Rabu, 28 Oktober 2020

 International Journal of Public Sector Management

Followership and Job Satisfaction in the Public Sector: The Moderating Role of Perceived Supervisor Support and Performance-Oriented Culture Myung Jin Bruce McDonald Jaehee Park

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To cite this document: 

Myung Jin Bruce McDonald Jaehee Park , (2016),"Followership and Job Satisfaction in the Public Sector: The Moderating 

Role of Perceived Supervisor Support and Performance-Oriented Culture", International Journal of Public Sector 

Management, Vol. 29 Iss 3 pp. -

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http://dx.doi.org/10.1108/IJPSM-05-2015-0101 

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Employee Followership and Job Satisfaction in the Public Sector: The Moderating Role of Perceived Supervisor Support and Performance-Oriented Culture

ABSTRACT

Purpose

The purpose of this study is to explicate the role of followership behavior on employee job satisfaction as well as the conditions that may moderate its impact.

Design/methodology/approach 

This study uses a large n survey data from federal agencies and investigates an additive moderation model in which two situational factors, perceived supervisor support and performance-oriented culture, interact with followership behavior.

Findings 

Employees high on active followership perceived greater job satisfaction when perceived supervisor support was high, rather than low. On the other hand, employees high on active followership perceived greater job satisfaction when performance-oriented culture was low, rather than high. 

Research limitations/implications 

This is, to our knowledge, the first empirical study based on a cross-sectional survey that tests how the effects of active followership on employee job satisfaction may vary depending on the different types of situational factors. As such, more studies are needed to validate the causal directions of our findings. 

Practical implications  

The present findings show that active engagement had greater association with job satisfaction when leader involvement was high and performance orientation was low. For highly engaged employees, leaders are encouraged to show higher degree of involvement in their work but with less emphasis on the performance orientation of the organization. 

Originality/value 

This study contributes to the broader literature in public sector leadership in two ways. First, research on the relationship between followership and job satisfaction has been sparse. Second, and most importantly, this study is the first empirical study that tests the moderating roles of situational (organizational) factors on the relationship between followership and employee attitude (job satisfaction).

 INTRODUCTION

Today’s work environment in which followers and leaders interact has become more complex and dynamic. This is in part due to the rapidly changing and constantly adapting organizational missions, technological developments and different priorities and values catching up with the multiple realities facing the organizations (Küpers, 2007).  

Followers play an active role in the leadership process for at least two reasons: first, without followers, no one can be a leader; second, all leaders are followers at times (Yukl, 2010). Consequently, organizational scholars have increasingly focused not only on the leader, but also on followers (Blanchard et al., 2009; Shamir, 2007; Gilbert & Hyde, 1988) and on work setting/context (Somech & Wenderow, 2006; Vroom & Jago, 1998; Shamir, 2007; Grissom, 2012) that may have moderating impact on the relationship between followership and work attitudes.

What, then, is active followership? Howell and Costly (2006) define it as an interactive role that individuals play that complements the leadership for achieving group and organizational performance. It was not until Kelley’s (1988) pioneering work on followership theory in which a follower-centered view took the center stage in the leadership literature. He defined active followers as people with vision and the social capacity to work well with others, have the strength of character to flourish without heroic status, and the desire to participate in a team effort for the accomplishment of some greater common purpose.

We focus on the interaction effects of active followership and two situational factors, supervisor support and performance-oriented culture, on employee job satisfaction and seek to add to previous research in two ways. Our primary contribution is to test the role of active followership on employee job satisfaction in the public sector. We have long known that followers and followership are essential to both employee and organizational outcomes (Yukl, 2012). However, despite calls in early management and leadership research to focus on followers and followership (Hollander and Julian, 1969; Sanford, 1950), little attention has been paid to it until recently (Baker, 2007; Kelley, 2008; Bligh, 2011). This lack of attention has been evidenced in Bligh’s (2011) study that over the 19-year period from 1990 to 2008 in The Leadership Quarterly, only 14% of the articles had some version of the word follower in the abstract or title, which is reduced even more to a handful of articles when the search is narrowed to include the word “followership.” To our knowledge, there has been only one study in the public sector in which Kim and Schachter (2015) found positive association between active followership and organizational performance. As such, our knowledge in leadership and its impact will remain incomplete without further understanding of the role that followership plays in the workplace (Kim, 2011).

Studying followership in the federal government is of particular importance because previously the overall federal personnel system has been more restrictive and cumbersome than has been the case in most other organizations (Gilbert and Hyde, 1988). For example, jobs were often narrowly defined; less flexibility existed in work assignments, training, and job enrichment opportunities; and performance appraisal often seemed to inhibit, rather than facilitate, the supervisor-subordinate relations on the job (Federal Register, 1987). Consequently, these rules and procedures were seen as barriers, rather than facilitators, to enhancing followership skills of federal workers (Gilbert and Hyde, 1988). The federal system, however, has recently undergone changes in work patterns which require for more active followership roles (Kim and Schachter, 2015). For example, in following the trends with private sector organizations, many public organizations have flattened their hierarchies and empowered employees by using new electronic technologies to provide them with more information, which led to more opportunities in decision-making (Kellerman, 2007). These initiatives changed the perception of followers as “unquestioningly and blindly obeying sheep” which would not work in today’s “complex and fast-paced mobile society” (Dixon and Westbrook, 2003, p. 20). Despite the active and newly invigorated roles given to followers, however, there is a dearth of study that focuses on this topic, and it is critical to discover their impact on various employee outcomes. 

As a first step in linking followership to employee outcomes, we focus on job satisfaction, because it is one of the most important workplace attitudes (Yang and Kassekert, 2009), which reflects “the congruence between what employees want from their jobs and what employees feel they receive” (Wright and Kim, 2004, 19). While job satisfaction on performance or productivity has received relatively mixed reviews (Yang and Kassekert, 2009), its effect on turnover, absenteeism, citizenship behavior, and other organizational attitudes and behaviors is well established (Harrison et al., 2006; Wright and Kim, 2004). Studying job satisfaction is of particular importance because many studies have reported that the federal civil service is losing high-quality employees due to their  dissatisfaction with the workplace (Light, 2008). Thus, building a satisfying workplace remains a critical issue and is a vital element of maintaining strong federal workforce. Despite the aforementioned critical role of both followership and job satisfaction in the public sector, our knowledge is limited by lack of empirical studies that examine the relationship between followership and job satisfaction. Trottier et al. (2008) argue that because followers are so critical to the success of contemporary organizations, their satisfaction is both a vital process measure for an organization, as well as an end result in itself. Vroom’s (1964) study reports that high job satisfaction results in lower turnover, fewer unexcused absences, and slightly lower accident rates and has been shown to lead to a better quality of output and to a healthier workforce (Kearney & Hays, 1994).

Our second main contribution is to investigate two situational factors conditioning the effect of followership. Based on the previous research and theory, we consider perceived supervisor support (PSS) and performance-oriented culture (POC). Applying the situational leadership theory, the former is expected to weaken the links between followership and job satisfaction as strong support from supervisors or managers is expected to partially alleviate the need for subordinates to demonstrate characteristics of active followership. On the other hand, we hypothesize that strong performance-oriented culture increases the magnitude of followership’s impact on job satisfaction, because employees who are actively participating and thinking independently will attribute greater variance in their satisfaction to their followership behaviors.

THEORY AND HYPOTHESES

Followership and Job Satisfaction 

What is a followership? According to Kelley’s (1992) pioneering work on this topic, he views followers as active courageous individuals who can formulate their own meaning of life and whose main goals are to cooperate for organizational success. The major premise in his theory is that organizational success is not solely dependent on dynamic leaders but that followers are active rather than passive who contribute to the betterment of employee and organizational well-being. The theoretical root of followership has been found in several extant theories (e.g., Leroy 2012; Ward 2010; Vondey 2008). For example, using self-determination theory (SDT) as a guiding framework, which posits that individuals have inherent growth tendencies and are motivated behind the choices that they make without any external influence and interference, Leroy (2012) describes that “good followers” (Sergiovanni 2007) find a reason and strength to complete a task, without influence from other people or situations. 

The most prominent scholar in bringing the theory of followership into leadership literature was Kelley (1992) who operationalized followership based on two dimensions: active engagement and independent critical thinking. Critical thinking has recently gained attention as a desirable employee characteristic (Blanchard et al., 2009). Followers who engage in independent critical thinking analyze the information given to them, meticulously evaluate situations and actions, and make judgments independent of the political consequences of decisions (Kelley, 1992; Latour & Rast, 2004). Dowd and Bolus (1998) argue that critical thinking can improve health outcomes of employees in stressful situations. According to Blanchard and her colleagues (2009), engaging in critical thought is effortful and involves extra work on the part of the follower, which should lead to cognitive dissonance and subsequent effort justification.

 The second characteristic of followership is active engagement (Kelley, 1992). Followers who are actively engaged take initiative, assume ownership, and actively participate in performing their job. These individuals assume responsibilities beyond their minimum job requirements and exert considerable effort to accomplish goals (Kahn, 1990; Romano, 1995). Individuals who demonstrate active engagement go above and beyond expectations, proactively participate in activities, and provide high-quality work. Active engagement has also attracted a substantial amount of attention recently (Macey and Schneider, 2008). It is considered highly motivational (Schaufeli et al., 2002) and has been linked to increases in health outcomes (Schaufeli & Bakker, 2004) as well as increased job satisfaction, organizational commitment, and decreased turnover (Salanova et al., 2003; Schaufeli et al., 2002). Based on these characteristics of followership behaviors, Howell and Costley (2006) theorize how active followership may increase employee job satisfaction. First, they note that followership role fulfills important personal needs for individuals, because it provides for comradeship with valued others by serving them, and thus helps satisfy one’s social needs and confirms a favorable self-concept for many people. Subsequently, fulfilling active followership roles satisfies individual needs for self-esteem as it provides for personal growth by helping them become more mature and effective performers (Vondey, 2008).

While a paucity of empirical studies exists that directly link followership to job satisfaction, several scholars suggest that followership behaviors will result in increased motivation, satisfaction, and feelings of empowerment (Gilbert & Hyde, 1988; Howell & Costley, 2006). Most recently, based on a survey of 331 faculty members at a large public university, Blanchard and her colleagues found empirical evidence that effective followership has positive influence on job satisfaction. Using cognitive dissonance theory, which suggests that employees seek effort justification (Aronson &  Mills, 1959) by changing their attitudes to justify their behavior, they concluded that followers who are actively engaging in their work more likely to justify their behavior by believing that their jobs are “really good” and worth their extra effort. Thus, the following hypothesis is examined in this study:

Hypothesis 1: Active followership is positively related to employee job satisfaction.

Conditions Influencing the Effects of Active Followership 

Research on the effects of followership has not given much attention to moderating influences. The present study considers the influence of two situational factors, perceived supervisor support and performance-oriented culture, which are often conceptualized as a theoretical extension of perceived organizational support (Eisenberger & Stinglhamber, 2011). Our choice of perceived supervisor support as a conditioning factor in the public sector is important given the distinction between public and private organizations. For example, the environments in which government supervisors, as compared to private sector supervisors, operate can make motivating their employees more difficult, due to (1) frequent changes in leadership as elected or politically-appointed leaders often have brief tenures; (2) having goals that are often difficult to translate into units that are objectively measurable; (3) strong employee protections, which makes it difficult for supervisors to deal with even the poor performers; and (4) constraints put on the use of financial incentives. Although many studies show that strong managerial support increases job satisfaction of government employees in spite of the aforementioned challenges that public sector managers face (Ting, 1997; Cho & Perry, 201; Yang & Kassekert, 2009), how it moderates the effect of active followership has not been investigated. Our choice of performance-oriented culture as a moderator also has demonstrable relevance to public sector organizations. For example, the theory that reforming performance-based pay systems would improve government operations and employee satisfaction has been a hallmark of the new public management (NPM) movement (Osborne & Gaebler, 1992). For public agencies long known for their struggles with classical bureaucracies, such as red tape (DeHart-Davis & Paney, 2005) and procedural constraints and routines (Wright & Davis, 2003), promoting the culture of performance orientation has important implications for employee job satisfaction. Thus, the current research explores how perceived supervisor support and performance-oriented culture moderate the effect of active followership. 

Moderating Role of Perceived Supervisor Support (PSS)

Perceived supervisor support (PSS) is defined as the beliefs employees hold regarding the extent to which supervisors provide emotional and instrumental (work-related) assistance (Thoits, 1985). Although benefits of PSS are widely recognized (Ng & Sorensen, 2008), most of the existing studies prior to Kelley’s publication on followership in 1998 were based on leader-centric approach (Hollander, 1993; Meindl et al., 1985), which viewed managers as superior and employees inferior and passive (Taylor, 1911).

Research shows that PSS creates “enabling relationships with others that make it easier for employees to learn” (Mink, Owen, & Mink, 1993), and thus is considered to facilitate employees’ learning and development (Ellinger et al., 2003). However, for active followers who demonstrate independent critical thinking and show high degree of job competence, and thus require less supervision and direction, strong employee perceptions of supervisor support may undermine the effect of active followership. For example, medical doctors, airline pilots, accountants, electricians, and other professionals do not require much supervision and often do not want it (Yukl, 2010). Likewise, professionals who are internally motivated by their values and ethics do not need to be encouraged by the leader to do high-quality work. This phenomenon is theoretically explained in Hersey and Blanchard’s (1977) situational leadership theory, which specifies the appropriate type of leadership behavior for different levels of subordinate maturity, a composite of diverse elements such as subordinate confidence, ability, and motivation, in relation to the work. The major proposition of their theory is that when followers have low competence and/or low commitment, the leader should act supportive, consult with the subordinate, and provide both support and direction. On the other hand, for followers who demonstrate high commitment and high job competence, leaders should use a low level of task-oriented and relations-oriented behaviors.

Therefore, for effective followers who are self-motivated, supervisor support has little, if any, effect (Yukl, 2010). Moreover, in this situation, if subordinates perceive close supervision and direction to be an unnecessary imposition of leader control, satisfaction may actually decline (Yukl, 2010). Although there is no research data on the moderating effect of PSS on active followership, proponents of role-based followership approaches have recently called for “reversing the lens” in leadership research (Shamir, 2007) by identifying followers as the causal agents (i.e., follower characteristics and behaviors), the independent variables, and testing the role of leader behavior as a moderator on the effects of active followership.

Hypothesis 2: The relationship between active followership and employee job satisfaction will be stronger under low levels of perceived supervisor support.

Moderating Role of Performance-Oriented Culture (POC) Performance-oriented culture (POC) measures perceptions about performance-based accountability and performance incentives such as pay for performance, two of which symbolize the hallmark of the managing-for-results (MFR) movement that had started from the Clinton Administration (Osborne & Gaebler, 1992; Yang & Kassekert, 2009). Although its implementation in government often faces considerable challenges, the performance orientation is advocated to break these characteristics (Barzelay, 1992) and has shown empirical evidence that it not only improves government operation but also employee satisfaction and motivation (e.g., Hays, 2004; Yang & Kassekert, 2009). For example, referencing Lee et al. (2006), Yang and Kassekert (2009) report that performance-based pay has a positive impact on job satisfaction in four of the seven surveys conducted between 1979 and 2002 in federal government.  

According to Bjugstad et al. (2006), a follower’s motivation is a function of environmental and internal factors. They argue that to increase follower motivation, an organization needs to create a results-oriented environment with genuine concern for its followers and provide performancerelated reward. Although active followers motivate themselves primarily by their own ambition (Hughes, 1998; Kelley, 1988; Bjudgstad et al., 2006), Strebel (1996) notes that followers also determine their motivation by reflecting on matching the level of their work effort to what type of recognition or reward they might receive, and whether that reward will be worth it. This is consistent with Kelley’s (1992) conceptualization of active followers who are not only exemplary but are also pragmatic in terms of having clear expectations and needing satisfaction with the outcome(s) they receive (Green, 2000). Thus, we hypothesize that for active followers, the motivation and thus job satisfaction will be felt more strongly when they perceive a high level of performance-oriented culture (i.e., distributive justice) in their organization. Our research framework appears in Figure 1.

Hypothesis 3: The relationship between active followership and employee job satisfaction will be stronger under high levels of performance-oriented culture.

[Insert Figure 1: Research Framework]

Method

To test the hypotheses, we compiled a pooled, cross-sectional data set consisting of the 2011, 2012, 2013, and 2014 Federal Employee Viewpoint Surveys (N = 1,723,392) (U.S. Office of Personnel Management) representing permanent full- and part-time civilian government employees in all 82 Federal agencies and covering all federal occupations. The purpose of this survey was to assess the degree to which federal agencies are using human capital management practices that characterize high-performing organizations, and to provide managers and supervisors with information on workforce issues that deserve specific attention such as employees’ satisfaction with their jobs, pay, and organization to improve agency-specific services. To control for agency-level characteristics, data from FedScope Employment Cube (2011, 2012, 2013, and 2014), under OPM’s centralized data warehouse system, were used. 

[Insert Table 1: Descriptive Statistics of the Variables]  

Measures  

Table 1 presents descriptive statistics for the study variables. Full list of the questions associated with each scaled variable is shown in the appendix. All primary independent variables are measured by multiple items. They have acceptable Cronbach’s alpha values, ranging from .80 to .94. We integrate the multiple measurements into a single indicator by using a mean value. Except for demographic factors, all items are ordinal-based on 5-point Likert-type scale ranging from strongly disagree (1) to strongly agree (5). The only exception was on employee job satisfaction where two of the four items were measured using satisfaction scale (very dissatisfied=1, very satisfied=5). Because the scales have the same 5-point ordinal structure and show high degree of internal consistencies, we concluded it was reasonable to integrate the measures (Cho & Perry, 2012). 

The dependent variable was measured using four items capturing satisfaction with the nature of the job and organization. It captures two of the three measures used in Cook et al.’s (1981) job satisfaction scale (e.g., satisfaction with job and the organization). The four items were averaged to calculate the composite job satisfaction score (Cronbach’s α = 0.89).

Followership is measured with an index of four items (Cronbach’s α = 0.80). Two items tap employees’ level of active engagement in the workplace: “My talents are used well in the workplace” and “I know how my work relates to the agency’s goals and priorities.” These items are equivalent to followers’ ability to take initiative and to contribute at a high level (Blanchard et al., 2009). And two items measure employees’ critical, independent thinking: “I feel encouraged to come up with new and better ways of doing things” and “I can disclose a suspected violation of any law, rule or regulation without fear of reprisal.” Perceived supervisor support is measured with an index of six items (Cronbach’s α = 0.94). It captures employees’ perception that their supervisor values their contribution and cares about their well-being (e.g., Kottke & Sharafinski, 1988; Hutchison, 1997; Rhoades et al., 2001). A sample item includes “my supervisor supports my need to balance work and other life issues.” Performance-oriented culture was measured with an index of six items (Cronbach’s α = 0.91). A sample item includes “awards in my work unit depend on how well employees perform their jobs.” Several demographic (years worked, age, managerial status, minority status, and gender) and agency-level characteristics (institutional location, percentage of professional staff, organizational tenure, and organizational size) were used as control variables in the model. The natural logarithm of organizational size was used to transform the distribution into a normal distribution.

Assessment of Measures and Common Method Bias 

The construct reliabilities, consistent with the aforementioned Cronbach’s alphas, all exceeded .80 (minimum cut-off value is .70; Nunnally, 1978). To test whether these variables are properly measured as differentiated concepts, we conducted a confirmatory factor analysis for the focal constructs included in the model. The analysis yielded an excellent fit (Standardized RMR was 0.03 for which the upper threshold is 0.05; RMSEA was 0.07 which is within the range of acceptable fit of 0.08; CFI, NFI, and GFI all showed acceptable fit at 0.95, 0.95, and 0.92, respectively). The convergent validity of the scales was affirmed by the presence of significant factor loadings (all t values exceeded the critical t of 3.29 for p < .001; Gerbing & Anderson, 1988) and in a range between 0.609 and 0.889. The AVE estimates were all greater than .50 as recommended by Fornell and Larcker (1981) and Bagozzi and Yi (1988).

Additional evidence of discriminant validity was found as AVE estimates of the constructs were all greater than the squared correlations between corresponding pairs of constructs (Fornell & Larcker, 1981), except for the AVE estimate of followership with job satisfaction (our dependent variable). This was expected given the high correlation between them (Table 2). Since AVE estimates are often considered to be “quite conservative” (Hatcher, 1994, p. 331), we also performed a confidence interval test to assess the discriminant validity of the two constructs (Anderson & Gerbing, 1988). This test involves calculating a confidence interval of plus or minus 2 standard  errors around the correlation between the factors, and determining whether this interval includes 1.0. If it does not include 1.0, discriminant validity is demonstrated (Anderson & Gerbing, 1988). The confidence interval for the relationship between followership and job satisfaction ranged from 0.901 to 0.903, meaning that it is very unlikely that the actual population correlation between them is 1.0, and thus supports the discriminant validity of the measures.

Because the constructs were measured at the same point in time and come from a single source for all the data (OPM), we estimated a CFA model in which all their corresponding indicator variables loaded on one general method factor to test the seriousness of common method bias. This alternative one-factor model yielded very poor fit (RMR = 0.07, RMSEA = 0.14, GFI = 0.61, CFI = 0.76, NFI = 0.76). While the results of these analyses do not preclude the possibility of common method variance, they do suggest that it is unlikely to confound the interpretation of our results. 

[Insert Table 2: Correlations] 

Analysis

We used hierarchical OLS regression analysis to test the hypotheses. To test the moderating effects in Hypotheses 2 and 3, we calculated the mean-centered values of the interacting variables before multiplying them, to minimize multicollinearity and to make the regression coefficients more meaningful (Aiken & West, 1991).

Results  

In Table 3, we provide the regression results. The control model (Step 1) accounted for 2.7% of the variance in employee job satisfaction and differed significantly from a null model (p < .001). Step 2 showed significant improvement in that it explained 67.6% of the total variance in employee job satisfaction (p < .001). Adding the interaction terms, the full model (Step 3) explained an additional 0.1% of the total variance explained in employee job satisfaction (p < .001). In our full model, an analysis of variance inflation factors (VIFs) (Bowerman and O’Connell 1990) and tolerance values (Menard, 1995) indicated that the multicollinearity was not a serious problem in this study

[Insert Table 3: Hierarchical Regression Model]

In support of Hypothesis 1, we found a positive direct relationship between followership and job satisfaction, β = .58, p < .001 (Step 2). Also statistically significant was the conditional effect of followership (Step 3). Among the employees average in their perceptions of supervisor support and performance orientation of their organization (because these were both mean centered in the analysis) but equal in supervisory status, gender, minority status, age, and tenure (because these are statistically being held constant), two individuals who differed by one unit in their followership were estimated to differ by β = .57 units in their job satisfaction.

The expectations for interaction terms were partially confirmed by the analysis. In partial support of Hypothesis 2, the regression coefficient for the product of followership and PSS was statistically significant (β = -.01), meaning that the effect of active followership on job satisfaction depends on employees’ perceived supervisor support, but the direction of its impact was the opposite. More specifically, as positive perceptions of supervisor support increased by one unit, the difference in job satisfaction between two individuals who differed by one unit in their followership increased by .02 units. Figure 2 shows the interaction, which reflects that fulfilling active followership had more positive effect on job satisfaction among those who perceived that supervisor support was high than it did among those who perceived that supervisor support was low. Hypothesis 3 was also partially supported as the interaction effect was statistically significant (β = - .03, p < .001, Step 3). However, the direction of its proposed impact was reversed. Figure 3 further demonstrates the nature of the interaction. The positive relationship between followership and job satisfaction was more pronounced among employees whose perceptions of their agency’s performance-oriented culture were low rather than high.  

 [Figure 2: Interaction of followership and perceived supervisor support for employee job satisfaction]

[Figure 3: Interaction of followership and performance-oriented culture for employee job satisfaction] 

Discussion 

In this inquiry, we have sought to achieve a better understanding of the relationship between followership role and one important employee outcome, job satisfaction, by considering the moderating role of perceived supervisor support and performance-oriented culture. We find that fulfilling active followership role has significant positive influence on employee job satisfaction. Findings also show that the demonstrated influence of active followership on job satisfaction is contingent on the types and the degree of situational factors. However, contrary to our hypotheses, active followership had more positive effect on job satisfaction under conditions of relatively high, as opposed to low, perceived supervisor support. Similarly, the relationship was more positive under conditions of low, as opposed to high, performance orientation.  

Two primary theoretical contributions emerge from this research. First, drawing from Kelley’s followership research and other theories in organizational psychology, our study demonstrates that active followership has significant positive influence on job satisfaction. Although this relationship has been theoretically argued in a few number of studies (e.g., Howell & Costley, 2006; Hurwitz & Hurwitz, 2009), there has been a dearth of empirical evidence. The only empirical evidence prior to our findings has been Blanchard et al.’s (2009) study of followership styles and their effects on employee attachment to their organization in a university setting. Thus, our findings add to the substantially under-researched aspect of the literature on the followership by establishing a positive relationship between followership and job satisfaction.

More importantly, the findings of the interaction effects were shown to be contrary to our theoretical reasoning. For example, our study shows that perceived supervisor support enhances, rather than decreases, the favorable effects of active followership on job satisfaction. This suggests that high degree of support and supervision may still be beneficial for even the highly engaged employees. The conflicting evidence on the moderating effect of supervisor support on the relationship between followership and job satisfaction can be, in part, explained by the conceptual work of Anderson and Oliver (1987) on supervisory control. They argued that there are two types of behavioral mechanisms that supervisors use to support their followers—activity control and capability control. Activity control refers to “the specification of the activities a person is expected to perform on a regular basis, the monitoring of actual behavior, and the administering of rewards on the basis of the performance of specified activities” (Challagala and Shervani, 1996, p. 90). Capability control, on the other hand, emphasizes the development of individual skills and abilities. It involves providing guidance for improvement if needed. Research shows that while activity control is negatively associated with job satisfaction, capability control by supervisors is positively associated job satisfaction. As our measure of perceived supervisor support includes items that relate to supporting employee development and providing opportunities for leadership skills, these factors may increase their intrinsic motivation.

In addition, our findings show that employees highly engaged in their work expressed stronger job satisfaction when the perceptions of performance orientation of their organization were low, rather than high. We suspect that this is, in part, because followership roles are performed mostly voluntarily. High emphasis on performance alone by the organization may undermine the many aspects of activities that active followers perform that are not part of the performance appraisals. These results are important because until now, the role of situational factors has not been given much consideration in the followership-employee outcomes equation.

Practical Implications 

For managers in the public sector, the finding that fulfilling active followership role brings positive emotional effect to subordinates’ job satisfaction is particularly insightful in light of the challenges associated with public organizations. For example, studies show that federal civil service is losing high-quality employees due to their dissatisfaction with their job (Yang & Kassekert, 2009). Although recent trends in flattening of government organization structures have given a wider range of public sector employees the opportunity to share power and responsibility, research was previously lacking on whether these new challenges were considered as risks to be avoided or as potential opportunities for structural empowerment. While further studies are needed to validate our findings, the fact that our evidence shows strong positive affiliation between active followership and job satisfaction can be used as a testament that taking on more vocal and more leadership roles is not a stressful work for subordinates, and it instead increases emotional attachment to their work and the organization. Thus, managers may devote more resources to help develop and sustain their followership skills, which can increase career satisfaction (Hurwitz & Hurwitz, 2009), and subsequently reduce turnover intention (Choi, 2008; Moynihan & Pandey, 2007). 

More importantly, supervisors need to be made aware that not everybody demonstrates followership at a high level. Consequently, knowing who their followers are and what their levels of followership skills are will be critical to ensuring the success of managerial actors in terms of keeping job satisfaction of followers at an optimal level. Employees who demonstrate active followership are those who take initiatives and derive satisfaction through their own motivation and action (Bjugstad et al., 2006), and their actions can lead to even greater impact on their emotional attachment to the organization when supervisors provide job broadening opportunities. By identifying those whose followership skills are low, supervisors will be better able to focus on those who need such guidance and supervision. Finally, in a similar vein, it is important that government agencies are seen as  providing justice in terms of the decisions to distribute resources fairly (performance orientation) as it invigorates the favorable effects of active followership. Overall, this empirical analysis provides public managers with a unique understanding of the preferred working style of active followers: less supervision is preferred but while making sure that their hard work is recognized fairly by the agency.

Conclusion

Our study is not without limitations. First, although some of the threats to validity in this study are controlled through its large sample size, drawing causal relationships should be performed cautiously due to the cross-sectional nature of the data (Bobko & Stone-Romero, 1998). Second, the survey items did not contain a tested scale for some of the constructs, so proxies were used. Although our assessment of the measures provided support for the reliability, convergent validity, and discriminant validity in our study, future research could investigate these constructs using instruments originally designed specifically for them.

Third, our use of single source of data might raise some concerns about common method variance. Although our test shows that the potential common method bias is not serious, future studies could greatly benefit by utilizing other sources for evaluating job satisfaction to reduce the likelihood of common method variance (Lovelace et al., 2001).  

The main objective of this study was to deepen our understanding of the relationship between the level of active followership and job satisfaction through the potential moderating role of perceived supervisor support and performance-oriented culture. We have shown that strong supervisor support enhances the relationship between active engagement and job satisfaction, while performance emphasis may buffer the favorable effects of active followership on job satisfaction. We hope that this study prompts further investigations of the ways different situational factors including leadership styles may interact with followership.

Acknowledgement 

This work was supported by the National Research Foundation of Korean Government (NRF2013S1A3A2055108) 

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APPENDIX: MEASUREMENT AND SCALE PROPERTIES 

Job Satisfaction (JS, α = 0.895) 

• My work gives me a feeling of personal accomplishment. 

• I recommend my organization as a good place to work. 

• Considering everything, how satisfied are you with your job? 

• Considering everything, how satisfied are you with your organization? Followership (α = 0.805) 

• My talents are used well in the workplace. (AE) 

• I know how my work relates to the agency’s goals and priorities. (AE) 

• I feel encouraged to come up with new and better ways of doing things. (CIT) 

• I can disclose a suspected violation of any law, rule or regulation without fear of reprisal. (CIT) Perceived Supervisor Support (PSS, α = 0.940) 

• My supervisor supports my need to balance work and other life issues. 

• My supervisor/team leader provides me with opportunities to demonstrate my leadership skills. 

• My supervisor/team leader is committed to a workforce representative of all segments of society. • Supervisors/team leaders in my work unit support employee development. 

• My supervisor/team leader listens to what I have to say. 

• My supervisor/team leader treats me with respect. Performance-Oriented Culture (POC, α = 0.912) 

• Promotions in my work unit are based on merit. 

• In my work unit, steps are taken to deal with a poor performer who cannot or will not improve. 

• In my work unit, differences in performance are recognized in a meaningful way. 

• Awards in my work unit depend on how well employees perform their jobs. 

• Employees are recognized for providing high quality products and services. 

• Pay raises depend on how well employees perform their jobs. Note: All answers are permitted along the five-point agreement scale in which each question is coded in such a way that higher values are associated conceptually with greater (more positive) levels of either agreement or satisfaction. Each construct was developed using confirmatory factor analysis in SAS. 


 

 


 



 

  

 

 


 

 


 

  

 Participative Management and Perceived Organizational Performance: The Moderating Effects of Innovative Organizational Culture

Jungwon Park, Keon-Hyung Lee & Pan Suk Kim

To cite this article: Jungwon Park, Keon-Hyung Lee & Pan Suk Kim (2016) Participative Management and Perceived Organizational Performance: The Moderating Effects of Innovative Organizational Culture, Public Performance & Management Review, 39:2, 316-336, DOI: 10.1080/15309576.2015.1108773 To link to this article: http://dx.doi.org/10.1080/15309576.2015.1108773

Published online: 14 Dec 2015.

Published online: 14 Dec 2015. 

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PARTICIPATIVE MANAGEMENT AND PERCEIVED ORGANIZATIONAL PERFORMANCE: THE MODERATING EFFECTS OF INNOVATIVE ORGANIZATIONAL CULTURE 

JUNGWON PARK KEON-HYUNG LEE 

Florida State University 

PAN SUK KIM 

Yonsei University

ABSTRACT: 

Participative management and innovation are major themes of recent organizational reforms in the United States and other countries. Using a South Korean version of the Organizational Assessment Survey of the U.S. Office of Personnel Management, this study assesses how participative management and innovative culture are associated with public employees’ perceived organizational performance in the South Korean central government. The study finds that both are positively related to perceived organizational performance, but that the relationship between participative management and perceived organizational performance (i.e., internal efficiency) is moderated by employees’ perceptions of the organization’s innovative culture. Specifically, participative management has weaker effects on internal efficiency in highinnovation cultures than in low-innovation cultures

KEYWORDS: innovative culture, organizational performance, participative management, South Korea.

Participative management and innovation are a major theme of recent organizational reforms in the United States and other countries. A number of researchers have examined the relationship between participative management and innovativeness and organizational performance in various private and public organizations (Damanpour, Walker, & Avellaneda, 2009; Julnes, 2001; Kim, 2002; Kim, 2010; Lam, Chen, & Schaubroeck, 2002; Locke & Schweiger, 1979; Wagner, 1994). In general, the works of these researchers suggest that there is a positive relationship between participative management and performance and also between innovativeness and performance. Accordingly, many governments, especially in Western countries, have implemented participative management and innovation to enhance their organizational performance. However, as in other Asian countries, authoritarian managerial styles were long common in the South Korean government, and relatively little attention was paid to participative management and innovative culture. Since the 1990s, however, the South Korean government has adopted New Public Management (NPM) to improve its performance. As a result, various public agencies in South Korea have implemented participative management and promoted innovative culture through organizational reform.

Despite the fact that public sector organizations have adopted participative management practices and have built innovative cultures with the expectation of improving performance, there is a dearth of empirical assessment exploring the relationship among participative management, innovative culture, and performance in the public sector of South Korea. Most prior work was based on samples from Western cultures like the United States and the United Kingdom. Given the widely recognized cultural differences between Western and Asian countries, this study analyzes how participative management and innovative culture affect perceived organizational performance in a non-Western country like South Korea. The study has the further objective of examining the moderating effects of innovative culture on the relationship between participative management and perceived organizational performance in the South Korean setting. Testing the effect of participative management and innovative culture on organizational performance will have implications for current organizational reform in South Korea.

Literature and Model Development

PARTICIPATIVE MANAGEMENT AND ORGANIZATIONAL PERFORMANCE

Locke and Schweiger (1979) separate the benefits of participative decisionmaking (participative decision-making) into two major categories: (1) enhanced employee morale and job satisfaction, and (2) increased productive efficiency. With respect to the first category, participative decision-making increases morale and job satisfaction and reduces turnover and absenteeism, and increased employee morale and job satisfaction are positively related to organizational performance. Thus, participative decision-making indirectly affects performance. On the other hand, the second category includes “higher production, better decision quality, better production quality and reduced conflict and costs” (Locke & Schweiger, 1979, p. 277). Therefore, participation also has a direct influence on organizational performance. Most studies on the relationship between participation and performance fall into these two categories (Guthrie, 2001; Huang, 1997; Kim, 2002; Lam et al., 2002; Wagner, 1994).

Several researchers have provided practical evidence regarding the impact of participation on organizational outcomes such as productivity, job satisfaction, turnover rate, and absenteeism in public and industrial organizations (Cotton, Vollrath, Froggatt, Lengnick-Hall, & Jennings, 1988; Huang, 1997; Kim, 2002; Nouri & Parker, 1998; Wagner, 1994). In general, empirical research on the relationship between participation and performance has produced positive results. For example, the study by Kim (2002) showed that participative management is positively related to employee job satisfaction in local government agencies in the United States. However, some empirical studies reported insignificant or negative effects of participation on performance and satisfaction (Berkowitz, 1953; Cotton et al., 1988; Latham & Yukl, 1976).

With these mixed results from previous studies, scholars have focused more on the contextual factors that moderate the participation-outcome relationship. In addition to different forms of participation, they have found that various situational variables can affect the participation-performance relationship and may produce mixed outcomes (Sagie, 1994; Wagner & Gooding, 1987). For example, a number of researchers have suggested that the link between participative decision-making and organizational outcomes depends on cultural values (Huang, 1997; Lam et al., 2002). Lam et al. (2002) found that participative management has a greater effect on performance when it fits the situation (i.e., cultural values).

Authoritarian managerial styles are common in South Korea. Public agencies emphasize an authoritative and hierarchical organizational culture to promote efficiency in civil service (Ko, Park, & Kim, 2007). In this culture, government decision-making is centralized. However, since the 1997 economic crisis, administrative reform has been a top priority for the South Korean government (Kim, 2000). The government has adopted New Public Management to improve its performance. In keeping with NPM, the South Korean government has emphasized participative management practices and taken measures to increase personal empowerment and employee involvement in public agencies. However, even though NPM highlights the importance of a participative culture in government agencies, South Korea still has a national culture with a high power distance index (PDI) and a low individualism value (IDV), according to Hofstede (2009). A high PDI shows a high level of inequality of power, whereas a low IDV indicates a society with a collectivistic attitude and relatively strong interpersonal bonds. Sagie and Aycan (2003) argue that participative decision-making styles are different across countries due to different national cultures. This means that the decision-making style reflects cultural values. For example, where national culture is low on individualism and high on power distance, participants in decision-making are limited and the purpose of participative decision-making is to strengthen loyalty. Thus, the relationship between participative decision-making and performance can vary from culture to culture. In the present study, we examine the relationship between participative decision-making and organizational performance in South Korea.

Despite the adoption of participative management practices by public sector organizations with expectations for improving performance, there is a dearth of empirical assessment of the relationship between participative management and performance in the public sector of South Korea. Cho and Kim (2009) examined the effect of participative decision-making on performance in public enterprises run by the city of Seoul. However, their results do not support a positive relationship between participative decision-making and performance.

Since prior research has had mixed and inconclusive results regarding the relationship between participative decision-making and performance, we examine whether the use of participative management improves organizational performance by improving the attitudes and organizational commitment of officials in public sector organizations in South Korea (Julnes, 2001; Locke & Schweiger, 1979). Therefore

Hypothesis 1: Participative management is positively associated with perceived organizational performance.

INNOVATIVENESS AND ORGANIZATIONAL PERFORMANCE

Innovation is defined as a “response to environmental change or means of bringing about change in an organization” (Damanpour & Evan, 1984, p. 393). Faced with uncertainties and external and internal environmental changes, organizations need to be innovative to survive and to achieve their organizational goals. Organizations cannot meet new environmental conditions without innovative activities, and innovations are “a means of maintaining or improving organizational performance” (Damanpour & Evan, 1984, p. 395). Thus, innovativeness is considered “an enduring organizational trait” for organizational success (Subramanian & Nilakanta, 1996).

With respect to public sector organizations, there has been little research regarding the effects of innovation on organizational performance (Damanpour et al., 2009; Salge & Vera, 2009; Walker, Damanpour, & Devece, 2011).

Damanpour et al. (2009) and Salge and Vera (2009) examined the innovation-performance relationship in public organizations in England. Both studies found a positive relationship between innovation and organizational performance in public organizations. The study by Walker et al. (2011), using structural equation modeling, also found a positive effect of management innovations on organizational performance in English local governments. 

In addition, there has been little research on the impact of innovative culture on organizational performance in the public sector. Organizational culture consists of the body of assumptions, values, and norms shared by the organization’s members, and innovation and risk-taking comprise one of the dimensions of organizational culture (O’Reilly, Chatman, & Caldwell, 1991). Innovative culture can be understood in terms of attitudes toward innovation, technology, exchange of knowledge, entrepreneurial activities, business, and uncertainty (Hofstede, 2003). In other words, it refers to deeply held beliefs and values in innovation. If an organization has an innovative organizational culture, it is more likely to try out new ideas, take risks, and encourage innovations (O’Reilly et al., 1991). McLean (2005) proposes that “organization innovation occurs in organizations that provide a context that contains both enabling and motivating conditions for innovations” (p. 243). Organizations that provide such contexts generate more innovations, which in turn improve organizational performance. Kim (2010) examined public employees’ perception of public entrepreneurship (i.e., risk-taking, innovativeness, and proactiveness), and then analyzed its impact on perceived organizational performance in 296 U.S. state agencies. Results showed that all three dimensions of public entrepreneurship were statistically significant for improving performance. Similarly, we expect that a higher level of perceived innovative culture is positively associated with organizational performance. Thus:

Hypothesis 2: Innovative culture is positively associated with perceived organizational performance.

Third, this study examines the impact of an organizational culture of innovation on the relationship between participative management and organizational performance. Thus, we add an interaction term for participative management and innovative culture, to test the prediction that participative management is most consequential with respect to the level of innovative culture in an organization. Innovative culture, as an underlying value, may moderate the relationship between participative management and organizational performance. As Yiing and Ahmad (2009) observed, a management style that fits an organizational culture style can lead to good organizational performance. Previous research provides evidence of the moderating role of organizational culture on the relationship between participation and job-related outcomes. For example, Subramaniam and Ashkanasy (2001) found that budgetary participation reduces job-related tension when managers’ perceptions of innovation are high. In addition, Yiing and Ahmad (2009) found that innovative and supportive cultures moderate the relationship between participative and supportive leadership behaviors and organizational commitments.

Thus, participation in decision-making can be more effective in improving managerial performance when there is a high level of uncertainty in an organization. This is because participation increases a “participant’s commitment to the new idea, making implementation more effective” (Russell & Russell, 1992, p. 643). Lam et al. (2002) noted that the effect of participative decision-making on employee performance is dependent on the employee’s participation efficacy. The research by Rafiei and Pourreza (2013) found that the level of a perceived power distance culture has a significant effect on the relationship between participation and outcome variables. To sum up, previous studies have shown that organizational culture influences the usefulness of participation in decision-making, thus moderating the relationship between participation and organizational performance (Lam et al., 2002; Rafiei & Pourreza, 2013; Subramaniam & Ashkanasy, 2001).

Participation and employee-involvement programs can be successful when they are compatible with the existing culture of an organization (Cotton et al., 1988). For example, innovative organizational climate is the driver for employee involvement in decision-making (Shadur, Kienzle, & Rodwell, 1999). There is a constant interplay between organizational culture and management practices. Without the support of the necessary culture, participative decision-making does not function well. Thus, we expect that participative decision-making will yield a greater organizational performance benefit when the organization has a high-innovative organization culture. In organizations with low levels of innovative culture, participation is less likely to provide the opportunity to enhance organizational performance. Accordingly 

Hypothesis 3: Participative management has a greater positive effect on perceived organizational performance for organizations with higher levels of innovative culture than organizations with lower levels of innovative culture.

Figure 1 shows the theoretical framework for this study. There are two main independent variables that may positively affect organizational performance: participative management and innovative culture. The study includes the moderating effect of innovative culture on the relationship between participative management and organizational performance.


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The data for this study were collected using a modified and translated Korean version of the Organizational Assessment Survey (OAS) by the U.S. Office of Personnel Management. The OAS measures 17 dimensions of organizational climate (innovation, employee involvement, supervision, etc.) that are important in organizational performance. In addition to the original survey questions in the OAS, we added questions on the perception of organizational performance after reviewing the related organizational performance literature (Brewer & Selden, 2000; Kim, 2005).

The survey was conducted from October 2007 to January 2008 at the Central Officials Training Institute in Gyeonggi-do, South Korea. We randomly chose three training sessions that had a capacity of 300. Among the training participants, we were able to find the first 200 participants’ contact information. Then the survey questionnaire package was mailed twice to 200 permanent full-time public employees in various South Korean central government agencies. To increase the response rate, follow-up request letters were mailed two weeks after the delivery of the initial survey. A total of 159 completed surveys were returned, yielding a response rate of 79.5%. Due to missing values, the number of observations in our sample in Model 1, Model 2, Model 3, Model 4, and Model 5 is 136, 134, 135, 135, and 134, respectively. Table 1 provides demographic descriptions of survey respondents in terms of their sex, age, length of service, and hierarchical rank. As shown in Table 1, 80% of the respondents were male and the remaining 20% were female. In terms of the age distribution of survey respondents, it is quite evenly distributed between those in their thirties, forties, and over fifty. More than half of the respondents had less than five years of service as public servants. More than half of the respondents were in Grade 5 or 6.


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MEASURES

All survey questions regarding innovative culture, participative management, job satisfaction and organizational performance were in the form of a 5-point Likert scale ranging from 1 (strongly disagree) to 5 (strongly agree). A full list of survey questions is in the Appendix (see the Appendix). The study has five dependent variables (i.e., proxy variables for perceived organizational performance); participative management and innovative culture are the main independent variables. As control variables, in the regression models, we included gender, age, number of years worked in the current agency, rank, and job satisfaction. 

It would have been informative if we had used an objective measure of organizational performance as a dependent variable. However, in the public sector it is difficult to find an objective organizational performance measure. We addressed this problem by following Brewer and Selden (2000) and measuring organizational performance as the perceived organizational performance among individuals who work in the organizations. As Brewer and Selden (2000) suggested, “when objective organizational performance data are unavailable, subjective (i.e., perceived) organizational performance can be used as an alternative method” (p. 689). As to concerns that self-reported perceived performance measures might be biased, there is a strong positive correlation between perceived and objective measures of organizational performance. Therefore, we employed measures of perceived organizational performance as our dependent variables in this study. Perceptions of organizational politics were measured with five items from a scale developed by Kim (2005): (1) business relations with outside customers are dealt with very promptly; (2) the organization’s manpower is used efficiently; (3) the cost of managing the organization and performing work has been reduced; (4) in the past two years, productivity has improved; (5) overall performance has improved. Each of the five dependent variables measures three dimensions of organizational performance (Brewer & Selden, 2000; Kim, 2005) (see the Appendix).

The Organizational Assessment Survey by the U.S. Office of Personnel Management provided three items to measure participative management. The perceived level of participative management is a summative measure of three different questions, such as “Employees have a feeling of personal empowerment and ownership of work processes,” “Supervisors/team leaders provide employees with the opportunity to demonstrate their leadership skills,” and “Managers provide an environment that supports employee involvement, contributions, and teamwork.” Cronbach’s a between the three variables is 0.86. The participative management variable ranges from 4 to 15. Innovative culture was measured by an index of five items: risk taking, reward for creativity and innovation, managers’ receptiveness to change, employees’ receptiveness to change, and encouragement of new practices. The Cronbach’s a value of innovative culture is 0.82. These five items were summed to create a score for innovative culture. The combined innovative culture variable ranges from 7 to 24. The bivariate correlations and descriptive statistics for the sample data are reported in Table 2.

ANALYSIS

We conducted multiple regression analyses. To reduce multicollinearity in the interaction term, we created mean-centered variables for the scaled variables, and these mean-centered variables were used in the actual analysis. A significance level of p < 0.10 was considered significant for all tests. In addition, collinearity diagnostics were conducted. Specifically, we calculated the variance inflation factor (VIF) for the explanatory variable to detect the presence of multicollinearity. As a rule of thumb, severe multicollinearity may happen if any one of the VIF values is greater than 10.

Results

Table 2 presents the bivariate correlations for all of the variables in the analyses. The bivariate correlations among the variables are generally moderate and weak. The magnitude of the correlation coefficients between all of the independent variables ranged from 0.01 to 0.63, indicating no multicollinearity problems. In addition, all independent and control variables have VIF values of less than 3; thus the regression models do not have multicollinearity issues. The proportion of variance explained by a variable ranged from 0% to 40%. However, some dependent measures show relatively high correlation coefficients. For example, the second dependent variable (DV2) is substantially correlated with the third dependent variable (DV3) (r ¼ 0.782), which indicates that they are not sufficiently distinct.1

First, we analyzed whether R2 improved after including the two main independent variables (i.e., participative management and innovative culture). Table 3 reports R2 values for the model with only control variables and for models with the main independent variables. Results show that two variables significantly increase the explanatory power of the models. For example, while approximately 22% of the variance in DV5 can be explained by the control variables, the portion of variance explained by a model increased by 21% with both of the two main explanatory variables. In other words, including two variables (i.e., PM and IC) doubled the overall R2 of the model from 0.22 to 0.43. This increase indicates that participative management and innovative culture have significant explanatory power in explaining variations in perceived organizational performance.

Table 4 shows the results of the robust regression analyses of participative management and innovative culture regarding separate perceived organizational performance measures. Table 4, section a reports the results of the simple main effect of participative management and innovative culture. Thus, no interactions


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are present in Table 4, section a. For the first dependent variable (i.e., “My organization has conducted business relations with outside customers very promptly”), participative management is positively associated and statistically significant (b ¼ 0.134, p < 0.01). Also, for the second dependent variable (“The organization has carried out work by efficiently utilizing its manpower”), participative management is positively associated and statistically significant (b ¼ 0.095, p < 0.05). For the third dependent variable (“My organization is trying to reduce the cost of managing the organization and performing work”), only innovative culture is positively associated and statistically significant (b ¼ 0.083, p < 0.01). For the fourth dependent variable (“In the past two years, the productivity of my organization has improved”), only participative management is positively associated and statistically significant (b ¼ 0.173, p < 0.01). Finally, for the fifth dependent variable (“Overall performance has improved”), both participative management and innovative culture are positively associated and statistically significant (b ¼ 0.145, p < 0.01, and b ¼ 0.042, p < 0.05 respectively). Thus, participative management and innovative culture in the organization are associated with employee perceptions of the organization’s overall performance. However, participative management is a more important predictor than innovative culture in explaining perceived overall performance. For example, for the fifth dependent variable (DV5), one standard deviation (1.95) increase in participative management enhances the perceived overall performance by 0.40 standard deviation (≈ 0.27), but one standard deviation (3.03) increase in innovative culture increases the perceived overall performance by 0.18 standard deviation (≈ 0.12).

In sum, we find that participative management, one of the two main independent variables, is positively associated with four out of five of the perceived organizational performance measures, and these relationships are statistically significant. Innovativeness, another main independent variable of this study, is also positively associated with two of the perceived organizational performance measures, and these relationships are statistically significant as well. Thus, it is possible to conclude that both participative management and innovative culture can enhance perceived organizational performance. When we compare the absolute size of the independent variables, the most influential predictor is participative management in all models except DV3. For DV3, innovative culture is the most important variable.

Our analyses support that satisfaction in an organization is positively associated with perceived organizational performance, while job satisfaction turns out to be statistically insignificant. We find that satisfaction in an organization is positively related with organizational performance in two out of the five models. Another finding is that ranking is negatively associated with perceived performance. That is, the higher-ranking public servants’

 

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Figure 2. Moderating Effect of Innovative Culture in the Relationship Between Participative Management and Organizational Performance. Notes: DV2 = Efficiently utilizing organization’s manpower; DV3 = Reducing the cost of managing the organization and performing work; Low IC = Organizations with low innovative culture (μ − 1r); Mean IC = Organizations with mean innovative culture; High IC = Organization with high innovative culture (μ + 1r).

perceived performance is lower and is statistically significant for all five dependent variables.

 The two-way interaction terms between participative management and innovative culture are included in Table 4, section b. We find statistically significant interaction effects in two out of the five models. Significant interaction terms show that innovative culture has significant moderating effects on the influence of participative management on perceived organizational performance (i.e., internal efficiency). Contrary to our expectations, however, positive interaction effects are not found. We only find negative interaction effects between participative management and innovative culture on DV2 and DV3 (b ¼ 0.017, p < 0.10, and b ¼ 0.018, p < 0.10 respectively). The negative interaction effects indicate that the effect of participative management on internal efficiency is stronger when there is a low level of innovative culture in an organization. On the other hand, when an organization has a high innovative culture, the effect of participative management on internal efficiency is weaker. Figure 2 (a and b) shows two slope plots for the two-way interaction between PM and IC. As shown in Figure 2, participative management has minimal influence on the perception of internal efficiency for an organization in a high innovative culture.

Discussion

This study examines participation-performance linkages and innovationperformance relationships in the public sector in South Korea. The results of the regression analyses on five different dependent variables strongly suggest that both participative management and innovation positively influence perceived organizational performance. Participative management and innovativeness have positive effects on differently measured organizational performance in the public sector. This finding implies that participative management styles, such as employee involvement and teamwork, can enhance organizational performance in a public organization. Further, public employees perceive that the innovative culture in their organization increases organizational performance. Indeed, risktaking activity and willingness to accept new practices and methods are more likely to enhance organizational performance.

Although several scholars in the business sector have identified cultural differences and their effects on the relationship between participation and organizational performance, there has been relatively little study of how participation and innovation affect organizational performance in the public sector in Asia. Most of the previous studies in public management have focused on the effects of participation and innovation on performance in the public sector in Western countries such as the United States and the United Kingdom (Kim, 2002; Salge & Vera, 2009; Walker et al., 2011). In this study, South Korean civil servants perceive that participative management and innovative culture have positive effects on perceived organizational performance. These results indicate that participative management and innovative culture have become more common in the South Korean government.2

Another important research question addressed in this study was whether an innovative organizational culture moderates the positive effects of participative management on perceived organizational performance. In addition to the direct effects of participative management and innovative culture, the study found interactive effects of two variables on perceived organizational performance. Although the interaction effects are statistically significant, the direction (negative) of the two-way interaction term did not support the hypothesis (Hypothesis 3). Regardless of innovative organizational culture, participative management increases organizational performance. However, the increase is much greater for an organization with a weak innovative culture than for an organization with a strong innovative culture. In other words, our finding suggests that participative management may have greater effects on perceived organizational performance when there is a low innovative organizational culture.

Why does innovative organizational culture offset the positive effects of participation on organizational performance in the South Korean government? One possible explanation for this result is that there are differences in participative decision-making across cultures. Thus, an innovative organizational culture may conflict with a participative decision-making model in South Korea. Sagie and Aycan (2003) suggested four different approaches to employee participation according to the two cultural dimensions of individualism-collectivism and power distance: face-to-face participative decision-making, collective participative decision-making, pseudo-participative decision-making, and paternalistic participative decision-making. They argue that in societies with low individualism and high power distance (e.g., Korea and Turkey), the most common form of participation is paternalistic participative decision-making (Sagie & Aycan, 2003). In paternalistic participative decision-making, participation is limited to senior employees and the purpose is to strengthen the loyalty and compliance of subordinates. On the other hand, face-to-face participative decision-making is frequently observed in the United States, where the national culture is high on individualism and low on power distance. In face-to-face participative decision-making, individual employees participate in the process and knowledge sharing is encouraged for organizational outcomes. Although our study did not measure different forms of participative decision-making, public employees in Korea may understand the concept of participation in decision-making differently due to the different underlying cultural values (i.e., high power distance and low individualism). Thus, if South Korean civil servants perceive participation as a paternalistic relationship, a strong innovative organizational culture may not have a synergistic effect on the relationship between participative decision-making and organizational performance. 

Overall, this study provides insight into organizational performance with respect to participative management and innovation. Governmental efforts to create a participative and innovative culture in an organization may enhance organizational performance. Likewise, both the private sector and the public sector can increase performance with participative management and innovation. In fact, participative management increases organizational commitment and the motivation of public employees through empowerment. Thus, enhanced organizational commitment might increase organizational performance. Therefore, participation and innovation need to be encouraged in the public sector. Also, it is important to be aware of cultural differences and how they affect the effectiveness of participative management and organizational culture. Our findings suggest that a strong innovative organizational culture does not fit with the South Korean participation style, while previous studies have shown that participative decision-making yields greater organizational performance with a strong innovative organizational culture.

This study has several limitations. First, it has a relatively small data sample. The small sample size warrants caution in the interpretation of the results and highlights the need for further research with a much larger sample. Second, the study did not distinguish the types and dimensions of participative decision-making. Depending on its dimensions, participative decision-making can be classified as (1) forced or voluntary, (2) formal or informal, and (3) direct or indirect (Locke & Schweiger, 1979). Additionally, it can vary in degree, content, and scope. Thus, the various types of participation in combination with the aspects of degree, content, and scope can have different effects on organizational performance. Further, innovation has different effects on performance depending on its type. Thus, future research needs to consider other types of participative management and innovation. Third, this study used perceived measures of participation, innovation, and performance. The measures of independent and dependent variables are not objective measures, but subjective. This percept-percept measure can inflate the effect size, and may produce biased results (Crampton & Wagner, 1994; Wagner & Gooding, 1987). Fourth, this study is a cross-sectional study; thus the causal link between independent and dependent variables was not proven. We need to examine this issue through a longitudinal design.

The current study only considers individual-level factors. In future studies, we will strive to perform a two-level analysis that combines individual and organizational information. Since data from individuals are often nested within an organization, a two-level analysis, having secondary data related to structure, culture, and performance at the organizational level, will provide a more realistic and conservative statistical test. Finally, previous studies have found a moderator and mediator that can affect the relationship between participative management, innovation and organizational performance (Wagner & Gooding, 1987; Walker et al., 2011). Therefore, we need to include possible moderator and mediator variables to examine the effects of participation and innovation on performance in future studies. Using a moderator and a mediator, we will better understand how participation and innovation affect performance in the public sector.

Notes 1. 

Some dependent measures for organizational performance present relatively high correlation coefficients, and Cronbach’s a between the five variables is 0.86. Although performance measure shows high internal consistency, it has low construct validity. Thus, we separately analyze the effects of participative management and innovative culture on five measures related to organizational performance. 2. Caution is necessary when we interpret this result, because it does not mean that the United States and South Korea have the same level of participative management and innovative culture.

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Jungwon Park is a postdoctoral researcher in the Askew School of Public Administration and Policy at Florida State University. His research focuses on public health insurance, managed care delivery systems, and competition in the healthcare market. He has also worked on research related to personnel management and performance in public organizations. 

Keon-Hyung Lee is a Professor of Public Administration and Public Health in the Askew School of Public Administration and Policy, Florida State University. His work focuses on patient satisfaction, the impact of hospital competition and payer-specific case mix on hospital costs and revenues, hospital choice analysis, and the uninsured. He has published in public administration and health services administration journals. 

Pan Suk Kim is a Professor of Public Administration in the College of Government and Business at Yonsei University, Wonju Campus, South Korea. He was the President of the International Institute of Administrative Sciences (IIAS) in Brussels. He is currently the President of the Asian Association for Public Administration (AAPA). His work was supported by the National Research Foundation of Korea Grant funded by the Korean Government (NRF-2013S1A5B8A01055336).