Edit Motivation Research in Organizational

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Research in Organizational Settings has long demonstrated the impact of cultural factors on work motivation (Maslow). The current study develops a model of cultural factors and work motivation, more specifically equity sensitivity, in a concerted effort to understand worker motivation in the context of multicultural workforce. Past research provides the foundation for the present academic investigation demonstrating the evolution of academic theories supported by ongoing empirical research. The research is designed to demonstrate the impact of a multicultural workforce on the ability of human resource mangers to successfully motivate employees.

This chapter will examine past research and examine the synthesis of the theoretical and empirical research pertaining to the equity sensitivity construct and an actual multicultural organizational setting. The discussion will explain the theoretical model.

The review will also discuss work motivation theories and Cultural factors.

Theoretical Model

The globalization of the workforces creates an environment in which cultural differences create unique working environments within multicultural organizations. The ability to equitably reward and motivate employees continues to challenge American-based organizations (Henderson 1994). Current research explores the evolution of the workforce both domestically and globally (Chhokar, Zhuplev, Fok, & Hartman, 2001, Hofstede, 2001; Wheeler, 2002). In the fast pace of current business operations organizations are increasingly faced with the challenge of attempting to gain a strategic advantage through employee motivation (Schein, 1996). The expanding global economy has led to an increasing emphasis on understanding cultural values and their impact on human resource management throughout the world.

To implement employee motivation strategies properly, firms must understand how employees from various cultures are motivated in the workplace. (Hofstede, 1997; Trompenaars, 1998; Vladimir et al., 1992). Understanding and implementing cost-effective yet successful employee reward programs is critical to organizations attempting to recruit and retain a culturally diverse workforce. Reward systems that are very effective in motivating workers in one culture might be met with hostility, perceptions of inequity and dissatisfaction in an environment with differing cultural values (Wheeler, 2002). This unpredictable response to similar reward systems by employees within the same organization necessitates the need for firms to determine why individuals respond differently to similar rewards.

The globalization of the workforce is not limited to one industry. However certain fields, such as healthcare, have experienced a dramatic increase in culturally diverse employees. One reason for this is shortage of nurses in the domestic workforce and an inability to meet the medical needs of an aging population. This growing demand is creating a dependency upon international workers within American hospitals. It appeasrs that one major challenge that organizations are faced with is the development of reward systems that are perceived to be fair, equitable and distributing the reward in accordance with employee beliefs about their own value to the organization (Ramlall, 2004; Henderson,1994;Fine, 1996).

An equitable reward system has the potential of stabilizing an organization's workforce while improving the organizational commitment of employees.(Lust, 2003; Heneman, 2003)

Research in social psychology and in human and work motivation supports the contention that culture shapes beliefs, values, and perceptions (Henderson,1994;Fine, 1996). Research also suggests that people of different cultures cannot be expected to exhibit similar behavior patterns or react to stimuli similarly in an organizational context (Mueller and Clarke, 1998).

To attain high levels of performance, employers depend on their employees to perform at levels that positively affect the bottom line (Wiley, 1997). Thus, employers must understand what motivates workers in an organizational setting. Rather than attempting to adapt employees to existing reward systems organizations must realize that reward systems need to be adapted to the needs of the individual employee. This information combined with the potential predictability of equity sensitivity is an extremely valuable tool in the recruitment and retention battle in industries facing a shortage of qualified candidates.

Among theories of motivation, equity sensitivity, due to its combination of cultural factors and work motivation is ideal for exploring the context of a multicultural workforce. Previous studies explored this and that, many of these studies specifically dealt with a student population and/or foreign countries as opposed to investigating a multicultural, professional workforce in an American organization (Chen, 1995; Chhokar et al., 2001; Wheeler, 2002). The context of prior research investigations are important due to the influence the environmental settings have on the behaviors of the study's participants. For instance, students may have a different response to certain reward situations becaue they prefer academic rewards rather than economic rewards; on the other hand, an individual in the workforce setting has a different set of goals and thus responds differently as compared to a student. Figure 1 is a proposed model of this potential investigation.

Figure 1. Proposed Model

Work Motivation

Maslow's Hierarchy of Needs major theorist in the area of motivation was Abraham Maslow, he contended that human being possessed a hierarchy of needs; within this hierarchy, there are five groups of needs that must be met. (Maslow 1943) the most primitive needs are physical -- food, water, shelter etc. The next set of needs deal with the safety of an organisms surroundings -- people have a need to be free from inherent danger. Maslow also contends that people have a need for love and attention. (Maslow 1943) in addition, Maslow asserts that living things have socialized needs. Last in the hierarchy is the need for self-actualization (Byrne and Lindgren, 1971).

Maslow explains that the motivation of human beings is dependent upon the fulfillment of these five needs. This hierarchy is the foundation of most motivation theories. While the first four needs deal with biological and social issues (Byrne and Lindgren, 1971), the last need for self-actualization is used most often in developing reward systems for employees.

Goal Setting

Edwin Locke has also been a preeminent theorist in the area of motivation as it pertains to the workplace and educational environments. Locke's theory of motivation asserts that goal setting plays a large role in worker motivation. Early goal setting theories contend that "Goal setting theory is based on the premise that much human action is purposeful, in that it is directed by conscious goals."(Drillings and O'neil, 1994) Locke's theory asserts that because human beings have the ability to reason, they have the ability to set goals and pursue long-range purposes. (Locke and Latham1990)

Team Motivation

Lawler asserts that motivation can change when individuals are place in a team setting. Acoording to Lawler a definition of a team is a "a distinguishable set of two or more people who interact, dynamically, interdependently, and adaptively toward a common and valued goal/objective/mission; each of whom has been assigned specific roles or functions to perform, and who have a limited life-span membership"(Salas et al. 1992). Lawler contends that team motivation consists of team spirit, interpersonal skills, leadership and communication. Knowledge of what motivates teams is essential to human resource manage because many organizations rely on teamwork to get organizational goals met. According to Katz and Kahn (1978), three main factors motivate teams. These factors include; external rewards, rule enforcement and internalized motivation (Katz and Kahn 1978).

Intrinsic/Extrinsic Motivation

Many theories make predictions about individual motivation to perform in organizations (Harder, 1992). The unique difference in individuals continues to make the motivation of employees an ongoing challenge for theorist and organizations dealing with worker motivation theories. These theories have been predominately divided into two broad classes, which are intrinsic and extrinsic motivational theories. A person is intrinsically motivated if he/she performs an activity for no apparent reward except the activity itself (Turnage and Muchinsky, 1976). Extrinsic motivation refers to the performance of an activity because it leads to an external reward. The equity sensitivity construct is derived from the original equity theory (Intrinsic) and is utilized due to its predictive nature. This construct provides additional clarity to equity theory allowing it to function as a substantive tool for organizations and human resource executives. In addition, the equity sensitivity construct provides insight into the various responses of individuals in similar reward systems.

Equity Theory

Equity theory is the foundation for numerous empirical studies (Adams, 1963, 1965; Barr & Conlon, 1994; Carrell & Dittrich, 1978; Chhokar et al., 2001; King, Miles, & Day, 1993; King & Miles, 1994; Lane & Messe, 1971; Messe, Dawson, & Lane, 1973; Miles, Hatfield, & Huseman, 1994). Equity theory has been broadly researched (Barr & Conlon, 1994; Carrell & Dittrich, 1978; Chhokar et al., 2001; King, Miles, & Day, 1993; King & Miles, 1994; Lane & Messe, 1971; Messe, Dawson, & Lane, 1973; Miles, Hatfield, & Huseman, 1994). Weick (1966) labels it as being "among the most useful middle-range theories of organizational behavior."

Comprehensive reviews of this theory (Major & Deaux, 1982; Miner, 1980; Mowday, 1991) and other writings concerning the path of equity theory acknowledge the lack of a conceptual framework for individual differences in equity theory prediction. In addition, it suggests the incorporation of individual differences into the equity theory formulation (Miles, Hatfield, & Huseman, 1994). Additionally, the original version of equity theory had issues when removed from the laboratory and conducted in a field setting (Pinder, 1977).

Equity theory recognizes that individuals are concerned not only with the absolute amount of rewards they receive for their efforts, but also with the relationship of this amount to what their peers receive (Ramlall, 2004). Adams (1963, 1965) posits that individuals are motivated by the perception of inequality, as measured by "input" and "outcome" ratios in comparison to others. Equity theory draws from multiple empirical theories and is utilized to make predictions about how individuals manage their relationships with others (Huseman, et al., 1987). If equity exists, the individual is at peace with the exchange and therefore not moved to action. If the individual perceives that his or her outcome/input ratio is less than that of a referent individual, then inequity exists, and motivation to restore equity arises (Chhokar et al., 2001).

Perception of inequity

Behavioral response (define)

Individuals may respond by choosing a behavioral response by reducing their inputs or increasing their outcomes. On the other hand, subjects may instead use a cognitive response to reduce feelings of inequity such as selecting another person to use as their referent. The subject may choose to exit the situation by deciding to transfer or quit the organization (Allen & White, 2002). Exiting the organization is one of the most commonly explored responses to inequity.

The most commonly studied responses to inequity are behavioral in nature, and include raising or lowering work inputs (Greenberg, 1988), or, in extreme cases, quitting a job (Bing and Burroughs, 2001).

Huseman et al., (1994) notes that empirical research in equity theory has consistently failed to study psychological individual difference variables and has instead centered upon demographic variables. The globalization of the workforce intern creates a need to focus more on the individual differences rather than the demographic variables.

In other studies Mueller and Clarke (1998) note that findings have generally been mixed and despite its appealing parsimony, equity theory has come under increasing criticism, centered primarily on questions of the theory's generalizability and its inability to explain individual differences in perceptions of fairness and reactions to inequality (Huseman et al., 1987; King et al., 1993). This seems to indicate that cultures perceive rewards differently even in similar settings. Some cultures perceive certain rewards as motivational while others perceive the same reward as unfair or inequitable. It is essential to determine the underlying cause of the varying individual responses in certain reward situations. The comprehension of individual motivating factors has limitless value to employers.

Equity Sensitivity

Huseman, Hatfield, and Miles (1985, 1987) proposed the construct of equity sensitivity. Equity sensitivity attempts to clarify why people react differently to inequitable exchanges. The construct posits that individuals are differentially sensitive to the various levels of outcome/input ratios found between themselves and their peers in the workplace (Bing and Burroughs, 2001). It was an improvement over equity theory in that it offered the opportunity to account for and recognize individual differences in reactions to inequity without sacrificing parsimony (Mueller and Clarke, 1998).

Notably it allows a certain level of predictability to a theory that once lacked this essential component.

Equity sensitivity is utilized in this study due to its predictive nature and the integral role it plays in the evolution of the original equity theory. Equity theory originally served as a rational explanation of motivation; however, researchers noted an obvious lack of clarity in Adam's (1963, 1965) works. This original theory failed to explain individual reactions both positive and negative in reward situations. The lack of consistent and predictable individual responses in reward situations created a concern regarding the reliability and validity of the equity theory. Miner (1980) and Mowday (1991) concluded that equity theory could only remain viable if it could account for observed differences in reactions to equity within the workplace.

Huseman et al., (1985, 1987) and Miles et al., (1989) have provided empirical evidence in support of a categorization of individuals on a continuum of equity sensitivity (Bing and Burroughs, 2001). Equity sensitivity expands equity theory by classifying individuals into three categories based upon their sensitivity to equity, which are benevolents, equity sensitives and entitleds (Huseman et al., 1985). These three categories form what has now developed into a continuum of individuals. All individuals fall somewhere along this continuum thus enabling employers to make some type of predetermination of an employee's perception of the current or future reward program. Figure 2 presents a continuum of these three categories.

Figure 2. The equity sensitivity continuum.

Benevolents

Equity Sensitives

Entitleds

Note: the equity formulas shown in figure 1 are simple adaptations of Adam's original formula. This figure is specifically adapted from Huseman et al. (1987).

The equity sensitivity construct is related directly to equity theory and suggests that individuals react in consistent but individually different ways to both perceived equity and inequity because they have a different preference for (i.e., are differentially sensitive to) equity (Huseman et al., 1987). Equity sensitivity is distinctive among individual difference variables in that it proposes that an individual has a unique sensitivity to equity that influences perceptions of equity (or inequity) and likewise influences reactions to perceived inequity (King et al., 1993). It has proven to be the natural progression of the original equity theory and has enabled researchers to answer some of the criticisms surrounding the original theory. The potential ability to predict employee responses to certain situations is the driving force justifying the utilization of this model in the current study. The next few paragraphs will discuss the three categories that form equity sensitivity.

ES: Benevolents

Benevolents are individuals who prefer their outcome/input ratios to be less than the outcome/input ratios of the comparison of others. Bing and Burroughs (2001) note that empirical evidence reveals that benevolent individuals are willing to do more work for less pay than those of an entitled disposition (Miles et al., 1989, 1994). For them, satisfaction is a result of perceiving that their inputs exceed their outcomes and that they have made valuable contributions to the relationship (Huseman et al., 1987). While King et al., (1993) have since reconstrued benevolents as individuals "who have a greater tolerance for, but not preference for under-reward" (Sauley and Bedian, 2000). These employees are most likely preferred by employers due to their acceptance or tolerance of under reward in certain situations. Benevolent individuals are predominately preferred by employers due to their higher tolerance of inequity in reward systems. According to Huseman et al., (1987) the conceptual roots of benevolence can be traced to the psychology of individuals originally developed by Alfred Adler (Adler, 1935).

ES: Equity Sensitives

Equity sensitives are individuals who merely want to be equitably rewarded when compared to their peers. These individuals represent the traditional equity theory model, and thus, require little description (Huseman et al., 1987). Equity sensitive individuals fit into the classic equity theory and they will most likely react if they perceive their ratios to be higher or lower than that of others (Wheeler, 2002). These individuals feel "distress" if they are under rewarded and guilt when over rewarded; this is the only group that experiences both of these feelings (Huseman et al., 1987). Patrick and Jackson (1991) conducted a survey that demonstrated equity sensitives were significantly more likely to alter their inputs and their outcomes than Entitleds when they are over compensated (Allen and White, 2002).

ES: Entitleds

Entitleds are the type of employees that are the least preferred by employers. Individually they prefer to have a higher outcome to input ratio than. coworkers.

These individuals usually feel that they have a right to receive a greater reward than their inputs deserve in relation to coworkers (Wheeler, 2002).

However, much like the definition of Benevolents King et al., (1993) reconceptualized entitleds as individuals "who are more focused on the receipt of outcomes than on the contribution of inputs and who are thus intolerant of under-reward, more tolerant of over reward than are either equity sensitives or benevolents" (Sauley and Bedian, 2000).

Summarization of the Equity Sensitivity Construct

The equity sensitivity construct can therefore be viewed as a continuum, with entitleds at one extreme (preferring high ratios of outcomes to input), benevolents at the other extreme (preferring low ratios of outcome to input), and equity sensitives in the middle (Mueller and Clarke, 1998). This continuum is represented in Figure 2.

The current study adopts Huseman et al., (1985, 1987) framework by using the three categories (Benevolents, Equity Sensitives, Entitleds) in order to determine how they fit in the cross-cultural context. Over time, scholars have utilized empirical research evolving these categories into a notable continuum of potentially predictable actions or reactions when certain types of individuals are faced with equitable or inequitable situations in certain types of environments.

Equity Perceptions

Equity perceptions are unique to each individual and the particular reward the individual is offered. Each individual has his or her own perception of what may be considered an equitable reward in any given reward situation (Miles and Day (1993).

King et al., (1993) contend that equity sensitivity is distinctive among individual difference variables with regard to equity theory in that it proposes an individual has a unique sensitivity to equity that influences perceptions of equity and likewise influences reactions to perceived inequity. These individual unique responses to the perception of equity create empirical support for the ongoing need of investigation pertaining to cultural diversity and equitable reward.

Figure 3 is presented to assist in clarifying the perception of equity in a reward situation based upon the individual's equity sensitivity category.

In today's highly competitive labor market, there is extensive evidence that organizations regardless of size, technological advances, market focus and other factors are facing retention challenges (Ramlall, 2004). This reinforces the importantance of ensuring that all employees perceive that they are being equitably rewarded for their contributions to the organization. The consequences of an employee's perception that they are not being treated fairly can create a variety of options for the employee (Champagne, 1989). These options can include decreasing their inputs to that of others, seeking pay increases or seeking alternative employment. Employers invest a large amount of money, time and effort to recruit and retain employees thus it is vitally important to ensure that all employees are satisfied with the reward system within the organization.

Figure 3. Equity perceptions.

Importance of Worker Motivation

Worker motivation is a critical topic of concern for American society due to the ongoing cultural diversification of the domestic workforce (Katzell and Thompson, 1990). Demographic projections for the increased diversity of the American workforce in the 1990's and beyond are also raising the additional problems of matching motivation practices to the needs and values of diverse subgroups of employees (Thompson and DiTomaso, 1988). These problems have lead to an increase in motivational concerns amongst psychologist and behavioral scientist. The primary issue is that every group and organization is an open system that exists in multiple environments (Schein, 1990). An open system is a work environment in which employees are able to freely enter and exit at their own will. These open systems attract various types of employees that are motivated by differing variables.

II. Cultural Factors

Hofstede (2001) defines culture as collective programming of the mind; it manifests itself not only in values, but also in ways that are more superficial; in symbols, heroes, and rituals. Culture perpetuates and reproduces itself through the socialization of new members entering the group (Schein, 1990). Culture is what a group learns over a period of time as that group solves its problems of survival in an external environment and its problems of internal integration (Schein, 1990). Thus, the concept of dimensions of culture is introduced through an inquiry into the philosophical opposition between the specific and the general, the different and the similar. The existing literature about dimensions of culture, both theory based and empirically derived, contain predictions and validations of these dimensions (Hofstede, 2001). These dimensions are important because they provide empirical support for the various decisions made by individuals in similar situations.

Mueller and Clarke (1998) note that U.S. management theories were developed when there was little interest in determining whether such theories applied cross-culturally. There was the assumption that U.S. based behavioral theories were universally applicable; this tendency stemmed in part from the dominant Anglo-American perspective of the research generated in the United States and the lack of cross- cultural empirical studies (Adler, 1989; Boyacigillar and Adler, 1991). Understanding the implications of cultural factors is of growing concern due to the rapidly expanding global economy and the vital role culturally diverse workforces play in today's economy.

A simplifying typology is always dangerous because one many not have the right variables in it, but if one distills from small group theory dimensions that recur in group studies, one can identify a set of major external and internal tasks that all groups face and with which they must learn to cope (Schein, 1990). To meet the needs of the current study three of Hofstede's five cultural dimensions are utilized to explore the relationship between ES and cultural factors in a multicultural workforce. An analysis of culture, cultural factors and the evolution of Hofstede's works are reviewed and an in-depth analysis of three of Hofstede's five dimensions is defined. The three dimensions that are adapted and specifically explained in the following paragraphs are collectivism/individualism, power distance and uncertainty avoidance.

Cultural differences were not considered large enough to override the predictive and explanatory nature of behavioral theories developed within the United States (Chhokar et al., 2001). Today, however, a substantial body of social psychology research on human motivation and performance supports the contention that culture shapes beliefs, values and perceptions and suggests that people of different cultures cannot be expected to exhibit similar behavior patterns or react to stimuli similarly in an organizational context (Mueller and Clarke, 1998). Thus cultural factors are a recognizable variable that influences individuals not only in external appearance but internal motivation and decision-making. Schein (1993) determined that individual are culturally over trained not only to think in terms of certain consensually validated categories but also to withhold information that would in any way threaten the current "social order."

Hofstede's (1980, 1983, 1997) empirical studies of international differences in values have become the major framework in the study of cultural factors in relation to: "different ways to structuring organizations; different motivations of people within organizations; and different issues people face within society" (Wheeler, 2002). Through this analysis

Hofstede (2001) developed five dimensions of culture or cultural values, which are individualism-collectivism, masculinity/femininity, uncertainty avoidance, power distance and more recently long-term vs. short-term orientation. These cultural dimensions at the individual level have received extensive examination in studies concerning a wide variety of work-related variables (Wheeler, 2002). Three of these five dimensions, which are individualism-collectivism, uncertainty avoidance, and power distance, will be utilized to investigate the subject matter.

Individualism-Collectivism

Individualism implies the fulfillment of individual interests, which supersedes any conception of group interests (Chen et al., 1998). Hofstede (2001) notes individualism is reflected in the way people live together for example, in nuclear families, extended families, or tribes. It has many implications for values and behavior. In some cultures, individualism is seen as a blessing and a source of well-being; in others, it is seen as alienating. The value of individualism emphasizes an "I" where everyone takes care of him/herself and immediate family. Individualism emphasizes independence, individual initiative, achievement, the right to private life opinion, and autonomy (Wheeler, 2002).

On the other hand, collectivism represents a society in which people are integrated into strong, cohesive in-groups. These cohesive group continues to protect the individual throughout their lifetime in exchange for unquestioned loyalty (Hofstede, 2001). Collectivism emphasizes a "we" orientation, where people are highly identified with families or clans (Wheeler, 2002).

Power Distance

Mulder (1977) defines power distance as "the degree of inequality in power between a less powerful Individual and a more powerful other, in which the individual and the other belong to the same (loosely or tightly knit) social system." Power distance is the degree to which a culture accepts that there are inequalities between various groups within a culture, social classes, and organizational hierarchy (Hofstede, 1984). Power distance is based upon theory derived from the work of Dutch social psychologist (Mulder, 1976). It is based upon laboratory and field experiments with simple social structures (Hofstede, 2001). According to Hofstede (1980), people in countries high in power distance endorse submissiveness to superiors, prefer superiors who exercise autocratic or paternalistic leadership, and do not expect to participate in decision making (Begley, Lee, Fang, and Li, 2002).

Uncertainty avoidance

Uncertainty avoidance is derived from U.S. organization theorists Richard M. Cyert and James G. March, who use it in their book a Behavioral Theory of the Firm (1963). The fundamental issue is how society deals with the fact that time runs only one way; that is, we are all caught in the reality of past, present and future, and we have to live with uncertainty because the future is unknown (Hofstede, 1983). Hofstede (1984) declares that uncertainty avoidance is a cultures comfort with uncertainty as a part of their daily existence. The people in those cultures that are high on the uncertainty avoidance dimension feel that uncertainty is a threat that is to be fought, tend to have higher levels of anxiety and stress, feel a strong need for consensus, are intolerant of deviant persons and ideas and are concerned with security in life. Individuals in those cultures low in uncertainty avoidance are more accepting of uncertainty and dissent, more willing to take risks, and believe there should be as few rules as possible (Wheeler, 2002).