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Person-based reward systems: A theory of organizational reward practices in reform-communist organizations

01 May 1994-Journal of Organizational Behavior (John Wiley & Sons, Ltd.)-Vol. 15, Iss: 3, pp 261-282
TL;DR: In this paper, a type of organizational reward system based on personal power is described and partially tested, developed from observations of Hungarian organizations, is grounded in theories of procedural justice and learned helplessness, which lead to employee perceptions of unfairness; negative evaluations of others; anxiety; and perceptions of self, collegial and organizational inefficacy.
Abstract: A type of organizational reward system based on personal power is described and partially tested. The theory, developed from observations of Hungarian organizations, is grounded in theories of procedural justice and learned helplessness. Person-based organizational reward systems are characterized by highly valued rewards combined with personalistic criteria for reward distribution. Such organizational reward systems were hypothesized to lead to employee perceptions of organizational unfairness; negative evaluations of others; anxiety; and perceptions of self, collegial and organizational inefficacy. These hypotheses were supported in tests in a sample of three Hungarian state-owned organizations classified as having person-based systems and five non-person-based organizations (two Hungarian privately-owned companies, one American state-owned and two American privately-owned organizations). In addition, several behavioral effects of person-based reward systems were proposed: they foster bargaining behavior, withholding of information, avoidance of collaborative tasks, ingratiation and noncompliance with rules.

Summary (6 min read)

Introduction

  • This paper presents and partially tests a theory of the affective and behavioral effects of the organizational reward systems in Hungarian state-owned organizations in the early period of economic transformation.
  • While there are excellent sociological and economic studies of statesocialist enterprises, there has been less attention to the development of theoretically grounded analyses of these organizations' incentive systems.
  • This form of person-based reward system is less familiar to organizational psychologists and, therefore, provides a fruitful basis for the development of general theories.
  • This grounded theory is then partially tested using questionna self-reports collected in a different sample of Hungarian organizations in early 1990 an comparable American sample.

Highly valued organizational rewards

  • Because it had been virtually impossible to fire employees, many Westerners have mistakenly extrapolated that under state-socialism managers controlled few powerful rewards and punishments for employees.
  • In 1990, Hungarian citizens were allowed only the equivalent of US$280 in foreign exchange every three years (which bought a very short stay in western Europe).
  • (2) The use of material organizational rewards in state-socialist societies is most visible in the use of financial bonuses.
  • As is common in the organizations of the West, many managers find they can expand their available incentives by allowing favored employees to 'break the rules'.

Personal criteria for reward distribution

  • Before discussing the criteria, the processes by which these organizational rewards were distributed need to be described.
  • In state-socialist economies, virtually all revenue, as well as permissions and regulations, came from centralized governmental decisions, so executives learned to focus their attention up, rather than down or laterally.
  • Non-managerial employees do not have detailed information about the party's power loss, since decisions are made behind closed doors.
  • In these centralized and complex industrial societies, one's 'good connections' may or may not deliver, and the supplicant often does not know why.
  • While disingenuousness about what is rewarded really is well known in nominally performance-based reward systems (e.g. Kerr, 1975) , person-based systems have two distinctive characteristics: (1) the high value of the rewards to employees, and (2) the absence of formal criteria and rules.

Affective effects of person-based rewards

  • These workplaces were characterized by several affective and behavioral 'dysfunctions' that the authors propose were a direct consequence of the use of person-based reward systems.
  • Drawing on the research on procedural justice and learned helplessness, as well as the field interviews and observations, hypotheses regarding the effects of this type of organizational reward system have been developed.

Unfair organizations

  • Procedural justice theory focuses on the reactions of individuals to just or unjust procedures (Thibaut and Walker, 1975; Folger and Greenberg, 1985) .
  • Leventhal (1980) argued that just procedures serve to suppress bias, create consistent allocations, rely on accurate information, are correctable, and consider the concerns of all participants.
  • Focusing specifically on procedural justice in organizational allocations, Folger and Greenberg (1985) emphasized the importance of openness or publicness of criteria in the perceptions that pay systems will be perceived as fair.
  • With their characteristic secrecy and use of personalistic criteria, the authors believe that personbased systems can be characterized as procedurally unjust.
  • The substantial experimental evidence on reactions to procedural (in)justice suggests possible reactions to person-based reward systems that the authors found mirrored in their observations.

Negative evaluations of others

  • Consistent with Lind and Tyler, there is also evidence that those in authority often were negatively evaluated under person-based systems.
  • In an extension of procedural justice research, managers in these organizations sometimes held negative evaluations of those below them.
  • Authority was split between management and the party, and accountability was avoided by those who felt they had no possible control.
  • While research on the effects of learned helplessness appears in a wide range of subdisciplines, the work focusing on task performance evaluation provides several insights applicable to person-based organizational rewards.

Anxiety

  • Employees in these person-based systems lacked the security imparted by clear rules and procedures.
  • They had difficulty knowing whether they had done enough or if additional efforts might be worthwhile.
  • One might have had a good connection but could never be sure whether that connection would (or could) deliver when needed.
  • Such uncertainty is palpable in the above quotation from Haraszti describing the behavior of machinists who were dubious about whether or not they had received their 'due' supplemental wages.
  • Under person-based reward systems, employees report relatively more anxiety than is reported by employees working under other organizational reward systems, also known as Therefore, H3.

Inefficacy

  • A sense of self-inefficacy was also observed in these person-based systems.
  • When employees did receive rewards, they did not know exactly why, and when they did not achieve a desired reward, they could never be sure whether it was the result of some ineffective action on their part or of some unknowable series of events.
  • This response seemed to generalize to their assumptions about their colleagues and their organizations.
  • Thus, it is hypothesized that person-based reward systems lead to the affective reactions of system distrust, negative evaluations of others, anxiety, and low perceptions of efficacy.
  • The tests of these hypotheses are reported in the next section.

Behavioral effects of person-based systems

  • Several of the behavioral reactions observed in these state-owned enterprises are consistent with what would be predicted from research on procedural justice and learned helplessness.
  • In addition, these interview and observational data suggest other effects consistent with their theoretical perspectives but not tested by these psychologists.
  • Unfortunately, their existing comparative data do not allow us to test these ideas systematically.
  • Their discussion here in propositional form provides a more complete theory grounded in the qualitative data and literatures on procedural justice and learned helplessness.
  • Lind and Tyler (1988) concluded their literature review of procedural justice research by noting that perceived injustice leads to more dispute and protest behavior, greater interpersonal conflict, and lowered compliance with laws.

Disputatious

  • Dispute and protest behaviors were common in face-to-face encounters and in collective settings, such as trade union meetings.
  • Subordinates believed that aggressive bargaining was the only way to get their 'fair shares' of the bonus money that they suspected the supervisor was retaining.
  • One personnel director of a large state-owned industrial organization described how he wanted to establish a performance appraisal system.
  • He asked one of his professional staff members to head the cross-functional task force to design the system.
  • She knew that the director retained some bonus money 'in his desk drawer', and she expected to be paid for this extra task.

Withhold information

  • The protest behavior predicted from learned helplessness research often took an indirect form in many Hungarian state-owned organizations.
  • With powerful rewards and punishments at the command of bosses, often, overt disputes were risky.
  • Rather, employees would sometimes withhold information from coworkers and supervisors.
  • Partly, this was an aid in bargaining (as for Haraszti's foremen described above).
  • But it also became a form of protest behavior: the plans and directives could be 'shown' to be wrong if employees let others go ahead using faulty data and assumptions, P2: Under person-based reward systems, employees withhold more information from one another than do employees working under other systems.

Avoid complex collaborative tasks

  • Additional behavioral effects more particular to the managerial job were observed.
  • In an environment in which most interchanges became bargaining sessions, managers learned to avoid asking for assistance.
  • Each time managers must begin unexpected projects or solve new problems, they must 'use' their bargaining resources.
  • The implications of this practice for organizational coordination and flexibility in response to changing environments are clear.
  • Thus, organizational work that was complex and required collaboration across units was avoided, P3: Those working under person-based reward systems tend to avoid complex, collaborative tasks to a greater extent than do those working under other reward systems.

Ingratiation

  • Those working under person-based reward systems believed that good relations with the high ranking would be rewarded.
  • At the training for 'T' managers, I was surprised to see one of the regional managers toadying to the human resources director who visited on the last day.
  • If employees believe that good connections with the high ranking, based on nothing more substantial than friendship, are the routes to rewards, they will invest their energy in such personal ingratiation, P4: Gregory (1989) analyzed why Soviet managers needed to violate rules in order to solve the problems created by supply breakdowns and incompatible directives.
  • Person-based organizational reward systems foster relatively more rule noncompliance than do other types of organizational reward systems.

Method Sample andprocedures

  • The sample used to test the hypotheses about the affective effects of person-based reward systems consists of the employees and managers in eight organizations: three state-owned Hungarian enterprises, two private Hungarian companies, a state-owned American university, and two large American corporations.
  • The Hungarian organizations were different from the ones used to develop the theory, and no managers or employees had undergone 'Western-style training' prior to data collection.
  • An attempt was made to survey the entire population of Hungarian employees; however, poor records and a low response rate limited the samples.

Hungarian state-owned enterprises

  • The porcelain factory was founded in 1777 by a count on his estate in remote wooded mountains in what is today just inside the border with Slovakia.
  • At the time of data collection in early 1990, it had 1045 employees, many of whom were grandchildren and great grandchildren of former porcelain factory employees.
  • The sheet glass manufacturer, located in a northern industrial city, was established in 1893 and was controlled by non-Hungarian owners until its nationalization in 1949.
  • Company psychologists distributed surveys to 1760 employees, and 271 usable surveys were returned to the researchers (14 per cent response rate).
  • The advertising agency was one of the two advertising agencies in Hungary until the reforms of the 1980s permitted the formation of small partnerships.

Hungarian privately-owned companies

  • The business machines manufacturer was founded in the early 1980s as a 'cooperative' by four engineers who left their jobs in the national postal service because they felt their employer was not adequately developing their ideas for coin-and bill-counting machines.
  • The Hungarian postal service soon became the first customer for this cooperative's lines of coin-and bill-counting and other small business machines.
  • At the time of data collection, the cooperative had become a 'share-holding company' and had two primary manufacturing facilities in two small towns.
  • At the time questionnaires were distributed, it had 72 employees, with 32 usable surveys returned to the researchers from a sample of 60 (53 per cent response rate).
  • The speciality lamps manufacturer, which also began as a 'cooperative', was started in 1983 by a man who had owned and operated his own company until he was forced out of business during the communist nationalizations of the late 1940s.

American organizations

  • Questionnaires containing some of the same scales as those distributed in the Hungarian organizations were distributed in three American organizations, one state-owned and two privatelyowned corporations.
  • The second is a regional office of one of the largest international public accounting firms.
  • The questionnaires were distributed and returned by mail, with 62 usable responses (a 67 per cent response rate).
  • All of the 284 engineers and engineering technicians in three 'groups' in the aerospace division received questionnaires late in 1988.
  • In all Hungarian and American organizations, the respondents were promised anonymity, and they and their managers received summary feedback of the results.

Measures

  • All of the measures reported here appeared in the Hungarian surveys; however, three of these measures were not available from the earlier American instruments.
  • All of the questions were originally developed in English.
  • Using this conservative procedure, none of the items on scales developed in the American and Saudi samples cross-loaded onto any other scale in the Hungarian sample (although a few original items were dropped from the scales).
  • In Table 2 , the employees report that the Hungarian state-owned organizations were significantly more likely to use non-merit criteria and nepotism than were the Hungarian privately-owned companies.

Hypothesis 1

  • Employees working under person-based systems were expected to perceive their systems as more unfair than would employees working under non-person-based systems.
  • Table 3 reports the employees' perceptions of the fairness of their organizational reward systems ('Organizational trustworthiness').
  • Consistent with the hypothesis, the employees of the Hungarian state-owned organization were significantly more likely to report that their organization's personnel system was unfair than were the employees in the non-person-based Hungarian private organizations and the American organizations.
  • Thus, the employees in person-based reward systems perceive their systems as less fair than the Hungarians and Americans working under performance-based organizational reward systems.

Hypothesis 2

  • Employees in organizations with person-based organizational reward systems were expected to report more negative evaluations of their supervisors and coworkers than would be reported privately-owned.
  • Hungarian state-owned significantly higher than Hungarian privately-owned and American state-owned; American privately-owned higher than Hungarian privately-owned and American state-owned.
  • 2Both Hungarian types significantly lower than both American types.
  • Negative evaluations are assessed with the scales 'Supervisory favoritism' and 'Exploitive coworkers'.
  • The employees in the person-based Hungarian state-owned organizations were significantly more likely to report that their supervisors engaged in favortism than were their counterparts in the other organizations.

Hypothesis 3

  • Person-based system employees were expected to report greater workplace anxiety than would employees working under other organizational reward systems.
  • Thus, for this one measure, person-based system employees did report greater workplace anxiety than was reported by non-person-based system employees.
  • Hypothesis 4. Finally, employees working under person-based reward systems were expected to perceive themselves, their coworkers and their organizations as less efficacious than would employees under non-person-based reward systems.
  • Each of these tests is imperfect, for they lack the inability to control all of the possible unmeasured variables (for examples, the occupations and skills across organizational types) and are cross-sectional rather than causal, which limits their confidence that type, and only type, caused the difference.

Conclusions

  • This study provides a theory derived from the paradigmatic work on procedural justice and learned helplessness, which has been grounded in observations of Hungarian state-owned organizational reward practices during the period of 'reform communism'.
  • In state-socialist societies, it is traditional for authorities to respond to criticism with a declaration that the proper measures have been taken and the problem no longer exists.
  • The feelings of unfairness and distrust that pervaded these workplaces have not disappeared overnight.
  • The authors expect that versions of person-based organizational reward systems are probably more common in the capitalist countries than is generally acknowledged.

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Title
Person‐based reward systems: A theory of organizational reward
practices in reform‐communist organizations
Permalink
https://escholarship.org/uc/item/4df0v5tk
Journal
Journal of Organizational Behavior, 15(3)
ISSN
0894-3796
Authors
Pearce, JL
Branyiczki, I
Bakacsi, G
Publication Date
1994
DOI
10.1002/job.4030150307
Copyright Information
This work is made available under the terms of a Creative Commons
Attribution License, availalbe at
https://creativecommons.org/licenses/by/4.0/
Peer reviewed
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University of California

JOURNAL OF ORGANIZATIONAL BEHAVIOR, Vol. 15, 261-282 (1994)
Person-based reward systems: A theory of
organizational reward practices in reform-
communist organizations,
JONE L. PEARCE
Graduate School of Management, University of California, Irvine, California 92717, U.S.A.
AND
IMRE BRANYICZKI AND GYULA BAKACSI
Department of Management and Organization, Budapest University of Economics, Budapest,
Hungary
Summary A type of organizational reward system based on personal power is described and
partially tested. The theory, developed from observations of Hungarian organizations,
is grounded in theories of procedural justice and learned helplessness. Person-based
organizational reward systems are characterized by highly valued rewards combined
with personalistic criteria for reward distribution. Such organizational reward systems
were hypothesized to lead to employee perceptions of organizational unfairness; negative
evaluations of others; anxiety; and perceptions of self, collegial and organizational ineffi-
cacy. These hypotheses were supported in tests in a sample of three Hungarian state-
owned organizations classified as having person-based systems and five non-person-
based organizations (two Hungarian privately-owned companies, one American state-
owned and two American privately-owned organizations). In addition, several beha-
vioral effects of person-based reward systems were proposed: they foster bargaining
behavior, withholding of information, avoidance of collaborative tasks, ingratiation
and noncompliance with rules.
Introduction
This paper presents and partially tests a theory of the affective and behavioral effects of the
organizational reward systems in Hungarian state-owned organizations in the early period of
economic transformation. While there are excellent sociological and economic studies of state-
socialist enterprises, there has been less attention to the development of theoretically grounded
analyses of these organizations' incentive systems. Below, we develop and test several hypotheses
regarding what we term 'person-based organizational reward systems'. Although personal
influence is present in all organizations (Pfeffer, 1981), we will argue that these organizations
were dominated by a particularly powerful form of personal power. Furthermore, these person-
' This research has been supported by the Vallalatgazdasagi Tudomanyos Egyes6let (Hungarian Business Economics
Scientific Society) and an Irvine Faculty Fellowship. An earlier version of the paper was presented at the Second
Annual Western Academy of Management International Conference, Katholieke Universiteit, June 21-24, 1992. The
authors wish to thank Anne Tsui, Lyman Porter, Dan McAllister, Rochelle Klein, and Marcia Frideger for their
comments on earlier drafts.
CCC 0894-3796/94/030261-22 Received 20 November 1991
? 1994 by John Wiley & Sons, Ltd. Accepted 27 September 1993

262 J. L. PEARCE, I. BRANYICZKI AND G. BAKACSI
based reward systems were part of a conscious strategy designed to obtain specific employee
behaviors. We prefer the term 'person-based' because similar terms, such as 'unfair' or 'arbitrary',
emphasize evaluative judgements about such systems or imply that they are inadvertent.
Research and theory on the psychology of organizational reward systems has been dominated
by cognitive utilitarian approaches pioneered by Vroom (1964). This early work has been
enriched by attention to equity (Adams, 1965) and to justice (Folger and Greenberg, 1985)
in employee responses to incentives, as well as to the placement of incentive systems in social
(Whyte, 1955; Pearce, 1987), political (Staw, 1977), and institutional contexts (Eisenhardt, 1988).
We hope to contribute to the development of this literature through this analysis of Hungarian
organizational incentives during the period of 'reform communism' (late 1980s until the Spring
1990 election of a non-communist government). This form of person-based reward system is
less familiar to organizational psychologists and, therefore, provides a fruitful basis for the
development of general theories.
Eisenhardt (1989) suggested that empirically grounded theory creation, which arises from
the juxtaposition of data and theory, leads to divergent thinking and to truly novel theories.
We believe that the theory of person-based reward systems presented here is an example of
the new ways of thinking that can arise in an inductive theory-building process. Our understand-
ing of employee reward systems under reform-communism provides insights into a type of
reward system that can appear in organizations throughout the world. Although sometimes
more muted in other economies, these systems are not unique. Rather, their stark character
in these organizations helps to illuminate psychological features of reward systems that have
been difficult to study.
The theoretical arguments are based on a systematic contrast of observational and interview
data collected in the late 1980s in Hungary (the American author taught in the International
Management Center in Budapest in 1989) with paradigmatic theoretical work in procedural
justice and learned helplessness. This grounded theory is then partially tested using questionnaire
self-reports collected in a different sample of Hungarian organizations in early 1990 and a
comparable American sample.
The paper is organized as follows. First, person-based reward systems as they existed in
Hungarian state-owned organizations are described. Second, we contrast our person-based
reward concept with the extant literature on employee rewards, especially with the well-known
performance-based theory of organizational rewards. Next, hypotheses about the affective and
behavioral effects of person-based reward systems are developed from related literatures on
procedural justice and learned helplessness. Following this, the methods and results of the
hypothesis testing are reported. The paper concludes with comments on both the possible genera-
lizability of these ideas to other settings and their functional autonomy from their political
origins.
Before beginning, it is important to note that state-socialist enterprises have had substantially
different task environments than either private or publicly-owned enterprises in capitalist coun-
tries. These differing environmental pressures set the contexts within which enterprise managers
used the person-based reward systems to obtain the organizational behavior they needed to
meet organizational objectives. Although we will briefly refer to this context throughout, space
does not permit a political or an economic analysis of these systems. For a more detailed
analysis of Hungary after the 1968 economic reforms, the interested reader is directed to Kornai
(1986), Lauter (1972), and Stark (1990); additional material on enterprises in the Soviet Union
is available from Gregory (1989), Grancelli (1987), and Lawrence and Vlachoutsicos (1990);
and, on the recent economic reforms in the People's Republic of China, from Boisot and Child
(1988) and Nee (1989).

PERSON-BASED REWARD SYSTEMS 263
Person-based organizational reward systems
A person-based reward system contains two components: (1) highly valued rewards and (2)
personal criteria for reward distribution. Each of these two components will be described in
detail.
Highly valued organizational rewards
Because it had been virtually impossible to fire employees, many Westerners have mistakenly
extrapolated that under state-socialism managers controlled few powerful rewards and punish-
ments for employees. In fact, government planners in these economies quickly recognized the
unworkability of organizations without material incentives: 'When workers recognised in Cuba
that their labour was ineffective because of disorganization--spare parts were unavailable, inputs
did not arrive on schedule, finished goods awaited transportation-whatever commitment they
had was substantially undermined. ... Also, some workers were less motivated than others
and either stayed away from work or did not exert themselves, and with low morale there
is less commitment and consequently less work accomplished: a classic vicious circle. Since
1970 in Cuba more and more stress has been given to the use of traditional material incentives'
(Wood, 1987).
By the 1970s, the use of powerful material incentives was adopted in state-socialist societies
except in the People's Republic of China where it was delayed until 1978 because of Mao's
ideologically-based Cultural Revolution. That is, in practice, managers in state-socialist econo-
mies controlled powerful material incentives which they have not hesitated to administer to
obtain desired actions. The three most important organizational rewards distributed to
employees at all organizational levels in Hungary were (1) promotions and perquisites, (2)
bonuses, and (3) access to resources.
(1) Promotions in all organizations are one of the most valuable rewards that can be bestowed,
since they are accompanied by higher salaries, more autonomous work, perquisites, enhanced
status, and feelings of power (Locke, 1976). However, promotions may be even more important
in state-socialist societies than in the capitalist ones. This is because, for ideological reasons,
opportunities for independent wealth creation have been limited. This has meant that most
of the attractive forms of consumption (comfortable housing, foreign travel, cars, vacations
in the countryside) were controlled by employers, and virtually all of these attractions became
more accessible as one rose in hierarchical rank.
Foreign travel is particularly attractive in a small country such as Hungary, yet even under
post-communism, foreign travel has been extremely difficult. For example, in 1990, Hungarian
citizens were allowed only the equivalent of US$280 in foreign exchange every three years
(which bought a very short stay in western Europe). Even after the new market freedoms brought
foreign currency earnings, private persons were allowed to buy only one plane ticket per year
(as a policy to build foreign currency balances). Yet, one could have unlimited travel through
employers. Of course, the situation in fully state-socialist societies is even more severe: for
example, private car ownership was forbidden in People's Republic of China, but cars-and-
drivers come with ranking managerial positions. Now, there is widespread knowledge of the
special stores, apartments, hospitals, and other privileges reserved for the elite (see Simis, 1982;
Voslensky, 1984). In these economies, promotions retained all of the capitalist advantages of
increased power and income with the additional attractions of providing desirable goods and
services for oneself and one's family.
(2) The use of material organizational rewards in state-socialist societies is most visible in

264 J. L. PEARCE, I. BRANYICZKI AND G. BAKACSI
the use of financial bonuses. Yearly bonuses play a much larger role in employee compensation
in state-socialist societies than they do in capitalist ones, since a substantially larger proportion
of the pay of all employees at all levels is 'at risk' in these enterprises than in capitalist ones.
In Hungary, as in other state-socialist countries, it has been normal compensation practice
to provide yearly bonuses ranging from 0 per cent to 200 per cent of base pay. In contrast,
highly variable pay is confined to only a relatively narrow range of jobs in the West. Western
'merit pay' increases typically have ranged between 5 per cent and 7 per cent (Greeley and
Ochsner, 1986). As is the practice in all variable pay systems, relatively few employees in Hungary
received no bonus at all. Nevertheless, the variation in actual take-home pay has been substan-
tially wider for Hungarian employees than for employees in developed countries holding compar-
able positions.
The amount of pay at risk is even more important in these enterprises because base pay
was set at bare subsistence levels. The following statistics give a flavor of how little purchasing
power base wages provide: in Hungary, it took 927 hours of work to purchase a color television
(versus 88 hours in the Federal Republic of Germany) or 404 hours of labor to buy an automatic
washing machines (versus 83 hours in Germany) (Heti Vilaggazdasag, 431, September 5, 1987).
In the study period, the base pay of a Hungarian employee of a state-owned enterprise usually
did not cover his or her rent or mortgage payment. Although it is true that food and other
necessities were subsidized, the perennial shortages often meant that, in practice, extra payments
(bribes) were necessary to secure many services, such as health care. Thus, Hungarians depended
on supplemental income: large bonuses and second (and even third) jobs. Such supplemental
income was a vital necessity to virtually all families.
(3) The other valuable reward that organizations could administer was illicit access to organiza-
tional resources, including time off. As is common in the organizations of the West, many
managers find they can expand their available incentives by allowing favored employees to
'break the rules'. For example, Sayles (1989, p. 45) suggested that successful supervisors learn
to protect their subordinates, sometimes even 'covering up for them'. Although these practices
are common in capitalist organizations (particularly in certain occupations-see Mars, 1982),
such practices in Hungary were quite open and widespread. Common examples of illicit rewards
in Hungary included letting certain employees leave early or allowing them to take company
supplies for their own use. While most of these practices were not officially sanctioned (or
formally acknowledged) by managers, neither were they aggressively prosecuted.
While these kinds of rewards may be minor to more affluent Western employees, the supply
shortages can make them very valuable in state-socialist countries. An example from an interview
conducted by the American researcher in November 1989:
'W': There's a rule in the company, if you build a house you can go to the main plant
and buy things.
Interviewer: If you're an employee? You can buy it at a cheap price?
'W': It's not much cheaper. The thing is it's not always available in Hungary. As a company
everything is available, whatever you want. If you want [-], it's available there. Their task
is to have everything. It doesn't matter how much.
Interviewer: These inventories must be quite ...
'W': Fantastic! Hundreds of meters ...
Interviewer: This is horrible. It costs a lot of money ...
'W': In the shops you can't get anything ... OK, so I went there and asked the person
[warehouse foreman]. I've never seen that man before. I gave him my name. Why is he
so friendly? He said, 'You could get a much better type of pipe, a [-] pipe'. What he

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Journal ArticleDOI
TL;DR: In this paper, a social exchange model of employee work attitudes and behaviors was used to test a LISREL results revealed that whereas the three organizational justice dimensions (distributive, procedural and interactional) were related to trust in organization only interactional justice was related with trust in supervisor.
Abstract: Data obtained from full-time employees of a public sector organization in India were used to test a social exchange model of employee work attitudes and behaviors. LISREL results revealed that whereas the three organizational justice dimensions (distributive, procedural and interactional) were related to trust in organization only interactional justice was related to trust in supervisor. The results further revealed that relative to the hypothesized fully mediated model a partially mediated model better fitted the data. Trust in organization partially mediated the relationship between distributive and procedural justice and the work attitudes of job satisfaction, turnover intentions, and organizational commitment but fully mediated the relationship between interactional justice and these work attitudes. In contrast, trust in supervisor fully mediated the relationship between interactional justice and the work behaviors of task performance and the individually- and organizationally-oriented dimensions of citizenship behavior.

1,574 citations

Journal ArticleDOI
TL;DR: In this paper, personal initiative, a concept akin to entrepreneurship and organizational spontaneity, was compared in East and West Germany and the differences were hypothesized to be the results of occupational socialization, particularly of work control and complexity rather than of a selection effect.
Abstract: Personal initiative, a concept akin to entrepreneurship and organizational spontaneity, was compared in East and West Germany. Differences were hypothesized to be the results of occupational socialization, particularly of work control and complexity, rather than of a selection effect. A representative longitudinal study was conducted in the East and a cross-sectional study in the West. Lower initiative at work was found in the East; control and complexity affected changes in initiative. The results speak for socialization and against selection.

660 citations

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TL;DR: In this paper, the authors describe the process of inducting theory using case studies from specifying the research questions to reaching closure, which is a process similar to hypothesis-testing research.
Abstract: Building Theories From Case Study Research - This paper describes the process of inducting theory using case studies from specifying the research questions to reaching closure. Some features of the process, such as problem definition and construct validation, are similar to hypothesis-testing research. Others, such as within-case analysis and replication logic, are unique to the inductive, case-oriented process. Overall, the process described here is highly iterative and tightly linked to data. This research approach is especially appropriate in new topic areas. The resultant theory is often novel, testable, and empirically valid. Finally, framebreaking insights, the tests of good theory (e.g., parsimony, logical coherence), and convincing grounding in the evidence are the key criteria for evaluating this type of research.

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TL;DR: In this paper, the authors define a leadership event as a perceived segment of action whose meaning is created by the interactions of actors involved in producing it, and present a set of innovative methods for capturing and analyzing these contextually driven processes.
Abstract: �Traditional, hierarchical views of leadership are less and less useful given the complexities of our modern world. Leadership theory must transition to new perspectives that account for the complex adaptive needs of organizations. In this paper, we propose that leadership (as opposed to leaders) can be seen as a complex dynamic process that emerges in the interactive “spaces between” people and ideas. That is, leadership is a dynamic that transcends the capabilities of individuals alone; it is the product of interaction, tension, and exchange rules governing changes in perceptions and understanding. We label this a dynamic of adaptive leadership, and we show how this dynamic provides important insights about the nature of leadership and its outcomes in organizational fields. We define a leadership event as a perceived segment of action whose meaning is created by the interactions of actors involved in producing it, and we present a set of innovative methods for capturing and analyzing these contextually driven processes. We provide theoretical and practical implications of these ideas for organizational behavior and organization and management theory.

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TL;DR: In this paper, the authors integrate the work of hundreds of researchers in individual workplace behavior to explain choice of work, job satisfaction, and job performance, including motivation, goal incentive, and attitude.
Abstract: Why do people choose the careers they do? What factors cause people to be satisfied with their work? No single work did more to make concepts like motive, goal incentive, and attitude part of the workplace vocabulary. This landmark work, originally published in 1964, integrates the work of hundreds of researchers in individual workplace behavior to explain choice of work, job satisfaction, and job performance. Includes an extensive new introduction that highlights and updates his model for current organization behavior educators and students, as well as professionals who must extract the highest levels of productivity from today's downsized workforces.

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TL;DR: A synthetic polyisoprene rubber latex produced by emulsifying a solution of polyisoperene rubber in an organic solvent with water and removing the solvent from the resulting oil-in-water emulsion is significantly improved with respect to mechanical stability, wet gel strength and dry film strength as mentioned in this paper.
Abstract: A synthetic polyisoprene rubber latex produced by emulsifying a solution of polyisoprene rubber in an organic solvent with water and removing the solvent from the resulting oil-in-water emulsion is significantly improved with respect to mechanical stability, wet gel strength and dry film strength by utilizing, as a polyisoprene rubber, a modified polyisoprene rubber prepared by introducing from about 0.03 to 20 carboxyl groups per 100 recurring units of isoprene monomer present in the synthetic cis-1,4-polyisoprene rubber.

10,422 citations