FACTORS AFFECTING AOC AMONG KNOWLEDGE WORKERS AFFECTING AOC AMONG KNO · Compensation will influence

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    A Study on Factors affecting Affective Organizational Commitment among

    Knowledge Workers in Malaysia

    Muhiniswari Govindasamy Bachelor of Applied Science (Applied Physics) Hons

    University Sains Malaysia Malaysia

    1999

    Submitted to the Graduate School of Business Faculty of Business and Accountancy

    University of Malaya, in partial fulfilment of the requirement for the Degree of Master of Business Administration

    April 2009

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    ABSTRACT

    In 2002, Datuk Tan Chai Ho (Tan, 2002) from the Ministry of Energy,

    Communications and Multimedia had said that Malaysia should attract

    knowledge workers and technopreneurs in order to make Malaysia the global

    test bed for technology. The cry for knowledge workers in knowledge

    organizations has been the result of a knowledge-based economy or K-

    economy. One of the biggest challenges for most knowledge organizations

    in these highly competitive times comes from changes in work behaviours of

    the new generation of workers knowledge workers (Amar, 2002).

    Understanding knowledge workers and what makes them stay and continue

    to contribute to the organization is a formidable task for most managers.

    In this context, knowledge workers affective organizational commitment is a

    measurement which determines if the employee will still continue to work with

    the current organization. Thus is the nature of this study as it aims to

    determine the factors which will influence affective organizational commitment

    among knowledge workers. This research has identified and will examine

    how five factors of organizational practices namely Knowledge Sharing

    Practices, Task Orientation, Fairness of performance management and

    promotion, Opportunities of training and development and finally

    Compensation will influence affective organizational commitment among

    knowledge workers. Thus, this research will contribute significantly to

    organizations wanting to encourage knowledge workers to be committed and

    continue their service with them in this knowledgebased economy.

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    ACKNOWLEDEMENTS

    This thesis is a significant milestone in my long journey in obtaining my

    degree in MBA. This work would not have been possible without the

    presences of those who have contributed significantly towards my endeavour

    and made this journey a successful one.

    Ms. Sharmila Jaysingam, my project supervisor, who has been a great

    inspiration for me. I thank her for her tireless efforts, continuous guidance,

    support and mostly for her constructive comments and suggestions during the

    course of this project. I am indeed grateful to her for her patience with me in

    the most trying times throughout this project.

    My deepest appreciation goes to my husband, Mr. Kumaravelu for his love,

    support and constant encouragement towards my pursuit of life-long learning.

    This is a tribute to him.

    My parents, Mr & Mrs Govindasamy, have always been a source of inspiration

    to me throughout my life. They have seen me through thick and thin and I

    know that they have always prayed for only the best for me.

    My sincere thanks go to all my friends for all their continuous moral support.

    Finally, to all the respondents who have been willing to participate in this

    survey, thank you for participation.

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    TABLE OF CONTENTS

    ABSTRACT ii ACKNOWLEDGEMENTS iii TABLE OF CONTENTS iv LIST OF FIGURES vii LIST OF TABLES viii CHAPTER 1: INTRODUCTION 1 1.0 Chapter Overview 1 1.1 Introduction / Background of the Study 2 1.2 Purpose of the Study 4 1.3 Significance of the Study 4 1.4 Research Questions / Objectives of the Study 6 1.5 Scope of the Study 7 1.6 Organization of the study 8 CHAPTER 2: LITERATURE REVIEW 10 2.0 Chapter Overview 10 2.1 Definitions and Concepts 10 2.1.1 Knowledge Workers 10 2.1.2 Organizational Commitment 15 2.2 The importance of Affective Organizational Commitment 19

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    2.3 Factors Influencing Affective Organizational Commitment

    20

    2.3.1 Leadership 25 2.3.2 Employee Relation 26 2.3.3 Task Orientation 27 2.3.4 Compensation and Incentives 28 2.3.5 Performance Management and Promotion 29 2.3.6 Training and Development 30 2.3.7 Knowledge Sharing 31 2.4 Moderating effect of gender 33 CHAPTER 3: RESEARCH METHODOLOGY 35 3.0 Chapter Overview 35 3.1 Theoretical Framework / Research Model 35 3.2 Research Instrument 39 3.3 Selection of Measures 40 3.4 Sampling Design 42 3.5 Date Collection Procedure 43 3.6 Data Analysis Techniques 44 3.6.1 Factor Analysis 44 3.6.2 Cronbach's Alpha 46 3.6.3 Descriptive Statistical Analysis 46 3.6.4 Pearsons Correlation Test 46 3.6.5 Multiple Regression 47 CHAPTER 4: RESEARCH RESULTS 49 4.0 Chapter Overview 49 4.1 Response Rate 50 4.2 Demographic Characteristics of Respondents 51 4.3 Goodness of Measures 56 4.3.1 Independent Variables 56 4.3.2 Dependent Variable 62 4.4 Revised Conceptual Framework and Hypothesis 64 4.5 Multiple Regression Analysis 67

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    CHAPTER 5: CONCLUSIONS AND RECOMMENDATIONS 71 5.0 Chapter Overview 71 5.1 Summary and Conclusions 71 5.2 Discussion 72 5.3 Limitation of the Study 77 5.4 Suggestions for Future Research 79 5.5 Implications of the Study 81 5.6 Conclusion 84 BIBILIOGRAPHY 85 APPENDICES 96

    Appendix 1 Key Steps in Data AnalysisAppendix 2 KMO and Bartletts Test on IVAppendix 3 Items of Independent Variables Dropped after FactorAppendix 4 Cronbachs Alpha Coefficient Values for IndependentAppendix 5 KMO and Bartletts Test on DVAppendix 6 Items Dropped after Factor Analysis on DVAppendix 7 Outliers cases dropped from the analysisAppendix 8 SPSS Results from Multiple Regression AnalysisAppendix 9 The survey questionnaire

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    LIST OF FIGURES

    FIGURE FIGURE TITLE PAGE NO

    3.1 Theoretical Framework for Affective Organizational

    Commitment of Knowledge Workers

    36

    4.1 Revised Conceptual Framework 65

  • viii

    LIST OF TABLES

    TABLE TABLE TITLE PAGE NO

    2.1 Factors Influencing Organizational commitment 21

    2.2 Definition of Constructs used in the Model 34

    3.1 Selection of Measures 41

    4.1 Research Response Rates 50

    4.2 Demographic Characteristics of Respondents 54

    4.3 Factor Loadings on IV 58

    4.4 Correlation Coefficients and Descriptive Statistics (sample Size= 259)

    62

    4.5 Factor Loadings on DV 64

    4.6 Revised Hypothesis 66

    4.7 Hierarchical Regression Results Using Gender as a Moderator in the Relationship between the Independent Variables and Affective Organizational Commitment

    69

    4.8 Result of the Hypothesis testing 70

  • 1

    CHAPTER 1: INTRODUCTION

    1.0 Chapter Overview

    This initial chapter will focus on the introduction and background of Affective

    Organizational Commitment in a general sense. Subsequently, it will discuss

    the purpose of the study, the objectives, its scope, and its limitations before

    concluding with the organization of the study.

    1.1 Introduction / Background of the Study

    Organizational commitment is an important area of study to many researchers

    and organizations because the outcomes of this behaviour or value may help

    to determine many work related interaction of the employees. It is mainly

    related to the employees desire to continue working with the particular

    organization. As such, researchers and practitioners are ever so keen and

    interested to understand the factors that may influence an individual's decision

    to stay or leave the organization. Here, affective commitment most often tends

    to be the most highly related to the desire to leave an organization.

    Affective Organizational Commitment is one of the most prominent work

    attitudes examined in the work and organizational literature. The study of

    organizational commitment is an important and integral part of the literature

    on management and organizational behaviour for a long time, since as late as

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    the 70s. Among the first studies on organizational commitment were

    conducted by Porter, Steers, Mowday and Boulian (1974), where they studied

    on Organizational commitment and turnover among psychiatric technicians.

    Mowday, Richard, and Porter (1979) also studied on the measure of

    organization commitment. Since then, there have been many studies by

    researchers on organizational commitment but mostly amongst salespersons.

    These studies encompassed how Affective Organizational Commitment

    affects salespersons (Agarwal and Ramaswami, 1993), salespersons job

    satisfaction (Bhuian and Menguc, 2002) and salespersons the rate of

    turnover (Johnston, Varadarajan, Futrell and Sager, 1987).

    Studies have shown that Organizational Commitment have received

    considerable attention due to the importance that managers place on retaining

    personnel (Johnston, Parasuraman, Futrell, and Black, 1990; Mathieu,

    Bruvold and Ritchey, 2000; Boles, Madupalli, Rutherford and Wood, 2007).

    However, the importance of retaining employees or personnel is not only

    confined to any single industry, as many employers place great importance to

    employee retention and to reduce employee turnover as this may involve high

    costs in terms of induction, training and productivity (Firth, Mellor, Moore and

    Loquet 2004).

    In todays world, we see