J Bhatnagar
J Bhatnagar
J Bhatnagar
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 273
Jyotsna Bhatnagar & Soumendu Biswas
274 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Predictors & Outcomes of Employee Engagement
variable which research studies in India states, psychological and behavioral out-
and globally have not investigated comes in a variety of contexts (e.g., Ryan
(Bhatnagar 2007a, Saks 2005). In their & Connell 1989). The authors propose
research, Robinson, Perryman and to map the antecedents of Employee
Hayday (2004) note that Employee En- Engagement, which reflect a degree of
gagement has been highlighted by prac- need satisfaction. Variables of justice, like
titioners, but largely undermined in aca- procedural and distributive may provide
demic literature. Although Kahn (1990), a perception of fairness to the employ-
Saks (2006), and Bhatnagar (2007a) have ees. The formation of the individuals
tried to provide a concrete conceptual psychological contract is shaped by com-
definition of the Employee Engagement pany policies related to recruitment, com-
construct, yet literature revealed that the pensation, claims etc along with social
conceptualization and definition of the cues from the work environment (Boxall
construct is frequently contaminated with & Purcell 2002). The motivational basis
its identification with other outcome vari- of employee work attitudes and behav-
ables such as job involvement, intrinsic iors is regarded as an important compo-
motivation, organizational commitment, nent of research agenda relating to man-
and organizational citizenship behavior. agement practices (Aryee, Budhwar &
(Bhatnagar 2007a; Saks 2006) This was Chen 2002) especially in an employment
seen when Gallup q 12 (Buckingham & relationship domain (Bhatnagar
Coffman 1999) or Gallup Workplace 2009a:171).
Audit was used (Bhatnagar 2007a). We
would like to extend the work and would Over the past decade or so, numer-
measure using Employee Engagement ous studies have provided empirical sup-
with a different scale of Saks (2006) in port to the notion that psychological con-
the Indian context. It is hypothesized: tract as an important motivator for em-
ployees (e.g.,) Sturges, Conway, Guest
Hypothesis 1: Employee Engag- and Liefooghe, 2005, Rousseau 2004).
ement is a holistic measure of job En- Wilhelm et al. (2007) state that the re-
gagement and Organizational Engag- sults of these studies and highlight that
ement. when individuals perceive breach of
promises by their employer; their moti-
Predictors of Employee vation and commitment to the organiza-
Engagement tion decreases and their intention to leave
their jobs increases (Tekleab, Takeuchi
Measurement of employee engag- and Taylor 2005) as cited in Bhatnagar
ement has entered into academic and (2009:172). This current study proposes
practitioner debate (Meyer & Gagne to measure the predictors of Employee
2008:61). The authors state that Self Engagement. These are variables of jus-
Determining Theory has guided the mea- tice and psychological contract. The au-
surement of engagement relevant vari- thors propose to test the following hy-
ables like: need satisfaction, motivational pothesis:
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 275
Jyotsna Bhatnagar & Soumendu Biswas
Hypothesis 2: Procedural and distri- Indian sample. They found the firms
butive justice; transactional and relational competitive advantage emerging due to
psychological contract will be predictors organizational commitment. More re-
of Employee Engagement cently Employee Engagement has been
related to building a firms competitive
Outcomes of Employee advantage. Employee Engagement, in
Engagement fact, can make or break the business
bottom line (Lockwood 2006). Martel
Consultants have focused on Em- (2003:30, 42) is of the opinion that in or-
ployee Engagement encompassing in der to obtain high performance in
some combination affective commitment postindustrial(sic), intangible work that
(e.g., pride in the organization, willing- demands innovation, flexibility, and speed,
ness to recommend the organization as employers need to engage their employ-
an employer), continuance commitment ees. Engaging employeesespecially by
(e.g., intention to remain with the orga- giving them participation, freedom, and
nization), and OCB, described as discre- trustis the most comprehensive re-
tionary effort (e.g., feeling inspired by the sponse to the ascendant postindustrial
organization, being willing to go above and values of self-realization and self-actu-
beyond formal role requirements). Macey alization. Performance data of the best
& Schneider 2008:57). Bhatnagar (2007) companies in the US show that in all the
reports studies on organizational commit- practice areas discussed previously. Ob-
ment as an explanatory factor of employ- jectives are more easily met when em-
ees mobility. Linkages between ployees are engaged and more likely to
mentoring and organizational commitment fall short when they are not. In order to
and source of support and target of com- maintain an Employer brand we see an
mitment have been explored by Lin et al., emergence of a series of studies on em-
(2005), Payne & Huffman (2005), ployer of choice, which also measure
Stinglhamber and Vandenberghe (2003). engagement index and financial perfor-
However, Bhatnagar and Sharma mance (Coleman 2005).
(2009:292) report recent research
(Iverson & Zatzick 2007: 456) which has
Objectives are more easily met
highlighted the economic and political
when employees are engaged and
conflicts associated with such practices
more likely to fall short when they
(Godard 2001a), including the financial
are not.
costs that may offset productivity gains
(e.g., Cappelli & Neumark 2001) and the
intensification of work that results in A recent SHRM Conference (2006)
greater burnout and stress for employ- reported the results of a new global Em-
ees (e.g., Green 2004, Ramsay, ployee Engagement study showing a dra-
Scholarios & Harley 2001). They have matic difference in bottom-line results in
further found organizational commitment organizations with highly engaged em-
to be a predictor of firm performance in ployees when compared to organizations
276 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Predictors & Outcomes of Employee Engagement
whose employees had low engagement become more engaged in their jobs, be-
scores (Bhatnagar 2007a). A compelling cause they derive fulfillment from it
question is: how much more productive (Schaufeli & Bakker, 2004) and inturn
is an engaged workforce compared to a they perform better (Bakker 2009).
non-engaged workforce? (as cited in
Seijts & Crim 2006 and reported in Further, given the logic of self deter-
Bhatnagar 2007a). mining theory (Meyer & Gagne 2008:61)
the current study proposes to measure
According to Soupata (2005) orga- the antecedents and outcomes of Em-
nizations should strive towards enter- ployee Engagement, which would predict
prise excellence. In this context, pro- higher firm performance at the organi-
cesses such as employee commu- zational level and lower intention to quit
nication, employee relations, and their at the individual level . These support di-
learning and development assume an im- rectly the outcome variables of Employee
portant role in predicting an employees Engagement as pointed by Macey and
performance and his/her attachment to Schneider (2008). They focus primarily
his/her job and organization. It is in this on task performance and organizational
context that we consider employee en- effectiveness as outcomes of engage-
gagement as a peremptory construct in ment. This further supports the SDT
explaining an employees attachment to theory implications on employee well
his/her job and his/her organization. As being as pointed by Meyer and Gagne
reported by Xanthopoulou et al. (2009 : (2008:61). Individuals who experience
184), the motivational process of the job the feeling of well being in an organiza-
demandsresources ( JD-R) model tion due to high Employee Engagement
(Bakker & Demerouti 2007) suggests may exhibit lower intention to quit.
that job resources are the main initia-
tors of employees work engagement
Individuals who experience the
and consequently of enhanced perfor-
feeling of well being in an organi-
mance. Job resources refer to physical,
zation due to high employee en-
social, or organizational aspects of the
gagement may exhibit lower inten-
job that are functional in achieving work-
tion to quit.
related goals, reduce demands and the
associated costs, and stimulate personal
growth and development (Bakker & Extending this work and building on
Demerouti 2007). As intrinsic motiva- RBV, the authors propose organizational
tors, job resources fulfill basic human commitment, lower intent to quit, and
needs (i.e. need for belonging) and fos- firm performance to be the outcome vari-
ter individuals development (Deci & ables at individual and firm levels. These
Ryan 1985). As extrinsic motivators, would provide a competitive advantage
they encourage employees to exert ef- to the firm. This line of research would
fort towards a task (Gagne´ & Deci fill in the caveat in RBV as pointed by
2005). In both cases, employees may Colbert (2004). It answers the question:
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 277
Jyotsna Bhatnagar & Soumendu Biswas
how does a firm actively build and con- Hypothesis 4: Organizational Commi-
tinuously renew strategic human and or- tment and Organizational Citizenship
ganizational resources to fuel competi- Behaviour will be predicted by Employee
tive advantage? Engagement.
Fig. 1 - The Proposed Conceptual Model Hopkins and Washington (2006) in-
vestigated the perceptions of distributive
justice, procedural justice, organizational
3URFHGXUDO commitment, organizational satisfaction
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and turnover intentions in
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2UJ
Results suggested that
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the relationship between
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both organizational .satis-
faction and affective
5HODWLRQDO
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procedural justice and
turnover intentions was
278 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Predictors & Outcomes of Employee Engagement
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 279
Jyotsna Bhatnagar & Soumendu Biswas
Xanthopoulou et. al., (2009) has found which they have tried to establish through
this linkage, but with diverse variables. case studies. Looking at this gap in lit-
Xanthopoulou et. al., (2009) investigated erature we propose to test our model sta-
how daily fluctuations in job resources tistically and would apply Amos (version
(autonomy, coaching, and team climate) 17.0; Arbuckle & Wothke 1999) for the
are related to employees levels of per- same, and would conduct our data to
sonal resources (self-efficacy, self- es- structural equation modeling.
teem, and optimism), work engagement,
and financial returns. Forty-two employ-
Changes in management prac-
ees working in three branches of a fast-
tices that increase employee sat-
food company completed a questionnaire
isfaction may also increase busi-
and a diary booklet over 5 consecutive
ness-unit outcomes, including
workdays. The multi-level analyses, uti-
profit.
lized in the research study, confirmed that
day-level job resources had an effect on
work engagement through day-level per- In a related research by Schneider,
sonal resources, after controlling for gen- Hanges, and Smith (2003) on employee
eral levels of personal resources and en- attitude data from 35 companies over 8
gagement. Day-level coaching had a di- years were analyzed at the organizational
rect positive relationship with day-level level of analysis against financial (return
work engagement, which, in-turn, pre- on assets; ROA) and market performance
dicted daily financial returns. (earnings per share: EPS) data using lagged
analyses permitting exploration of prior-
Harter, et. al,. (2002a) used meta- ity in likely causal ordering. Analyses re-
analysis to examine the relationship at the vealed statistically significant and stable
business-unit level between employee relationships across various time lags for 3
satisfaction-engagement and the busi- of 7 scales. Overall Job Satisfaction and
ness-unit outcomes of customer satisfac- Satisfaction with Security were predicted
tion, productivity, profit, employee turn- by ROA and EPS more strongly than the
over, and accidents. Generalizable rela- reverse (although some of the reverse re-
tionships large enough to have substan- lationships were also significant). Research
tial practical value were found between has usually not indicated reverse causal
unit-level employee satisfaction-engage- indicators on employee engagement though
ment and these business-unit outcomes. related studies (Schneider, Hanges, &
An implication is that changes in man- Smith 2003), quoted above, on Employee
agement practices that increase em- attitude, Job satisafaction and Financial per-
ployee satisfaction may also increase formance are present.
business-unit outcomes, including profit.
Further, in a related work Harter et al In our study we propose a linkage
(2002 b), stated that methodologically in between firm performance and Employee
their meta-analysis, they could not ad- Engagement, but in a reverse feedback
dress the issue of statistical causality, loop. This entails that those firms which
280 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Predictors & Outcomes of Employee Engagement
are financially robust will have a higher The hypotheses above are presented
Employee Engagement score. This line in a proposed conceptual path model
of research is in consonance with the (fig.1) along with a competing model
findings of a study by Towers Perrin (fig.2). Which ever model emerges after
(2003). Their Talent Report reflected testing the hypothesized relationships and
operating margin with 5%, 10%, 15% applying structural equation modeling to
change in engagement. More recently, confirm or reject the hypothesized rela-
MacLeod (2009) found in both public and tionships, will be adopted for discussion
private sectors that leadership, line man- and further implications.
agement, employee voice and integrity are
key enablers of engagement and that the Sample: We collected data for the
correlation between engagement, well-be- present study from 310 working executives
ing and performance is repeated too of- employed in different industry sectors. For
ten for it to be a coincidence. The study this purpose different strata of managers
was conducted in the western context. viz., senior-level, middle-level, and junior-
level managers were randomly assigned the
We posit thus: survey instrument. Thus, purposive sam-
pling in selecting the organizations of the
Hypothesis 8: There may be reverse respondents and stratified random sampling
causality between Firm Performance and for selecting the respondents themselves
Employee Engagement. was applied for data collection.
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%HK
facturing/engineering sectors
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 281
Jyotsna Bhatnagar & Soumendu Biswas
Data analysis technique: This re- Aryee. S.. Budhwar. P. & Chen, Z. (2002), Trust
search is proposed as a non-recursive as a Mediator of the Relationship between
Organizational Justice and Work Outcomes:
study attempting to confirm certain hypo-
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286 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Role, Work Perception & Stress in a High Reliability Work
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The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 287
Omer Bin Sayeed & Satish Chandra Kumar
288 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
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