Antecedents of employee performance: an empirical investigation in India

DOIhttps://doi.org/10.1108/01425451211191887
Pages177-192
Publication Date29 Dec 2011
AuthorSoumendu Biswas,Arup Varma
subjectMatterHR & organizational behaviour
Antecedents of employee
performance: an empirical
investigation in India
Soumendu Biswas
Management Development Institute, Gurgaon, India, and
Arup Varma
Graduate School of Business, Loyola University Chicago, Chicago, Illinois, USA
Abstract
Purpose – The purpose of this paper is to examine the relationship between psychological climate,
and transformational leadership, with employee performance. The paper builds on relevant research in
this area, and extends such research to the Indian context.
Design/methodology/approach Data were gathered from 357 participants in Indian
organizations, who responded to questions regarding their work environment and perceived
supervisory support. The respondents’ demographic data were treated as control variables.
Findings As predicted, it was found that organizational psychological climate, and
transformational leadership, predicted job satisfaction. Job satisfaction, in turn, predicted employee
performance, a composite measure of in-role and extra-role performance.
Research limitations/implications All data were collected from the participants at one point of
time – as such, causality cannot be inferred, and the results may be subject to common method bias.
Practical implications – From a practical perspective, the results emphasize the need for
organizations to create a positive climate, where employees can feel valued. Next, the results suggest
the need for managers to adopt a transformational style of leadership over the transactional style, so
that employees may learn and grow with the organization. Together, these shall result in increased
employee satisfaction which shall ultimately lead to higher levels of employee performance.
Originality/value – While there are numerous theoretical pieces exploring the antecedents of
employees’ performance, the number of empirical studies relating cross-level variables using
structural equation modeling is limited. Moreover, this is the first known study to examine the
variables in the Indian context, which continues to gain importance on the world economic scene.
Keywords Employees attitudes,Employees behavior, Human resourcemanagement, Job satisfaction,
Workplace
Paper type Research paper
Introduction
The increasing global spread of business and the growing prominence of multinational
corporations (MNCs) in emerging economies have brought to fore the need to study
management practices in different social and cultural contexts (Budhwar, 2003; Napier
and Vu, 1998). In this connection, India is one such economy where global changes
have had profound socio-economic influences (Biswas et al., 2006; Budhwar and Boyne,
2004). Not only have these changes affected the Indian socio-cultural milieu, they have
also brought forth significant transformations in managerial policies and philosophies
(Chauhan et al., 2005). Further, these changes have assumed contextual relevance,
especially in light of the resilience exhibited by the Indian economy in the period
following the South East Asian financial crisis of 1997-1998 (World Bank, 2001) which
The current issue and full text archive of this journal is available at
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Antecedents of
employee
performance
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Employee Relations
Vol. 34 No. 2, 2012
pp. 177-192
qEmerald Group Publishing Limited
0142-5455
DOI 10.1108/01425451211191887
catapulted India into the league of the fastest evolving and most stable financial
destinations for investors from the world over (Goldman Sachs, 2003).
In this connection, Zurcher (1968) argued that in view of the growing worldwide
commercial operations, it is necessary to study the behavioral facets of business within
the contextual boundaries of socio-cultural events. As is well-known, India is a country
with a rich heritage of national culture. To a large extent, the socio-economic values
and actions of Indians can be attributed to their long cultural history. Further, these
cultural characteristics are deeply ingrained in the individual mindsets, and markedly
influence their cognitions and affect in their personal, social, and professional
environment (Rao and Abraham, 2003). At the same time, the indigenous culture of
India has readily accepted alien customs and traditions while preserving its unique
cultural norms and legacies (Biswas et al., 2006). This has put the Indian social order as
a classic example in the map of the South East Asian cultural geography. With
reference to the cross-vergent socio-cultural ethos therefore, India stands as a pione er
in establishing norms and recipr ocities that govern managerial pol icies and
procedures, especially in the light of the contemporary boundaryless business
environment (Ralston et al., 1997). In a cross-cultural framework, the preceding
discussion indicates the elevated status of India in the global socio-cultural atlas (see
Budhwar and Varma, 2010).
As such, in order to study criteria such as positive workplace outcomes, we
considered leadership, which has been indicated by literature to be an important
explanatory construct for such criteria. This is because competent leaders ensure that
organizations are healthy by maintaining a satisfied and motivated workforce
(Tordera et al., 2008). In this connection, extant literature indicates that
transformational leadership is a key predictor of work attitudes and behavior
such as, satisfaction, motivation, and performance of an organization’s workforce
(Barling et al., 1996; Behling and McFillen, 1996; Castro et al., 2008; DeGroot et al., 2000;
Dvir et al., 2002). It has been further suggested that attention may be paid to an
understanding of the linkages between transformational leadership and its consequent
attitudinal and behavioral effects (Bass, 1999; Conger, 1999; Kark and Shamir, 2002).
Also, within the framework of the path-goal theory as well as the augmentation
hypothesis, transformational leadership has been recommended as a precursor to
several workplace outcomes (Vecchio et al., 2008).
To continue, it may be noted that previous studies on supervisor behavior found
that two of its dimensions namely, consideration and initiating structure are associated
with the levels of employees’ job satisfaction (Fleishman, 1973; Osborn and Hunt, 1975;
Stogdill, 1974). Taking a cue from the above and, in conjunction with House’s (1996)
interpretation of transformation leadership within the framework of the path-goal
theory, we contend that transformational leadership will be associated with employe es’
level of job satisfaction.
Moreover, according to the action regulation theory, transformational leadersh ip as
an antecedent should not be considered in isolation when studying consequences such
as attitudes and performance. In keeping with the above argument it was found that
psychological climate or , employees’ perceptions a nd interpretations of their
day-to-day workplace environment is a proximal contingent factor that has a similar
impact on workers’ level of satisfaction and performance as transformational
leadership (Tordera et al., 2008).
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