that leader were to be injured, fall ill, get promoted, or go on vacation, the entire organization would be handicapped, if not paralyzed. In HROs, decisions must be made, often quickly, at the point of mechanical or procedural breakdown (Perrow, 1984). Because a single leader cannot be at all places at all times, especially in the context of complex and tightly coupled HROs, C2 centralized decision-making in HROs can be risky. Decentralized decision-making is recommended instead (Roberts & Bea, 2001). 5.3 Impeding Follower Development Third, when strong C2 results in more centralized decision-making, junior leaders and other employees do not get day-to-day practice making decisions. The training literature is rife and conclusive; active practice and training is necessary for optimal performance (Klein, 1998; Roberts, 1990). When decentralized leaders are not given the opportunity to practice decision-making, they will lack the capability or skill set and/or the confidence and self-efficacy to make appropriate, timely, and conservative decisions when it matters most. Metaphorically, the weak get weaker when they are not given the opportunity to build a decision-making backbone that would enable them to navigate complex, social, ethical, and political decision-points (Offstein, 2006). 5.4 Disengaging the Workforce Finally, when strong leaders exercise overly strong C2, the participatory and egalitarian culture can erode. With decision-making and organization prioritization limited to the few or even a single leader, followers can become alienated (Buckingham & Coffman, 1999). The research on alienated followers suggests that cynicism and withdrawal are the common behavioral symptoms (Kelley, 1992). Predictably, this often begets a lack of effort where elements of the workforce may stop trying, implicitly or explicitly understanding that the sole leader will make the decision anyway (McCaffrey, Faerman, & Hart). This apathetic and disengaged organization is the anathema of all academic and industry research on HROs that demand a highly engaged, intrusive, involved, questioning, and intellectually curious workforce (Weick & Roberts, 1993; INPO SOER 10-2). This is particularly true for HROs where a variety of problems can emerge at any given moment; an engaged workforce helps capture and address these problems quickly and effectively.

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6. DISCUSSION AND IMPLICATIONS From our analysis above, several meaningful themes emerge deserving of more scholarly and applied attention. First, this construct of command and control (C2) is considerably under-researched and conceptualized. Without question, more empirical and theoretical inquiry is needed. Grounding the construct of C2 within a nomological network is difficult. The validity of the construct is mostly anchored in the military literatures or in the systems/technology arenas (e.g., see Alberts & Hayes, 2006). With thousands, maybe even tens of thousands of academic articles published over the last three decades on the topic of leadership, it appears that the conceptual and empirical “tent” is quite large; there is room for contingency, transactional, transformational, situational, stewardship, entrepreneurial, and trait models of leadership. Surprisingly, C2 is absent in the larger leadership domain. This is particularly troubling given that C2 tends to be the dominant leadership logic within HROs. Given the importance of HROs to a variety of stakeholders, question arises—should we not know more about C2, its efficacy, and its relation to other leadership models and theories? Second, and in an initial response to the question above, we contend that C2 is or could be considerably more than simple directive, authoritarian, domineering leadership. As more dialogue surfaces around this construct, we offer the possibility of enlightened command and control. Interestingly, we borrow from the Stockdale paradox perspective (Collins, 2001), which argues that individuals can hold two competing and conflicting thoughts simultaneously and still act appropriately. For HROs to remain safe and reliable, enlightened C2 must adhere to the core tenets of the Stockdale paradox. This could take many forms. For instance, enlightened C2 could involve acting decisively while inviting participation. Alternatively, it could look like taking control of a situation while simultaneously questioning the variables that caused or triggered the event and inviting challenge to the variables that may remedy the problem. Lastly, C2, typically is viewed as a leadership style contained within a singular individual. But what if we could imagine enlightened C2 as jointly shared and executed command and control? We contend that for C2 to be successful in HRO environs, it must allow, and even invite, collaboration and challenge. Put simply, we need to imagine and examine a more expansive view of C2. Finally, perhaps this notion of enlightened C2 can be trained or built over time. Maybe the launching point is to encourage and legitimize, or even demand, challenge (Infante & Gorden, 1985). The starting point for organizational challenge is probably in the planning and execution of meetings. This is where dissent and dialogue should be nurtured. In addition to encouraging challenge, HR professionals may wish to recruit and select individuals who are skilled in practicing leadership behaviors consistent with enlightened C2 or have the capacity to successfully learn and implement this leadership style (Avtgis & Chory, 2010). Of course, construct and criterion validity studies of C2 and its measurement are warranted to inform hiring decisions and strategy. To discount the role of C2 to our collective societal safety would be folly. HRO reliance on C2 leadership is undisputed. However, up for debate is whether it does, indeed, make HROs safer. We offer some propositions to suggest otherwise. C2, especially C2 that is characterized by overly aggressive, directive, punitive characteristics may, in fact, hurt HRO reliability. Toward that end, we urge more scholarship and research on a more expansive notion of command and control—enlightened command and control; the reliability and safety of our HROs may just depend upon it.

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AUTHOR PROFILE:

Dr. Evan H. Offstein earned his Ph.D. from Virginia Tech University in 2004 and is currently an Associate Professor in the Department of Management at Frostburg State University. He is a graduate of the United States Military Academy at West Point and is a former Military Intelligence Officer. Dr. Offstein has authored three leadership books and published in journals such as Academy of Management Learning and Education, Human Resource Management Journal, and Group and Organization Management. Dr. Rebecca M. Chory earned her Ph.D. at Michigan State University in 2000 and is currently an Assistant Professor in the Department of Management at Frostburg State University. Dr. Chory has published over 50 peer-reviewed journal articles and has received numerous awards for her research. She is a former Fulbright Scholar to Hungary and is the co-founder and primary program planner for the George Gerbner Conference on Communication, Conflict and Aggression, which is held in Budapest.

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D. Robin Bichy earned her MBA from George Washington University and is currently the Chief Operating and Financial Officer for Excelerated Leadership Partners, LLC, which develops proprietary and leadingedge strategy solutions to high risk/high hazard organizations. Prior to establishing Excelerated Leadership Partners, Ms. Bichy was responsible for leading multi-disciplinary teams in delivering positive business results for Dominion Resources, Inc., a Fortune 200 Company. Raymond Kniphuisen earned his M.S. from Albertus Magnus College and an M.A. from Fielding Graduate University and is currently a Partner at Excelerated Leadership Partners, LLC. Prior to establishing Excelerated Leadership Partners, Mr. Kniphuisen was a US Navy nuclear operator and nuclear prototype instructor, as well as a US Coast Guard Reservist. Previously, he designed and implemented the senior leader program for Dominion Resources, Inc.

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THE EFFECT OF PAY SATISFACTION ON TURNOVER INTENTION: MEDIATING ROLE OF JOB SATISFACTION AND ORGANIZATIONAL COMMITMENT Davoud Hayati, National Iranian Oil Company, Iran Morteza Charkhabi, University of Verona, Italy Dariush Kalantari, National Iranian Oil Company, Iran Francesco De Paola, University of Verona, Italy

ABSTRACT The main aim of this study was to design and test a causal model of the effects of pay satisfaction on turnover intention. The second aim was to evaluate the mediating role of job satisfaction and organizational commitment between pay satisfaction and turnover intention. Data were gathered from a sample of 273 employees of National-Iranian-South-Oil-Company (NISOC) in Iran who were selected by stratified random sampling method. Among this sample, 95.2 % were men and average age was 44 years. The instruments used in the present study consist of Turnover Intention, Organizational Commitment, Job Satisfaction, and Pay Satisfaction scales. Structural equation modeling (SEM) through AMOS-21 and SPSS-21 software packages was used for data analysis. Bootstrap method was run to test the mediating effects. On the basis of the overall model fit indices, findings indicated that the designed structural model was warranted. In addition, job satisfaction, and organizational commitment mediated the relationships between pay satisfaction and turnover intention. Keywords: pay satisfaction, turnover intention, job satisfaction, organizational commitment

1. INTRODUCTION The outstanding feature of organizations in the twenty-first century is the rapid and continuous pace of change path (Olusegun, 2013). Organizations may be different in their efforts to achieve high productivity and competitive advantage. Therefore, organizations should attempt to keep themselves in the competition and do their best to improve production and services, along with their employees satisfied (Huselid, 1995). Considering staff as the biggest and most important assets of any organization is a phenomenon in recent decades that has attracted considerable attention (Deeromram, Suwannimitr, & Jundeekrayom, 2010). At the present time, industrial, commercial and service organizations are trying to raise their productivity to increase in professional satisfaction and commitment of employees and owners and are worried about the loss of well-experienced staff. Because happy employees are more likely to be committed to the organization and, in turn, are proud to be a member of that organization and also believe the goals and values of the organization and thus show higher levels of performance and productivity (Mahdi et al, 2012; Joo & Park, 2009; Mohammed Issa, 2013; Steinhaus & Perry, 1996). In the other side, leaving a job is one of the challenging issues in any organization. Instead, the money and time invested in recruiting and training a person, who leaves the organization, is lost forever. The growing concern for many organizations is the high rates of staff turnover. Employees are a valuable asset to the organization. Leaving job means the voluntary end of the organization's Membership by staff (Morrell, Levan-Clarke & Wilkinson, 2001). Empirical researches have confirmed the role of variables such as job satisfaction (Irvine & Evans, 1995), satisfaction with income (Hester, 2002), perceived control (Spector, 1986), job stress (Parasuraman, 1982; Summers, Dennis and DeCottis, 1989) intention to leave (Chen, Hui & Sego, 1998) and absence (McElroy, Morrow and Fenton, 1995) to predict turnover behavior. Several models in relation to turnover were presented and discussed and the role of different variables in predicting the turnover intention has been determined. For example, DeConinck and Stilwell’s model (2004), including organizational justice, satisfaction, income satisfaction and organizational commitment to the stewardship that shows the satisfaction of earning has a negative direct effect on withdrawing

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recognition and increases through the organizational commitment. Moreover, Vandenberg and Tremblay (2008) found that different dimensions of satisfaction have differential effects on turnover intention. According to the former designed models, the current study wants to propose a new causal model of the effect of pay satisfaction on turnover intention considering to mediator role of job satisfaction and organizational commitment simultaneously.

2. CONCEPTUAL BACKGROUND From the ancient times to the present, money and financial incentives were considered as one of the most important factors to encourage employees to do their best (Furnham & Argyle, 1998; Zelizer, 1994). However, this focus was reduced after the human relations movement but it is still among the most effective methods (Gerhart & Milkovich, 1992; Gardner et al, 2004). There is no doubt that pay satisfaction has always been the primary concern of employees as well as employers but systematic attention to the issue started from the 1960s when researchers focused on identifying the factors that influence pay satisfaction (Adams, 1963). More recent studies, have examined the determinants of pay satisfaction (Carraher, 1991; Henman & Schwab, 1979, 1985; Mulvey, Miceli, & Near, 1992); while the pay satisfaction has important implications for organization and it must take into account by carrying out researches on pay satisfaction consequences (Henman & Jaj, 2000; Tremblay et al, 1999). One of the most considered effect where pay satisfaction can influence turnover intention (Vandenberg and Tremblay (2008). Pay satisfaction and turnover intention. Our investigation shows that researches related to pay satisfaction and turnover intention and turnover behavior are limited. Mobley (1977) claims that job attitudes have significant direct effects on actual turnover behavior. More recent researches in regard to turnover intention have shown that pay satisfaction is one of the important predictors of turnover intention among employees (Hester, 2002). Besides, Curral et al. (2005) believe that pay dissatisfaction can decreases job satisfaction and motivation and increases absenteeism and turnover. In line with the done research, we will expect to observe the following hypothesis: H1: Pay satisfaction has a direct negative effect on turnover intention. Organizational commitment and turnover intention. Since the last two decades, the role of organizational commitment on job turnover has been studied. Research conducted shows that decreased organizational commitment can lead to increased tendency to job turnover (Kim et. al, 1996; Ben-Baker et. al, 1994; Arnold & Feldman, 1982). Organizational commitment is desire to survive and do numerous efforts for organization, as well as accepting the values and goals of the organization. Before the research of Porter et.al (1974) researchers being considered at job satisfaction as the main reason of job turnover but for the first time their research revealed that turnover intention could be influenced by organizational commitment as well. Moreover, they concluded that organizational commitment is a better antecedent of job turnover in comparison with job satisfaction (Wong, 1996; Arnold & Feldman, 1982; Bluedorn, 1982; Porter, 1974). Khatri et al (2001) found that the major cause of high job turnover level in some of the Asian countries such as Singapore, Malaysia, South Korea, and Taiwan is that lower level of organizational commitment. In addition, researches conducted in non-Asian countries showed that job satisfaction and organizational commitment are related to turnover intention and turnover behavior (e.g., Hsieh & Jaw 2006; Karsh et.al, 2005). Dreher et.al (1988) has stated that the reactions to the income approach play a mediatory role between remuneration and working efficiency. Hence the income satisfaction may be considered as a necessary condition but not sufficient for organizations to achieve their goals and reward such as the reward system to motivate and retain employees. It means that we must detect some mediators which

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can affect the dynamic relation between pays satisfaction and turnover intention. Thus, organizational commitment is our second research hypothesis and is formulated in the below: H2: Pay Satisfaction has an indirect negative effect (through organizational commitment) on turnover intention. Job satisfaction and turnover intention. Relationship between turnover and job satisfaction is one of the concepts that have been studied extensively. There are a lot of the researches have shown that there is a negative relation between job satisfaction and job turnover (Cotton & Tuttle, 1986; Arnold & Feldman, 1982; Bluedorn, 1982; Mobley, 1982; Price & Mueller, 1986). They also have found that it is more likely to quit their jobs those employees that are experiencing lower level of job satisfaction because job dissatisfaction leads to job burnout and it subsequently increases job turnover (Razza, 1993). It seems that job satisfaction only may explain a very small percentage of the variance (less than 15%) on job turnover (Blau & Boal, 1989). In fact, the role of job satisfaction in job turnover is not sufficiently strong and it should be combined with other variables to explain the causes job turnover. Besides, newer researches reported a negative relation between job satisfaction and turnover intention (e.g., Amah, 2009; Biswas, 2010). Moreover, Karsh et.al (2005) found that job satisfaction and organizational commitment are two important predictors of turnover intention. It is assumed that job satisfaction has a similar effect on turnover consistence with organizational commitment. Falkerburg and Schyns (2007) describe job satisfaction as a behavioral cycle with regard to the behavior reason which is the satisfaction of different aspects of job and job conditions and they believed that satisfaction is a degree which employees like their jobs. Job dissatisfaction related to income leads to turnover intention and then change into more serious reactions such as job turnover. Therefore this is expected to consistent with past research, job satisfaction plays a mediating role on the relationship between pay satisfaction and turnover intention. Therefore, the third research hypothesis deals to: H3: Pay Satisfaction has an indirect negative effect (through job satisfaction) on turnover intention. The base of the present study is established on these three presented hypotheses in the above. They are trying to know whether staff attitudes towards income can get (directly / indirectly) influence on the formation of their turnover intention or not? To achieve the goal and better understanding, we drew a conceptual model of the direct and indirect effects of pay satisfaction on turnover intention and it is shown in the figure 1. Organizational Commitment

Pay satisfaction

Turnover intention

Job satisfaction Figure 1. Proposed model of the direct and indirect effects of pay satisfaction on turnover intention

3. METHOD Overview. This new model was designed to conduct basic research on the pay-satisfaction-related needs of Iranian employees who are working under demanding conditions and to develop intervention materials to prevent of the job turnover phenomena. Data were collected from poultry workers in National-Iranian-

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South-Oil-Company (NISOC) in Iran. The data collected from distinct samples using structured selfreported surveys. In the following sections, we describe the sampling, data collection, measures, and analysis strategy of each data source. Recruitment. Male and female employees who were formerly or currently employed in the NationalIranian-South-Oil-Company (NISOC) in Iran were eligible to participate in this research. Participants were purposefully selected to ensure the inclusion of workers in a wide variety of jobs in this oil company. Such purposive sampling is typically used for qualitative research to find persons who have depth and breadth of experience in an occupation and are sufficiently articulate and thoughtful to provide useful data (Quandt & Arcury, 1997). The selected persons were informed about the needed instructions for filling out self-reported surveys. At the end of this step, we could get a collection of various contributions. Sample. The statistical population of this study was 5000 workers who were working in this company. To get sampling, we selected 350 employees as a main sample and 70 employees as subsidiary sample in order to test the validity and reliability of our research scales by stratified random sampling method. Finally we received 273 filled questionnaire of the main sample (78%) and 52 filled questionnaire of the subsidiary sample (74%). The range of ages was from 25 to 60 (M= 44.08 & SD= 9.53). Most of them were married or living as married (n = 191) and the rest of them were living as single (n = 120). The majority had formal education at least in bachelor degree (n = 109) reported. Also, participants had working records from 1 to 41 years (M = 21.35 & SD= 9.72). Data collection. Data were collected through survey method where self-reported questionnaires were administered. Closed ended questions were used in gathering information. Participants had adequate time to respond to the asked questions. Accurate and reliable data were collected through survey method and hence it is deemed very efficient. Participants studied through this method are given adequate time and freedom to answer the questions and hence accurate information is collected. The utilization of closed ended questions helps in restricting participants to some questions and gathering wide range of information respectively.

4. MEASURES AND ANALYSIS Pay satisfaction scale. The pay satisfaction of employees was assessed by the pay satisfaction selfreported tool (Heneman & Schwab, 1985). This tool consists of 18 items which are categorized under four dimensions of income satisfaction (4 items), benefit satisfaction (4 items), increased-income satisfaction (4 items) and management/structure satisfaction (6 items). Our research experience conducting research in this population suggests that employees have difficulty responding to items with affective response sets (e.g., strongly agree to strongly disagree). Response options were never, rarely, sometimes, often, and always. Heneman and Schwab (1985) reported the reliabilities of income satisfaction, benefit satisfaction, increased-income satisfaction and management/structure satisfaction 0.95, 0.84, 0.93 and 0.85 respectively. Also, in the present study the correlation between this scale with dimension of income satisfaction (job description scale) was significant (p