Exam 2 March 2017, questions and answers PDF

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Preliminary examination commentary 2017: MN3075 Human Resource Management This commentary reflects the preliminary examination and assessment arrangements for this course in the 2015-16 academic year. All references to the subject guide will be to the latest version (2013). General remarks: High-performing students answered at least three and more usually four questions, and were more likely to structure their answers effectively and construct a coherent and logical argument when this was required. They made effective use of course readings in addition to the subject guide and cited empirical evidence to support their arguments. These students provided clear and convincing answers to the questions posed on the exam. Lower-performing students were much more likely to attempt only one or two questions, or only parts of three or four questions, which is a very risky strategy. Poor answers were sometimes too brief to do anything more than name the constructs involved (with no description or explanation attached), and sometimes very lengthy but incorporating material that was irrelevant to answering the exam question. These students were more likely to write the same amount of text for all parts of a question, despite the fact that parts (a) are only worth 5 marks and parts (c) are worth 15 marks. This is not a sensible strategy as clearly, questions worth 5 marks are asking for less information than questions worth three times as many marks. Comments on specific questions: 1. (a) How would you explain the “psychological contract” to a friend? (10 marks) This is discussed in Chapter 5 of the subject guide. See page 82 for definitions of the psychological contract, and page 91 for its key features. According to Edgar Schein (1980), a psychological contract is: ‘a set of unwritten reciprocal expectations between an individual employee and the organisation’. Denise Rousseau (1989) describes a psychological contract as: ‘an individual’s beliefs regarding the terms and conditions of a reciprocal exchange agreement between the focal person and another party’. Psychological contracts are unwritten, perceptual, and subjective. They are not enforceable in law but have psychological consequences if breached (e.g., undermining morale). The notion of reciprocal exchange is important here – some students wrote exclusively about employees’ expectations of what the employer should do for them, but neglected to mention that this is in return for the employees’ contributions. (b) Why would a manager be interested in the psychological contract? (15 marks) A starting point would be to discuss the PC as capturing the exchange relationship between the employee and employer and to demonstrate the consequences of PC breach/fulfilment for the organisation. Students should identify the link between contract breach and lower organisational commitment, lower trust in the current and subsequent employer (attitudes), lower OCB, performance, exit, voice and neglect (behaviours). The evidence supports the norm of reciprocity (Gouldner), in which individuals strive to match their own behaviour with that perceived behaviour of the employer.

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Therefore, the psychological contract is useful for HR managers in that it provides a predictive framework for employee attitudes and behaviours. HR managers can use this to manage the exchange relationship with employees by taking steps to ensure that contract breach is minimised. Students could then briefly discuss contract breach and ways of minimising it. Perceptions of breach occur as a result of an organisation reneging on its promises (unwillingness or inability to fulfil promises/obligations). The consequences of the latter may be reduced through perceptions of procedural and interactional justice. Incongruence may occur between the employee and employer in terms of the promises made. This may arise as a result of different schemata, ambiguity and complexity of promises made as well as poor communication between the parties. Therefore, a number of steps can be taken to avoid breach. First, organisations need to be careful in making promises to employees that they may later find they cannot fulfil. Second, to maximise congruence, organisations may want to increase communication between organisational agents and employees. Furthermore, the use of realistic job previews may minimise subsequent perceptions of contract breach, as employees will have a good understanding of the job prior to hiring. Students could draw on Robinson and Morrison (2000) in terms of the antecedents of contract breach. Here, students could draw on Conway and Briner (2005) to frame a discussion of the ways HR managers can manage the psychological contract. Although the psychological contract is useful for managing the employment relationship, it does have limitations, such as its subjectivity and the extent to which employees endorse the norm of reciprocity (individuals focusing on what they get out of the relationship rather than what they put in). In relation to this, candidates would need to state that it would be useful for HR managers to know that individuals differ in terms of how they approach exchange relationships.

2. (a) What are the five core job characteristics in Hackman and Oldham’s model? (5 marks) Material relating to this question can be found in Chapter 8 of the subject guide. Students can draw from page 145 to describe the five core job characteristics. These are: 1. skill variety – the worker has the opportunity to use a variety of skills in their job; 2. task identity – the worker completes a whole piece of work or an identifiable part of the production process; 3. task significance – the worker can see the way in which their efforts contribute to the product as a whole, and the way in which their efforts will impact on the end user of the product; 4. autonomy – in terms of influencing personal responsibility, it is necessary to allow workers a degree of control over the planning and execution of the work; if an individual is free to use their discretion in terms of the way in which they perform a particular task, they will feel a greater sense of responsibility if problems emerge, but will feel a greater sense of achievement if the job is successfully completed; 5. feedback mechanisms – in terms of influencing knowledge of results, it is essential that the company has effective feedback systems in place, such that workers have access to relevant performance data.

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(b) What else needs to be present, beside the five core job characteristics, for the model to work? (10 marks) Three moderators moderate the strength of the impact of an improvement in the five core job characteristics on the three critical psychological states, and the strength of the impact of an improvement in the three critical psychological states on motivation and performance. This material can be found on page 146 of the subject guide. The moderators and their ultimate impact on the outcomes of the JCM are as follows: 1) Knowledge and skill: if a worker does not possess the knowledge or the skills to perform the redesigned job effectively, the redesign initiative will not lead to an improvement in performance. 2) ‘Growth need strength’ or how strongly the individual feels that they need to develop and grow: if a need for personal development is lacking, an improvement in the five core job characteristics will have little impact on the three critical psychological states, or on resulting levels of motivation. As different people have different levels of ‘growth need’ strength, some are likely to respond more favourably to job redesign initiatives than others. 3) Context satisfaction: this relates to the context of the work situation. It is necessary, therefore, for workers to be in receipt of a reasonable rate of pay, for supervisory style not to be overly authoritarian, for working conditions to be acceptable and for there to be a sense of equity in the workplace. If workers are dissatisfied with these factors, it is unlikely that they will respond positively to a job redesign initiative. (c) Say whether you think this is a “good” model for managers to follow, and state the reasons you have come to this conclusion. (10 marks) Students should draw upon the material on pages 146-148 to answer this part of the question. The model made several important contributions to the job redesign debate. First, by incorporating moderators, the model recognised the psychology of individual differences – the fact that different people in different situations may respond differently to attempts to redesign jobs. For example, some people have a high-growth-need strength; they are likely to respond more positively to attempts to give them higher levels of autonomy than are workers with a low-growth-need strength. This was the first time that individual differences such as these had been taken into consideration. As such, the theory represents a considerable step forward from the universalistic theory presented by Herzberg, which assumed that job redesign would impact on everyone in the same way. Second, the theory provided valuable guidance for managers in terms of the specific characteristics of jobs that need to be taken into account when job redesign issues are being considered. In particular, the theory suggested to managers the need for jobs to be diagnosed in terms of the extent to which they provided opportunities for task variety, task identity, task significance, autonomy and feedback. In terms of its limitations, the Job Characteristics Model has faced some criticisms, which may limit the extent to which this is a “good” model for managers to follow. Students could mention some of the following issues: • Research evidence suggests that in many instances, job redesign initiatives have not been effective in increasing motivation (Kelly, 1992). It seems, therefore, that improvements in the five job characteristics are sufficient to result in job satisfaction, but not necessarily to motivate workers to work harder. What satisfies employees will not necessarily motivate them. 3

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Where job redesign has resulted in performance increases even without improved motivation, this appears to be due to increased pay, and/or improved workflow or work layout that generates less downtime. These pathways between job design and improved performance are not accounted for by the Job Characteristics Model. It may be the case that there is more to jobs than the five core job characteristics listed in the model. For example, the model makes no reference to issues such as physical load, memory load and time pressure. These factors are likely to have a considerable influence on workers’ attitudes and behaviour, and hence on the likelihood that a job redesign initiative will raise levels of motivation and performance. There is nothing within the Job Characteristics Model that refers to the process by which jobs are redesigned. For example, it may be the case that where jobs are redesigned in a participative manner, with workers themselves having an input in terms of the way in which jobs will be redesigned, they are likely to respond more favourably to the redesign initiative. The Job Characteristics Model does not take into account the fact that job redesign initiatives may prove more effective in certain organizational contexts, such as high-skill environments, as opposed to low-skill or bureaucratic environments. The model focuses on a narrow range of outcomes. The only outcomes considered are performance, motivation and satisfaction. It may be the case that job redesign initiatives have an impact on a much wider range of work-related outcomes, such as mental health, stress, accidents and grievances.

3. (a) Explain the difference between “employee involvement” and “employee participation”. (5 marks) This is discussed in Chapter 9 of the subject guide. Students need to distinguish between ‘involvement’ and ‘participation’, both of which focus upon employee voice: how do employees make their views known, and how do managers find out about what employees have to say? The difference between involvement and participation is essentially one of degree: employment involvement may involve communication by managers (downward involvement) and/or upward communication by employees to managers, for example via quality circle, suggestion schemes or problem solving groups. Participation implies more active involvement in decision-making through staff associations, trade unions, works councils, employee-representation on a supervisory board (e.g., in Germany), etc. (b) Why might an organisation decide to introduce an employee participation scheme? (10 marks) Management may wish to involve employees in the business in order to change attitudes, improve morale, increase commitment, enhance a sense of belonging, enhance business awareness, enable employees to be better informed, encourage greater interest in the business, gain support for management action, as an incentive, to encourage the acceptance of changing work practices, to encourage the acceptance of greater mobility across jobs (i.e. flexible working), to improve quality, to reduce costs, to encourage greater personal interest in the job, to try to give greater job satisfaction, to give employees increased job control, to draw on increased employee suggestions for improvement, to restrict the scope of union dealing and influence, to win hearts and minds of employees from union influence, to get union cooperation and to draw on union advice. (c) Discuss the advantages and disadvantages of employee participation. (10 marks) Advantages include any of the points listed in (b), as well as evidence from the European Foundation for the Improvement of Living Working Conditions (cited in the subject guide) that participation schemes have a strong impact on economic performance. The more forms of participation used, the greater the effects; the greater the scope of the participation (in 4

terms of work and employees covered by it), the greater the effects. The study found that few organisations implemented multiple schemes to develop an integrated approach to participation. Cotton’s research found that self-directed work teams had a strong positive impact on employee commitment. Disadvantages could include the following: Cotton found that representative participation had a weak impact on employee commitment. Some employees may not wish to be involved in active participation in decision making activities in the workplace. Employee responses to participation schemes may depend on their perception of management (harsh or supportive toward employees).

4. (a) What is “performance appraisal”? (5 marks) This is discussed in Chapter 7 of the subject guide. Students need to distinguish between ‘performance appraisal’ and ‘performance management’, and should not be writing more generally about performance management in parts (b) and (c). Performance appraisal involves regularly recording an assessment of an employee’s performance, potential, and development needs. The appraisal is an opportunity to take an overall view of work content, loads and volume, to look back on what has been achieved during the reporting period, and to agree objectives for the period ahead. (b) Describe the main features of goal-setting theory and explain its relevance for performance appraisal. (10 marks) Material related to this question can be found on page 127 of the subject guide. Goal-setting theory proposes that there is an important relationship between the way individual employee performance objectives are set, the nature of those goals, and employee performance. Thus, the goal-setting model of Latham and Locke suggests that when the employee participates in goal setting, the employee accepts the goals, and the goals are specific and challenging, then the employee will be motivated to pursue the goals with intensity and persistence (leading to higher performance), and that this link will be mediated by the employee’s ability. The model suggests that knowledge of the results of their performance, in turn, feeds back to further affect the intensity with which employees pursue the goals. Students may also draw on the SMART acronym to describe how goals should be set in order to elicit higher levels of motivation. The point here is that if managers and employees set objectives together during performance appraisals, these will be more likely to lead to high performance if they adhere to the tenets of goal-setting theory. (c) According to goal-setting theory, why are specific and tightly focused goals more likely to improve performance than open-ended goals? (10 marks) Goal-setting theory postulates that if there is no goal commitment, then a goal cannot have motivational effect. One of the factors that enhances goal commitment is expectancy, the subjective probability that goals can be achieved (Locke et al., 1981), taking Vroom’s expectancy theory as an antecedent of goal commitment. Expectancy is itself affected by specificity, comprehensibility and achievability. You cannot be motivated by something that is too vague, too complex to understand, or too difficult to achieve in the first place.

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5. (a) What is the difference between “procedural justice” and “distributive justice”? (10 marks) Material relating to this question can be found in Chapter 10 of the subject guide. Distributive justice addresses the question of whether resources are allocated fairly (outcome satisfaction). Equity theory determines if the ratio of outputs to inputs is fair, based on social comparison to similar others (co-workers, people doing a similar job at a different organisation, etc.). Inputs are things like education, training, work effort and experience; outputs include intrinsic and extrinsic rewards. Individuals can perceive their ratio to another’s ratio is greater or less than their similar ‘other’ (e.g., a co-worker or the organisation) – which can leave one feeling unfairly treated (under-rewarded) or guilty (overrewarded). Perceptions of inequity prompt the desire to reduce inequity via various means such as altering inputs and/or outcomes, exiting the firm, or changing one’s comparison other. Procedural justice is the question of whether the processes that inform decisions are fair (system satisfaction). According to Leventhal, procedures are perceived as fair if they demonstrate consistency, bias suppression, accuracy of information, correctability, representativeness, and ethicality. Exercising voice also leads to increased perceptions of procedural justice. Employees react less negatively to distributive injustice if they perceive that the processes are fair, and procedural justice is also linked to organisational commitment and OCBs. (b) In what ways is organisational justice theory relevant to HR policies and practices? (15 marks) Potential employees and current employees must perceive that policies and practices are fair in order to be motivated to perform well and to have positive attitudes toward and exercise positive behaviours in the organisation. Students may discuss how HR practices such as selection and performance appraisal are perceived by employees as being fair and legitimate. For example, although assessment centres and work samples may be valid techniques, applicants may view these selection mechanisms as unfair. If individuals view selection mechanisms as unfair yet are still offered the position, they may have less commitment to the employer or be less likely to accept the job. In the context of performance appraisals, organisational justice is relevant in a number of ways: utilising fair rating criteria; evaluators must be credible and have adequate knowledge; make sure metrics and criteria are legitimate and fair; if you say ‘you’re going to appraise’ – then the employer must conduct appraisals. Given the difficulty of ensuring distributive justice (managers can’t make everybody happy all of the time), better answers draw upon Folger and Cropanzano’s (1998) two-component model to explain how high levels of perceived procedural justice can help compensate for low levels of distributive justice and ward off counterpr...