A REVIEW OF ECONOMIC &

SOCIAL DEVELOPMENT

Lead Article on

Trade Union & the

Financial Crisis

György Széll

SRC
SHRI RAM CENTRE
Vol. 46 No. 2 October 2010
FOR IR & HR
 The Indian Journal of Industrial Relations
A Review of Economic & Social Development

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 The Indian Journal of Industrial Relations
A Review of Economic & Social Development

VOLUME 46 NUMBER 2 OCTOBER 2010

Contents

Articles

Trade Union Movement & Labour Policies in the György Széll 183
EU after the Global Financial Crisis

Leverage & Trade Unionism in Indian Industry : Saibal Ghosh 194

An Empirical Note

Reforming Labour Legislation on Working Conditions Tapomoy Deb 201

for Competitive Advantage: An Empirical Study

Trade Unions in Indian IT Industry? An Employees’ Perspective Nidhi Bist 220

Employee Attitudes Towards Employer- Yvan Barel, Sandrine Fremeaux 229

Sponsored Child Care: Evidence from France & Grant Michelson

Role of Neo Five Factor Model of Personality in Archana Tyagi & Veena Bansal 248
Management Education: An Empirical Study

Suitability of Instruction Methodology in Ashutosh Muduli 259

Informative Management Course: An Empirical Study Vinita Kaura

Predictors & Outcomes of Employee Engagement: Jyotsna Bhatnagar 273

Implications for the Resource-based View Perspective Soumendu Biswas

Role, Work Perception & Stress in a Omer Bin Sayeed 287

High Reliability Work Environment Satish Chandra Kumar

Predictors of Occupational Stress: An Exploratory Study Alok Chandra 300

Baldev R. Sharma
 VOLUME 46 NUMBER 2 OCTOBER 2010

Emotional Intelligence & Managerial Effectiveness : Nivedita Srivastava 313

Role of Rational Emotive Behaviour Shreekumar K. Nair

Management Styles, Productivity & Ravindra Jain 328

Adaptability of Human Resources: An Empirical Study R. Premkumar

Timely, Continuous & Credible Communication & Reeta Raina 345

Perceived Organizational Effectiveness

Book Review

Winning In Emerging Markets –A Road Map For K. Ramachandran 360

Strategy And Execution
Tarun Khanna & Krishna G. Palepu

Changes In Labour Institutions In China: Right Steps Nand Dhameja 362

Towards Achievement Of Decent Work
K R Shyam Sundar

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Trade Union Movement & Labour Policies in the EU after
the Global Financial Crisis
György Széll
There are fundamental questions to
ask before we are able to come to
grips in regard to the future of the
European Social Model and the role
of Europe in a globalising world.
Today we are facing a number of
challenges. In September 2009 the
biggest financial and economic
crash since the Black Friday 1929
has shuttered the economic model of
deregulation at any price and the at-
tempt to destroy the welfare state. Ap-
parently we are at a new beginning,
although those who are mainly re-
sponsible for this disaster try to
blame the state. Since many years
there were already a number of
warnings that this neo-liberal eco-
nomic system, which declared war on
the trade unions and workers’ par-
ticipation, is not sustainable – nei-
ther economically or financially nor
socially or environmentally, argues
the paper.
Gyorgy Szell is Professor Emeritus, Department of
Social Sciences, University of Osnabrueck, Germany.
E-mail:gzell@uos.de. This paper was presented at
the International Symposium on Labour Relations
&Labour Rights under the Global Recession, Nov.
6-9, 2009, Guangzhou, People’s Republic of China.
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Pre-remarks
There are a number of fundamen-
tal questions we have to ask ourselves,
before we are able to come to grips in
regard to the future of the European
Social Model. Apparently we also have
to inquire about the role of Europe in a
globalising world. Today we are facing
a number of challenges, which grew
over the last couple of decades, but
have materialized only over the last
couple of months. Just a week before
the opening of the Third Congress of
the European network “Regional and
Local Development of Work and
Labour” the biggest financial and eco-
nomic crash since the Black Friday
1929 has shuttered the economic model
of deregulation at any price and the at-
tempt to destroy the welfare state.
Apparently we are at a new beginning,
hopefully for better, although those who
are mainly responsible for this disaster,
which destroys dozens of millions of
jobs and the economies of a whole gen-
eration, try to blame the state. Actu-
ally, since many years, there were al-
ready a number of warnings that this
neo-liberal economic system, which
183

declared war on the trade unions and
workers’ participation, is not sustainable
– neither economically or financially nor
socially or environmentally. In 1986 the
movie “Wall Street” characterised the
financial system with its elements of cor-
ruption and megalomania quite precisely.
It may be also reminded of another quite
pertinent Canadian movie in the same
year: “The Decline of the American
Empire”. These are all in the highlight of
the Reagan administration and its
Reaganomics. The most successful finan-
cial speculator, George Soros, published in
1998 a book with the significant title “The
Crisis of Global Capitalism. The Open So-
ciety Endangered”, where he warned of the
risks of an uncontrolled financial system. I
published in 1987 an article with a scenario
for 2000, where I forecasted the crisis of
autumn 2008 (English translation: Széll
1990). Apparently I was partly wrong, as
I put the crisis eight years early. How-
ever, most probably – besides the fasci-
nation of a round number – the break-
down of the Soviet system in 1989/1990
gave ultra-liberal market capitalism an-
other few extra years.
The management of the financial
crisis today, however, is more con-
cerned with saving the big compa-
nies instead of taking the occasion
for a fundamental turn-around.
The management of the financial cri-
sis today, however, is more concerned
with saving the big companies instead of
taking the occasion for a fundamental
turn-around. The old recipe is repeated:
privatisation of profits and socialisation
184 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
György Széll
of losses. The former chief-economist of
the World Bank, Nicholas Stern, who
became well known, as he published last
year the first account of the costs of ne-
glecting environmental protection, pub-
lished in December 2008 an article, where
he argued that the crisis is a unique
chance to save the planet.
History
Trying to set the stage for a further
European Social Model, we have first to
look back. As Warren Buffet, the richest
man in the world, said: We can only learn
lessons from the past. So what has
changed in regard to our topic since 1945,
1968, 1989 and 2000? Apparently the dates
are not neutral, and we may take other
options. In 1858, after some failed revolu-
tions in Europe, perhaps the most impor-
tant element was that Prussia entered the
international scene, first unifying and es-
tablishing the Second German Reich, and
then building up huge industry and military.
The second important element is the unifi-
cation and ending of the inner frontiers of
the United States of America about the
same period. The German model to catch
up with the leading economies and imperi-
alist powers – the British and French em-
pires – was a modernisation from the top,
played on two different fronts, expansion
outwards and pacification inwards: the in-
troduction of the Bismarckian welfare state
and the interdiction of the Social-Demo-
cratic Party (SPD). The outcome was ter-
rible, as we all now, two World Wars and
the Holocaust (Wehler).
Fascism and Stalinism were both
based on the passive participation of the
 Trade Union Movement & Labour Policies in the EU after the Global Financial Crisis
masses (Gramsci). Another important
innovation was the system of Fordism,
developed in the USA, combining mass
production and mass consumption, i.e.
participation was reduced to it.
After the Second World War Fordism
spread over to the other industrialised
nations, including Japan. In Germany the
“social market economy” was designed
as a third way between socialism and
capitalism. The biggest political and eco-
nomic experiment in the 20th century was
the creation of the European Union in
1958 with its predecessor the European
Community of Coal and Steel in 1951. It
has been largely successful, although the
realisation of a European Social Union is
still lagging far behind.
In the Third World, some countries
experimented with other forms of
industrialisation and welfare state (China,
India, Cuba, North Korea, Algeria, Tan-
zania – just to name a few), however,
mostly failed. China changed in 1978 to
the so-called “socialist market-economy”
with the destruction of most of its wel-
fare system (Széll, Kamppeter & Moon
2009).
1968 was not only for my generation
a fundamental watershed, but for future
generations as well. It was the starting
point for a large democratisation process.
Until then democracy stopped at the fac-
tory gates. The famous slogan “To dare
more democracy” of the then German
Chancellor and Peace Nobel Prize win-
ner, Willy Brandt, was a marking stone.
The implosion of the Soviet system
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
in 1989/1990 gave way for the integra-
tion of some of its European satellite
states into the EU, for the others a fall
back into more or less authoritarian
structures. The end of history, as de-
clared by Francis Fukuyama in 1992, did
fortunately not take place, although a new
era of deregulation and military conflicts
started, and did not end so far.
At the beginning of the new century,
or the new millennium the fifteen Mil-
lennium Goals by the United Nations, the
Lisbon Agenda for the EU, and the De-
cent Work campaign by the International
Labour Organisation were launched.
There was a slogan of the beginning of
the Pacific Century with the rise of China
in accordance with its past grandeur.
The Questions
Some fundamental questions first,
before we proceed further:
1. Is there one European Social Model?
For sure there are – as already stud-
ies in the 1970s demonstrated – quite
a number of variations (IDE 1981),
due to the differences relating to his-
tory, culture, power etc. However,
some clusters are discernible: Nordic,
Anglo-Saxon, Central European and
Mediterranean – before 1990 there
existed also the Yugoslav one. Al-
though these differences are still quite
marked, we can conclude in compari-
son to the U.S.-American or also the
Japanese model there are some dis-
tinctive features, which make it that
we may speak on the global level of a
European Social Model.
185

2. What kind of participation are we
looking for? Again there are quite
substantial differences. We may dif-
ferentiate between financial partici-
pation, participation in decision-mak-
ing and on different levels, direct or
representative participation, ad hoc
or permanent participation (Kester &
Pinaud 1996).
3. Double participation: Participation
within the company and as a citizen
and/or consumer. These roles may be
contradictory at some times. The task
is to overcome this kind of schizop-
hrenia.
4. What is the role of experts? Partici-
pation in decision-making has be-
come through globalisation and the
differentiation of the workforce so
complex that workers and their rep-
resentatives need special training
and/or advice from experts to come
to grips with decisions about future
investments, off-shoring, environme-
ntal issues, human rights etc. Al-
though it may be still true, what the
former general secretary of the
French CFDT once said: “The
worker is the real expert concerning
his work.”
The Challenges
During a conference “Which Euro-
pean Social Model?”, which was co-
sponsored by the European Foundation
for the Improvement of Living and Work-
ing Conditions, in Aix-en-Provence in
September 2001, I presented a paper on
“Fifteen Challenges for a European So-
cial Model” (Széll 2002a), which is in my
186 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
György Széll
eyes still up-to-date. Let me just pick up
some of the issues:
1. The environment – is still the big-
gest challenge. And since the movie
by the former US-American Vice-
president and Peace Nobel Prize win-
ner, Al Gore, “An Inconvenient
Truth” and the report by his co-Peace
Nobel Prize laureate, the Interna-
tional Panel on Climate Change
(IPCC), there is no doubt that envi-
ronmental protection is the biggest
challenge for humanity. We only have
an opening of another ten years to
fix the challenge (Hennicke 2009).
All empirical studies prove that it is
only with the participation of all con-
cerned that this challenge may be
overcome (Széll 2004a). However,
even after the progress, which has
been made by the European Union
in this regard over the last two years,
and the election of Barrack H.
Obama as President of the U.S.A.
the prospects look rather grim for a
Kyoto II-convention in 2009 in
Copenhagen, not to speak of the on-
going pollution and depletion of the
seas and rivers, the lack of drinking
water, the waste disposal etc.
There is no doubt that environ-
mental protection is the biggest
challenge for humanity.
2. Gender equality is the next big chal-
lenge, not only – as the late Chair-
man Mao Dze Dong put it: “Women
are half of heaven” – but because
without the active participation of
 Trade Union Movement & Labour Policies in the EU after the Global Financial Crisis
women in all realms of life, not at
least in environmental protection,
there will be no social justice, no de-
cent work, no future.
3. All organisations (political, social,
trade unions) are in a deep crisis in
regard to recruiting new members,
especially from the younger genera-
tion. The problem concerns as well
the low qualified and the most highly
qualified strata of society. It seems
that the dominant economic system
with its focus on “sex and shopping”
has resulted in to a large degree of
depolitisation and individualisation,
which has been analysed by Alexis
de Tocqueville already more then
170 years ago.
Quite often they seem to be more
concerned with competing among
themselves than to struggle to-
gether for their common targets.
4. In regard to trade unions they have
certainly partly to blame themselves,
as they still remain largely blue col-
lar, male unions, which are not only
in the EU quite diverse, due to their
historical legacies. Besides, quite of-
ten they seem to be more concerned
with competing among themselves
than to struggle together for their
common targets, if they are politically
or sectorally differently oriented,
which leads to a number of unnec-
essary conflicts and by that to the
weakening of the whole labour
movement. To that adds the lack of
training, competence and quality of
many union officials. And the em-
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
ployers contribute to these difficul-
ties their part as well. For instance,
Peugeot and Siemens, two of the big-
gest companies in the world, financed
until recently “yellow unions”. Defi-
nitely the trade unions have to re-
structure themselves. But big – as the
mergers of the past years show – is
not always beautiful and successful.
The mergers in Germany, resulting in
to the biggest single unions in the
world (IG Metall, ver.di) had as a col-
lateral damage, the formation or
strengthening of smaller unions of a
guild type (pilots, train conductors,
health sector). On the other hand the
European Trade Union Confederation
(ETUC) has made substantial
progress since the enlargement of the
EU. And another very positive de-
velopment is the creation of the uni-
fied International Trade Union Con-
federation (ITUC) in 2006, seven-
teen years after the break-down of
the Soviet Empire. This gives hope
for a new élan. Since then the pres-
ence of the trade union movement on
the international scene has much pro-
gressed.
The weakness of the labour move-
ment is mirrored by the weakness
of the employers’ associations.
5. The weakness of the labour move-
ment is mirrored by the weakness of
the employers’ associations. Quite a
number of companies in the new
economy do not associate them-
selves with employers’ associations,
thinking they can save the fees, and
187

they are better off without binding
collective agreements (Széll, Bösling
& Hartkemeyer 2005).
6. This phenomenon is particularly pro-
nounced within the new EU-Mem-
ber States, where employers’ asso-
ciations in the period of really exist-
ing socialism did not exist. The strat-
egy in these countries is still to make
the pie bigger to share some of the
benefits, instead of going for
sustainability.
7. After the implosion of the Soviet sys-
tem there was much fear of a large
East-West migration. This happened
only partially, as the freedom of
movement was restricted for the first
years after the entry of the new
Member States. Nevertheless migra-
tion is quite an issue as the illegal flux
from non-EU States is still very
strong, and as all EU Member States
face a decrease in population, nota-
bly the active population (Széll
2002b).
8. In regard to participation and the
European Social Model there are
many obstacles to overcome, even
within the EU, as the European So-
cial Union is far from being realised,
i.e. that not only social rights can be
easily transferred. And the full rec-
ognition of diploma, which started
with the Bologna-process ten years
ago, is not yet established every-
where.
9. Social security is still largely a na-
tional affair. One of the reasons of
the negative referenda in France and
The Netherlands in regard to the EU
188 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
György Széll
Constitution Treaty was just the de-
fence of the national social security
systems against liberalisation strate-
gies on the EU-level. This fear seems
to have reasons as for two decades
the neo-liberal strategies focussed on
the destruction of the welfare state.
However, on this concrete point the
refusal of the EU Constitution Treaty
was wrong: It would have brought
more social rights than the Nice-
Treaty. And the famous Plan B by
Jacques Delors – with better social
protection – was a myth. Even now
the problem is who controls the so-
cial security system? The drive for
privatisation was very strong. Espe-
cially the pension funds, which are
already now the biggest institutional
investors, are playing the game on the
international markets – with all the
risks we know now. And the pen-
sion funds of the big US-American
car makers are one of the reasons
of their bankruptcy. The only real al-
ternative to state bureaucratic con-
trol of the social security system is
the social economy, the fastest grow-
ing sector in the world – without the
risks of the dominant sector.
The pension funds of the big US-
American car makers are one of
the reasons of their bankruptcy.
10. That brings us to the concern of
globalisation. Here the main actors
are the WTO, IMF, World Bank, G8
and OECD. The driving force in this
process, the financial sector, is not
regulated at all, as we just noticed in
 Trade Union Movement & Labour Policies in the EU after the Global Financial Crisis
the banking crisis in autumn 2008 and
as George Soros monitored previously.
11. One answer to the unregulated
globalisation is continental regionali-
sation, of which the EU with all its
flaws is still the most successful
model, with its own currency, the
Euro. Mercosur, ASEAN and SARC
are modelled after the EU, and even
in North-East Asia China, Japan and
South Korea try to establish their own
union with its own currency.
12. Although the shareholder dictatorship
has been questioned during the last
couple of months, those who profited
most of it, blame the state for the fail-
ure and not their own business. So,
the European alternative, the stake-
holder democracy, has to struggle hard
to overcome this ideology.
13. One of the means of shareholder dic-
tatorship to increase profits to a
maximum is outsourcing, off-shoring,
and delocalisation. Although this strat-
egy may bring benefit to new EU-
Member States, for the emerging
economies and Third World countries,
the price is rather high, because
outsourcing, off-shoring, and
delocalisation does not only mean
lower salaries, but less social protec-
tion, non-respect of human rights and
the environment. So far participation
in decision making is a pre-condition
for decent work and sustainability
instead of social and environmental
dumping.
14. The results of uncontrolled and un-
regulated globalisation are precari-
sation and dualisation of the work-
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
force. No standard, life-long labour
contracts are practiced any more for
an increasing part of the employees,
mainly the young ones. The “Genera-
tion Praktikum” (generation intern-
ship) in Germany and elsewhere is a
symbol of this trend. Apparently the
precarisation does not only affect the
quality of life and working-life but
also the possibilities of life-long learn-
ing and participation, and with it the
quality of products and services.
The results of uncontrolled and
unregulated globalisation are
precarisation and dualisation of the
workforce.
15. That this process could so easily be
implemented without much resis-
tance by the concerned is certainly
due to the cultural hegemony of the
media industry. That a tycoon like
Silvio Berlusconi came twice to
power, based on his ownership of
large parts of the TV-industry, in a
civilised country like Italy is a scan-
dal. Here the analysis by the US-
American media-sociologist Neil Post-
man with his book “Amusing Our-
selves to Death” from 1984 is more
up-to-date than ever. His thesis that
everything in our societies, even poli-
tics, becomes entertainment is con-
vincing. That does not mean that ev-
erything of new global information
and communication technologies, e.g.
Internet, contributes to this trend. Our
scientific conferences and publica-
tions, the World Social Forum and its
regional and national off-springs
189

would not have been possible with-
out the new media and technologies.
16. Education (general, vocational, uni-
versity training) is in a crisis as well.
Europe – except Scandinavia – is far
from its target to invest 3 % of its
GDP into science and research. In
international comparisons it is lagging
behind even of emerging nations like
South Korea or China. Expenditure
on education and science is in gen-
eral still regarded as costs and not
as an investment into the future.
However, in the OECD countries 40+
% of the generation are today uni-
versity graduates. So not only the
future managers and elites are
trained there, but also a large part of
the workforce. So university training
has to give them the qualification for
participative management and partici-
pation in decision making. But eco-
nomics and business are not taught
in secondary schools – not to speak
of primary schools –, although every-
body will be part of it. An essential
precondition to have a future for a
participative European Social Model
is that teachers and university faculty
have these competencies and are
unionised themselves. There is still in
most countries a long way to go, as –
when they are unionised – it is mostly
in kind of professional, guild-like as-
sociations with rather conservative
ideologies.
Conclusions
The world has not only changed in
regard to the topics mentioned in the para
190 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
György Széll
above on the challenges, but also con-
cerning the structure of the economy.
The Lisbon agenda speaks of a knowl-
edge-based society. The biggest eco-
nomic sectors in the world today are ag-
riculture, IT, health care, entertainment,
tourism – which are at the same time the
weakest in regard to unionisation.
Performance is certainly the issue of
today, but also quality. And quality of life
and working life are actually the most
important targets, as the economy is not
an end in itself. (Széll & Széll 2009). To
reach a sustainable company, economy
and society, which are the targets of the
Rio and Lisbon agendas, environmental
Kaizen is an important tool (Széll 2004a).
To realize them we need a kind of socio-
cultural revolution. Part of it is Corpo-
rate Social Responsibility, which includes
the environment as well (Széll 2006).
The State, which has been re-
garded as ineffective and hence
dismantled during this period, has
become again the only institution,
into which citizens and consumers
have trust.
A fundamental element of this socio-
cultural revolution is trust. Trust is the
basis of all human society and relations,
although it has been largely lost during
the last couple of decades of casino capi-
talism, as also the crash of the last
couple of months proves. The State,
which has been regarded as ineffective
and hence dismantled during this period,
has become again the only institution,
into which citizens and consumers have
 Trade Union Movement & Labour Policies in the EU after the Global Financial Crisis
trust. The civil society, which has been
destroyed as well, being replaced by
crude individualism, is the other institu-
tion, on which the reconstruction of the
economy and society at large has to be
based on.
In the last years benchmarking and
best practice have become tools to mod-
ernize the economy and business. But
as we know against Taylorism there is
no one best way. The optimal solution
depends on the socio-historical context
of each institution. The Open method
of co-ordination within the EU is a flex-
ible answer to this. The target of ad-
aptation to or overcoming the chal-
lenges has to be a win-win situation,
where there are collateral benefits in-
stead of damages.
“Think globally, act locally!” was the
slogan in the 1970s and 1980s. That is
truer than ever today. And our inter-
national network, Regional and Local
Development of Work and Labour in
its tenth year of existence, is a modest
answer.
Keynesianism was already an an-
swer to this widespread market
failure.
The old dream – from hetero- via co-
to self-management – is on the agenda
again. There is empirical evidence to
prove since long that participative com-
panies and those with social responsibili-
ties perform much better than the oth-
ers. (Garibaldo & Telljohann 2004). So
the question stands: why are these prin-
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
ciples not applied everywhere, if the
power of market and the homo
oeconomicus prevail? Again recent eco-
nomic research – honoured by diverse
Nobel prizes – as well as the recent de-
velopments in the world economy dem-
onstrate that the economy is far from be-
ing as logical as the main stream neo-clas-
sical textbooks pretend. Keynesianism
was already an answer to this widespread
market failure.
The economy is far from being as
logical as the main stream neo-clas-
sical textbooks pretend.
The obstacles are ideological, and
are ignorance, i.e. cognitive dissonance.
It is power relations within business and
the economy, which prevail and are
termed by the German author Günter
Ortmann (1995) as micro-politics. There
the role of academia comes in for train-
ing and research. Human resources
management, change management, qual-
ity management, and environmental man-
agement are already partial answers in
this process of enlightenment. Fortu-
nately there are a number of companies
and institutions, which are run by an en-
lightened management and driven by en-
lightened economic, political, social and
cultural actors. It is a dialectical pro-
cess. As Karl Marx described it 160
years ago: “In the womb of the old so-
ciety the new one is born”. History may
proceed as the procession in the town
of Echternach in Luxemburg: two steps
forward, one step back. Hopefully we
are now at the moment of two steps
forward, and the European Social Model
is part of it.
191

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193

Leverage & Trade Unionism in Indian Industry :
An Empirical Note
Saibal Ghosh
Market power in the hands of a
supplier such as a labor union affects
an industry’s capital structure. Using
panel data techniques for 1992-2004,
this note shows that industries indeed
appear to employ financial leverage
strategically to influence collective
bargaining decisions. The estimates
imply that strategic incentives from
input markets have a substantial
impact on financing decisions.
Saibal Ghosh is presently on lien from the Reserve
Bank of India. E-mail: sai_ghosh@ hotmail.com.
The views expressed are personal
194 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Saibal Ghosh
Introduction
The product market and input market
effects of capital structure link the
financial and real activities of a firm. A
significant body of theoretical literature
relates financial structure to market
conduct and postulates strategic use of
leverage by firms (Dasgupta & Sengupta
1993, Campello 2003, Cavanaugh &
Garen 2004). Notwithstanding the
advancements in the theoretical literature,
empirical evidence on this aspect is far
less convincing. The present note
addresses this gap in the literature by
demonstrating that strategic incentives
from input markets have an impact on
financing decisions.
Existing evidence on the link between
collective bargaining and capital structure
determination relies on cross-sectional
comparisons that may be affected by omitted
variable bias. Bronars and Deere (1991), for
instance, show that unionization rates are
correlated with financial leverage at the
industry level. This sort of analysis, however,
fails to take cognizance of the strategic
increases in debt from the more
‘mechanical’ balance sheet effects.
 Leverage & Trade Unionism in Indian Industry : An Empirical Note
We identify the strategic effect
empirically using profitability across
industries which reflects differences in the
specific product markets in which industries
compete. When labour and management
bargain, a union can claim a portion of the
firm’s excess liquidity – its operating cash
flow- net of any required debt payments.
Collective bargaining, therefore, imposes a
greater threat to a firm when a firm
maintains higher levels of excess liquidity.
With limited liability and positive debt
balance, greater underlying profit is one
factor that increases expected excess
liquidity and a firm’s susceptibility to union
rent seeking. Greater profitability of
potential projects implies that the firm must,
on average, maintain greater excess
liquidity in order to fund the same marginal
project. Profitable firms are thus more
vulnerable to union rent seeking and
therefore, have greater incentive to use debt
to shield liquidity from workers in
bargaining. Consequently, evidence of the
strategic effect can be found by analyzing
the interaction between union bargaining
power and firm profitability.
The remainder of the paper
proceeds as follows. The empirical model
is presented in the subsequent section,
along with the data base employed for the
purpose. This is followed by a discussion
of the results. The final section concludes.
Collective bargaining, therefore,
imposes a greater threat to a firm
when a firm maintains higher levels
of excess liquidity.
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Empirical Strategy
The degree of union bargaining power
in negotiations with a given industry is likely
to increase with the proportion of
employees covered by the bargaining
process. In industries with greater
coverage, union-organized job actions are
likely to be more costly, and as a result,
industry-wide policies are more likely to be
affected by bargaining. We use industry-
level data on bargaining as a proxy for union
bargaining power and estimate its effect
on the firm’s choice of capital structure.
In industries with greater coverage,
union-organized job actions are
likely to be more costly, and as a
result, industry-wide policies are
more likely to be affected by
bargaining.
The empirical equation for industry j at
time t can be specified as follows :
Debtj,t= I j+a2*Coverage+a3 *Profit+a4
(Coverage*Profit)+ C *{Control
variables)+zj,t (1)
where (ignoring subscripts) Debt is
the debt profile of the industry which is
modeled as a function of the proportion of
employees covered by bargaining
(Coverage), industry profits (Profit) and
the interaction of Coverage and Profit, a
set of control variables [Controls] and two-
digit NIC industry fixed effects, I . Finally,
z denotes the error term.
As regards the dependent variable,
we employ both the level of debt as well
195

as its composition. Accordingly, we
estimate alternate specifications where the
dependent variable is defined in terms of
both the level of debt (such as total debt
and total bank debt) as well as its
composition (defined in terms of the debt
equity ratio and the proportion of bank debt
to total debt).1
Among the independent variables,
following from the literature (Bhattacharjee
& Datta Chaudhuri 1994), Coverage is
measured as the number of employees
registered as trade union members divided
by total number of employees. The
profitability variable, Profit is measured as
the ratio of operating profits to total assets.
It is demeaned (with respect to the sample
mean) before it is interacted with
Coverage to allow for a more meaningful
interpretation of the interaction term. The
financial controls are those typically
included in leverage regressions,
specifically, the proportion of tangible assets
(proxy for informational asymmetry), log
sales (proxy for firm size) and modified
Altman-Z score (proxy for probability of
bankruptcy). Finally, the industry-specific
fixed effects capture the effect of omitted
variables specific to the concerned industry.
For identification purpose, the dummy
variable for electricity industry (NIC code
40) is omitted, so that the coefficients on
the other industry dummies measure the
response relative to this omitted category.
Table 1 presents the details of the definitions
and source of the concerned variables along
with their summary statistics.
1. We employ bank debt since evidence suggests
that bank debt is the preponderant form of
debt employed by firms (Ghosh 2007)
196 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Saibal Ghosh
The analysis covers 16 industries for
the period 1992-2004, the latest period for
which data on the relevant variables is
available on a consistent basis. Towards
this end, we matched the data from
Prowess with those obtained from the
Annual Survey of Industries (ASI). As it
stands, the ASI data are reported at the 2-
digit NIC classification code. The CMIE
data, on the other hand, is firm-level data.
The two data sets were made compatible
using the following method: the ASI data,
which are reported in 2-digit NIC codes,
were aggregated into 16 industries.2 The
ASI format was then used to assign general
classification to the CMIE-listed firms. In
this fashion, we arrived at consistent 2-digit
level classifications by suitably integrating
the CMIE data with the ASI data.
The Results
The results emanating from the
analysis are presented in Table 2. As
evident, the interaction term of Coverage
and Profit is positive and statistically
significant at the 0.01 level. Thus, the
interaction provides a margin for detecting
strategic response to bargaining. To interpret
the magnitude of this effect, consider two
industries – one with profitability one per
cent more than the other. An increase in
2. These include: NIC 20-21 (food products), 22
(beverages), 23 (cotton), 24 (wool, silk and
man-made fiber), 25 (jute), 26 (textiles,
including wearing apparel), 27 (wood), 28
(paper), 29 (leather), 30 (basic chemicals), 31
(rubber, plastic, petroleum and coal), 32 (non-
metallic minerals), 33-34 (basic metals and
metal products), 35-36 (machinery and
equipment), 38 (other manufacturing) and 40
(electricity).
 Leverage & Trade Unionism in Indian Industry : An Empirical Note

Table 1: Variable definitions and summary statistics

Variable Definition (Data source) Mean Std. Devn.
Debt Logarithm of total borrowings (Prowess) 3.633 0.756
Bank debt Logarithm of bank borrowings (Prowess) 7.146 1.604
Leverage Bank borrowings / total borrowings (Prowess) 0.335 0.137
Debt equity ratio Total borrowings/(equity plus reserves) (Prowess) 1.344 1.427
Altman Z 3.3 (PBIT/total asset)+1.0 (Sales/total asset)+1.4
(retained profit/total asset)+1.2 (working capital/total
asset) (Prowess) 2.980 4.172
log sales logarithm of total sales (Prowess) 3.962 0.730
Tangible land and building plus plant and machinery/total
asset (Prowess) 0.467 0.122
Inventories total value of inventories/sales (Prowess) 1.983 4.057
Raw materials total value of raw materials/sales (Prowess) 0.768 1.701
Fin. Goods total value of finished goods/sales (Prowess) 0.499 1.016
Coverage number of employees registered as union members/total
number of employees (Indian Labor Yearbook) 0.227 0.199

the industry’s union coverage by 10 management will likely consider labor

percentage points is associated with around
67 basis point greater increase in overall
debt for the more exposed firm.
Profitable industries are more
susceptible to union capture,
especially if they exhibit greater
union coverage, impelling these
industries to increase overall debt.
A key feature of industry’s debt policy
is that it is generally set unilaterally, without
consent of the labour (Baldwin 1983).
Management fixes the capital structure
(typically at the firm level), subject to capital
market constraints. When a union has
market power but cannot commit to future
negotiating positions (Grout 1983),
market ramifications in choosing its debt
policy. Judged from this standpoint, the
present results seems to suggest that
profitable industries are more susceptible
to union capture, especially if they exhibit
greater union coverage, impelling these
industries to increase overall debt.
Among the control variables, the
coefficient on Altman-Z is negative, since
higher probability of bankruptcy leads firms
to lower their debt profile. Bigger firms
assume higher debt, as expected from
theory. The fit of the model is quite high,
as evidenced from the high value of R-
square across all models.
In the second model, we employ
logarithm of bank debt as the
explanatory variable. In this case, the

The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 197
 Saibal Ghosh

Table 2: Leverage and Trade Unionism - Baseline Regressions

Variable Debt Bank debt Debt equity ratio Leverage
Model I Model II Model III Model IV

Constant 0.594 -1.523 18.726 -0.286

(0.189)*** (0.578)*** (2.406)*** (0.126)**

Coverage 0.0002 -0.0002 0.0009 -0.0002

(0.0005) (0.001) (0.006) (0.0003)

Coverage*Profit 0.067 0.070 -0.417 -0.031

(0.019)*** (0.061) (0.242)* (0.013)

Profit -0.019 -0.012 0.065 0.009

(0.003)*** (0.011) (0.049) (0.002)

Controls

Altman Z -0.009 -0.021 -0.032 -0.0006

(0.004)** (0.012)* (0.053) (0.003)

Log (sales) 0.916 2.344 -3.371 0.102

(0.045)*** (0.137)*** (0.568)*** (0.029)

Tangible -0.129 -0.325 -3.151 -0.094

(0.155) (0.473) (1.968)* (0.103)

Industry dummies included included included included

Number of industries 16 16 16 16

Time period 1992-2004 1992-2004 1992-2004 1992-2004

R-square 0.993 0.986 0.682 0.846

Prob > chi-sqaure 0.000 0.000 0.000 0.000

(p-Value)

Clustered standard errors within parentheses

***, ** and * indicate statistical significance at 1, 5 and 10%, respectively.

coefficient on the interaction term is not The response of industries to higher

statistically significant, which suggests
that profitable industries do not alter
their bank debt in response to higher
union militancy. Combining Models I and
II, it seems that the response of
industries to higher unionism is to raise
their debt profile, primarily by altering
their non-bank debt.
unionism is to raise their debt
profile, primarily by altering their
non-bank debt.
The third and fourth models explore
the composition of debt as opposed to the
level of debt. With debt-equity ratio is the
dependent variable (Model III), the

198 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
 Leverage & Trade Unionism in Indian Industry : An Empirical Note
coefficient on the interaction term is
negative and on the borderline of
significance, which suggests that the
response of profitable industries to lower
union militancy is to raise their debt equity
ratio.
The final specification focuses on
the composition of bank debt. In this
case, the coefficient on the interaction
term Coverage*Profit is not significant,
corroborating the results obtained in
Model II.
Ultimately, much of workers’
bargaining power is derived from credible
threats to withhold labor services. To
mitigate these threats, firms may
strategically maintain costly ‘buffer’
inventories, which increases the cost of a
strike borne by workers relative to those
borne by the firm. Compared to materials
and goods in earlier stages of the production
process, inventories of finished goods
provide the most effective insurance and
deterrence against employee job actions.
Theoretical analysis seems to suggest that,
in anticipation of a strike threat, firms often
over-employ in an earlier period so as to
build up an inventory that can be employed
Table 3: Unionisation and inventory policy
Variable Inventories
Model I
Coverage 0.009 (0.006)
Coverage*Profit 0.280 (0.141)*
Profit -0.042 (0.049)
Industry dummies Included
R-square 0.961
Clustered standard errors within parentheses
***, ** and * indicate statistical significance at 1, 5 and 10%, respectively.
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
in order to offset the revenue loss during
the strike period (Clark 1991). Subsequent
work by Coles and Smith (1998) shows that
access to strategic stock by the firm in the
process of union-firm bargaining depresses
the negotiated wage.
Industries appear to have been
using inventories of finished goods
strategically in conjunction with
bargaining negotiations.
Analyses of the inventory hypotheses,
presented in Table 3, seems to suggest that
industries appear to have been using
inventories of finished goods strategically
in conjunction with bargaining negoti-ations.
As expected, the effect appears to be
driven most by a build-up of finished goods
inventories (Model III), although raw
materials seems to exert limited influence
on firm’s inventory policy. Although these
results are persuasive, corroboratory
evidence from the labor law analysis would
be ideal. Unfortunately, disaggregated data
drilling down inventories by stage-of-
production is not readily available for the
period of analysis and evidence based on
total inventories are only indicative.
Raw materials Finished goods
Model II Model III
0.002 (0.005) 0.001 (0.002)
0.145 (0.186) 0.150 (0.083)*
-0.034 (0.037) -0.028 (0.016)*
Included Included
0.877 0.931
199

Concluding Remarks
The bargaining process led indus-
tries to adopt a capital structure that
made them more vulnerable to cash
flow shocks.
Anecdotal evidence suggests that the
capital structure of relatively unionized
firms seems to be significantly different
from those which are relatively less
unionized. A natural question to ask is what
role does unionization plays in this regard.
Since unionization data is not available at
the firm-level, we employ industry-level
unionization information to explore this
hypothesis. Based on our analysis, the
evidence suggests that the bargaining
process led industries to adopt a capital
structure that made them more vulnerable
to cash flow shocks. As a supplier with
market power, a union can demand a share
of the industry’s liquidity, which the industry
maintains primarily to insure against
negative shocks. To reduce the impact of
collective bargaining on profits, the industry
has the incentive to undertake costly
actions that reduce its expropriable
liquidity. Consequently, the bargaining
solutions emanating from the process can
yield outcomes that are not Pareto-
optimal.
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58: 155-85
200 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Saibal Ghosh
Bhattacharjee, D.& T.D.Chaudhuri (1994),
“Unions, Wages and Labour Markets in
Indian industry: 1960-86”, Journal of
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vation of Shareholder Wealth,” Quarterly
Journal of Economics, 106, 231-54
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Product Market Interactions: Evidence from
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Unionization and the Firm’s Use of Debt”,
Managerial and Decision Economics, 18:
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Employment and Wages”, Economic Journal,
101: 630-41
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with Firm Inventories”, Journal of Economic
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(2002), Annual Survey of Industries, Mumbai.
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Reforming Labour Legislation on Working Conditions for
Competitive Advantage: An Empirical Study
Tapomoy Deb
Sixty years have passed since In-
dia gained its independence, but
it is still a large agrarian economy
with 3/5th of workforce employed
in agriculture and produces
about 1/4 th of gross domestic
product (GDP). Since the liber-
alization of Indian economy, the
reform in respect of labour has
been the slowest. Labour legisla-
tion on working conditions needs
to be equitable, more responsive
and more inclusive and which fa-
cilitates in making Indian firms
more competitive. The challenge
is of combining greater flexibil-
ity with the need to maximize se-
curity for all particularly labour,
argues the author.
Tapomoy Deb is Deputy General Manager (Human
Resources) in JK Lakshmi Cement Ltd. 4, Bahadur
Shah Zafar Marg, New Delhi110002. E-Mail:
drtdeb@gmail.com
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Globaliztion &Competitiveness
Globalization has facilitated the inte-
gration of world economy thereby mak-
ing geographical boundaries only of po-
litical relevance. Globalization is consid-
ered to be a major force behind liberal-
ization and privatization of hitherto closed
or somewhat closed economies primarily
in the developing world. Since it is the
firms and not nations that compete in the
market the onus of gaining and sustain-
ing competitiveness lies on the firms. The
increased competition has forced firms
to reduce their operating costs in order
to reduce price of their products and ser-
vices. Thus, it has become imperative for
firms to control their costs especially at
present time due to global meltdown fu-
elled by economic slowdown. Under such
a compelling business scenario, Indian
firms are looking at ways for cutting
down their costs especially the labour
cost. This is because labour cost consti-
tutes a major component of operating and
consequently product costs of firms.
Competitiveness is a complex term
which requires firms, government and
201

mechanisms to be readjusted and reori-
ented for ensuring long-term success. At
the micro level, the labour reform seeks
to improve working conditions of the
workforce on one hand and frees employ-
ers from the shackle of cumbersome and
archaic legal system on the other. The
trade unions should act as facilitators and
play the role of a resource person to bring
about greater awareness amongst
workforce about the working condition
regulations, motivate and guide workers
towards greater cooperation for improv-
ing the productivity and competitiveness
of the firm so that all its stakeholders in-
cluding the employees, management, sup-
pliers, customers and society can be ben-
efited. At the macro level, reform of the
working condition regulations seeks to
bring the key stakeholders of the firm, that
is, workers, trade unions and management
closer and move towards the path of suc-
cess across the different sectors of the
industry. This will result in creation and/
or development of a business-conducive
environment in the country with win–win
approach. The creation of a business-con-
ducive environment will help in attracting
more and more foreign direct investment
(FDI) necessary for spearheading socio-
economic development of the country.
Commentators may argue that such a
scenario is too idealistic and cannot be
realized in practice given the past experi-
ences. It may be argued that the very
object of working condition regulations or
as a matter of fact any other labour legis-
lation is a piece of social welfare mea-
sure. If the laws are not serving its in-
tended purpose either to business or to
labour, then its existence is questionable
or debatable. India has to make its legal
202 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Tapomoy Deb
environment such as working condition
regulations growth inducing so that em-
ployers, workers, and the society gains.
Since it is the firms and not nations
that compete in the market the
onus of gaining and sustaining
competitiveness lies on the firms.
Over the past one decade there has
been increasing globalization of Indian
economy, which has necessitated increas-
ing the competitiveness of Indian indus-
try through human resources in general
and workers in particular. There has been
an increasing demand from the industry
for reform in labour legislation in order
to increase efficiency, effectiveness,
competitiveness and productivity of In-
dian workers so as to face the onslaught
of global competition, especially from
China. In general, the Indian labour leg-
islations are partly archaic and have out-
lived their utility in a globalizing world.
However, reforming labour legislation is
a very touchy issue and there are con-
flicting interest groups involved, which
has resulted in lack of initiative of the
government to make necessary amend-
ments. Much has been talked but little
seems to have been done.
The Indian labour legislations are
partly archaic and have outlived
their utility in a globalizing world.
Review of Literature
Literature survey indicates that there
is a widespread concern at the present
 Reforming Labour Legislation on Working Conditions for Competitive Advantage
level of effectiveness of labour legisla-
tion on working conditions in view of glo-
bal business competitiveness. Peru-
Pirotte (1996) observed that labour leg-
islation is quickly evolving in order to take
into account the impacts of technologies
on working conditions and on human re-
sources within firms. Traditional law, pro-
tecting the worker, is modernized in or-
der to be more pre-occupied by today’s
employer’s requirements and constraints
concerning the hiring, redundancy, work-
ing hour ’s management and wage
earner’s status. Pierre and Scarpetta
(2006) drawing from harmonized surveys
of firms around the world compared
employer’s responses with actual labour
legislation and found that employer’s con-
cerns about labour regulations are closely
related to the relative stringency of labour
laws. Medium and large firms, as well
as innovating firms, were those most
negatively affected by onerous labour
regulations. In the Indian context, re-
search conducted by Upadhyaya (2003)
in Garment & Hosiery industry of Noida
points out that although The Factories Act,
1948 makes very elaborate and unam-
biguous provisions regarding the minimum
welfare (also health and safety) stan-
dards to be followed, but laying down the
standards alone is not enough. It is also
to be ensured that these provisions are
actually implemented. He found that fa-
cilities for first aid, washing, canteen,
refreshment/tea, annual holidays, and in-
tervals of rest were satisfactory; ambu-
lance and lunch room facility were found
to be inadequate in terms of implemen-
tation, provisions relating to welfare of-
ficer and storing and drying clothing were
not found to be implemented even in a
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
The problems of working conditions
pertain to long working hours,
forced overtime without remune-
ration, inadequate breaks, high
work pressures and lack of work-life
balance.
single unit covered under the study, none
of the selected units had any provision
for appointment on compassionate
ground, majority of the respondents were
working for more than 9 hours a day (av-
erage 10 hours of working per day). In-
terestingly, no child labour was employed.
A research made by Ramesh Babu
(2004) in Business Process Outsourcing
(BPO) industry found that the continued
stress and strain at work lead to circum-
stances where the women workers can-
not carry on due to atypical timings of
work especially that of shift work.
Noronha and d’Cruz (2008) found that
75% of the call centre employees joining
union can be attributed to improving pay
and conditions, followed by information/
advice about employee rights (67%) and
believe in trade unions (38%). 65% of
the call centre/BPO employees cited
working times as being very important in
prompting to join a trade union. Two-
thirds of respondents reported that they
were either ‘very’ or ‘quite pressurized’
as a result of their work on a normal day.
87% of these respondents cited ‘having
to meet targets’ as the greatest source
of work pressure. 51% reported of hav-
ing not enough breaks while 48% of the
respondents found hardly enough time to
take care of family/personal matters.
Thus, the problems of working conditions
pertain to long working hours, forced
203

overtime without remuneration, inad-
equate breaks, high work pressures and
lack of work-life balance.
Bhavani and Bhanumurthy (2007) in
their study observed that the economic
policy reforms of 1991 were expected to
instil competitive forces in the Indian in-
dustry. They emphasized that it is essen-
tial to revamp complex and comprehen-
sive labour legislation to further compe-
tition. Papola and Pais (2007) resonates
the same sentiments when they argue that
reforming labour laws has become nec-
essary to make Indian industry effi-
cient, cost effective and internationally
competitive in the face of globalization.
Sahu (2008) says that besides rational-
ization of labour laws, emphasis must be
given on the improvement of labour ad-
ministrative machinery.
However, Gill (1999) took the tradi-
tional view and observed that trade union-
ism is influenced by growth of capital-
ism with its own specificities, the media-
tion of the state and initiatives by the
trade union movement. The author fur-
ther argues that at the moment trade
unions are not displaying capacity to meet
the challenge of attempt to review labour
legislation, therefore bold and new initia-
tives are needed to enable them to play
their historical role to build just and hu-
mane society for working people. How-
ever, Lucio Baccaro (2008) concluded in
his study that there has been a consider-
able decline in unionization over the past
two decades. Union density declined in
almost all the 51 countries considered in
the study. The decline was dramatic in
Central and Eastern European countries,
204 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Tapomoy Deb
where levels had initially been very high.
Advocate Kumar (2009) observes
that “it is true that existing labour laws in
India cannot be changed or removed by
a fiat as it could be easily done in China
but the fact lies that unless the laws are
changed drastically, it would not be pos-
sible to obtain desired results. Continu-
ing to ‘protect’ a small aristocracy of in-
dustrial labour means hurting the pros-
pects of prosperity for the mass of India’s
labour. It is time to repeal this imperial
legacy.” Thus, reforming labour legisla-
tion on working conditions is imperative
for us in order to meet the demands of
modern industrializing society. Pradhan
(2005) observed that creating an environ-
ment that reduces the cost of doing busi-
ness can help attract FDI into India. He
argues that creating a legal environment
that is conducive to entrepreneurship and
growth is vital.
The Factories Act, 1948 and The
Delhi Shops and Establishment
Act, 1954 make very elaborate and
unambiguous provisions regarding
the minimum standards of safety,
health and welfare to be followed
by the organizations.
The reasons for concern on working
condition regulations are as varied as the
stakeholders are. Different stakeholders
like workers, both blue collar and white
collar, trade unions, employer’s associa-
tions and officials of labour department
have different perceptions on working
condition regulations and hence have dif-
ferent object of reforming the same. The
 Reforming Labour Legislation on Working Conditions for Competitive Advantage
concept of working conditions is flexible
and elastic and differs widely with times,
regions, industry, country, social values and
customs, the degree of industrialization,
general socio–economic development of
people and political ideologies prevailing
at a particular moment. The Factories Act,
1948 and The Delhi Shops and Establish-
ment Act, 1954 make very elaborate and
unambiguous provisions regarding the mini-
mum standards of safety, health and wel-
fare to be followed by the organizations.
However, laying down the standards
alone is not enough, as it is to be imple-
mented in letter and spirit. Furthermore,
with passage of time, drastic changes in
technology, general economic and busi-
ness environment has taken place. The
present study was conducted to ascer-
tain how far the provisions of Factories
Act, 1948 and The Delhi Shops and Es-
tablishment Act, 1954 have been
achieved. It also examines the scope for
reforming the legislations in order to meet
the standards of working conditions re-
quired in any civilized society from the
perspectives of factory workers, call cen-
tre agents and trade unions and identify-
ing opportunities for giving impetus to
competitiveness of business organization
by making the legislations less cumber-
some, business oriented and less prone
to labour politics, from the perspectives
of business associations and government.
Objectives of the Study
The purpose of the present study is
to describe, analyze, understand and
draw inferences on the need for reform-
ing labour legislation on working condi-
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
tions for competitive advantage. More
specifically, the study aims to achieve the
following objectives:
• To study and review various legal pro-
visions relating to working conditions
in Factories and Shops/Establish-
ments.
• To examine the current trends in
labour jurisprudence in India.
• Assessing the impact of LPG (Lib-
eralization, Privatization and Global-
ization) on legal perspectives of busi-
ness organizations in enhancing com-
petitive advantage.
• To suggest appropriate reforms in
labour legislations relating to work-
ing conditions in contemporary busi-
ness environment.
Research Methodology
This study looks into the perceptions
of workers, call centre agents, trade unions,
business/employer’s associations, and
labour department of government of NCT
of Delhi. The perspectives of workers and
call centre agents revolve around nine es-
sential constructs viz. working posture,
nature of industry, hours of work, safety
measures, accident prevention measures,
safety culture, safety training and partici-
pation, worker’s perception on statutory
inspections, and workers perception on re-
forming working condition regulations. The
perspectives of trade unions and business
associations revolve around the present
state of working conditions, role of labour
legislation in ensuring appropriate working
conditions for the workers, role of inspec-
205

tors in improving the working conditions,
frequency and manner of inspections, per-
ceived role of statutory inspectors as re-
source person for the industry as a whole
in terms of building awareness, training,
providing guidance and suggestions for
improving working conditions, misuse of
statutory power by inspectors in collusion
with employers affecting productivity, role
of government in working conditions, hours
of work, flexi-work system, need for sepa-
rate labour legislation on working condition
for small, medium and large sectors, par-
ticipative decision making on working con-
ditions, perception on working condition
regulations as impediment to attaining com-
petitive advantage by firms, and finally the
issue of reforming working conditions regu-
lations to make it more contemporary need
based, business and growth oriented and
competition friendly. Finally, the perception
of the labour department (factory inspec-
torate and shops and establishments inspec-
torate) on present level of compliance of
working condition regulations, effective-
ness of inspections in ensuring adequate
working conditions, measures to educate
workers / agents on working condition
regulations, emergent areas of emerging or
newer risks at workplace to be addressed
through legislation, and opinion on reform-
ing working condition regulations.
Given above mentioned dimensions, the
views of trade unions, employer’s associa-
tions, government and practitioners through
secondary sources were examined before
finalizing the research questions. The study
relied upon primary data and is collected
through questionnaire, interview guide, dis-
cussions and observations. Purposive ran-
dom sampling was employed. For the sur-
206 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Tapomoy Deb
vey method, the sample size was 338 re-
spondents, consisting of 291 workers of 13
different factories in pharmaceutical, tex-
tiles, beverages, refrigeration and air-con-
ditioning, consumer, confectionary, auto-
components and engineering products, 82
call centre agents from a leading Call Centre
company, 5 office bearers of five national
federation of trade unions, 25 state-level
trade unions, 1 national-level call centre
employees union, 11 business associations,
4 personnel of Factory Inspectorate and
1 personnel of Shop & Establishment In-
spectorate of Government of NCT of
Delhi. SPSS software using statistical tools
like mean, standard deviation, t-test, co-
efficient of correlation, and chi-square test
were utilized.
Findings
Workers in a new economy industry
like pharmaceutical group have better per-
ception than those in non-pharmaceutical
group on various dimensions of working
condition viz. safety measures availability,
accident prevention measures, safety cul-
ture, safety training and participation, health
measures available and perception on work-
ing condition regulations and inspections as
compared to traditional industry. However,
increased work pressure leads to unsafe
work practices amongst workers and not
call centre agents. Workers and call cen-
tre agents appreciate the vitality of regular
inspection but for different reasons. Work-
ers of pharmaceutical group holds that in-
spection is helpful in identifying workplace
hazards (value-additive) while workers of
non-pharmaceutical group and call centre
agents find inspections routine (non value-
additive) ( Tables 1- 4).
 Reforming Labour Legislation on Working Conditions for Competitive Advantage

Table 1: Comparison of Working Conditions between Two Groups of Companies

(Pharmaceutical & Non-Pharmaceutical)

S. No. Dimensions Pharmaceutical Non- t-Value

(N=129) Pharmaceutical
(N=80)
Mean SD Mean SD
1 Hours of Work 3.59 1.19 2.10 1.46 8.07**
2 Safety Measures Available 4.39 0.34 4.30 0.60 1.27**
3 Accident Prevention 3.91 0.59 3.79 0.55 1.51**
Measures
4 Safety Culture 4.22 0.33 4.10 0.35 2.46**
5 Safety Training & 4.40 0.25 4.16 0.50 4.57**
Participation
6 Health Measures Available 4.38 0.56 3.68 0.55 8.82**
7 Perception on Working 4.32 0.33 3.97 0.54 5.73**
Condition Regulations &
Inspections
** Significant at 0.01 level

Table 2: Distribution by Company on Vitality of Regular Inspections

Description Pharmaceutical Non-Pharmaceutical Total

  N = 129 N = 80 N = 209
Identify hazards in the workplace 92 17 109
  {71.3} {21.3} {52.5}
Keep the organization looking good 18 52 70
  {14.0} {65.0} {33.5}
Aid communication 19 11 30
  {14.7} {13.8} {14.4}
Chi-Square Value = 62.18, significant at 0.01 level
Note: Figures in brackets are in percentages
Both trade unions and business as- However, half of the respondent employ-
sociations perceive that working condi- ers favour flexi-work system also. Trade
tion regulations have been partially suc- unions want more statutory inspections
cessful in protecting the interest of work- to be carried out and educating workers
ers, trade unions and management. Trade about their legal rights is necessary while
unions perceive deterioration in working business associations want a complete
conditions while business association per- change in the character of working con-
ceive improvement in working conditions dition regulations keeping in view latest
since liberalization, privatization and glo- developments in technology, flexibility
balization of Indian economy in 1991. and dynamic scenario of competitiveness.
Both trade unions and business associa- Trade unions hold that corruption and
tions do not favour flexi-work system. bureaucracy amongst statutory inspec-

The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 207
 Tapomoy Deb

Table 3: Mean & Standard Deviation of Dimensions by Type of Company with Respect to Perception
of Workers on Reforming Working Regulations
S. No. Perception Dimension Pharmaceutical Non-Pharmaceutical  t-Value
(N=129) (N=80)
    Mean SD Mean SD
1 The implementation of 4.15 0.88 3.79 0.63 3.20 (NS)
legislation is satisfactory
2 Legislation kept pace with 4.34 0.76 3.54 0.78 7.39**
changing needs of working class
3 Statutory inspectors facilitate 4.37 0.67 4.25 0.99 1.06 (NS)
in effective implementation of
safety measures
4 Satisfied with quality of 4.20 0.86 4.41 0.79 1.78 (NS)
implementation of welfare schemes
5 Statutory inspectors cause dislocation 4.20 0.99 3.24 0.95 6.94**
of work as & when they visit us
** Significant at 0.01 level
NS = Not Significant

Table 4 : Relationship (Coefficient of Correlation) Among Various Dimensions of Working

Conditions (N = 82)
  Dimension Dimension Dimension Dimension Dimension Dimension Dimension
1 2 3 4 5 6 7
Dimension 1 1.0000 0.1757 0.3012 0.2949 0.0070 0.0406 0.1238
Dimension 2 0.1757 1.0000 0.6300 0.5959 0.7130 0.6151 0.5923
Dimension 3 0.3012 0.6300 1.0000 0.5489 0.5632 0.5507 0.4011
Dimension 4 0.2949 0.5959 0.5489 1.0000 0.5689 0.5100 0.6875
Dimension 5 0.0070 0.7130 0.5632 0.5691 1.0000 0.6646 0.5779
Dimension 6 0.0406 0.6151 0.5507 0.5100 0.6646 1.0000 0.3753
Dimension 7 0.1238 0.5923 0.4011 0.6875 0.5779 0.3753 1.0000
Dimension 1 Hours of Work
Dimension 2 Safety Measures Available
Dimension 3 Accident Prevention Measures
Dimension 4 Safety Culture
Dimension 5 Safety Training and Participation
Dimension 6 Health Measures Available
Dimension 7 Perceptions on Working Conditions Regulations & Inspections

tors are impediments to effective imple- amongst workers to be the impediment.

mentation of working condition regula- While surprisingly trade unions are satis-
tions whereas business associations per- fied with present level of emphasis on
ceive lack of awareness of legal rights working conditions business association’s

208 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
 Reforming Labour Legislation on Working Conditions for Competitive Advantage
Both trade unions and business
associations do not favour flexi-
work system.
finds lack of government emphasis on
working condition. Trade unions perceive
that the reason of lower number of court/
adjudication cases on working condition
is due to the fact that all stakeholders are
satisfied with working conditions. On the
other hand, business associations find lack
of proper understanding of the signifi-
cance of working condition amongst all
stakeholders to be reason behind lower
number of court/adjudication cases.
Labour department argues that most
of the employers in organized sectors are
complying with working conditions pro-
visions stipulated in The Factories Act,
1948. However, employers in unorga-
nized sectors, constituting small firms,
have failed to comply with health, safety
and welfare provisions provided in the
said act.
Employers in unorganized sectors,
constituting small firms, have
failed to comply with health, safety
and welfare provisions provided in
the said act.
Labour department states that cus-
tomers of the firms play a pivotal role in
ensuring compliance and improving work-
ing conditions. This is because increas-
ingly buyers/customers want production
of goods by workers working in adequate
working condition and with a legally com-
pliant note. Now-a-days inspector’s at-
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
titude has changed from ‘prosecution’ to
‘education’. The inspectorate strongly
advocates for deletion of minimum stipu-
lation of 10 workers working in any pre-
mises or precincts thereof to be a con-
sidered as a factory in pursuance of sec-
tion 2 (m) of the Factories Act, 1948.
Vibration is still not recognized as a health
hazard under the Factories Act, 1948.
Therefore, legislation must provide for
provisions governing vibration treating it
as a health hazard and integral part of
working conditions. The number of fac-
tory inspectors is much lesser than the
number of factories (1: 615 for organized
sector). The inspectorate pointed out that
the trade unions seldom make complaints
on working conditions to the inspectorate.
This results in indifference to working
condition regulations. The inspectorate
suggests that The American Model on
OSH can be emulated by us. Once a fac-
tory is found to comply with the provi-
sions of the act at the time of granting
factory license, then as an incentive to
the employers, immunity from further
checking by factory inspectors can be
granted. This will seek to motivate em-
ployers to maintain and improve working
conditions of their own.
The American Model on OSH
can be emulated by us.
The shops and establishment inspec-
torate contends that lack of registration
has adversely affected the effective
implementation of the Delhi Shops and
Establishments Act of 1954. As on date,
the inspectorate is not undertaking any
suo-motto inspections. Inspections are
generally undertaken as a result of com-
209

plaints received from employees of shops
and commercial establishments. The in-
spectorate is of the view that given ram-
pant unemployment especially in current
economic recession scenario, effective
implementation of the act is difficult given
that supply of manpower far exceeds its
demand. Provision for mitigating risks to
employee’s health on account of stress
should be expressly provided for in the
said act. Further, in order to ensure bet-
ter compliance by employers, deterrent
punishment of fine of Rs. 25, 000/- should
be provided for against the present mea-
gre fine of Rs. 250.
Both trade unions and business as-
sociations favour reforming working con-
ditions regulations to make it more con-
temporary need based, business and
growth oriented and competition friendly.
The Factory Inspectorate strongly be-
lieves that The Factories Act, 1948 is not
an impediment in attaining or sustaining
competitive advantage by firms. The
Factories Act exists in developed coun-
tries like USA and UK, but nowhere is it
an impediment to competitive advantage
of the firms. The inspectorate contends
that Delhi Shops and Establishments Act,
1954 is not an impediments to attaining
or sustaining competitiveness by the
firms. They argue that the recent eco-
nomic downturn of American economy
indicates that competitiveness of firms
cannot be unregulated or unrestricted
otherwise frauds and malicious failures
will continue to trouble corporate world
and national economy as well.
Many commentators argue that the
enforcement of the labour legislation in
210 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Tapomoy Deb
India is a bigger problem in the present
judicial system. Unfortunately, the legal
and judicial system has been unable to
keep pace with the needs of a growing
population of workers and the increasing
complexities of the industrial sector. In
Bharat Forge Ltd. Vs. Uttam Manohar
Nakate (1985), Supreme Court of India,
2005, the Supreme Court’s final judgment
was based on the interpretation of laws
that have not changed. The judicial sys-
tem could have arrived at this common
sense at any stage of the proceedings
(after all, the facts of the case were not
really in dispute, Nakate always accepted
the fact that he was sleeping). There-
fore, one should not be impressed by the
fact that the judicial system eventually
got the judgment right. Furthermore, as
per the latest available estimates, pend-
ing cases number 28 million, and are
growing at the rate of 8% a year, imply
an additional of more than 2 million pend-
ing cases a year.
Many commentators argue that the
enforcement of the labour legisla-
tion in India is a bigger problem in
the present judicial system.
Recommendations
For Workers and Call Centre
Agents: Workers should in so far as pos-
sible work in sitting position. Working in
standing position creates discomfort and
leads to a poor perception of working
conditions and related regulations. Work-
ers should not resort to unsafe work prac-
tices lest accident and even death could
result. They should not be overwhelmed
 Reforming Labour Legislation on Working Conditions for Competitive Advantage
by work pressure and should obey all
safety and health instructions of their
superiors and as documented in manuals
in their own interest. Management should
ensure that excessive work pressures are
avoided and if it is inevitable then adequate
training and close monitoring should be
resorted to. Although both legally and
morally employers are responsible for the
safety of the workers at workplace, work-
ers must consider themselves most impor-
tant for ensuring their very own safety.
Unless they are conscious about self-
safety, even the best safety measures
such as personal protective equipments
can only help to a limited extent.
Workers understand their crucial
role in improving competitiveness of
their firms and at the same time empha-
size the motivational aspect of working
conditions. Their needs, aspirations and
requirements must be fulfilled by appro-
priately reforming working condition
regulations. Unless their needs, aspira-
tions and requirements are met, the in-
tended purpose of working condition
regulations is hardly being fulfilled.
For Trade Unions: Trade unions should
work towards improving working conditions
and compliance of working condition regu-
lations in tandem with both employers and
inspectorate in a spirit of trust and collabo-
ration. This will help to reduce or eliminate
the employer’s tendency to collude with
corrupt inspectors and help in betterment of
the working conditions for the workers. This
will also pave the way for attitudinal change
from one being focused on employment re-
lations arising from workplace to the condi-
tions of the workplace itself.
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Trade unions should improve the
frequency and closeness of their in-
teractions with workers to stay abreast
with the needs, aspirations and reali-
ties of worker’s perceptions and prob-
lems in respect of working conditions.
This is especially important because
while workers and employers find
present status of working conditions
to be satisfactory but trade unions
feels otherwise. This calls for more
intense partnership between trade
union leaders and workers for who
they profess to be advocating for ad-
equate working conditions. Otherwise,
they will be alienated amongst the
working population and soon will find
no place for them. Trade unions also
need to come out of the shackles of
historic mindset which believes that
employers are the adversaries of the
working class.
Trade unions also need to come
out of the shackles of historic
mindset which believes that em-
ployers are the adversaries of the
working class.
In this globally competitive era, they
need to shift from ‘conflict’ to ‘coopera-
tion’ framework in letter and spirit. Then
only they will continue to justify their role
and will be important for both the work-
ers and the employers. Trade unions must
strive to understand the business com-
plexities, technology and changing pat-
terns of organization and should interpret
competitiveness of the firms in that per-
spective. Merely pointing accusing fin-
gers at the employers will neither help
211

anybody nor further the cause of the
firm. Their role should be to assist man-
agement in identifying and overcoming
challenges in global business environment
and render a helping hand to improve
worker productivity, which is the step-
ping stone of firm level competitiveness.
Rather than looking up to government
for help in improving working conditions,
they should themselves embark upon vari-
ous educational and training programmes
for building awareness of rights, duties and
liabilities amongst the workers in relation
to working condition regulations. Relying
too much upon a third party like govern-
ment will only increase their vulnerability
to political manoeuvring. They should build
pressures on employers through process of
mutual dialogue and a demanding
workforce which is committed to produc-
tivity and adequate working conditions.
Trade unions must recognize the signifi-
cance of working conditions and must
spread it amongst workers and government
agencies. They must press upon strength-
ening of those provisions of working con-
dition regulations that help in realizing bet-
ter working conditions and elimination of
those provisions which fails to serve the
purpose of none or still worse impede com-
petitiveness of the firms. Developing and
nurturing cooperation, collaboration and
trust with employers will help them to
achieve both better working conditions as
well as competitiveness of the firm which
is essential for survival of all stakehold-
ers.
Relying too much upon a third
party like government will only in-
crease their vulnerability to politi-
cal manoeuvring.
212 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Tapomoy Deb
For Business/Business Associa-
tions: Business associations should now
come out of the traditional mould of dis-
trust and conflict which has been ruling
the roost of employer-trade union rela-
tionship for long. They should now forge
partnership with trade unions and work-
ers for improving productivity and com-
petitiveness of workforce and eventually
their firms. Changes in legislative provi-
sions in terms of reforming working con-
dition regulations would undoubtedly pro-
vide them relief from archaic and restric-
tive provisions but without trust, collabo-
ration and mutuality the objectives of the
firm cannot be achieved successfully.
Today firm’s success depends upon the
commitment and capability of its
workforce and therefore collaboration
and cooperation will go a long way in
improving individual and firm perfor-
mance. This would also reduce their de-
pendence on third party like government
and its numerous bureaucratic agencies
that they often complain against.
Although business associations
accept that there is wide-spread corruption
amongst statutory inspectorates what they
need to understand is that unless they stop
bribing inspectors for escaping legal
provisions with impunity, this problem will
continue to haunt especially the honest and
upright employers in the future also.
Employers should themselves implement
the legally stipulated measures of safety,
health and welfare and refuse to bribe
corrupt inspectors.
Employers often have the means and
measures to ensure that their workers
have access and full knowledge of vari-
 Reforming Labour Legislation on Working Conditions for Competitive Advantage
ous rights, duties and obligations under
working condition regulations. This will
reduce dependence of workers on third
parties such government and/or trade
unions. Since business associations ap-
preciate that there is a lack of proper
emphasis on working conditions, they
should themselves provide for means and
measures of accommodating workers
participation and involvement in decisions
related to working conditions. This will
probably come when they treat workers
as equally important partner and have a
non-adverse attitude towards them, es-
pecially the trade unions. Such a gesture
on the part of the employers will build
trust and aid strategic imperatives of
the firm due to enhanced level of com-
mitment and ownership amongst the
workers. Additionally, these should be
forthcoming as regards initiating and
implementing safety, health and wel-
fare measures are concerned quite vol-
untarily. Business associations should
themselves act as a regulatory body for
their members so that employers are
persuaded to improve working condi-
tions in their respective firms. They
may also constitute a neutral audit team
to inspect and suggest means and mea-
sures of improvement at the workplace.
They should ensure that member em-
ployers upload status of compliance of
working condition regulations in the
website voluntarily.
Business associations should
themselves act as a regulatory body
for their members so that employers
are persuaded to improve working
conditions in their respective firms.
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
For Government: Government is
one of the most crucial actors of work-
ing condition regulations both as the law
maker and the law enforcer. Both the
employers and trade unions rely upon its
support to achieve their respective but
often contradictory goals. This makes the
job of government even tougher as bal-
ancing the two traditional adversaries is
quite difficult. However, we make the
following recommendations for the gov-
ernment.
• Government must invest in concerted
media and other publicity mecha-
nisms in a planned, systematic and
continuous manner to ensure that
due awareness on working conditions
is being built which will help work-
ers as well as employers to know
their respective rights and obligations
under The Factories Act, 1948 and
The Delhi Shops and Establishment
Act, 1954.
• The position of Certifying Surgeon
must be dispensed with immediately
and a pool of Medical Officers should
be engaged on full time basis for ren-
dering a host of medical assistance
and services to the workers em-
ployed in factories, shops and other
commercial establishment. A tie-up
with Employees State Insurance
Corporation’s dispensaries and hos-
pitals can provide the doctor’s pool
as enumerated above at a marginal
cost to the government.
• The labour enforcement machinery
is grossly inadequate to cope with the
multitude of labour laws and the vari-
ous establishments that require sur-
213

veillance. The enforcement strategy
will be to reduce the burden on the
existing machinery and to encourage
employers and other stakeholders like
trade unions to proactively participate
in the implementation of this strategy
on a voluntary compliance basis. For
this purpose, stipulation of worker
strength should be reduced suitably (say
200) to ensure appointment of welfare
(or safety officer) in almost all the fac-
tories and they should be designated
as “Resident Factory Inspector”.
These resident factory inspectors
should upload compliance status of
working condition regulations in their
firm’s website on voluntary basis.
These resident factory inspectors
should upload compliance status of
working condition regulations in
their firm’s website on voluntary
basis.
• In this global business era, govern-
ment must foresee its role as facili-
tators and enablers rather than inter-
ventionist. This will help government
and its various agencies to focus on
areas important for improving work-
ing conditions rather than being
bogged down with in-fighting be-
tween employers and trade unions.
This will also help the government to
give proper focus on working condi-
tion regulations also rather than
merely concerned with industrial re-
lations only.
• Multiplicity of forms/returns to be
done away with and combined re-
turns to be introduced. Both trade
214 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Tapomoy Deb
unions and business associations
agree that multiplicity forms is at best
a drag on time, efforts and resources
of a firm which can be better utilized
into productive activities. Often these
forms are not even properly scruti-
nized but simply dumped into record
rooms as a matter of record.
• It is recommended that a firm found
complying with working condition
regulations at the time of grant of li-
cense or subsequently for three years
should be granted immunity from fur-
ther inspections. Different authori-
ties, employers and trade unions can
coordinate to arrive at an inspection
schedule that is mutually convenient.
This will help in increasing account-
ability of trade unions also in addi-
tion to employers in matters of work-
ing conditions and prevent illegal
gratifications of corrupt statutory in-
spectors. All deficiencies and short-
comings must be noted on the inspec-
tion book clearly in a positive envi-
ronment, rather than the practice of
informing later, with due signatures
of management and trade union rep-
resentatives along with the con-
cerned inspectors. Trade unions can
then pursue with employer for the re-
quired improvement duly assisted by
the inspector, as needed.
• The inspectors must be trained so that
they act as resource person for the
industry as a whole and make edu-
cational efforts for improving knowl-
edge about statutory provisions
amongst both workers and employ-
ers. The training and guidance to in-
spectors is necessary so as to do
 Reforming Labour Legislation on Working Conditions for Competitive Advantage
away with the punitive or rent seek-
ing behaviours.
• Central Factory Rules must be for-
mulated by the central government
in order to bring uniformity and sim-
plicity in procedure, process and
documentation. This is crucial as
now-a-days many multinational as
well as domestic firms are setting-
up their factories in more than one
state.
• Government must setup training cen-
tres on occupational safety and
health at every district and such cen-
tres should provide a wide spectrum
of training, retraining and refresher
training to workers, trade unions,
employers and inspecting staff on
various issues, aspects, problems and
new developments in respect of
working conditions. Attending train-
ing programmes at the centres should
be made compulsory by instituting
suitable provision in The Factories
Act, 1948 and The Delhi Shops and
Establishment Act, 1954.
Engagement of women in night
shifts should be allowed in all the
industries subject to satisfactory
safeguards.
• Engagement of women in night shifts
should be allowed in all the industries
subject to satisfactory safeguards.
Requirement of all ‘prior approvals’
should be done away with. This will
help in employment of ever increas-
ing women workforce who is both
career-oriented and capable.
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
• In the case of organizations having
ISO/TS 16949/GMP etc. certifica-
tions, inspections could be done once
in three years, thus placing reliance
on self-certification. Since most of the
quality certifications consider
working conditions before certifying,
therefore reliance upon such
international or national certifications
can be made.
• Registration of shops and establish-
ments must be revived and made
compulsory at the earliest. The proc-
edure for making and obtaining reg-
istration must be simple and online.
Similarly, the application for and grant
of factory license including renew-
als thereof should be online.
• Adequate number of qualified and
separate inspecting staff under The
Delhi Shops and Establishment Act,
1954 must be created so as to en-
sure effective implementation of the
working conditions in shops and com-
mercial establishments. Further, the
inspectorate must be headed by a full
time and independent Chief Inspec-
tor of Shops and Establishment in
order to bring desired improvements
in enforcement.
• Punishment and fine as a deterrent
under The Delhi Shops and Estab-
lishment Act, 1954 must be enhanced
to a reasonable level on the pattern
of The Factories Act, 1948.
For Law Making Bodies: The law
making bodies assume paramount impor-
tance not because of their law making
ability but their role in balancing the
215

needs and expectations of various stake-
holders of the working condition regula-
tions viz. workers, call centre agents,
trade unions, business association and the
inspectorates of the government. This is
definitely a challenging task given balanc-
ing equity with efficiency.
Our law makers must look beyond
the “income-employment” security
paradigm which seems to have
made employment or terms of em-
ployment more important than the
conditions of employment.
Our law makers must look beyond
the “income–employment” security para-
digm which seems to have made employ-
ment or terms of employment more im-
portant than the conditions of employ-
ment. Working conditions, where em-
ployees spend 80% of their waking life,
cannot be less important than wages and
other benefits. It is in this context, that
reforming working condition regulations
assumes paramount importance.
Some of the crucial recommenda-
tions for law making bodies in respect of
working condition regulations are as fol-
lows:
• The Factories Act, 1948 must be
amended to remove obsolete and
dysfunctional provisions which serve
purpose of none of the stakeholders.
Also, all ILO conventions on safety,
health and welfare must be incorpo-
rated in the amended acts. Further,
working condition regulations must
be very simple and easy to under-
216 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Tapomoy Deb
stand and implement which meets the
required and desirable aspects of
safety, health and welfare needs of
a modern India.
• Section 2 (m) of The Factories Act,
1948 must be amended to remove
stipulation of 10 workers as a quali-
fying ground for consideration of a
premise or precincts therefore as a
factory. This will help to extend the
benefits of the law to unorganized
sectors of the industry.
• Appellate mechanism and complaints
on corruption against inspecting staff
must be incorporated in The Facto-
ries Act, 1948. This will act as a de-
terrent to corrupt inspectors.
• Vibration and stress must be recog-
nized as health and safety hazard and
accordingly provisions must be in-
serted in the working condition regu-
lations of the Factories Act, 1948 and
the Delhi Shops and Establishment
Act, 1954. Also, more elaborate
safety provisions must be inserted in
the Delhi Shops and Establishment
Act, 1954.
• Training and education on provi-
sions pertaining to working condi-
tions must be compulsorily provided
to the workers by the management
and earmarking of managerial per-
sonnel who are directly responsible
for safety, health and welfare of the
workers and call centre agents
must be made and given refresher
training.
• Workers working in hazardous pro-
cesses must be rotated periodically
 Reforming Labour Legislation on Working Conditions for Competitive Advantage
(say every 6 months) to prevent or
minimize occurrences of occupational
diseases.
Audit of working conditions must
be laid down in the statute book
which shall be conducted by a re-
puted and independent body hav-
ing specialized knowledge of a par-
ticular industry and well aware of
safety, health and welfare aspects.
• Like other professions, certifications
by the government for being quali-
fied to look after safety, health and
welfare can also be made in the
same pattern as that of ‘Energy Au-
ditors’ (Bureau of Energy Efficiency,
under Ministry of Power).
• Provisions on working conditions for
benefit of call centre employees
must be provided for in the Informa-
tion Technology Act of 2000.
• The working condition regulations
must contain a provision that it needs
to be completely reviewed after ev-
ery 10 years. This will help in keep-
ing the labour legislation on working
conditions both relevant and upto
date. Review should be made on the
basis of survey carried out by a spe-
cial commission being headed by
“Safety and Health Commissioner”
taking field data from different types
and kinds of factories and establish-
ment and incorporating reasonable
suggestions of trade unions, business
associations and inspectorates.
The impact of customer’s require-
ments on compliances of working condi-
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
tion regulation on the actual condition and
improvement initiatives by the employ-
ers can also be studied. This may high-
light whether business has greater impact
than legal stipulations on maintaining or
improving adequate working conditions in
factories, shops and commercial estab-
lishments.
Conclusions
All the stakeholders of working con-
dition regulations viz. workers, call cen-
tre agents, trade unions and business as-
sociations are in favour of reforming
labour legislation on working condition but
for varying reasons. Workers and call
centre agents want better safety, health
and welfare measures that can take care
of their contemporary needs and aspira-
tions. Trade unions want to make the
working condition regulations even
stricter while business association want
to rationalize them for improving com-
petitiveness of their firms. This implies
that it is essentially a struggle between
equity and efficiency. Trade unions per-
ceive deterioration in working conditions
and therefore want that labour legisla-
tion on working condition to be strength-
ened whereas business associations per-
ceive an improvement in working condi-
tions and therefore want it’s rationaliza-
tion for making it competition friendly.
Liberalization, privatization and globaliza-
tion of Indian economy since 1991 has
focused only on industry thereby making
to suddenly face global competition while
still keeping the workforce under tradi-
tional over protective working condition
regulations which has created a disequi-
librium in the economic system. From the
217

empirical evidence, workers (both fac-
tory workers and call centre agents) are
satisfied with working conditions. There-
fore, it is a challenging proposition for the
government and law making bodies to
strike a balance between equity and ef-
ficiency. They need to reform or ratio-
nalize the labour legislation on working
conditions in such a way that interest of
workers and employers as a class on one
hand and business enterprise and com-
petition on the other hand are balanced
to the maximum extent.
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Trade Unions in Indian IT Industry? An Employees’
Perspective
Nidhi Bist
The importance of trade unions in
India descended because of
negativities associated with them;
but off late their activities are again
gaining momentum not only in
manufacturing industries but also
in service industries. IT industry is
one of the high growth service in-
dustries in India, which has con-
tributed significantly to the upsurge
in the Indian economy and has cre-
ated a huge base of white-collar
occupa-tions. The industry known
for its knowledge workers is dis-
tinct in comparison to other indus-
tries with no organized union ac-
tivities. This paper attempts to un-
derstand the perspective of IT pro-
fessionals towards unionization by
exploring the responses given by
these professionals for organized
trade unions in the industry. The
paper also investigates the role
trade unions can play in collective
bargaining for these knowledge
workers in the contemporary con-
text.
Nidhi S Bisht is Asst. Professor (HR) in Institute of
Marketing Management, New Delhi. E-mail :
nidhisbisht@gmail.com
220 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Nidhi S Bisht
IT Industry &Trade Unions
Indian IT industry has carved a niche
for itself in the international arena with
its global offshore delivery model and
competent workforce. Many of the
labour laws applicable to the industry
have been simplified in the name of re-
quirement for growth and development
of the industry and employers are now
playing with these simplified laws by tak-
ing advantage of the existing loop holes.
Employees thus have an array of un-
settled demands due to which have
warmed up to the idea of trade unions in
recent years. However, there has been
a reverberating voice of employers and
associations against the formation of
trade unions in the IT industry.
The industry directly employs more
than 2.3 million employees and as the in-
dustry will expand the employees’ base
will continue to increase further at a high
rate. With such vast employee base the
possibility of organized trade unions
should be given a serious thought since
right to association is guaranteed by the
Constitution of India. The right to asso-
ciation, right to collective bargaining; in-
 Trade Unions in Indian IT Industry? An Employees’ Perspective
cluding the right to strike also constitute
the core conventions of the International
Labour Organisation (ILO) of which In-
dia is a founder member. Welfare of em-
ployees can not be overlooked for an in-
dustry which has had an unparalleled im-
pact in the growth and development. In
the long run the repugnance to the em-
ployee demands and international labour
standards can be serious trouble for In-
dian IT industry.
In the long run the repugnance to
the employee demands and inter-
national labour standards can be
serious trouble for Indian IT in-
dustry.
Theoretical Background
Trade unions represent association
of employees for the purpose of secur-
ing improvements in pay, benefits, work-
ing conditions etc through collective bar-
gaining. The Trade Unions Act (1926)
defines a trade union “as any combina-
tion, whether temporary or permanent,
formed primarily for the purpose of
regulating the relations between work-
men and employers or between work-
men and workmen or for imposing re-
strictive conditions on the conduct of any
trade or business and includes any fed-
erations of two or more Trade Unions”.
The Trade Union Act which is a central
legislation administered by the state gov-
ernments, is applicable to all industries
in India including the IT industry. Trade
Union Amendments Act (2001) although
restrains the multiplicity of trade unions
there are no provisions of barring IT in-
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
dustry or any other industry from for-
mation of trade unions.
But why do we need trade unions in
IT industry? The ILO governing body dis-
cussed fundamental rights at work with
trade union formation activities as prima
facie in their agenda (as quoted in the press
release by ILO on 29th March’10). Whether
trade unions are there or not, employees
respond to the inherent alienation of work
by resistance (Joseph 2010). The main
motive of the trade unions is to put for-
ward ideas across the management and
get those converted into well-structured
plans through negotiations (Sinha 2007)
and it is understandable and will be good
for the industry to operate on a level play-
ing field with other Indian industries
(Subramanyam 2005). There can not be
any industry which can quash trade union
formation activities and show disrespect
to the labour laws. Centre of Indian Trade
Unions (CITU) has forwarded various
complaints from employees in this sector
to the Labour Ministry for taking suitable
action (Rajan 2006).
There can not be any industry
which can quash trade union for-
mation activities and show disre-
spect to the labour laws.
When a union is recognized, a pro-
found change is created in the relation-
ship between the white collar staff and
their employer leading to transition from
an “individualistic” to a more “collective”
relationship (Marsh & Pedler 1993). It
is actually through collective bargaining
that individuals stand to gain much more
221

than they would gain, if left to themselves
(Tapomoy Deb 2009). ILO made an ob-
servation way back, in the year 2003
that the group dynamism in the IT indus-
try in India may force establishment of a
trade union movement in the near future
(Devanathan 2009). Although there are
formal associations, there is an absence
of ideology in the present era of
liberalisation, globalization and privatization
and therefore Indian trade unions are los-
ing sympathy from various quarters
(Jagannathan & Roy 2009). Key policy
actors in the external and internal envi-
ronment (contextual and individual), have
been instrumental in the failure of the
unionization effort in the beginning
(Shantanu Sarkar 2008). However trends
are also showing lesser number of trade
unions functioning in the industry across
the world in the form of decline in the
number of overall unions and the growth
of lesser number of ‘Super Unions’ (Start
et al. 2010). Today trade unionism is
showing a new trend of associations with
international interaction showcasing a
new mechanism, as cross border trade
union mergers. Trade unions are defend-
ing their members by opting for multi-lat-
eral link-ups via Global Trade Union Fed-
erations to counter balance the economic
strength of multi-nationals in a globalized
economy (Gennard 2008).
The annual survey conducted by The
International Trade Union Confederation
(ITUC) for the year 2009 shows that the
employees are facing glitches in organiz-
ing trade unions and the Indian govern-
ment is maintaining strong restrictions on
the right of employees to strike. The re-
port has also put forward clauses of The
222 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Nidhi S Bisht
Essential Services Maintenance Act
(ESMA) which enables the government
to ban strikes in public enterprises and
demand conciliation or arbitration in cer-
tain “essential” industries; without speci-
fying what these essential industries are.
Such policies pose a question mark over
the intentions of Indian government to-
wards employee welfare.
Conceptual Framework Relating to
Trade Unions in IT Industry
In the past discerning IT profession-
als in India have been putting in efforts
for trade union formation in cities like
Bangalore and Hyderabad and Kolkata.
One of these early initiatives is the Union
for Information Technology & Enabled
Services (UNITES) head quartered in
Bangalore. UNITES is a part of global
union UNI, which is a global union for skills
and services having 1.2 million workers
worldwide. The union strives to create a
distinct and cogent link between employ-
ers & employees at all levels. Following
the foot steps, another unionized body ‘The
IT Professional’s Forum’ is made under
the aegis of UNI with dual objectives of
better working conditions and studying
impact of social change and technology.
Similarly West Bengal Information Tech-
nology Services Association is set up un-
der the patronage of CITU to safeguard
welfare of all employees in the IT & ITES
service sector, West Bengal.
In the existing landscape many of the
professionals in Indian IT industry feel the
need of organized trade unions and sce-
nario hints that there will be a progressive
increase in such activities in other IT hubs
 Trade Unions in Indian IT Industry? An Employees’ Perspective
like Chennai, Delhi and Mumbai. So it’s
obviously relevant that there should be ap-
propriateness of union policies for the cat-
egory of employees whose unions are com-
peting for membership on an unprec-
edented scale (Bowen et al.1993).
Though there is a burgeoning demand
for unionisation from the employees of this
sector in India, the voice is subsided by the
employers and different employer associa-
tions. These initiatives relating to regional
unions have been controversially debated in
the fraternity with no unanimous accep-
tance. Any of these employees’ associations
have not been endorsed by NASSCOM
which is an apex regulatory body for IT in-
dustry. Kiran Karnik, former president of
NASSCOM, pointed out that union forma-
tion will not succeed in IT industry as it does
not make sense in thinking about unions
when workers are not exploited and have
access to management to redress their griev-
ances. However the stark reality is not
aliened with the remarks made the former
NASSCOM president. To contradict the
statement made by NASSCOM that the
employees of the IT/ITES sector did not
want trade unions, practicing profession-
als in the industry were surveyed to seek
their opinion about trade unions.
Research Methodology
Both descriptive and analytical types
of research designs have been used for
the study. The descriptive research has
been used to describe the state of affairs
existing at present and to discover opin-
ion of the employees about trade unions.
Analytical research design has been used
to analyze the existing facts from the data
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
collected for the research work. Employ-
ees working in the industry were asked
via mail that if the presence of organized
trade unions in the industry would pro-
vide employees a better bargain about
work- related issues. In the close ended
question, dichotomous scale was used to
take responses from the professionals.
The Dichotomous Thinking about pref-
erence of trade unions in the software
industry has been used to assess the cog-
nitive thinking style. The close ended
question was further branched as an open
ended question, where employees were
asked to substantiate their opinion about
preference for trade unions. With a view
to taking insights from male and female
employees for existence of organized
trade unions in the industry hypotheses
were formed which were tested with chi
square test (SPSS14.0 version).
The sample includes employees work-
ing in Tier 1 and Tier 2 companies. The
tiered classification of the companies has
been adopted on the basis of the annual
revenue of the companies. Tier 1 Software
companies are those having annual rev-
enue of more than Rs.10,000 crores and
Tier 2 Software companies are those hav-
ing annual revenue between Rs.10,000
crores- 450 crores and 800 professionally
qualified male and female employees
working in the industry in the age group
of 20-35 years from six prime geographi-
cal locations viz. Delhi-NCR, Mumbai,
Pune, Hyderabad Bangalore and Chennai
were the targeted respondents. The sur-
vey was conducted in the year 2009-2010
where out of the 800 employees, 610 re-
verted back, so the actual sample size is
of 610 employees.
223
 Nidhi S Bisht

Results & Implications Table 2: One-Sample Statistics for Prefer-

ence of Trade Unions
A whopping 67% of the employees
N Mean Std. Deviation
who participated in the survey were in
favour of organized trade unions. They Preference for
Organized Trade
were assertive that organized trade unions Unions 610 1.33 .471
in IT industry would provide employees a
better bargain in work related issues.
Table 1 shows the demographic profile of A sizable proportion of women work-
the respondents who participated in the ers contribute to the total employee base
survey and Table 2 shows one sample sta- in IT industry and to find out whether
tistics for preference of trade unions in there is a difference in opinion for trade
the IT industry. unions in the case of male and female
employees, a null and an alternate
Table 1: Demographic Profile of the Respondents hypoth-esis were formed.
Variable Categories % of respondents
Gender Male 56 H0- There is a significant difference
Female 44 in the opinion of male and female em-
Age 20-25 years 39.5 ployees regarding existence of trade
25-30 years 52.29 unions
30-35 years 8.19
Location NCR 26.39
Mumbai 16.06 H1- There is no significant difference
Hyderabad 16.72 in the opinion of male and female em-
Bangalore 16.22 ployees regarding existence of trade
Chennai 10.16 unions
Kolkata 14.42

Table 3: Preference for Trade Unions: Gender Cross Tabulation Table 3

shows gender
Gender cross tabulation
1 2 Total
for preference
Prefer Trade 1 Count 239 169 408 of trade unions
Unions % within prefer 58.7% 41.3% 100%
Trade Unions
and Table 4
% within Gender 69.88% 63.05% 67.0% shows chi
square statistics
2 Count 103 99 202 for categorical
% within prefer 51.1% 48.9% 100% variables
Trade Unions
% within Gender 30.12% 36.95% 33.0%
among males
and females in
Total Count 342 268 610 regard to pref-
% within prefer 56.2% 43.8% 100% erence for
Trade Unions trade unions.
% within Gender 100% 100% 100%

224 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
 Trade Unions in Indian IT Industry? An Employees’ Perspective
Table 4: Chi-square Tests for Preference of Trade Unions
Value
Pearson Chi-Square 1.356 b
Continuity Correctiona 1.068
Likelihood Ratio 1.352
Fisher’s Exact Test
Linear-by-Linear Association 1.351
N of Valid Cases 267
a. Computed only for a 2x2 table
b. 0 cells (.0%) have expected count less than 5. The minimum expected count is 38.56.
At 5% level of significance with one
degree of freedom, Pearson Chi-Square
value of significance is .244. So we ac-
cept the null hypotheses that Male and
Female employees working in software
industry do not think differently in regard
to trade unions.
Male and Female employees work-
ing in software industry do not
think differently in regard to trade
unions.
Also we infer that most of the em-
ployees irrespective of gender welcome
the suggestion of trade unions in the in-
dustry.
The practicing professionals of IT
industry are veering for unionisation to
address concerns related to their job and
work environment; along with economic
concerns. Different driving responses
given by employees when asked to sub-
stantiate their opinion for organized trade
unions have been grouped and summa-
rized below:
Long Working Hours: Many of the
companies are flouting the weekly work-
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
df Asymp. Sig. Exact Sig. Exact Sig.
(2-sided) (2-sided) (1-sided)
1 .244
1 .301
1 .245
.294 .151
1 .245
ing hours norm set by International
Labour Organization. Employees work-
ing in the industry are forced to work for
extra hours as managers pressurize their
subordinates in the name of shrinking
deadline of projects.
Many of the companies are flout-
ing the weekly working hours
norm set by International Labour
Organization.
Work Load: Employees are pressur-
ized by their superiors for more output so
that the company can maximize profits.
Compensation Related Issues:
Parameters for performance based pay
are not clearly defined in the companies.
Some companies are even paying lesser
compensation to their employees going
for overseas assignments in comparison
to what they are entitled for, as per the
regulations of the host country for expa-
triates (e.g. CSC India Pvt. Limited, Noida
for its employees working in Denmark).
Appraisal &Promotion Issues:
Inspite of the methods like 360 degree and
MBO for performance appraisal, most of
225

the companies lack maturity in HR
processes to adopt such type of robust
appraisal approach. It is seen that the entire
appraisal of an employee is handled by the
immediate manager which generates
discontentment in the employee with no
appropriate solution. Also it is observed that
many deserving employees are overlooked
during the promotion process.
Many deserving employees are
overlooked during the promotion
process.
Job Insecurity: Employees in the
industry are not secured about their jobs
and many a times the companies are at
liberty to fire employees on flimsy
grounds without giving due notice. Em-
ployees fret about being given pink slip
but feel totally helpless in such cases.
High Stress Levels: These jobs are
very stressful leading to mental exhaution
and over-worked employees are unable to
strike appropriate work-life balance. How-
ever when we see other industries, people
are able to achieve work-life balance be-
cause they are not over worked and em-
ployers have a fear from trade unions.
Denial of Annual Leaves: Another
major problem in most of the IT compa-
nies is that employees are not given an-
nual leave although they are available on
paper. Even it can be seen that normally
an employee is not given leave for more
than 1-2 weeks yearly in spite of pending
leaves. This means that an employee can-
not take a long break to de-stress himself/
herself.
226 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Nidhi S Bisht
No Recognition for Extra Efforts:
Extra efforts by employees in the
organisation are not accounted for and
no compensation is given to the employ-
ees in lieu of that.
Lack of Transparency & Equity:
Organizational culture is spoiled due to
lack of transparency and equity as equal
opportunities are not provided to all the
employees. Some of the employees are
even harassed at times and hapless
employeees are forced to quit.
Similarly a plethora of issues need to
be addressed for employees’ concerns
and rights.
Amongst the responses for favoring
trade unions there were employees who
were not upfront about the organized trade
unions in the industry. They argued that
trade unions would not work in the indus-
try, as all the companies have differential
pay scale. They feared that unions would
lead to tussle on one or the other issue and
after sometime it may become a power
game handled by trade union leaders.
There can be insurgence of off beam de-
mands leading to corruption, donation and
politics of all sort. Also high quality on-time
delivery of services, one of the main USP’s
of Indian IT industry might get affected if
strikes and related activities are allowed in
the industry; thereby endangering the cher-
ished credibility built over decades.
It’s evident that there is a grow-
ing need to draw a fine balance
between the growth of the indus-
try and the rights of the workmen.
 Trade Unions in Indian IT Industry? An Employees’ Perspective
Some of the employees are still ap-
prehensive about trade unions but enlight-
ened and responsible trade unions with a
clear long-term vision can help to suit the
realities of Indian IT industry. The role
of trade unions should morph from tradi-
tional agitators to present day facilitators
and bargainers. Not withstanding the dis-
sension within the industry regarding ex-
istence of trade unions, it’s evident that
there is a growing need to draw a fine
balance between the growth of the in-
dustry and the rights of the workmen to
safeguard the integrity of the employees.
It is required to closely monitor policies
of the companies related to work envi-
ronment, social security provisions and
other work related issues. Turning a blind
eye to the reality of employee problems
will not help in the long run. We can have
union agreements where unions can work
collectively to improve the work culture
of the organizations and the right to strike
can be reserved for extreme circum-
stances. Trade unions acting as facilita-
tors will create a level playing field for
both employees and employers to come
to a common forum for discussing issues
and find amicable solutions.
Organized trade unions would help in
rationalising the work hours, compensa-
tion and other issues in a much better
manner especially for freshers working
in the industry who are the most exploited
ones. Unions can provide activated
Grievance redressal machinery for the
employees by opening way to two way
dialogues for solving the pending issues
and prove to be an institution for rede-
fining the role of collective bargaining and
eventually working along with employers
not against employers.
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Conclusion
This paper has explored the insights
of practicing professionals regarding the
existence of organized trade unions in
the IT industry. Results of the literature
review and the survey clearly indicate
that trade unions have found roots in the
industry and most of the employees are
in favour of organized trade unions.
However till now amongst NASSCOM
initiatives, there is no place for support-
ing union activities. Unorganized unions,
what ever may be the number, cannot
safeguard the interest of the employ-
ees working in the industry. In the highly
internationalised IT sector, we have
trade unions like UNI, PROSA in U.S,
UK, Denmark and many other coun-
tries across the globe. Therefore it’s
not fair to say that trade unions in In-
dia will conjure up chassis of strikes
and lockouts. Employers in the indus-
try should not feel that the existence
of trade unions will be a retrograde step
for a flourishing industry and should
adopt a progressive approach in favour
of labour movement. 
Organized trade unions will provide
a legitimate framework to the employ-
ees for voicing their grievances and be-
come more upfront for their rights to
work. It is therefore, imperative that the
present fear driven work environment
makes way for a healthy and balanced
work environment in the Indian IT indus-
try. Unionisation will lead to a more dig-
nified work place atmosphere with free-
dom of association and the effective rec-
ognition of the right to collective
bargaining(FACB) being guaranteed to
227

the employees. In the zeitgeist of global-
ization Indian government and IT indus-
try should endeavor to join the league for
the formation of organized trade unions
like in many other countries
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Employee Attitudes Towards Employer-Sponsored Child
Care: Evidence from France
Yvan Barel, Sandrine Fremeaux & Grant Michelson
The increasing numbers of women in the
labour market and the rise in dual-career
couples have prompted many organiza-
tions to introduce programmes to help their
employees balance their work and per-
sonal lives. Positive employee perceptions
of such initiatives have tended to be as-
sumed rather than demonstrated. This
study examines how a proposal for a work-
life balance programme is actually viewed
by employees. Drawing on survey data
from 300 employees in a shopping centre
in France, the study finds evidence of a
range of attitudes. These attitudes are in-
fluenced not only by existing and poten-
tial constraints, but also by the possibil-
ity of the employees benefiting from child
care as well as their views concerning the
role of the organization. Attitudes towards
the provision of child care are particularly
positive when they seek to attenuate diffi-
culties of work organization and are con-
sistent with a flexible approach that takes
employees’ personal constraints into ac-
count.
Yvan Barel is Associate Professor, University of Nantes,
France. Email: yvan.barel@univ-nantes.fr. Sandrine
Fremeaux is Associate Professor of Law, Audencia Nantes
School of Management, France. Email:
sfremeaux@audencia.com. Grant Michelson is Professor of
HRM and Director of Research, Audencia Nantes School of
Management, France. Email: gmichelson@audencia.com
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Introduction
The task of balancing work
and personal life is arguably be-
coming more challenging in many
countries as a result of the chang-
ing nature of work precipitated by
factors including workplace reor-
ganizations, technological de-
velop-ments, and an expansion of
spaces and times pertaining to
where and when paid work can
occur (Lewis et al. 2007). Such
challenges are increasingly evi-
dent when placed in the context
of increasing number of women
in labour markets, the rise of dual
career couples, higher divorce
statistics, the prevalence of
single-parent families, and an age-
ing population. These broader
societal trends oblige many em-
ployees to seek new solutions for
combining work with their per-
sonal and family lives. In addition,
business firms can also develop
proposals intended to help their
employees better balance their
work and personal lives (Davis &
Kalleberg 2006), even if some
employers might view them as
229
 Yvan Barel, Sandrine Fremeaux & Grant Michelson
disruptive (den Dulk & de Ruijter 2008).
These employer-based proposals, which
to date have generally come under the
term of ‘family-friendly’ practices, may
be grouped according to three categories:
flexible work policies, paid holidays or
vacations, and assistance with child care
and family health care.
It is with the last category of prac-
tices, specifically the provision of em-
ployer-sponsored child care services,
that this paper seeks to engage. There
might be a number of factors which mo-
tivate employers to promote such ser-
vices including strengthening the image
and communication of corporate values,
along with the desire to mitigate absen-
teeism, encourage employee involvement
and loyalty, and facilitate future recruit-
ment. Nonetheless, the real impact of
company and human resource initiatives
in this area is less than evident. Some
studies have observed a reduction in turn-
over and turnover intentions (Milkovich
& Gomez 1976, Grover & Crooker 1995)
or an increase in satisfaction (Kossek &
Nichol 1992, Ezra & Deckman 1996),
whereas other researchers did not ob-
serve these effects (Miller 1984, Goff et
al. 1990). What is even less well known
is how employees regard the provision
of child care arrangements by their or-
ganizations. Because of the ostensible
benefits they provide in helping to reduce
work-family conflicts, it might be gener-
ally assumed that child care is universally
desirable and welcomed from an em-
ployee perspective. However, this claim
has not always been evaluated in empiri-
cal terms (for an exception, see Haar &
Spell 2004). Therefore, the major contri-
230 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
bution of the paper is to investigate the
views of employees towards the provi-
sion of employer-sponsored child care
arrangements.
This study poses the following two
major questions. First, is there a relation-
ship between work–family conflict and
a positive view of employer-driven child
care initiatives? A related question is:
what role do organizational and personal
situations play in explaining this conflict
and do the sources of work–family con-
flict affect employees’ attitudes? Second,
what other variables, independent of the
work–family conflict, help to inform em-
ployees’ views of employer-sponsored
child care?
In order to better understand the re-
actions of employees during the devel-
opment of a work-life balance
programme, a survey was conducted at
a large shopping centre (involving many
different small businesses) in France that
had introduced a proposal for the joint
financing of a child care centre. The na-
tional setting is one of established state
legitimacy and intervention in work regu-
lations, including state infrastructure and
support for child care and the 35 hour
working week. However, such public in-
terventions do not necessarily mean that
work-life conflicts are eliminated as the
traditional domestic division of labour in
France remains strong (Windebank 2001,
Crompton & Lyonette 2006) and the situ-
ation of fewer work hours is not always
improved for those who might work ‘un-
social or flexible hours of work in ex-
change of a reduction of their working
time’ (Fagnani & Letablier 2004: 551).
 Employee Attitudes Towards Employer-Sponsored Child Care: Evidence from France
Thus, it is precisely in such locations as
shopping centres where work-family con-
flicts and balance issues are more likely
to be exacerbated because of the nature
of operations with their extended days
and hours of business.
The economic and social repercus-
sions of work-family conflict and
work-life balance programmes are
quite complex
The research findings show positive
but not overwhelming support for the
child care proposal. Indeed, there were
employees who did not value such ar-
rangements even when their personal
situations may have suggested this de-
mand. From this, it is argued that the
economic and social repercussions of
work-family conflict and work-life bal-
ance programmes are quite complex and
need to take into account the diversity of
organizational and personal situations.
Theoretical Framework &
Research Hypotheses
To date, many studies (e.g. Duxbury
et al. 1994, Saltzstein et al. 2001,
McManus et al. 2002) have confirmed a
relationship between a high work–fam-
ily conflict and a positive reception to-
wards child care proposals. This means
that employees who face considerable
difficulties in balancing their work and
personal lives would view such a proposal
in favourable terms. Evidence from pre-
vious research further suggests that em-
ployees who feel overwhelmed and un-
able to find the time for their different
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
activities will appreciate any ‘kind’ and
supportive gestures from their supervi-
sor (Anderson et al. 2002, McManus et
al. 2002). Thus, a positive response by
supervisors or managers towards sup-
porting greater work-life balance among
their workforces will be welcomed by
employees. The link between a strong
work–family conflict and a positive view
of the employer-sponsored child care
proposal will be explored in the follow-
ing hypothesis.
Hypothesis 1: The stronger is the
work-family conflict, the more positive
is the perception of a work-life balance
proposal.
To elucidate the role of the work–
family conflict concept, our study will
measure the effect of the independent
variables of the work–family conflict on
the attitudes towards an employer-spon-
sored child care proposal. Frone et al.
(1992) define two categories of indepen-
dent variables: those related to individual
and family requirements, and those re-
lated to work and organizational require-
ments. The logic underlying their model
is that family requirements can cause a
spill-over of the family domain onto the
work domain, and thus dissatisfaction at
work, whereas work requirements can
impinge on family time, and cause dis-
satisfaction in the family. Building on the
findings of Frone et al. (1992), the cur-
rent study categorizes the independent
variables of the work–family conflict by
juxtaposing individual and family con-
straints alongside work and organizational
constraints. We explore whether each
variable increases the work–family con-
231
 Yvan Barel, Sandrine Fremeaux & Grant Michelson
flict and whether each variable increases
employees’ positive attitudes towards the
child care programme.
Individual & Family Constraints
Past research has shown that work-
family conflict is linked to a number of
factors including gender, parental status,
number and age of children, and family
status (Greenhaus & Beutell 1985,
McManus et al. 2002). These variables
are examined below.
Because women devote on average
more time than men to the domestic and
educational tasks in the home (Thomp-
son & Walker 1989, Major 1993), it is
hardly surprising that they are more
likely to complain of lack of time than
are men (Greenhaus et al. 1987, Kossek
1990). If work–family programmes
strongly affect productivity when women
constitute a higher percentage of the
work force (Konrad & Mangel 2000), it
is underst-andable that women will ex-
press a greater work–family conflict and
report a particula-rly positive view to-
wards work-life balance proposals.
Many studies also reveal that having
children and the number of children in-
creases the work–family conflict (e.g.
Kirchmeyer 1995). Moreover, the age and
diversity of ages of the children influences
the perception of personal constraints
(Frone & Yardley 1996). Having children
whose ages require different child care
methods will increase the work–family
conflict considerably (Duxbury & Higgins
2001). It is therefore probable that work-
ers with young children experience the
232 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
greatest work–family conflict and are
particularly receptive to any work-life
balance programme. Similarly, single par-
ents reportedly experience a greater
work–family conflict than those living with
a partner in that they have less help and
possibly fewer financial resources
(McManus et al. 2002). This might sug-
gest that they will be more favourable to-
wards the balance proposal. This leads to
the following hypotheses.
Hypothesis 2a: Women employees,
employees with young children or em-
ployees who are single parents experi-
ence the strongest work-family conflict.
Hypothesis 2b: Women employees,
employees with young children or em-
ployees who are single parents have a
more positive perception of the work-life
balance proposal.
Work & Organizational Constraints
Previous studies have revealed that
work-family conflict is linked to time al-
located to work, consideration of the
workers’ personal constraints by the su-
pervisor or manager, and predictability of
work schedules (Greenhaus & Beutell
1985, Goff et al. 1990, Kossek 1990).
Kossek (1990), for example, asserted
that dedicating considerable time to work
can increase the difficulties of balancing
one’s work life and personal life. Other
scholars in contrast, notably Evans &
Bartolomé (1980), demonstrated that
perceptions of employees regarding
work-family conflict are not connected
with the actual number of hours worked.
 Employee Attitudes Towards Employer-Sponsored Child Care: Evidence from France
Thus, analyses based on the number of
hours worked alone are insufficient. It
must be supplemented by assessments of
the perceived time allocated to work.
Workers who feel that they spend too
much time at work may be experiencing
the greatest work–family conflict. As a
result, they might have a more positive
view of any work-life balance proposal.
The findings of Anderson et al. (2002)
and McManus et al. (2002) remind us of
the importance of support by the direct
supervisor or manager. This support en-
tails creation of a climate that favours dia-
logue, variable work schedules, and toler-
ance of some personal phone calls (Tho-
mas & Ganster 1995), along with a ca-
pacity to listen to employees and offer
flexibility to workers in crisis situations
(Goff et al. 1990, Warren & Johnson
1995). Research has further shown that
support by the immediate supervisor in the
form of empathy and flexibility or assis-
tance attenuates the work–family conflict
(Thomas & Ganster 1995, Warren &
Johnson 1995). We may then infer that
the absence of respectful practices in an
organization will increase work–family
conflict and the positive views towards
work-life balance programmes.
Finally, the ease of co-ordination of
work hours, along with workers’ and
their families’ use of time, can also re-
duce work–family conflict (Greenhaus &
Beutell 1985, Anderson et al. 2002). We
may then ask whether the unpredictability
of work schedules will increase the dif-
ficulties of balancing an employee’s work
life and personal life. By implication, this
might suggest that employees with un-
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
predictable work schedules are more
likely to hold a positive view towards
work-life balance programmes than those
employees with more predictable work
schedules. This discussion leads to the
following hypotheses.
Hypothesis 3a: The perception of
spending too much time at work, a lack
of consideration of personal constraints
by the immediate supervisor or manager,
and unpredictable work schedules in-
creases the work-family conflict.
Hypothesis 3b: The perception of
spending too much time at work, a lack
of consideration of personal constraints
by the immediate supervisor or manager,
and unpredictable work schedules in-
creases the positive perception of the
work-life balance proposal.
Other Determinants
Employees’ positive views towards
a work-life balance proposal do not
emerge exclusively from the independent
variables of the work–family conflict.
The possibility of participating in such a
programme and their opinion of the ‘ideal’
organizational response may also contrib-
ute to positive employee attitudes.
Even if employees were not experi-
encing a strong work–family conflict at
the time of the study, they might antici-
pate benefiting from a work-life balance
programme in the short or medium term
future. Rather than the direct personal
and work-related constraints that employ-
ees experienced at the time of the study,
it is the possibility of eventually benefit-
233
 Yvan Barel, Sandrine Fremeaux & Grant Michelson
ing from the programme that could also
explain a positive view towards the em-
ployer-sponsored proposal. Just as it is
those employees who would benefit im-
mediately from this measure tend to per-
ceive the programme most positively (see
Grover 1991), employees who plan to
benefit in the future from the child care
centre would also be expected to report
the most positive response. From this, we
derive the following hypothesis.
Hypothesis 4: Employees’ positive
perception towards a work-life balance
programme is positively related to the
possibility that they will ultimately ben-
efit from the measure. Employee atti-
tudes are not influenced solely by per-
sonal interests. They can also be condi-
tioned by their understanding of the
‘ideal’ organizational response to the
work-family conflict. The successive
studies by Kanter (1977), Orthner &
Pittman (1986), and Kirchmeyer (1995)
propose a classification of organizational
responses to work-life conflict that range
from ‘separation’, to ‘respect’ and ‘inte-
gration’. An organization applies the prin-
ciple of ‘separation’ when it ignores the
personal life of its employees. The prin-
ciple of ‘respect’ described by Hall &
Richter (1998) assumes that a boundary
is maintained between one’s work life
and private life. The employer does not
assume the personal responsibilities of the
employees on their behalf, but rather al-
lows them to assume their own respon-
sibilities by considering their personal
constraints and by allowing flexible work
hours, for example. The ‘integration’ re-
sponse is when a firm tries to help its
employees meet the multiple require-
234 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
ments of work life and private life. The
proposed joint financing of a child care
centre reflects an integration perspective.
Employee attitudes are not influ-
enced solely by personal interests.
They can also be conditioned by
their understanding of the ‘ideal’
organiz-ational response to the
work-family conflict.
Researchers have examined the ef-
ficacy of each of these organizational
responses or models (e.g. Hall & Rich-
ter 1988, Kirchmeyer 1995). However,
we know of no study that has attempted
to evaluate the perceptions of employ-
ees concerning the ‘ideal’ organizational
response. Using the same typology, our
study aims to identify the influence of
employee endorsement of the models of
‘respect’ and ‘integration’ on their views
towards work-life balance programmes.
This leads to our final hypothesis.
Hypothesis 5: Employees’ positive
perception of a work-life balance
programme is positively related to em-
ployees’ support for the models of respect
and integration.
Figure 1 summarizes the variables
that could explain a favourable response
by employees towards the proposed
work-life balance programme sponsored
by employers.
Method
The study explored the attitudes of
employees towards an employer-spon-
 Employee Attitudes Towards Employer-Sponsored Child Care: Evidence from France

Fig. 1: Predictor variables of employee attitudes towards the work-life balance programme

Individual and family

contraints
H2b

H2a
Strong work - family conflict Positive perception of
H1
the proposal
H3a

H3b
Work-related and
organizational contraints

Other variables :
Possibility of benefiting H4
from the measure
Endorsement of models of H5
respect and integration

sored work-life programme. The employ-
ees were all based in a large shopping
centre in Nantes, a city in the west of
France with a total population of about
800,000 persons (wider metropolitan
area). The shopping centre contained a
supermarket and 49 stores, where the
centre management was considering the
possibility of jointly financing a child care
facility with the businesses in the centre.
In exchange for partial financing, each
participating business could obtain a pri-
ority assignment of places in the child
care centre for one or more of their em-
ployees’ children. The proposal was ex-
2. The wide span of hours of the stores:
pected to be well received in the shop-
ping centre for at least three reasons :
1. The context of child care places: If
the first organization-provided child
care centres were set up in France
in the early 1980s, only a few French
private firms had taken the initiative
to create or jointly finance a child-
care facility. In fact, it is very diffi-
cult to obtain a place in a state-
funded child-care centre because the
number of openings is limited but yet
such centres remain the preferred
means by parents for taking care of
their children. Giving the children of
employees’ priority access can, as a
consequence, be seen as consider-
able assistance even if the fee pro-
posed was not necessarily advanta-
geous.
Shop employees’ were expected to
be available for work from early
morning through to late in the evening,
including Saturdays and public holi-
days. There is also pressure for Sun-
day opening to be authorized (see

The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 235
 Yvan Barel, Sandrine Fremeaux & Grant Michelson
Baret et al. 1999). This situation in-
creases the need for child care ser-
vices to be made available beyond the
times established by state or public
child care providers.
3. The proportion of female employees:
The vast majority of employees at the
shopping centre were women and this
group generally experiences more
nonwork-related constraints than do
male employees.
The survey questionnaire was admin-
istered to the 650 employees of the shop-
ping centre in 2003. During the question-
naire distribution phase, we met all man-
agers of the 49 stores to make them
aware of our study. Of those distributed,
311 questionnaires were returned. Of this
figure, 300 questionnaires were usable
(response rate of 46%). Of the respon-
dents, 78% were female employees; 72%
had a full-time, permanent employment
contract; 69% were under the age of 36
years; and 74% lived with a partner (mar-
ried or de facto). In addition, 49% of re-
spondents had children and these employ-
ees had an average number of 1.21 chil-
dren.
Respondents were told that the ques-
tionnaire was intended to help research-
ers understand employees’ perception of
the work–family balance. It included four
sections that covered their work situa-
tion, personal situation, perceptions of the
work life–personal life balance, and the
work-life balance assistance measures.
Employees without children were
also encouraged to complete the ques-
tionnaire. Although precautions were
236 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
taken, it is possible that the 311 employ-
ees who completed the questionnaire
were those who felt particularly con-
cerned by the child care proposal. It is
likewise possible that the perception of
employees were more positive at the
point of the development of the project
than at the time of its subsequent imple-
mentation. It is often at the implementa-
tion stage that employees leave the sym-
bolic sphere of influence and become
aware of the concrete difficulties of its
application. As the study objective was
not to identify the proportion of individu-
als interested in the proposed child care
centre per se, but rather to understand
the determinants of the positive views of
employees, possible over-representation
of employees who were in favour would
not bias the validation of the research
hypotheses.
In order to discover the existence of
statistical relationships between variables,
either the Chi2 test for nominal variables
or the Fischer test when at least one of
the variables was an ordinal variable
(scaled), was employed. The p value is
the probability the real distribution of the
results is random (and thus not due to
the influence of the causal variable
tested). The relationship is statistically
significant when p is less than 0.05 and
very significant when it is less than 0.01.
Measures
The measure of work–family conflict
does not result from the lack of time and
the individual states of fatigue and irrita-
bility appearing in the traditional measure-
ment scales of inter-role conflict
 Employee Attitudes Towards Employer-Sponsored Child Care: Evidence from France
(Greenhaus & Beutell 1985, Frone et al.
1992). Rather, it is derived from the level
of satisfaction in the search for a work
life–personal life balance. The formula-
tion of the question is similar to that used
in classic studies of the concept of satis-
faction in life (Campbell et al. 1976, Rode
2004): ‘How satisfied are you with the
balance you have achieved between your
work life and personal life?’ The employ-
ees’ level of satisfaction was measured
on a 4-point scale (‘very dissatisfied’,
‘somewhat dissatisfied’, ‘somewhat sat-
isfied’, and ‘very satisfied’), similar to
those applied by Ezra and Deckman
(1996). The index varied between 1
(strong work-family conflict) and 4
(weak work-family conflict) with a theo-
retical average of 2.5 corresponding to a
neutral opinion.
In order to prompt employees to spe-
cifically appraise their possible difficul-
ties of balancing work and non-work, the
question related to satisfaction in the
quest for the work life-personal life bal-
ance was preceded by two questions:
‘How satisfied are you with your work
life?’ and ‘How satisfied are you with
your personal life?’
Positive perceptions towards the pro-
posed child care facility in the shopping
centre were measured using two crite-
ria: perception of normality and employee
preferences. First, employees had to re-
ply either ‘yes’ or ‘no’ to the question of
whether they found it ‘normal’ that
places in a child care centre jointly fi-
nanced by different organizations be as-
signed to employees. Second, to create
a hierarchy of employee preferences,
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
respondents were asked to specify the
services that would benefit them the
most. They selected a maximum of three
choices from the following services: as-
signment of a given number of places in
a child care centre co-financed by em-
ployers; occasional child care assistance
service (for example, people that could
visit the home if necessary); legal and
financial consulting services; messenger
services (delivery); laundry services (dry
cleaning) and services for seniors. The
two criteria used to determine the per-
ception of the proposal are complemen-
tary. Analysis of normality is based on
employees’ judgments of the theoretical
‘normality’ of the proposal, whereas the
analysis of preferences highlights their
individual and practical interest in the
child care centre.
Satisfaction in the quest for a work
life–personal life balance and the percep-
tion of the balance assistance proposal
were measured by the following personal
and family variables: gender (male/fe-
male), family situation (single or couple/
married or de facto), the number of chil-
dren (numerically open variable) and age
of children (under three years, between
four and six years, over seven years).
The following work-related and organi-
zational variables were also evaluated:
average number of hours per week spent
at work (numerically open variable), judg-
ment of work time (too much time at
work; not enough time; just the right
amount of time); consideration of personal
constraints by the immediate supervisor
or manager (never, sometimes, often, al-
ways) and predictability of work sched-
ules (never, sometimes, often, always).
237
 Yvan Barel, Sandrine Fremeaux & Grant Michelson
To measure the extent that employ-
ees believe they could benefit from the
programme, two criteria were used. The
first question inquired if the employees
who were most positive toward the child
care proposal had particular socio-demo-
graphic characteristics. Second, employ-
ees had to answer ‘yes’ or ‘no’ to whether
they thought they would be interested in
placing a dependent in a child care centre
over the short or medium term.
Consistent with the terminology used
by Kirchmeyer (1995), we considered
that employees who endorsed the ‘sepa-
ration’ model were those that answered
in favour of the item: ‘In your opinion,
under ideal circumstances should the
manager take into account work aspects
only (each worker resolves his or her
own personal constraints)?’ Employees
who adhered to the ‘respect’ model would
reply positively to the following item: ‘In
your opinion, under ideal circumstances
should a manager take into account the
demands of employees’ personal life
when planning work schedules (shifts,
meetings, paid leave, etc.)?’ Finally, em-
ployees who endorsed the ‘integration’
model were deemed to support the item:
‘In your opinion, in ideal circumstances
Table 1: Preferences in Child Care Assistance Services
Preferences
Assignment of a number of places in a child care centre financed by employers
Occasional child care services (e.g., people that could visit the home if necessary)
Legal and financial consulting services
Messenger services (delivery)
Laundry services (dry cleaning)
Services to help seniors
TOTAL
238 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
should a manager offer services to fa-
cilitate balancing the personal life of the
employees (child care, legal services,
etc.)?’ Although employees could be
favourable to all three organizational re-
sponses, attention will be especially di-
rected towards those employees who
supported the models of ‘respect’ and
‘integration’. This stands in contrast to
employees who indicated an exclusive
interest in the separation model.
Results & Analysis
Of the 300 respondents, we found
that 88% considered it ‘normal’ that
places in an employer-sponsored child
care proposal be given to employees
(rather than the direct public). Moreover,
the service preferences expressed by
employees indicate that the main expec-
tations concern assistance services for
daily child care or for occasional support
to care for sick children (Table 1). Along
with legal and financial services, these
constituted over three-quarters (77%) of
employee preferences. The lack of in-
terest in messenger and laundry services
can be explained by the fact that the shop-
ping centre already offered practical so-
lutions in both areas.
Frequency (%)
30
28
19
11
8
4
100
 Employee Attitudes Towards Employer-Sponsored Child Care: Evidence from France
Written comments on the survey
questionnaire confirmed these results
despite the fact that a few employees
demonstrated reticence with regard to
the child care proposal. Some employ-
ees expressed feelings of injustice, see-
ing in the work-family balance proposal
a source of discrimination. Among those
employees over 50 years of age, several
made critical comments: ‘In our time, all
that didn’t exist. Today, everything is done
for young people’. If the project is seen
as a discriminatory measure, it is because
it is not intended to satisfy the needs of
all the employees. Only a few employ-
ees could obtain priority for their children
in the child care centre. Further, one em-
ployee remarked that ‘not everybody
needs child care on the work premises,
Table 2: Impact of Work–family Conflict on Perception of the Child Care Proposal
It is normal for places in a child care centre financed
by organizations be assigned to employees
Yes
No
TOTAL
(p < 0.05)
Influence of Individual & Family
Constraints
Consistent with previous studies (e.g.
Goff et al. 1990, Konrad & Mangel
2000), socio-demographic variables such
as gender, parental status, number and
age of children, and family status influ-
enced the work–family conflict.
Having children whose ages require
different child care modes is another
explanatory variable of the work–
family conflict.
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
whereas everybody needs [more]
money’.
Table 2 shows the findings do not
support hypothesis 1, which posited that
the stronger the work–family conflict,
the more positively the child care pro-
posal is viewed. On the contrary, work-
ers who adopted a positive view of the
child care facility were on average more
satisfied in their quest for a work life–
personal life balance.
Workers who adopted a positive
view of the child care facility were
on average more satisfied in their
quest for a work life–personal life
balance.
Degree of satisfaction in the quest for work
life – personal life balance
2.68
2.44
2.65
(a) Gender: Women were significantly
less satisfied (mean = 2.58) than men
(mean = 2.90) with the balance be-
tween their work life and personal
life (p < 0.05).
(b) Number and age of children: The
number of children appears to be
very significant in accounting for
work-family conflict, because ‘very
dissatisfied’ or ‘somewhat dissatis-
fied’ employees have on average
1.51 children, compared with an av-
erage of 0.92 children for those that
239
 Yvan Barel, Sandrine Fremeaux & Grant Michelson
are ‘somewhat satisfied’ or ‘very
satisfied’ (p < 0.01). Having children
whose ages require different child
care modes is another explanatory
variable of the work–family conflict.
Employees who have at least one
child under 3 years of age and at least
one child over 4 years of age have a
level of satisfaction of 2.50, com-
pared with 2.61 for employees who
have only one child or several chil-
dren but these children are all over 4
years of age (p < 0.05).
(c) Family status: Women without chil-
dren, whether single or not, do not
differ significantly in their opinions (p
= 0.58). The level of satisfaction is
2.57 in the case of single women and
2.68 for women who are married or
live with a partner. Single employees
with at least one child clearly express
a relatively greater difficulty in balanc-
ing their work life and personal life
(mean = 2.20) than women who live
with a partner (mean = 2.81) (p < 0.01).
Hypothesis 2a, which posited that the
work–family conflict is linked to individual
and family variables, was therefore sup-
ported. The following personal variables
– gender, number and age of children and
single parent status – all influence the
work–family conflict. We will now evalu-
ate whether these variables also shape
the way employees perceive the pro-
posed child care centre.
Hypothesis 2b, whereby a positive per-
ception of the work-life balance
programme is linked to individual and fam-
ily variables, also received support: women
employees, parents with young children
240 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
(under 3 years of age), and employees who
were single parents all had a more positive
perception of the proposal (p < 0.05).
Influence of Work & Organizational
Constraints
The number of hours worked per
week did not appear to be an important
criterion among the surveyed employees
(p = 0.53). Employees who were ‘some-
what satisfied’ or ‘very satisfied’ with the
work-life balance worked about the same
number of hours (36.08 hours) per week
as those who were ‘somewhat dissatis-
fied’ or ‘very dissatisfied’ with their work-
life balance (36.54 hours per week).
It was therefore not the number of
hours worked that significantly affected
employee satisfaction as Kossek (1990)
has previously noted, but rather the per-
sonal judgment of the time spent at work
(p < 0.01). Employees who believed they
spent ‘too much time at work’ are least
satisfied with the balance between their
work and private lives (mean = 2.13).
However, those who considered that they
spent ‘not enough time’ are hardly more
satisfied (mean = 2.25). Satisfaction is
significantly greater among employees
who reported they spend ‘just the right
amount of time’ at work (mean = 2.82).
The claim that consideration by the
direct supervisor or manager of the em-
ployees’ personal constraints reduces the
work–family conflict was supported (p
< 0.01). The level of employee satisfac-
tion was only 2.0 when the manager
‘never’ considers personal constraints. It
increases to 2.73 if the manager ‘some-
 Employee Attitudes Towards Employer-Sponsored Child Care: Evidence from France
times’ considers the employees’ personal
constraints, to 2.76 when it is ‘often’ the
case and 2.78 when personal constraints
are ‘always’ considered.
The assertion that unpredictability of
work schedules increases the work–family
conflict was also confirmed (p < 0.01).
Employees who felt that their schedules were
‘never’ or ‘sometimes’ predictable were less
satisfied with the work life–personal life
balance (mean = 2.43) than employees who
believed their schedules are ‘often’ or ‘al-
ways’ predictable (mean = 2.76).
Hypothesis 3a, which stated that
work–family conflict is related to the fol-
lowing work and organizational vari-
ables—judgment of too much time spent
at work, absence of consideration of per-
sonal constraints by the immediate su-
Table 3: Impact of Consideration of Personal Constraints on Perception of the Child care
Proposal
It is normal for places in a child care centre financed
by organizations be assigned to employees
YES
No
(p < 0.01)
Although it increases work–family
conflict, work schedule unpredictability
also does not significantly contribute to a
Table 4: Impact of Predictability of Work Schedules on Perception of the Child Care Proposal
It is normal for places in a child care centre financed
by organizations be assigned to employees
Yes
No
TOTAL
(p < 0.21)
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
pervisor, and unpredictable work sched-
ules—was therefore supported. The feel-
ing of being overwhelmed by time spent
at work had no significant effect on per-
ceptions of the child care project: 88%
of employees said that they spent ‘too
much time at work’ and 89% of those
who believed they spent ‘just the right
amount of time’ found the child care joint
financing proposal to be ‘normal’.
If the lack of consideration of per-
sonal constraints increases the work–
family conflict, it does not necessarily
contribute to a positive attitude towards
the child care facility. In fact, the inverse
phenomenon was observed. The less
employees believed that their managers
considered their personal constraints, the
less ‘normal’ they considered the assign-
ment of child care places (Table 3).
Degree of satisfaction in the questfor work
life – personal life balance
2.58
1.89
positive perception of the proposed child
care centre (Table 4).
Degree of satisfaction in the quest for work
life – personal life balance
2.86
2.67
2.84
241
 Yvan Barel, Sandrine Fremeaux & Grant Michelson
Therefore, hypothesis 3b, which
stated that the perception of the work-
life balance programme is more positive
among employees facing organizational
sources of work–family conflict, was not
supported. On the contrary, consideration
of employees’ personal constraints by
supervisors and managers increased the
positive attitudes towards the proposed
child care centre.
Consideration of employees’ per-
sonal constraints by supervisors
and managers increased the posi-
tive attitudes towards the pro-
posed child care centre.
Influence of Other Determinants
Two results illustrate the influence of
employees’ personal plans. First, employ-
ees who were reportedly in favour of the
Table 5: Impact of the Possibility of Benefiting on Attitudes towards the Child care Proposal
Respondent would be interested in enrolling a
child in a child care centre over the short or
medium term
(p < 0.01)
Hypothesis 4, whereby the positive
perception of the work-life balance
programme is linked to the possibility that
employees will at some later stage ben-
efit, was supported.
Turning to the ‘ideal’ organizational
response to the work-family conflict, at first
242 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
child care proposal have particular char-
acteristics: 69% of the employees with-
out children versus 63% of employees who
were parents considered the assignment
of a given number of places in a child care
centre funded by businesses in the shop-
ping centre as one of the services that
would help them the most. Under-repre-
sentation of employees who were parents
may be related to the fact that they have
already chosen a child care system (for
children under 3 years of age) or they no
longer need this service (for children over
3 years of age). Employees under 35
years of age who did not yet have chil-
dren were considerably more likely than
the other workers to intend to have a child,
and were therefore more interested in the
child care centre. Moreover, employees
who expressed their intention to enrol their
child in a child care centre over the short
and medium term also viewed the proposal
much more favourably (Table 5).
The assignment of places in a
child care centre financed
by business is normal
Yes No TOTAL
Yes 95% 5% 100%
No 79% 21% 100%
TOTAL 88% 12% 100%
glance the data indicates a significant pref-
erence for the ‘respect’ model. In other
words, the responses were as follows (in
ascending order): model of separation
(22%); model of integration (60%); and the
model of respect (93%). Employees
favourable to the logic of ‘integration’ were
also strongly in support of the model of ‘re-
 Employee Attitudes Towards Employer-Sponsored Child Care: Evidence from France

spect’: all those who supported the ‘inte- at a supplementary level, and somewhat
gration’ model attached strong importance difficult to obtain, relative to the respect
to the principle of respect. On the other model. The various combinations (and re-
hand, only 65% of employees who sponses) are depicted in Table 6. The ‘re-
favoured the ‘respect’ model also subscr- spect’ model alone (or in combination with
ibed to the integration model. It appears, the ‘integration’ model) attracted about
then, that the model of integration was seen three-quarters of all responses (74%).
Table 6: Combinations of Organizational Responses
Separation Integration Respect model Number Frequency
yes model model no or NR no or NR 24 8%
Single no or NR yes no or NR 0 0%
combination no or NR no or NR yes 68 23%
Double no or NR yes yes 152 51%
combination yes no or NR yes 24 8%
yes yes no or NR 0 0%
Triple yes yes yes 16 5%
combination no or NR no or NR no or NR 16 5%
TOTAL 300 100%
NR = No Response

Different visions of the role of the
organization led employees to perceive the
employer-funded child care centre in dif-
ferent ways (p = 0.01). Specifically, 93%
of proponents of the ‘integration’ model
and 92% of employees that endorsed the
‘respect’ model regarded the allocation of
places in a child care centre financed by
business to be ‘normal’, compared with
only 69% of employees who embraced the
‘separation’ model. Thus, hypothesis 5,
whereby the positive perception of the
work-life balance programme is linked to
employee support for the models of ‘re-
spect’ and ‘integration’, was supported.
The results of the statistical analyses are
summarized in Figure 2.
Written comments on survey ques-
tionnaires were consistent with the sta-
tistical results on two major points. First,
employees did not necessarily see how
the proposed child care centre would re-
duce the work–family conflicts that they
faced. Thus, the link between the centre
and the practical difficulties of reconcil-
ing work and personal life was not al-
ways evident. For example, employees
who had experienced a strong work-fam-
ily conflict because of the number and
diversity in the ages of their children, and
who did not plan to have other children,
did not necessarily see the utility of such
a measure. Second, some employ-ees did
not see the value of a programme rooted
in an integration logic when they experi-
enced insufficient practices of respect.
These initial steps of respect seem to be
a necessary prerequisite for the imple-
mentation and success of any measure
aimed at supporting the ‘integration’
model.

The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 243
 Yvan Barel, Sandrine Fremeaux & Grant Michelson

The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
 Employee Attitudes Towards Employer-Sponsored Child Care: Evidence from France
ployees in the organization of their work-
ing time. The highly variable and often
unpredictable structure of work sched-
ules remains a problem in this industry
sector (Baret et al. 1999).
Conclusion
The study has found that if a range
of personal constraints can influence
work–family conflict, they do not guar-
antee a positive attitude among employ-
ees towards work-life balance
programmes (research question 1). Em-
ployees’ vision of a proposed assignment
of child care places in a French shopping
centre funded by employers depends not
only on individual and family constraints
but also on their own personal plans, their
perception of the work organization and
their concept of the role of the employ-
ing organization (research question 2).
It would appear that the success of
any employer-driven proposal intended to
balance one’s work and personal life
should meet the following conditions.
First, the work-life balance programme
must be tailored to the real needs of the
employees and the organization. A
programme must be designed to directly
address the aspirations of the largest
number of its employees. Second, the
work-life balance programme must be
consistent with the organization of work
that defends the fundamental rights of
employees and takes into account their
personal constraints as much as possible.
Businesses would only seem to benefit
from offering priority places in a child
care centre to their employees as part of
an integration response if they first em-
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
phasize respect, and take into account the
day-to-day personal circumstances of
their employees.
In other words, the ‘respect’ model
is perceived as a consensual solution,
whereas the model of ‘integration’ is con-
sidered as somewhat more difficult to
achieve. This conclusion is justified be-
cause implementing a work-life balance
proposal as part of an integration re-
sponse may exacerbate feelings of ineq-
uity and discrimination among some em-
ployees who will not benefit from the
measure. In future empirical studies, it
would be worthwhile to pursue the in-
vestigation using the same methodology
on already established child care centres
(provided by the employer) and on less
well targeted work-family balance
programmes such as services for the eld-
erly, for example. We also see potential
in doing comparative research both in
terms of reactions towards employer-
funded and government-funded child care
centres, as well as studies that extend
across different national settings
(Zeytinoglu et al. 2010).
Since work-life balance programmes
can sometimes evoke diverse reactions
for reasons that are not always easy to
identify, it is important that human re-
source and other managers not assume
that measures that purportedly favour an
improved work–life balance will have a
uniquely positive impact—both economi-
cally and socially. Only once a ‘respect’
approach is applied – especially by an
employee’s immediate supervisor – is it
then opportune to advance further to-
wards adopting the ‘integration’ model.
245
 Yvan Barel, Sandrine Fremeaux & Grant Michelson
Until this occurs, it would certainly be
prudent for employers to limit communi-
cation of any new initiatives that are still
tentative as to do otherwise might cre-
ate expectations that will prove difficult
to satisfy.
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247

Role of Neo Five Factor Model of Personality in
Management Education: An Empirical Study
Archana Tyagi & Veena Bansal
The present study compares the
personality profiles of male and
female students of the full time
management programme of a
management institute. It also ex-
amines the differences in person-
ality profiles of the male students
of the full time and part time man-
agement programmes. Significant
differences were found between
the male and females students of
the full time management prog-
rammes . Female students have a
significantly higher score in four
factors, namely, negative emo-
tionality, openness to experience,
agreeableness and conscientious-
ness. The full time male students
were low in negative emotional-
ity. The part time male students
were higher in conscientiousness
as compared to the full time male
students.
Archana Tyagi (archana.tyagi@gmail.com) is based
in Geneva and is associated with UBIS-Geneva as an
adjunct faculty in the area of OB/HR. She is also a
Coach for ‘Coach for Peace’ (an international non-
profit association) in Geneva. Veena Bansal is
involved in conducting personality development
programs and teaching applied psychology in CCS
University Meerut, India.
248 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Archana Tyagi & Veena Bansal
It is often argued that, besides cog-
nitive abilities, a blend of personality char-
acteristics is necessary for people to be
successful in education and eventually in
their jobs or careers (Smithikrai 2007).
Recent research has demonstrated that
personality assessment contributes
unique information to the prediction of job
performance, over and above that of-
fered by methods such as cognitive abil-
ity testing and managerial assessment
centres (Goffin, Rothstein & Johnson
1996). Progress has been made in recent
years in understanding the structure and
the concepts of personality (Dunn,
Barrick & Ones 1995). In principle, per-
sonality measurement should sample el-
ements or aspects of an individual’s
behaviour that are diagnostic of impor-
tance characteristics of people in gen-
eral. These diagnostic behaviour samples
should on the one hand, allow us to com-
pare different people against the same
standard and, on the other hand, allow
us to interpret what a person has done
and predict what he or she will do in other
Personality assessment contrib-
utes unique information to the pre-
diction of job performance.
 Role of Neo Five Factor Model of Personality in Management Education
important non-test situations. Both pro-
cesses –comparisons among people and
interpretations of individual cases –are
important tasks in industrial and organi-
zational psychology (Hogan 1991).
With the introduction and general
acceptance of the five-factor model
(FFM), also known as the ‘Big Five’
(Goldberg 1990) in the early 1990s, re-
search examining the link between per-
sonality and work behaviour has been
intensified. The FFM dimensions have
been replicated in an impressive series
of studies across countries and cultures
and have remained fairly stable over time
(McCrae &Costa 1997, McCrae,
Terracciano &78 Members of the Per-
sonality Profiles of Cultures Project 2005,
Salgado 1997, and Tett, Jackson, and
Rothstein 1991). These studies show that
the most relevant personality factors
which predict job performance are Con-
scientiousness and Emotional stability.
The five-factor model of personality is
obtaining construct validation, recogni-
tion, and practical consideration across
a broad domain of fields, including clini-
cal psychology, industrial-organizational
psychology, and health psychology
(Widiger & Trull 1997).
The most relevant personality fac-
tors which predict job performance
are Conscientiousness and Emo-
tional stability
Although the FFM has been re-
searched in many areas of individual-or-
ganizational psychology, most notably
with respect to job performance (Barrick,
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Mount & Judge 2001), the relationship
of the FFM to management education is
much less studied, especially in Asian
countries. And, moreover, no study of
such nature was done on a sample set
comprising Indians. Management educa-
tion encompasses a broad range of phi-
losophies, and issues concerned with
helping tomorrow’s manager’s to be more
effective in their jobs. Indian manage-
ment education has undergone a para-
digm shift. There have been fundamen-
tal and irreversible changes in the
economy, outlook of business and indus-
try, government policies and in the
mindset of the Indians in general. Thus
the objective of the present study is to
compare the personality profiles of males
and female students of the full time man-
agement programme. It also examines
the differences in personality traits of the
male students of full time and part time
management programme. This study can
be a guiding tool in the hands of man-
agement education institutes where it can
be used to effectively make tomorrow’s
leaders understand the virtues of their
core behavioural style.
Personality Overview & Recent
Developments
A person’s personality (that is a set
of psychological traits) is a relatively
stable precursor of behaviour; it under-
lines an enduring style of thinking, feel-
ing and acting (Hogan 1991, Mc Crae &
Costa 1997). Recent years have wit-
nessed a rebirth in the utility of person-
ality testing in work settings. This resur-
gence is largely due to the emergence of
a preferred taxonomy in personality clas-
249

sification. As discussed by Mount and
Barrick (1995), “it appears that many
personality psychologists have reached
a consensus that five personality con-
structs, referred to as the big five, are
necessary and sufficient to describe the
basic dimensions of normal personality”.
Interest has also increased due to re-
search documenting empirical linkages
between the “big five personality con-
structs and measures of individual per-
formance and success in work organiza-
tions in both North America (Barrick &
Mount 1991, Hough et al 1990, Tett et al
1991) and Europe” (Salgado 1997).
At the same time it is extremely rel-
evant in today’s scenario to link person-
ality and its implications to success in
work. Management education is one of
the most prominent and accurate places
to understand the vocabulary of individual
differences. In today’s scenario, it is dif-
ficult to think of learning without looking
at the relationship between the person-
ality type, user interface and actual per-
formance in the work place. It is there-
fore of significant interest to profile the
type preference in a management insti-
tute with due respect to the differences
in terms of experience and gender (Tyagi
& Bansal 2005).
Management education is one of
the most prominent and accurate
places to understand the vocabu-
lary of individual differences.
For the present research work NEO-
FFI instrument has been chosen. This
instrument has gained widespread accep-
250 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Archana Tyagi & Veena Bansal
tance in the academic-psychology com-
munity. It also offers human resource
practitioners a broadly applicable and
practical tool. NEO –FFI has been used
for: team building ,employee selection, job
analysis, training design, customer ser-
vice, management and leadership devel-
opment, coaching and counselling, career
development and conflict management to
name a few. (Howard & Howard 1995).
The NEO-FFI instrument has been cho-
sen for the present study, which will ulti-
mately help the management students in
not only knowing and exploring the self
but will at the same time, also help them
in making wise and meaningful career
choices in life.
NEO-FFI
The NEO-FFI dimensions are nega-
tive emotionality, extraversion, openness
to experience, agreeableness, and con-
scientiousness. Each of the Big Five di-
mensions is like a bucket that holds a set
of traits that tend to occur together. The
definitions of the five super factors rep-
resent an attempt to describe the com-
mon element among the traits, or sub fac-
tors, within each “bucket”. The most
commonly accepted buckets of traits are
those developed by Costa and McCrae
(1992).Negative emotionality concerns
the degree to which the individual is in-
secure, anxious, depressed, and emo-
tional versus the degree to which the in-
dividual is calm, self confident and cool.
Extraversion concerns the extent to
which the individual is gregarious, asser-
tive and sociable versus the extent to
which the individual is reserved, timid and
quiet. Openness to experience defines
 Role of Neo Five Factor Model of Personality in Management Education
individuals who are creative, curious, and
cultured versus those who are practical
with narrow interests. Agreeableness
concerns the degree to which individuals
are cooperative, warm and agreeable
versus the degree to which they are cold,
disagreeable and antagonistic. Conscien-
tiousness measures the extent to which
individuals are hard working, organized,
dependable, and preserving versus the
degree to which they are lazy, disorga-
nized and unreliable
Literature Review
While a good amount of information
related to NEO-FFI in the context of
team building, carrier guidance, conflict
resolution and leadership development is
available, there is considerably less re-
search work available, which investigates
the relationship between the NEO-FFI
and post graduate management students.
Educators of management institutes are
faced with the sensitive task of prepar-
ing students for the rapidly changing de-
mands of the 21st century. Understand-
ing one’s own personality as well as the
personality of others better, can make a
significant difference in one’s perfor-
mance and advancement. Much of one’s
success depends on how well he or she
is able to understand and act on the per-
sonality dynamics in one’s workplace
(Howard & Howard 2001).
Relations between personality traits
and job performance are also of potential
interest to personnel psychologists respon-
sible for selecting or placing employees.
Longitudinal research in history has dem-
onstrated that personality characteristics
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
are important indicators of career perfor-
mance. Since different features of per-
sonality will be relevant to different types
of jobs; the personnel psychologist must
determine the optimal configuration of
traits for each position (Costa & McCrae
1992).Two of the NEO PI-R(instrument
with 240 items) domains –Openness and
Conscientiousness –promise to be of par-
ticular interest in the area of educational
psychology. Openness is moderately re-
lated to measures of intelligence and
somewhat more strongly related to mea-
sures of divergent thinking, an ability gen-
erally thought to contribute to creativity
(Mc Crae 1987). Important questions for
educational research focus on whether
students gifted with openness are more
likely to avail themselves of, and profit by,
educational enrichment opportunities;
whether their unconventionality is a source
of misunderstanding and frustration in tra-
ditional classrooms; and whether Open-
ness itself can be increased by education,
as the concept of the liberal education has
traditionally assumed (Costa & McCrae
1992). Conscientious students on the other
hand, are well organized, purposeful and
persistent, and there is some evidence to
suggest that these traits lead to higher aca-
demic achievement (Digman & Takemoto
Chock 1981).Conscientious people consider
themselves, and are rated by others as be-
ing, more intelligent (McCrae & Costa
1987), and scores on this domain scale may
be a useful supplement, as predictors of
academic and later –life success. Barrick
and Mount (1991) found that conscientious-
ness, viewed as a broad construct was
positively related to performance across all
job criteria and across all occupational
groups (Moon 2001).
251

Although recent research has pro-
vided grounds for optimism, a close ex-
amination of the findings from the quan-
titative reviews reveals some discrepan-
cies in the results. For example, Barrick
and Mount (1991) found that conscien-
tiousness was the only FFM trait to dis-
play non-zero correlations with job per-
formance across different occupational
groups and criterion types. In contrast,
Tett, Rothstein and Jackson (1991) found
that only emotional stability displayed
non-zero correlations with performance
and two other Big Five traits –agreeable-
ness and openness- displayed higher cor-
relations with performance than consci-
entiousness. More recently, Salgado
(1997) and Anderson and Viswesvaran
(1998) found that two traits from the five-
factor model –emotional stability and
conscientiousness – displayed non-zero
correlations with job performance.
In India, management education stu-
dents come from various educational
backgrounds like Engineering, Com-
merce, Science and Art. Predicting the
success of any particular domain is an
uphill task. The present study is done in
the field of Management, in a Manage-
ment Institute with full time residential
students and part time management stu-
dents. Full time management students
are residential students who tend to com-
plete their post graduation study in two
years whereas part time management
students are those who work during day
time, and attend classes in the evening.
Hence for part time students the total
duration of completing the course is three
years. The present study aims to com-
pare the Personality profiles of male and
252 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Archana Tyagi & Veena Bansal
female students of Full time Management
Programme. It also examines the differ-
ences in personality profiles of male stu-
dents of the full time and part time man-
agement programme.
Sample
This study was conducted on the post
graduate students of a premier Business
Management Institute of Northern India.
Out of 229 students there were 138 full
time male students, 48 part time male stu-
dents and 34 full time female students.
There were only 9 female students
present in the part time PGDBM course.
The selection process of the students in
this Management Institute is the same
across the entire programme, that is they
have to clear the written test followed
by the Group Discussion and Personal
Interview. Educational backgrounds of
students were very diverse; ranging from
Engineering to as varied as art and com-
merce. The average age of the total
management students was 24 years. For
the full time male students the average
age was 23 years, for the part time male
students it was 27 years and for the full
time female students it was 23 years.
Instrument
The Neo-Five Factor Inventory
(NEO-FFI) developed by Costa and Mc
Crae (1985) was used in the present
study. This inventory is a short form of
the Neo-Personality Inventory. A 60
item version of Form S of NEO-FFI was
administered on the 229 students. Each
of the five factors was measured using
12 items for a total of 60 items. McCrae
 Role of Neo Five Factor Model of Personality in Management Education

and Costa (1989) have verified the ex-

istence of five independent personality
factors with coefficient alphas of .70 or
higher for the items measuring each of
the factors. It provides a comprehensive
assessment of the major dimensions of
personality and a broad sample of more
specific traits. It is a useful tool in al-
most any research on personality cor-
relates.
Procedure
NEO-FFI was conducted on the man-
agement students as a part of their Or-
ganizational Behaviour Course. And the
profile of each student obtained with the
help of this instrument was shared and
discussed through personal counselling,
which was also one of the main objec-
tives of this course. Organizational
Behaviour subject is taught in the 1 st se-
mester of the 1st year of the PGDBM
(Post Graduate Diploma in Management)
Programme, for both the full time and part
time students.
Results
This result indicates that female
management students feel the ef-
fect of even a little workplace
stress more readily than most
people and often serve as the ‘con-
science’ of those around them.
full time management students. Mean
score of NE (Negative emotionality) in-
dicate that full time female students have
higher (M=21.79) scores than full time
male students (M=17.78) on this dimen-
sion, and this was statistically significant
(t = -2.81). This result indicates that fe-
male management students feel the ef-
fect of even a little workplace stress
more readily than most people and often
serve as the ‘conscience’ of those around
them. In tough times female students may
need plenty of time to vent their frustra-
tions, before they are ready to tackle the
next job challenge. Mean score of O
(Openness to Experience) indicates that
females have higher scores (M=32.41)
than full time male students (M=27.92)
on this dimension, and this was statisti-
cally significant (t= -4.99). This trait in-

The first and Table 1: Differences in Mean values of Full Time Male & Female
Management Students
foremost aim of this
study was to identify Total Males F/T Females F/T Value of FFI test
the significant differ-
T Mean Mean Mean T Variable
ences in the person-
ality profiles of male 18.92 17.78 21.79 -2.81 NE
and female students 28.49 27.92 32.41 -4.99 O
of the Full time Man- 29.32 28.53 31.50 -3.24 A
agement Prog- 34.16 32.83 35.15 -2.17 C
ramme. The result NE-Negative Emotionality; O-Openness to Experience; A-Agreeableness;
presented in Table 1 C-Conscientiousness
shows mean values Values of t (Student’s t) less than -1.96 or greater than 1.96 have been
for male and female shown

The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 253
 Archana Tyagi & Veena Bansal

pline, ambition, and focus. Mean score

Females are more agreeable in of C (Conscientiousness) trait indicates
nature and they are more coopera- that female management students
tive rather than competitive. (M=35.15) have a higher score than full
time male students (M=32.83) on this di-
dicates that females are more open to mension and this was statistically signifi-
experience, and are willing to entertain cant (t= -2.17).This trait suggests that
novel ideas and unconventional values, female students are better focused, scru-
but they need to guard themselves against pulous, purposeful and punctual by na-
getting bored easily. Females are gener- ture. They are also strong willed and de-
ally assumed to be helpful, conflict averse termined by nature.
and a team player. Table 2: Differences in Mean Values of Full Time & Part Time Man-
This was proven agement Male Students
true with the mean
score of A (Agree- Total Male F/T Male P/T Value of
ableness) trait of T Mean Mean Mean t Var NEO-FFI
this study which
indicates that fe- 34.16 32.83 37.23 -4.18 Conscientiousness
males (M= 31.50) Values of t (student’s t) less than -1.96 or greater than 1.96 have been shown
have a higher
score than full time male management From the above table it is apparent
students (M= 28.53) on this dimension, that Conscientiousness trait was distinc-
and this was statistically significant (t =- tively higher in part time management
3.24) too. This trait indicates that females students than in full time management
are more agreeable in nature and they students. Part time management students
are more cooperative rather than com- are those who work in the day time and
petitive. At the same time they should be study in the evening. Hence they need to
wary of situations in which they are re- be really focused in their approach, to
sponsible to someone with whom they carry on with their responsibility in the
don’t share the same values, because workplace and also at the same to suc-
they will find it difficult to stand up to cessfully pursue their studies. Table 2
that person when they need to. Consci- shows mean values for males and fe-
entiousness is that trait of personality males full time management students.
which is linked with job success in many Mean score of Conscientiousness indi-
research studies. It is that trait of per- cates that part time management students
sonality which is associated with disci- have a higher score (M=37.13) than full
time male students (M=32.83) on this di-
mension, and this was statistically sig-
Female students are better fo- nificant (t = -4.81). This result indicates
cused, scrupulous, purposeful and that part time management students are
punctual by nature. more focused and organized in their ap-
proach.

254 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
 Role of Neo Five Factor Model of Personality in Management Education
Discussion
The primary focus of this study was
to better understand the relative impor-
tance of various personal characteristics–
emotional stability, extraversion, openness
to experience, agreeableness and consci-
entiousness in a management institute.
The results from this study attest to the
utility of using this measure for various
practical considerations i.e. selection,
training, team building, conflict resolution
and leadership development. From the
present study significant differences
were found in the personality traits of full
time males and females students of a
management institute in Negative Emo-
tionality, Agreeableness, Openness to
Experience and Conscientiousness. Fe-
male management students were found
to be on the higher side of Negative
Emotionality, which is indicative of more
susceptibility towards stress. This can be
a warning for female management stu-
dents who are going to be tomorrow’s
leaders, to take life little easy. They need
to seek out a position or role that is es-
sentially stress free or has only occasional
stress. For the full time male manage-
ment students it is good to know that their
ability to perform calmly in high stress
situations is a very positive indicator in
today’s turbulent environment.
In the case of Conscientiousness,
several studies provide robust support for
its ,usefulness as a predictor of Job Per-
formance (Barrick & Mount 1991, 1993
Barrick, Mount & Strauss 1993). Female
management students were found to be
significantly high on Conscientiousness
domain in comparison of their male coun-
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
terparts. The Conscientiousness factor
refers to the person pursing fewer goals
in a purposeful way. In general focused
people tend to be high achievers.
Agreeableness dimension was found
to be significantly higher among female
management students. The one situation
in which Agreeableness appears to have
high predictive validity is in jobs that in-
volve considerable interpersonal interac-
tion, particularly when the interaction in-
volves helping, cooperating and nurtur-
ing others. In fact in those settings, Agree-
ableness may be the single best person-
ality predictor (Barrick, Stewart, Neubert
& Mount 1998, Mount et al 1998). An-
other study by Antonioni (2001) has been
found to be useful and relevant. The re-
sults of this study suggest some strong
relationships between Big Five Person-
ality factors and conflict resolution strat-
egies. Managers who scored high on
Extroversion, Agreeableness and Consci-
entiousness tend to use a win-win col-
laboration strategy in resolving conflicts
with individuals who report directly to
them. The results of this study also sug-
gest that individuals with specific person-
ality traits may be more predisposed to
use interpersonal conflict resolution strat-
egies that match their traits. In the
present research work it was found that
females had higher scores on Agreeable-
ness and Conscientiousness than their
Agreeable individual team mem-
bers will tend to exhibit interper-
sonal skills such as the ability to
resolve conflict and communicate
openly.
255

male counterparts. So the chances of
using a win-win collaboration strategy will
be more applicable with the males. To
summarize, agreeable individual team
members will tend to exhibit interpersonal
skills such as the ability to resolve con-
flict and communicate openly.
In organizational settings, people
who are high on openness to experience
may have both a broader range and depth
of experience, and more of an appre-
ciation of the merits of new ways of
doing things and the potential for im-
proving and changing the status quo,
than individuals who are low on open-
ness to experience. In the present study,
as apparent from Table 1, Openness to
Experience trait is significantly higher
among female management students as
compared to full time male management
students. Ultimately full time female stu-
dents will be able to appreciate things
that are novel and unique in conjunction
with their greater sensitivity. And range
of experience may cause them to come
up with novel solutions to problems and
creative ideas to improve on current
functioning.
From Table 2 we can see the signifi-
cant difference in the Conscientiousness
trait. Part time management students
were found to be more focused, orga-
nized and a better planned in their ap-
proach, in comparison to full time male
management students. It can be sugges-
tive of role of experience in developing
this domain. Part time management stu-
dents have to work in the day time and
attend classes in the evening, which
forces them to be systematic and orga-
256 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Archana Tyagi & Veena Bansal
nized in their approach towards life in
general. Conscientiousness appears to be
the trait- oriented motivation variable that
industrial –organizational psychologists
have long searched for, and it should oc-
cupy a central role in theories seeking to
explain job performance (Barrick, Mount
&Judge 2001
Recommendations & Future
Directions
Recent research has clearly demon-
strated that personality is a valid predic-
tor of job performance, particularly when
the unique personality requirements of the
job have been accurately defined. Per-
sonality assessment is extremely useful
in predicting contextual job performance
as opposed to the technical aspects of
job performance (contextual perfor-
mance being described, typically, as the
“soft side” of work –interpersonal effec-
tiveness, person-organization fit, etc).
Finally, it is necessary to acknowledge
that the Five Factor Model, although a
current paradigm, in the field of person-
ality, is not unanimously accepted, and
some recent criticisms have been made.
For example Block (1995) suggested that
factor analysis is not an appropriate and
sufficient base to decide the theoretical
constructs of personality. Such criticism
was answered by Costa and Mc Crae
(1995) and Goldberg and Saucier (1995),
who said that the Big Five has been, re-
produced a great number of times, with
different factor methods, by different
researchers, with different instruments,
and in different languages. Consequently
the model is not exhaustive, but it man-
ages to support a more comprehensive
 Role of Neo Five Factor Model of Personality in Management Education
explanation of various facets of human
personality (Salgado 1997).
The population of the sample size is
only 229 in number; however the results
can be verified using a larger data set.
The present research is being confined
to the data collection from one manage-
ment institute only and hence the results
obtained cannot safely be generalized.
The data collection with the help of NEO-
FFI from a few management institutes
may be able to give a wider application
to the instrument with the full time and
the part time students.
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Suitability of Instruction Methodology in Informative
Management Course: An Empirical Study

Ashutosh Muduli & Vinita Kaura

Instructor’s decision to choose a suitable in- Instruction
struction methodology depends upon the ma- Methodology
turity level of learners. Literature reveals the
use of andragogy or pedagogy as instruction Optimum learning out-
methodology. Self-concept of learner, experi- come requires a perfect
ence, learning motivation, orientation to learn- matching of learners’ learn-
ing and domain of instruction are identified as ing style and instructor’s in-
the factors of learner’s maturity level. The cur- struction methodology
rent study focused on examining the relative (Beder & Darkenwald
effectiveness of andragogy and pedagogy in 1982, Brookefield 1984,
teaching higher level informative course to Knowles 1984). The learn-
postgraduate management learners of an au- ing style of learners is re-
tonomous business school in Rajasthan. Effec- flected by the type and
tiveness of learning is examined through mea- range of activities that
suring learning output. Analysis of results re- learners undertake to ac-
veals relatively high maturity level of learners quire domain knowledge
and therefore the preferred methodology of in- (Beder & Darkenwald
struction shall be andragogy only. Instructors 1982). Maturity of learner
are suggested to use practical application and familiarity with the do-
through use of videos, experiential exercises, main of current learning in-
and group activities in which learners can share fluence the learning style of
their experiences. learner (Nadkarni 2003).
Similarly, instruction meth-
Ashutosh Muduli is Associate Professor, School of Petroleum odology used by instructors
Management, Pandit Deendayal Petroleum University, Gandhi Nagar, can be either pedagogical or
Gujurat. E-mail:ashu_hrm@rediffmail.com. Vinita Kaura is andragogical. The
Assistant Professor, Faculty of Management Studies, Mody
Institute of Technology and Science (Deemed University),
instructor’s decision to use
Laxmangarh, Sikar (Dt.), Rajasthan. E-mail: kaura2005@ either pedagogical or
rediffmail.com andragogical methodology

The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 259

Andragogical methodology is
more preferred for highly ma-
tured learners and when the
learner has more familiarity with
the domain.
largely depends on the maturity level of
learners and the familiarity of the learn-
ers with the domain. Instructors prefer
to use pedagogical methodology when the
learner’s maturity level is low and the
domain specific knowledge is negligible;
whereas andragogical methodology is
more preferred for highly matured learn-
ers and when the learner has more fa-
miliarity with the domain.
Nadkarni (2003) commented that ‘fu-
ture studies may examine the relative
effectiveness of andragogy and pedagogy
in teaching higher level courses to ma-
ture learners. Further, research in teach-
ing higher level courses to mature learn-
ers mostly confined to either teaching
general management or decisional tools
such as strategic management, market-
ing management, organizational
behaviour, accounting etc. (Govekar &
Rishi 2007, Karns 2005, Nadkarni 2003,
Bale &Dudney 2000). Research in ex-
amining the relative effectiveness of
andragogy and pedagogy in teaching
higher level informative courses to ma-
ture learners is very rare. Again, in India
we haven’t come across any empirical
study related to the above said areas. This
research gap has encouraged the re-
searchers to pursue the current study.
The current study focused on identi-
fying the most preferred instruction meth-
odology for an informative course titled
260 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Ashutosh Muduli & Vinita Kaura
‘Changing Business Environment’ (CBE)
offered to a batch of postgraduate man-
agement learners of an autonomous busi-
ness school in Rajasthan, India. For this
purpose, data were collected from the
learners to explore the preferred instruc-
tion methodology. Secondly, maturity
level and domain awareness of the learn-
ers were ascertained to examine the dy-
namics of learners style of learning. Fi-
nally, effectiveness of learning is exam-
ined through measuring learning output.
Opinion study of the learner was con-
ducted to know how far the learning has
been successful in realizing learners’
objective.
Conceptualisation
Learning is an activity that learners
engage in to acquire particular skills and
knowledge (Brookefield 1984). The type
and range of activities that learners un-
dertake to acquire domain knowledge
reflects the learning style of learners
(Beder & Darkenwald 1982). The learn-
ing style of learners is contingent on the
domain of instruction and the maturity of
learners (Nadkarni 2003). The basic
premise of the adult learning literature is
that the better the fit between the learn-
ing style of learner and the instructional
methodology of instructor, the more
favourable the learning outcomes result-
ing from the activity of learning (Beder
& Darkenwald 1982, Brookefield 1984,
Knowles 1984). With this background in
mind, an attempt is made here to describe
the three important components of a
learning activity that is learner’s matu-
rity, instruction methodology and learn-
ing outcome.
 Suitability of Instruction Methodology in Informative Management
Learner’s Maturity
Smith and Delahaye (1987) described
learner’s maturity as including the amount
of knowledge the learner already has in
the subject area, the level of interest and
need to acquire the learning, the degree
to which the learner is willing to accept
the responsibility to learn, and the degree
of skill in learning the learner possesses.
Stuart and Holmes (1982) suggest that
learner ’s maturity consists of the
learner’s past learning experiences, ex-
pectations, attitudes to the forthcoming
learning event, and prior knowledge.
Nadkarni (2006) observed that learner
maturity consists of the learner’s past
learning experience, expectations, atti-
tudes to the forthcoming learner event,
and prior knowledge of the domain. On
the basis of the above literature, we
identified self-concept of learner, expe-
rience, learning motivation, orientation
to learning and the amount of domain
knowledge as the characteristics of
learner’s maturity.
Self- Concept of the Learner
Self-concept of the learner refers to
self-directed learning. A self-directed
learning is a process in which individuals
take the initiative, with or without the help
of others, in diagnosing their learning
needs, formulating learning goals, identi-
fying human and material resources for
learning, choosing and implementing ap-
propriate learning strategies, and evaluat-
ing learning outcomes (Knowles 1970).
The self-concept of learners varies from
a passive recipient of knowledge to self-
directed and responsible learning. The
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
movement from dependency to self-direct-
edness is, what Lieb (1991) considered as
the resultant of ‘the normal maturing pro-
cess of life’.
Experience
Experience influences learner ’s
learning style. As a person matures he
accumulates a growing reservoir of ex-
perience that becomes an increasing re-
source for learning. As Marienau (1999)
observed ‘a hallmark of an educated per-
son is the capacity to reflect on and learn
from experience such that the learning
yields meaningful interpretations of life
occurrences and informs future action’.
Motivation
Learning motivation has been defined
as the willingness to attend and learn ma-
terial presented in a developmental pro-
gram (Noe 1986). As a person matures
his readiness to learn becomes oriented
increasingly to the developmental tasks of
his social roles. Learners are ready to learn
those things they need to know in order to
cope effectively with life situations.
Orientation to Learning
Learning preferences of the learner
depends on goal orientation of the
learner. As a learner matures, his time
perspective changes from one of post-
poned application of knowledge to imme-
diacy of application and accordingly his
orientation towards learning shifts from
subject-centred to problem centred. For
example, an adult learner knows what
they want before they enrol in the course,
261

because they know where they want to
go. They appreciate a course that is well
organized and has goals delineated clearly
and preferably congruent with their own
(Lieb 1991). They prefer learning that will
help them perform tasks that they con-
front in their life situations.
As a learner matures, his time per-
spective changes from one of post-
poned application of knowledge to
immediacy of application and ac-
cordingly his orientation towards
learning shifts from subject-
centred to problem centred.
Domain Knowledge
Learners’ level of domain knowledge
also acts as a determinant of learning
maturity level. As Smith and Delahaye
(1987) observed that the amount of
knowledge the learner already has in the
subject area affects the maturity level of
the learner. The inherent contrast be-
tween different subjects such as pure
versus applied, quantitative versus quali-
tative, or analytical versus perceptual
suggests that more subtle differences
may prevail across different disciplines
such that the dynamics of teaching and
learning may manifest themselves in
characteristic ways (Nadkarni 2003).
The results of studies evaluating the re-
lation between instructional styles and
learning outcomes in subjects such as
mathematics and statistics that are quan-
titative, conceptual, and analytical may
not be applicable to management domains
such as organizational behaviour or stra-
tegic management that are qualitative,
262 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Ashutosh Muduli & Vinita Kaura
perceptual, and practical in orientation
(Nadkarni 2003). Marketing educators
have also given considerably more empha-
sis to active (Wright, Bitner & Zeithamel
1994) and experiential learning activities
(Gremler et al. 2000, Kennedy Lawton &
Walker 2001, Smith & Van Doren 2004).
Andragogical & Pedagogical
Methodologies
Knowles (1984) identified two con-
trasting instructional styles in adult edu-
cation: andragogical and pedagogi-
cal. Pedagogy is derived from the Greek
words paid (child) and agogus (lead or
accompany) while andragogy is derived
from aner (adult) and agogus. Pedagogy
involves adults leading or accompanying
children while andragogy is characterized
by adults leading adults (Bale & Dudney
2000). Pedagogical styles are more
teacher-driven and directed methods,
whereas andragogical methods are more
learner-centered or self-directed styles
(Nadkarni 2003). Knowles (1984) com-
pares the assumptions of pedagogy and
andragogy as follows:
1. The role of the child is that of a depen-
dent learner; the adult, due to the matu-
ration process, is a self-directed learner.
Adults have a need to “take charge”
of their learning and we as teachers
should nurture this natural tendency.
2. Children have no experiences of worth
that they can bring to the learning set-
ting; adults, as they grow and mature,
accumulate a wealth of experiences
that can be a rich resource for learning.
3. Children are brought, or made to go,
 Suitability of Instruction Methodology in Informative Management
to school when society deems it time;
adults come to learn when they are
compelled by the need to cope with a
“life change” or to satisfy some other
real-life circumstance.
4. Younger learners see learning as a
matter of accumulating subject mat-
ter content that will be used when
they are older; adults view learning as
a means to improve their competency
level, and they want to apply whatever
new knowledge immediately.
Knowles argued that andragogical
methods are universally more appropriate
for adult education than pedagogical meth-
ods. This is because adult learners are more
often the initiators of their own learning
experience; they exert more control over
learning processes and outcomes, and
therefore prefer more power and autonomy
in the learning context (Brim &Wheeler
1966). Unlike the practice of pedagogy,
which is teacher-centered, andragogy is
learner-centered, with the role of the
teacher primarily that of a facilitator.
Learning Outcome
Outcomes are the consequences of
participating in a particular project, course,
Table 1: Learning Outcomes Found in a Business Program
l Analytical and statistical skills (problem solving)
l Communication skills (oral and/or written)
l Content specific knowledge (e.g., financial theories, analysis, reporting, and markets) Critical
thinking skills
l Ethical understanding
l Global awareness
l Group and individual dynamics in organizations
l Motivational and leadership skills
l Multicultural and diversity understanding
l Organizational skills
l Use and management of information technology
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
or program, such as an academic degree
program. Learning outcomes are the re-
sultant of an interaction between the learn-
ing style of learners and the instructional
methodology of instructor. The better the
fit, the more favourable will be the learn-
ing outcomes. (Beder & Darkenwald 1982,
Brookefield 1984, Knowles 1984).
Student-learning outcomes provide a
means for clearly stating the expected out-
comes of instruction, or more broadly, the
expected outcomes of a program. Measur-
ing learning outcome requires both qualita-
tive and quantitative measures to be
adopted by the instructor. Qualitative mea-
sures of learning outcome are better indi-
cators of student learning than quantitative
measures such as examination performance
(Ramsden 1992, 2003). Student satisfac-
tion, achievement, persistence, and reten-
tion have been used as qualitative measures
(Beder & Carrea 1988, Charkins et al. 1985,
Conti & Welborn 1986, Graham 1988),
whereas quantitative measures like exami-
nation results, grades etc. have been used
as a measure of learning outcome (Watkins
& Hattie 1981, Entwistle & Ramsden 1983).
A common set of learning outcomes that
may be found in a business degree pro-
gram is provided in Table 1.
263

Learner Maturity & Instruction
Methodology
Stuart and Homes (1982) argue that
learner maturity is an important consider-
ation in selecting appropriate style of in-
struction. In other words, selection of in-
struction methodology (i.e. andragogy or
pedagogy) to teach an informative input to
post graduate management learners will
depend on learners’ level of maturity. The
self-concept of learners varies between the
andragogical and pedagogical methods.
The pedagogical method assumes learners
prefer to play the role of passive recipient
of knowledge. On the other hand, the
andragogical method assumes that learn-
ers prefer to be self directed and educa-
tors have the responsibility to encourage
and nurture the transformation from depen-
dency to self-directedness (Knowles 1970).
The importance of experience also
differs between andragogical and peda-
gogical methods. In the pedagogical
method, learners are assumed to have
limited experience to assist in learning.
In contrast, andragogy assumes learners
have many experiences that assist in the
learning process ( Knowles 1970). Peda-
gogy concentrates not on learning from
experience, but instead on instituting an
experience base (Forrest & Peterson
2006). While, andragogical teachers as-
sume learners have experiences, use of
such experiential knowledge is necessary
for the education process to be effective
(Forrest & Peterson 2006).
Assumptions made on learner’s mo-
tivations or readiness to learn, help de-
fining the differences between the two
264 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Ashutosh Muduli & Vinita Kaura
learning models. When describing readi-
ness to learn, Knowles (1970) discusses
“teachable moments”. Pedagogy as-
sumes that learners tend to experience
uniform teachable moments; therefore,
standard curricula combined with exter-
nal motivations are considered appropri-
ate. According to Knowles teachable
moments for adults are not uniform.
Andragogy implies that a curriculum
must be flexible enough to capture teach-
able moments, with adjustment for chang-
ing needs. Furthermore internal factors
tend to be more motivational for adults.
Under pedagogy, learners assume that
chosen course topics will help them to
acquire skills that will be relevant and
useful in the future. Under andragogy,
learners tend to seek immediate rel-
evance in education. Any knowledge
gained tends to be quickly applied to the
lives of adult learners; therefore, an
andragogical curriculum focuses on com-
petency development that is immediately
relevant to adult learners.
Domain & Learning Output
Instructor’s choice of instructional
methodology depends on domain as well.
As Nadkarni (2003) observed “the inher-
ent contrast between different subjects
such as pure versus applied, quantitative
versus qualitative, or analytical versus
perceptual suggests that more subtle dif-
ferences may prevail across different
disciplines such that the dynamics of
teaching and learning may manifest them-
selves in characteristic ways”. For ex-
ample, in lower level introductory
courses, the instructor’s primary function
is to build strong conceptual understand-
 Suitability of Instruction Methodology in Informative Management
ing in the learners. A pedagogical method
of instruction giving more thrust to con-
cept building through lecture based
method seems more appropriate for such
kind of courses.
A myriad of studies have shown that
instructional context strongly influences
learning outcomes such as student satis-
faction, achievement, persistence, and
retention (Beder & Carrea 1988,
Charkins et al. 1985, Conti & Welborn
1986, Graham 1988). Attempting to link
instructional methodology, domain and
learning output, Miglietti and Strange
(1988) commented that ‘the importance
of disciplinary differences in assessing
the outcomes of teaching styles always
mediated through learning styles’. Em-
pirical studies in learning also concluded
that ‘the relation between instructional
methodology and learning outcomes in
subjects such as mathematics and statis-
tics that are quantitative, conceptual, and
analytical may not be applicable to man-
agement domains such as organizational
behavior or strategic management that
are qualitative, perceptual, and practical
in orientation’ (Nadkarni 2003). Market-
ing educators have also given consider-
ably more emphasis to active (Wright,
Bitner & Zeithamel 1994) and experien-
tial learning activities (Gremler et al.
2000, Kennedy, Lawton & Walker 2001,
Smith & Van Doren 2004).
On the basis of the above discussion,
we propose the following hypotheses for
the study:
Null Hypothesis 1. There is no sig-
nificant difference between andragogy
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
and pedagogy (instruction methodology)
for informative inputs for Post Graduate
(PG) management learners. The above
hypothesis leads to the following sub hy-
pothesis:
Null Hypothesis 1a. There is no sig-
nificant difference between andragogy
and pedagogy (instruction methodology)
with respect to self concept for informa-
tive inputs for PG management learners.
Null Hypothesis 1.b. There is no sig-
nificant difference between andragogy
and pedagogy. (instruction methodology)
with respect to experience for informa-
tive inputs for PG management learners.
Null Hypothesis 1.c. There is no sig-
nificant difference between andragogy
and pedagogy ( instruction methodology)
) with respect to motivation/readiness to
learn for informative inputs for PG man-
agement learners.
Null Hypothesis 1.d. There is no sig-
nificant difference between andragogy
and pedagogy (instruction methodology)
with respect to orientation to learning for
informative inputs for PG management
learners.
Null Hypothesis 2. Learning outcome
for the informative inputs for PG man-
agement learners is not very high.
Methodology of the Study
Primary and secondary data were
used for this research. Primary data is
collected from an autonomous Business
School in Rajasthan, which is exclusively
265

for women. A questionnaire was admin-
istered on MBA part I learners in spring
semester. Total strength in MBA part I
was114 learners of whom 95.6% submit-
ted satisfactory responses.
Measures
The survey instrument included items
that assessed Preferred Learning Style (24
items) and Learning Outcome (5 items).
To measure Preferred Learning Style, we
used Student’s Orientation Questionnaire
(SOQ) used by Bale & Dudney (2000).
The SOQ was a modification of an earlier
questionnaire developed by Hadley (1975).
Hadley’s (1975) questionnaire contained 25
andragogical and 25 pedagogical items
(Deveci 2007). The modified SOQ used
by Bale & Dudney (2000) has 41 state-
ments, with 20 being andragogical and 21
being pedagogical. We further modified
SOQ for our research and confined the
number of questions into 24 statements, 12
being andragogical and 12 being pedagogi-
cal. The statements were scored on a 5-
point Likert scale ranging from 5 (almost
always) to 1 (almost never). Cronbach’s
alpha test is conducted to test the reliabil-
ity of data and its value is found .63 (Table
2). Learning Outcome is measured
through an instrument containing five items:
course coverage, course relevance, instruc-
tion methodology used, evaluation system
used and learning from the course. Respon-
dents were asked to share their satisfac-
tion through a 5-point Likert scale ranging
from 5 (excellent) to 1 (very poor).
Table 2: Reliability Test
Cronbach’s alpha .63
266 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Ashutosh Muduli & Vinita Kaura
Statistical Analysis
For the purpose of analysis of data, de-
scriptive analysis, paired sample T test analy-
sis and one sample T test analysis were used
on a standardized data set using SPSS ver-
sion 11.0 and MS Excel. Tables 3- 6 show
means, standard deviations, paired sample
T test analysis and one sample T test analy-
sis. Paired sample T test analysis was done
to investigate the significant difference be-
tween andragogy and pedagogy (instruction
methodology), and significant difference
between andragogy and pedagogy (instruc-
tion methodology) with respect to self- con-
cept, experience, motivation and orientation
to learning for informative inputs for PG
management learners. One sample T test
was done to measure the learning output.
Paired sample T test is analyzed to investi-
gate the significant difference between
andragogy and pedagogy (instruction meth-
odology). The paired sample T test analysis
indicates that for the 114 subjects, the mean
score on the andragogy methodology of in-
struction (M=3.97) was significantly greater
at the p<.05 level (note: p=.000) than the
mean score on the pedagogy methodology
of instruction (M=3.44). With this the null
hypothesis 1, that is, ‘there is no significant
difference between andragogy and peda-
gogy for CBE course’ is rejected. This im-
plies that the preferred instruction method-
ology is andragogy for CBE course. In other
words, the instructor may use more experi-
ential learning based methodology than lec-
ture and discussion based methodology for
teaching CBE to the learners.
The preferred instruction meth-
odology is andragogy for CBE
course.
 Suitability of Instruction Methodology in Informative Management

Table 3: Paired Sample Statistics between Pedagogy and Andragogy

Mean N Std. Deviation Std. Error Mean

Pair 1 Pedagogy 3.4495 109 .55254 .05292

Andragogy 3.9725 109 .51745 .04956

Table 4: Paired Samples Test between Pedagogy and Andragogy

Paired Differences t df Sig.
Mean Std. Std. 95% Confidence
Deviation Error Interval of
Mean the Difference
Lower Upper
Pair 1 Pedagogy - -.5229 .68848 .06594 -.6536 -.3922 -7.930 108 .000
Andragogy

Table 5 : Paired Samples Statistics among Learners Maturity level across Pedagogy - Andragogy
Mean N Std. Std.
Deviation Error Mean
Pair 1 And Self Concept 3.9174 109 .81795 .07835
Ped Self Concept 3.4862 109 .93902 .08994
Pair 2 And Experience 3.7064 109 .71106 .06811
Ped Experience 3.5229 109 .80042 .07667
Pair 3 And Motivation 3.7798 109 .69865 .06692
Ped Motivation 3.7615 109 .76859 .07362

Pair 4 And Orientation 4.1284 109 .70843 .06786

Ped Orientation 3.0459 109 .79798 .07643

Paired sample T test is conducted to instruction with respect to experience

investigate the significant difference be-
tween andragogy and pedagogy (instruc-
tion methodology) with respect to self-
concept, experience, motivation and ori-
entation to learning. The paired sample T
test analysis indicates that the mean score
on the andragogy methodology of instruc-
tion with respect to self-concept (M=3.91)
was significantly greater at the p<.05 level
(p=.000) than the mean score on the peda-
gogy methodology (M=3.48), the mean
score on the andragogy methodology of
(M=3.70) was significantly greater at the
p<.05 level (p=.047) than the mean score
on the pedagogy methodology (M=3.52),
the mean score on the andragogy meth-
odology of instruction with respect to
motivation (M=3.77) was insignificant at
the p<.05 level (p=.000) than the mean
score on the pedagogy (M=3.76), and
andragogy methodology of instruction with
respect to orientation to learning (M=4.12)
was significantly greater at the p<.05 level
(p=.000) than the pedagogy methodology

The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 267
 Ashutosh Muduli & Vinita Kaura

Table 6: Paired Samples Test among Learners Maturity level across Pedagogy - Andragogy
Paired Differences t df Sig.
Mean Std. Std. 95% Confidence
Deviation Error Interval of
Mean the Difference
Lower Upper
Pair-1 And Self .4312 1.18139 .11316 .2069 .6555 3.811 108 .000
Concept
Ped Self
Concept

Pair-2 And Self

Concept .4312 1.18139 .11316 .2069 .6555 3.811 108 .000
Ped Self
Concept
Pair-3 And
Experience .1835 1.04673 .10026 .0152 .3822 1.830 108 .047
Ped
Experience

Pair-4 And
Readiness .0183 1.00905 .09665 -.1732 .2099 .190 108 .850
Ped
Readiness

Pair-5 And
Motivation 1.0826 1.12323 .10759 .8693 1.2958 10.062 108 .000
Ped
Motivation

(M=3.04). With this the null hypothesis
1.a., 1.b., and 1.d. are rejected, where as
the null hypothesis 1.c. is accepted. This
means that the learners are self directed,
they bring practical experience and
knowledge to the educational activity and
are problem or performance centred. It
is also proved that learners are not moti-
vated by internal factors such as need to
learn. Rather, they seem to be more mo-
tivated by external factors such as grade,
placement etc.
In Table 7, one sample T test is con-

Table 7: Learning Output-One Sample Test

Test Value= 3 t df Sig.
Mean Std. Std. 95% Confidence
Deviation Error Interval of
Mean the Difference
Lower Upper
Var Learning 4.25 .124 .055 1.10 1.41 22.59 108 .000
Output

268 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
 Suitability of Instruction Methodology in Informative Management
ducted to investigate the significant dif-
ference between Instruction methodol-
ogy (andragogy/ pedagogy), Maturity
level (high/low) and Learning output for
informative inputs for PG Management
learners. The result of the analysis indi-
cates that the mean satisfaction of the
class (M=4.25) was significantly higher
at the p<.05 level (p=.000) than the
instructor’s goal (satisfaction level) of 3
from a five point scale. With this the null
hypothesis 2. i.e. ‘Learning outcome for
the informative inputs for PG Manage-
ment learners are not very high’ is re-
jected. This means that if the instructor
use andragogy methodology of instruc-
tion the learning output will be very high.
Discussion
The results of the study proved that
andragogy is the most suitable method of
instruction for teaching an informative
course to post graduate management
learners. The results support the tradi-
tional view on adult education that self-
directed, experiential instructional meth-
ods are most suitable for adult learners
(Brookefield 1984, Knowles 1984).
The results of the study proved
that andragogy is the most suitable
method of instruction for teaching
an informative course to post
graduate management learners.
The suitability of andragogy for the
given population is primarily based on the
maturity level of the learners. The results
of the study indicates that the maturity
level of the learners pursuing a post-
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
graduate management course is relatively
high for three learners maturity dimen-
sions i.e. self -concept, experience, and
orientation to learning except motivation.
The high maturity level across self-con-
cept, experience, and orientation to learn-
ing is because of the deliberately chosen
career through rigorous admission tests.
When learners intentionally chose the
career of management and therefore
admitted in to a management programme
from a self funded autonomus B school
(where the fees is relatively higher than
govt. funded B’ Schools), the learners are
expected to be self-directed. The find-
ing that the learners bring practical ex-
perience and knowledge to the educa-
tional activity is quite surprising consid-
ering the low level of experience of the
learners. However, perhaps earlier ex-
posure to such informative courses, par-
ticularly at the graduation level might
have helped the learners to bring more
experience to the class The finding that
learner’s orientation to learning is high,
is quite natural and expected because
learners of a professional programme are
expected to be problem or performance
centred. However, the results do not
agree with the assumption that learners’
maturity with reference to motivation is
very high. The result proved that learn-
ers are not motivated by internal factors
such as need to learn. Rather, they seem
to be more motivated by external factors
such as grade, rigid structure etc. Again,
the result is quite surprising. May be this
is because the population of the study is
females only. In Indian culture, the soci-
ety considers the marriageable age of
average females as 22-24. By the end of
a PG management programme, the stu-
269

dents are expected to be very close to
the said age level. This might have low-
ered the internal motivation of the learn-
ers resulting in more concern for exter-
nal motivation like grades or final result.
The result proved that learners
are not motivated by internal fac-
tors such as need to learn. Rather,
they seem to be more motivated
by external factors such as grade,
rigid structure etc.
Limitations
First limitation is that the sample unit
consists of one unit only (A deemed uni-
versity) where as the sample size is only
114 learners of a PG department of an
autonomous B school. The findings may
not be generalised across all learning en-
vironments. Secondly, the scope of the
study confines only to a single subject
(Changing Business Environment) under
informative course headings. Covering
more subjects related to the informative
course area may increase the variance
and therefore the results can be more
valid. Finally, the measurement of Learn-
ing Output may cover quantitative mea-
sures like GPA scores etc.
Conclusion
Management education is more quali-
tative than quantitative. For a given prob-
lem, there may be a variety of solutions
based on assumptions. So, instructors
have to create understanding among the
learners for different real situations
rather than information dump. Therefore
270 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Ashutosh Muduli & Vinita Kaura
we suggest the instructor to use practi-
cal application through use of videos,
experiential exercises, and group activi-
ties in which learners can share their
experiences in groups in every class for
informative domain as well. The meth-
odology can be emphasized more by us-
ing simulation and role-playing activities
and by encouraging learners to share
personal experiences. Long and compre-
hensive case discussions can be used fre-
quently with minimal intrusion from the
instructor. The findings further encour-
age free communication through group
activities such as class simulation and role
playing where the instructor adopted a
laissez-faire approach.
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272 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Predictors & Outcomes of Employee Engagement:
Implications for the Resource-based View Perspective
Jyotsna Bhatnagar & Soumendu Biswas
This paper extends the resource
based view of the firm to employee
engagement and explores linkages
with firm performance. It argues
that employee engagement interacts
with other intangible variables such
as the sense of justice and psycho-
logical contract which an individual
feels and expects, respectively. The
individual’s psychological contract
is shaped by organizations’ HR poli-
cies along with many social cues
from the work environment. This may
affect the employee engagement.
Further, there may be a positive ef-
fect of Employee Engagement on
Organizational Commitment and Or-
ganizational Citizenship Behavior.
The entire equation may lead to high
firm performance which in turn may
affect Employee Engagement. It pro-
poses a conceptual model of these
intangible variables and their link-
age with the tangible variable of firm
performance.
Jyotsna Bhatnagar (Email: jyotsnab@mdi.ac.in) is
Associate Professor (HRM), Chairperson-PGHR &
Soumendu Biswas (Email: sbiswas@mdi.ac.in) is
Assistant Professor (HRM) in Management
Development Institute, Gurgaon.
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Resource-based View
We extend the resource based view
of the firm to employee engagement and
try to explore linkages with firm per-
formance. By developing these intan-
gible capabilities of employee engage-
ment, it’s antecedents and outcomes,
which are path dependant, a firm can
stay ahead of it’s competitors (Teece
et al 1997; Colbert 2004) and leads to
VRIN which is difficult for competitors
to imitate (Barney 1991).This is in line
with the dynamic capability perspective,
which extends the RBV (http://www.
valuebasedmanagement.net methods_
barney_resource_based_ view_firm.
html/accessed 28th March 2009). It also
fills in the lacunae pointed by research-
ers like Foss et al (1996b). Foss and
Ishikava (2006) point out to the short-
comings of RBV and state that process
orientation has not made the theory
dynamic. Foss (1996b) speculates that
various “competence-based,” “capabili-
ties,” “dynamic capabilities,” etc. ap-
proaches which all try to highlight dy-
namics in various ways (e.g., Hamel
and Prahalad 1994) in RBV should be
the focus of research.. 
273

The resource-based view suggests
that human resource systems can con-
tribute to sustained competitive advan-
tage through facilitating the development
of competencies that are firm specific,
produce complex social relationships, are
embedded in a firm’s history and culture,
and generate tacit organizational knowl-
edge (Barney 1991). Much work has
been done in behavioral perspective,
leading to a non-conclusive view that
role behaviour may be copied by com-
peting firms (Colbert 2004). HR practices
and strategic HR roles on the other hand
emanate certain intrinsic motivational
effects like Organizational Commitment
and lead to high firm performance
(Bhatnagar 2007, Bhatnagar 2009a).The
motivational basis of employee work at-
titudes and behaviors is regarded as an
important component of research agenda
relating to management practices (Aryee,
Budhwar & Chen 2002) especially in an
employment relationship domain
(Bhatnagar 2009a:171). In the current
study we explore the processes which
emanate in organizations due to certain
HR practices in the workplace. We are
not studying the HR practices of the or-
ganization in this paper, but the processes
which serve as an important competitive
advantage for the firm. These are cap-
tured through the sense of justice and
psychological contract and individual
feels. The formation of the individual’s
psychological contract is shaped by com-
pany policies related to recruitment, com-
pensation, claims etc along with social
cues from the work environment (Boxall
& Purcell 2002).This in turn may affect
the employee engagement. There may be
a positive effect of the Employee En-
274 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Jyotsna Bhatnagar & Soumendu Biswas
gagement on Organizational Commitment
and Organizational Citizenship Behaviour.
There may be an interactive effect be-
tween these, leading to lower intention
to quit. The entire equation may lead to
high firm performance which in turn may
affect Employee Engagement. We exam-
ine this variable in the configurational
approach (Delery & Doty 1996) of theo-
rizing SHRM. The configurational school
in organization studies follows a holistic
principle of inquiry and is concerned with
how patterns of multiple interdependent
variables relate to a given dependent
variable (Meyer, Tsui & Hinings 1993).
Researchers gather multiple dimensions
of organizations, such as strategies,
structures, cultures, and processes, into
typologies of ideal types and treat the
types as independent variables (Colbert
2004:344).
Measurement of Employee
Engagement
Employee Engagement is a key to
retention of talent (Glen 2006) and is an
area where lead has been taken by prac-
titioners (Bennett & Bell 2004, Baumruk
et.al 2006, Gallup Management Journal
2006, Parsley 2006, Woodruffe 2006). It
is an area where rigorous academic re-
search is required (Macey & Schneider
2008, IOP Speical Issue 2008)
Employee engagement is a key to
retention of talent
Employee Engagement (Cartwright
& Holmes 2006, Joo & Mclean 2006,
Rothbard 2001) is an important mediator
 Predictors & Outcomes of Employee Engagement
variable which research studies in India
and globally have not investigated
(Bhatnagar 2007a, Saks 2005). In their
research, Robinson, Perryman and
Hayday (2004) note that Employee En-
gagement has been highlighted by prac-
titioners, but largely undermined in aca-
demic literature. Although Kahn (1990),
Saks (2006), and Bhatnagar (2007a) have
tried to provide a concrete conceptual
definition of the Employee Engagement
construct, yet literature revealed that the
conceptualization and definition of the
construct is frequently contaminated with
its identification with other outcome vari-
ables such as job involvement, intrinsic
motivation, organizational commitment,
and organizational citizenship behavior.
(Bhatnagar 2007a; Saks 2006) This was
seen when Gallup q 12 (Buckingham &
Coffman 1999) or Gallup Workplace
Audit was used (Bhatnagar 2007a). We
would like to extend the work and would
measure using Employee Engagement
with a different scale of Saks (2006) in
the Indian context. It is hypothesized:
Hypothesis 1: Employee Engag-
ement is a holistic measure of job En-
gagement and Organizational Engag-
ement.
Predictors of Employee
Engagement
Measurement of employee engag-
ement has entered into academic and
practitioner debate (Meyer & Gagne
2008:61). The authors state that Self
Determining Theory has guided the mea-
surement of engagement relevant vari-
ables like: need satisfaction, motivational
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
states, psychological and behavioral out-
comes in a variety of contexts (e.g., Ryan
& Connell 1989). The authors propose
to map the antecedents of Employee
Engagement, which reflect a degree of
need satisfaction. Variables of justice, like
procedural and distributive may provide
a perception of fairness to the employ-
ees. The formation of the individual’s
psychological contract is shaped by com-
pany policies related to recruitment, com-
pensation, claims etc along with social
cues from the work environment (Boxall
& Purcell 2002). The motivational basis
of employee work attitudes and behav-
iors is regarded as an important compo-
nent of research agenda relating to man-
agement practices (Aryee, Budhwar &
Chen 2002) especially in an employment
relationship domain (Bhatnagar
2009a:171).
Over the past decade or so, numer-
ous studies have provided empirical sup-
port to the notion that psychological con-
tract as an important motivator for em-
ployees (e.g.,) Sturges, Conway, Guest
and Liefooghe, 2005, Rousseau 2004).
Wilhelm et al. (2007) state that the re-
sults of these studies and highlight that
when individuals perceive breach of
promises by their employer; their moti-
vation and commitment to the organiza-
tion decreases and their intention to leave
their jobs increases (Tekleab, Takeuchi
and Taylor 2005) as cited in Bhatnagar
(2009:172). This current study proposes
to measure the predictors of Employee
Engagement. These are variables of jus-
tice and psychological contract. The au-
thors propose to test the following hy-
pothesis:
275

Hypothesis 2: Procedural and distri-
butive justice; transactional and relational
psychological contract will be predictors
of Employee Engagement
Outcomes of Employee
Engagement
Consultants have focused on Em-
ployee Engagement encompassing in
some combination affective commitment
(e.g., pride in the organization, willing-
ness to recommend the organization as
an employer), continuance commitment
(e.g., intention to remain with the orga-
nization), and OCB, described as discre-
tionary effort (e.g., feeling inspired by the
organization, being willing to go above and
beyond formal role requirements). Macey
& Schneider 2008:57). Bhatnagar (2007)
reports studies on organizational commit-
ment as an explanatory factor of employ-
ees’ mobility. Linkages between
mentoring and organizational commitment
and source of support and target of com-
mitment have been explored by Lin et al.,
(2005), Payne & Huffman (2005),
Stinglhamber and Vandenberghe (2003).
However, Bhatnagar and Sharma
(2009:292) report recent research
(Iverson & Zatzick 2007: 456) which has
highlighted “the economic and political
conflicts associated with such practices
(Godard 2001a), including the financial
costs that may offset productivity gains
(e.g., Cappelli & Neumark 2001) and the
intensification of work that results in
greater burnout and stress for employ-
ees (e.g., Green 2004, Ramsay,
Scholarios & Harley 2001). They have
further found organizational commitment
to be a predictor of firm performance in
276 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Jyotsna Bhatnagar & Soumendu Biswas
Indian sample. They found the firm’s
competitive advantage emerging due to
organizational commitment. More re-
cently Employee Engagement has been
related to building a firm’s competitive
advantage. Employee Engagement, in
fact, can make or break the business
bottom line (Lockwood 2006). Martel
(2003:30, 42) is of the opinion that in or-
der to obtain high performance in
postindustrial(sic), intangible work that
demands innovation, flexibility, and speed,
employers need to engage their employ-
ees. Engaging employees—especially by
giving them participation, freedom, and
trust—is the most comprehensive re-
sponse to the ascendant postindustrial
values of self-realization and self-actu-
alization. Performance data of the best
companies in the US show that in all the
practice areas discussed previously. Ob-
jectives are more easily met when em-
ployees are engaged and more likely to
fall short when they are not. In order to
maintain an Employer brand we see an
emergence of a series of studies on em-
ployer of choice, which also measure
engagement index and financial perfor-
mance (Coleman 2005).
Objectives are more easily met
when employees are engaged and
more likely to fall short when they
are not.
A recent SHRM Conference (2006)
reported the results of a new global Em-
ployee Engagement study showing a dra-
matic difference in bottom-line results in
organizations with highly engaged em-
ployees when compared to organizations
 Predictors & Outcomes of Employee Engagement
whose employees had low engagement
scores (Bhatnagar 2007a). A compelling
question is: how much more productive
is an engaged workforce compared to a
non-engaged workforce? (as cited in
Seijts & Crim 2006 and reported in
Bhatnagar 2007a).
According to Soupata (2005) orga-
nizations should strive towards ‘enter-
prise excellence’. In this context, pro-
cesses such as employee commu-
nication, employee relations, and their
learning and development assume an im-
portant role in predicting an employee’s
performance and his/her attachment to
his/her job and organization. It is in this
context that we consider employee en-
gagement as a peremptory construct in
explaining an employee’s attachment to
his/her job and his/her organization. As
reported by Xanthopoulou et al. (2009 :
184), the motivational process of the job
demands–resources ( JD-R) model
(Bakker & Demerouti 2007) suggests
that job resources are the main initia-
tors of employees’ work engagement
and consequently of enhanced perfor-
mance. Job resources refer to physical,
social, or organizational aspects of the
job that are functional in achieving work-
related goals, reduce demands and the
associated costs, and stimulate personal
growth and development (Bakker &
Demerouti 2007). As intrinsic motiva-
tors, job resources fulfill basic human
needs (i.e. need for belonging) and fos-
ter individuals’ development (Deci &
Ryan 1985). As extrinsic motivators,
they encourage employees’ to exert ef-
fort towards a task (Gagne´ & Deci
2005). In both cases, employees may
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
become more engaged in their jobs, be-
cause they derive fulfillment from it
(Schaufeli & Bakker, 2004) and inturn
they perform better (Bakker 2009).
Further, given the logic of self deter-
mining theory (Meyer & Gagne 2008:61)
the current study proposes to measure
the antecedents and outcomes of Em-
ployee Engagement, which would predict
higher firm performance at the organi-
zational level and lower intention to quit
at the individual level . These support di-
rectly the outcome variables of Employee
Engagement as pointed by Macey and
Schneider (2008). They focus primarily
on task performance and organizational
effectiveness as outcomes of engage-
ment. This further supports the SDT
theory implications on employee well
being as pointed by Meyer and Gagne
(2008:61). Individuals who experience
the feeling of well being in an organiza-
tion due to high Employee Engagement
may exhibit lower intention to quit.
Individuals who experience the
feeling of well being in an organi-
zation due to high employee en-
gagement may exhibit lower inten-
tion to quit.
Extending this work and building on
RBV, the authors propose organizational
commitment, lower intent to quit, and
firm performance to be the outcome vari-
ables at individual and firm levels. These
would provide a competitive advantage
to the firm. This line of research would
fill in the caveat in RBV as pointed by
Colbert (2004). It answers the question:
277

how does a firm actively build and con-
tinuously renew strategic human and or-
ganizational resources to fuel competi-
tive advantage?
With the resource-based view of the
firm as the basis, the authors propose that
Employee Engagement would lead to
higher levels of organizational commit-
ment, lower levels of quit intention, and
higher level of firm performance as the
outcomes. This would lead to an inimitable
and sustained competitive advantage to the
firm. It is expected that by proving this
line of thought, the authors would be able
to answer the doubts raised by Colbert
(2005) that firms may find it difficult to
develop and renew strategic human and
organizational resources and practices to
maintain competitive advantage.
Hypothesis3: An employee’s commi-
tment to his/her organization and Orga-
nizational Citizenship Behavior may in-
teract to result in lower intention to quit.
Fig. 1 - The Proposed Conceptual Model
 vestigated the perceptions of distributive
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278 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Jyotsna Bhatnagar & Soumendu Biswas
Hypothesis 4: Organizational Commi-
tment and Organizational Citizenship
Behaviour will be predicted by Employee
Engagement.
Hypothesis 5: Organizational Commi-
tment and OCB will predict lower inten-
tion to quit
Hypothesis 6: Firm Performance will
predict Employee Engagement.
Mediator Role between Predictors
& Outcomes
Furthermore, we intend to conceptual-
ize Employee Engagement as a factor within
the wider concept of ‘Hidden Assets’ (Ehin
2005) of an organization. Besides, we aim
at testing the proposed conceptual model
(Fig. 1) as a non-recursive one wherein we
posit Employee Engagement as an impor-
tant mediator variable, in place of an out-
come variable as suggested by previous lit-
erature (Kahn 1990, May et al. 2004).
Hopkins and Washington (2006) in-
justice, procedural justice, organizational
commitment, organizational satisfaction
and turnover intentions in
a downsizing context.
Results suggested that
trust partially mediated
the relationship between
 distributive justice and
)LUP
both organizational .satis-
faction and affective
3HUIRUPDQFH
commitment. Additionally,
the relationship between
procedural justice and
turnover intentions was
 Predictors & Outcomes of Employee Engagement
mediated by trust perceptions (Hopkins
& Washington 2006:477).
Later, a study by Loi et al (2006)
investigated the empirical linkage be-
tween employees’ justice perceptions,
perceived organizational support, orga-
nizational commitment and intention to
leave. A hypothesized model was devel-
oped to empirically test the linkage be-
tween the relationships among employ-
ees’ justice perceptions, perceived or-
ganizational support (POS), organiza-
tional commitment and intention to
leave. This model was tested using hi-
erarchical regression analyses on a
sample of 514 practicing solicitors in
Hong Kong. The results indicated that
both procedural and distributive justice
contributed to the development of POS,
and POS mediated their effects on or-
ganizational commitment and intention
to leave. As expected, organizational
commitment was negatively related to
intention to leave.
More recently, a relationship antec-
edent model was developed by assimi-
lating research findings on organizational
struct-ure, internal communication, and
organizational justice into relationship
management theory by Kim (2007:170)
where justice is the mediator between
internal communication, organizational
structure as antecedents and organiza-
tional trust, commitment satisfaction and
relationships as outcome variables.
Evidence also suggests that de-
creased perceptions of organizational jus-
tice and trust can adversely impact an
employee’s level of commitment and sat-
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
isfaction with the organization (Cohen-
Charash & Spector 2001, Mishra and
Spreitzer 1998). The accumulation of
these negative perceptions and feelings
may lead to an increase in turnover among
survivors (Aryee, Budhwar & Chen
2002, as cited in Hopkins & Washington
2006:478). Recent research in engage-
ment literature (Bakker 2009) has con-
sistently found work engagement (i.e. a
positive affective/motivational reaction
towards the job that is characterized by
vigour, dedication, and absorption), when
measured as a general well-being indi-
cator, has been found to be positively
related to individual job performance (for
a review see Bakker 2009). Sonnentag
(2003) found that employees’ day-levels
of work engagement predicted their day-
levels of proactive behaviour, after con-
trolling for general levels of engagement
and work characteristics. This is in con-
sonance with the strain of research cited
earlier and that Employee Engagement
would be a predictor to organizational
commitment, organizational citizenship
behaviour and may lead to lower intent
to quit. Given the mixed findings in re-
search we postulate the following hypoth-
esis to be tested in Indian industrial con-
text.
Hypothesis 7: Employee Engagement
will mediate the relationship between
Justice and psychological contract as
antecedents and organizational commi-
tment, OCB, intent to quit and firm per-
formance as outcome.
Very few studies investigate the link-
age between Employee Engagement and
firm performance. Recent work of
279

Xanthopoulou et. al., (2009) has found
this linkage, but with diverse variables.
Xanthopoulou et. al., (2009) investigated
how daily fluctuations in job resources
(autonomy, coaching, and team climate)
are related to employees’ levels of per-
sonal resources (self-efficacy, self- es-
teem, and optimism), work engagement,
and financial returns. Forty-two employ-
ees working in three branches of a fast-
food company completed a questionnaire
and a diary booklet over 5 consecutive
workdays. The multi-level analyses, uti-
lized in the research study, confirmed that
day-level job resources had an effect on
work engagement through day-level per-
sonal resources, after controlling for gen-
eral levels of personal resources and en-
gagement. Day-level coaching had a di-
rect positive relationship with day-level
work engagement, which, in-turn, pre-
dicted daily financial returns.
Harter, et. al,. (2002a) used meta-
analysis to examine the relationship at the
business-unit level between employee
satisfaction-engagement and the busi-
ness-unit outcomes of customer satisfac-
tion, productivity, profit, employee turn-
over, and accidents. Generalizable rela-
tionships large enough to have substan-
tial practical value were found between
unit-level employee satisfaction-engage-
ment and these business-unit outcomes.
An implication is that changes in man-
agement practices that increase em-
ployee satisfaction may also increase
business-unit outcomes, including profit.
Further, in a related work Harter et al
(2002 b), stated that methodologically in
their meta-analysis, they could not ad-
dress the issue of statistical causality,
280 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Jyotsna Bhatnagar & Soumendu Biswas
which they have tried to establish through
case studies. Looking at this gap in lit-
erature we propose to test our model sta-
tistically and would apply Amos (version
17.0; Arbuckle & Wothke 1999) for the
same, and would conduct our data to
structural equation modeling.
Changes in management prac-
tices that increase employee sat-
isfaction may also increase busi-
ness-unit outcomes, including
profit.
In a related research by Schneider,
Hanges, and Smith (2003) on employee
attitude data from 35 companies over 8
years were analyzed at the organizational
level of analysis against financial (return
on assets; ROA) and market performance
(earnings per share: EPS) data using lagged
analyses permitting exploration of prior-
ity in likely causal ordering. Analyses re-
vealed statistically significant and stable
relationships across various time lags for 3
of 7 scales. Overall Job Satisfaction and
Satisfaction with Security were predicted
by ROA and EPS more strongly than the
reverse (although some of the reverse re-
lationships were also significant). Research
has usually not indicated reverse causal
indicators on employee engagement though
related studies (Schneider, Hanges, &
Smith 2003), quoted above, on Employee
attitude, Job satisafaction and Financial per-
formance are present.
In our study we propose a linkage
between firm performance and Employee
Engagement, but in a reverse feedback
loop. This entails that those firms which
 Predictors & Outcomes of Employee Engagement
are financially robust will have a higher
Employee Engagement score. This line
of research is in consonance with the
findings of a study by Towers Perrin
(2003). Their Talent Report reflected
operating margin with 5%, 10%, 15%
change in engagement. More recently,
MacLeod (2009) found in both public and
private sectors that leadership, line man-
agement, employee voice and integrity are
key enablers of engagement and that the
correlation between engagement, well-be-
ing and performance is repeated too of-
ten for it to be a coincidence. The study
was conducted in the western context.
We posit thus:
Hypothesis 8: There may be reverse
causality between Firm Performance and
Employee Engagement.
Further the study by Bhatnagar
(2006) reported vast differences in or-
ganizational learning capabilities in Indian
industrial sectors, especially in the sun-
rise sectors at that time (IT, ITES). Fol-
lowing that line of research and variance
found in the Indian context, and given the
context of recessionary pressures on the
economy, we would like to test the fol-
lowing hypothesis:
Hypothesis 9: Managers of Indian in-
dustry sectors will differ in Employee
Engagement and intent to quit.
Hypothesis 10: Managers in Sunrise
sectors like ITES may have higher Em-
ployee Engagement and firm perfor-
mance linkage than managers of manu-
facturing/engineering sectors
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
The hypotheses above are presented
in a proposed conceptual path model
(fig.1) along with a competing model
(fig.2). Which ever model emerges after
testing the hypothesized relationships and
applying structural equation modeling to
confirm or reject the hypothesized rela-
tionships, will be adopted for discussion
and further implications.
Sample: We collected data for the
present study from 310 working executives
employed in different industry sectors. For
this purpose different strata of managers
viz., senior-level, middle-level, and junior-
level managers were randomly assigned the
survey instrument. Thus, purposive sam-
pling in selecting the organizations of the
respondents and stratified random sampling
for selecting the respondents themselves
was applied for data collection.
Measures: For the purpose of mea-
surement, items have been selected
from standardized questionnaires to
make up a survey instrument compris-
ing 102 items, excluding items related
to demography. Emotional engagement
Fig. 2: Competing Model: Employee Engage-
ment –Correlates and Outcomes
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281

was measured using 11 items of the
scale developed by Saks (2006). This
measure takes into consideration two
facets of Employee Engagement, that is,
job engagement and organizational
engagement comprising five and six
items respectively. Organizational jus-
tice was calculated on the basis of the
scale reported by Collquit (2001). The
construct of organizational justice com-
prised Distributive justice (four items)
and Procedural justice (seven items).
Psychological contract comprising
Relational contract and Transactional
contract are proposed to be computed
with the help of nine items and eight
items respectively of the scale devel-
oped by Raja, Johns, and Ntalianis
(2004). Organizational commitment
was computed using the scale developed
by Rhoades, Eisenberger, and Armelli
(2001). The scale comprises six items.
Organizational citizenship behavior
(OCB) was computed on the basis of
the scale developed by Lee and Allen
(2002). This scale comprises eight
items. Of these eight items, four repre-
sent Organizational citizenship behavior
directed towards individuals (OCB-I)
and four characterize Organizational
Citizenship Behavior directed towards
the organization (OCB-O). Intention to
quit was measured using the three item
scale reported by Colarelli (1984). Firm
performance was measured by taking
firms profit and loss statements from
the respondents.
Data analysis technique: This re-
search is proposed as a non-recursive
study attempting to confirm certain hypo-
thetical relationship(s) between the pro-
282 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Jyotsna Bhatnagar & Soumendu Biswas
posed variables. We propose to examine
the data by administering regression; in-
teractive effect and mediating effect us-
ing generalized least square (GLM)
through the Statistical Package for Social
Sciences (SPSS) version 16.0, and test-
ing a structural equation model using Ap-
plied Moments of Structure (AMOS) ver-
sion 16.0 to confirm the causal relation-
ships between the identified variables.
Theoretical and practical implica-
tions: We will present the model which
is confirmed through our results. This
model may strengthen the dynamic na-
ture of RBV and will help us draw fur-
ther implications for theory based on our
empirical findings in the Indian context.
This work contributes to the Employee
Engagement and RBV literature and
throws important implications for HR
managers who may design intervention
to improve Employee Engagement and
increase competitive advantage for their
firms.
Acknowledgements
An earlier version of this paper was
presented at the Indian Academy of
Management Inaugural Conference held
at XLRI Jamshedpur, December 2009.
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Role, Work Perception & Stress in a High Reliability Work
Environment
Omer Bin Sayeed & Satish Chandra Kumar
An empirical study of work attitude, role
efficacy and stress experienced in a high
reliability professional group was under-
taken using a sample of 52 Indian Air Traf-
fic Controllers (ATC) working in the
Mumbai Airport. Results showed that ATCs
experienced role stress with regard to in-
ter-role distance, role isolation, resource
inadequacy, role erosion and role stagna-
tion. ATCs maintained high confrontation
or problem solving skills in their role fol-
lowed by helping relationship, perceived
integration with the job and managing well
their inter-role linkages. Results further
showed significant relationships between
work attitude and role efficacy dimensions.
Regression analysis within respective ca-
nonical variable sets revealed role stress
being a significant predictor of attitude to-
wards supervisors and management, while
role efficacy dimensions (role making, role
centering and role linking) showed signifi-
cant explanatory power equally strongly
with respect to attitude towards work,
working conditions, co-workers, supervi-
sors, and management.
Omer Bin Sayeed is Professor of Organizational Behaviour/
HRM in National Institute of Industrial Engineering, Mumbai
400087 Email: omersayeed@gmail.com. S.Kumar is Reader
in the Department of Applied Psychology, Mumbai
University, Mumbai- 400 098.
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Air Traffic Controllers
(ATCs)
Air Traffic Control is basi-
cally a ground-based system
dedicated to the safe, orderly
traffic control and expeditious
flow of air traffic. The Air Traf-
fic Controllers (ATCs) who man
the system are well trained pro-
fessionals. They work under ex-
tremely demanding conditions for
the safety of more than one air-
craft at any given time. Safety is
maintained through a system of
airways and separation standards
and the air traffic controllers pro-
vide continuous instructions to the
pilot through the medium of Voice
Radio Telephony (VRT) from the
moment of start off to the final
taxiing of the plane into the park-
ing slot.
The Air Traffic Control Sys-
tem in India is divided into five
units, namely, (a) Surface Move-
ment Control (b) Control Tower
(c) Approach Tower (d) Area
Control Center (e) Flight Informa-
tion Center. These units function
in coordination with each other in
287

order to ensure the objectives of safety
and expeditiousness. The Air Traffic
Controller (ATC) is a trained professional,
a quick thinking man who does not have
the privilege to stall. His job calls for a
great deal of control and quick decision-
making. All his instruction to the pilot are
recorded continuously on tape and any in-
structional delays are traceable to replay.
Hence, the ATCs are under continuous
scrutiny and function to standards of pin-
point accuracy with a traffic load over
which they have no control. An incorrect
decision on his part can mean a loss of
human lives and millions of rupees as he,
at any point of time, is responsible for
more than one aircraft. Adding to the pres-
sure is the almost intolerable requirement
that the ATCs must retain an outward
calm revealing no feelings of pressure or
anxiety to the pilots. Simultaneously, they
have to maintain an optimum tension level
to ensure mental alertness. These two re-
quirements – contradictory in terms of
human nature – are exhausting mentally
and in the long run takes a toll on the
ATCs’ mental and physical health (Crump
1979). Perhaps, due to these reasons such
professions which require higher levels of
mental alertness, continuous monitoring at
the personal level and extremely higher
levels of risk (likely human and financial
losses) involved in making decisions are
generally termed as high reliability profes-
sions. Since ATCs jobs involved all the
three criteria mentioned above, it is but
right to characterize their occupational
domain of work as a high reliability pro-
fession.
In 1993, the Government of India
announced the ‘Open Sky Policy’ in civil
288 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Omer Bin Sayeed & Satish Chandra Kumar
aviation. As a result of this liberalization
policy there has been an advent of pri-
vate airline companies. This has resulted
in increased number of flights and con-
sequently increased air traffic. Such a
situation directly translates into higher
amount of work pressure and workload
for the ATCs. Mumbai (previously known
as Bombay) India’s commercial capital
has a Flight Information Region (FIR)
stretching to 1.2 lakhs square kilometers,
making it the biggest FIR in South Asia,
yet it operates with a single runway.
Technically, Mumbai has two runways,
but they cannot be used simultaneously
because they intersect each other in the
middle. Being the busiest Airport in the
country Mumbai handles more than 320
flight movements per day (i.e., 24 hours)
in addition to 100 flights, which over fly.
Besides regular flights, the ATCs at
Mumbai also have to handle helicopter
movement from Juhu and the Oil Rigs at
Mumbai High and also the Naval heli-
copters. This adds tremendously to their
workload, as managing helicopter move-
ment is very time consuming job.
Review of Literature
Given the highly demanding condi-
tions under which the ATCs work and the
absolute nature of the decisions they
must take, most studies in the West on
this group have focused on the stressors
associated with their jobs (Grandjean
1968, Grandjean & Wotzka 1971, Krol
1971, Repetti 1993). The primary short
term but uncontrollable stressors for
ATCs is their burgeoning workload. It is
easy to observe that there is a direct pre-
dictable relationship between the
 Role, Work Perception & Stress in a High Reliability Work Environment
workload of a pilot and ATCs’ i.e., as the
workload of pilots increases the work of
ATCs also increases. ATCs who per-
ceived workload to be high reported more
health complaints. Their moods turned in-
creasingly negative and less positive
(Repetti 1993). Alexander (1980) reported
that ATCs who suffered from burnout rap-
idly retired from work for medical rea-
sons and is also accompanied by loss of
initiative to enter into active work later.
Grandjean and Wotzka’s (1971) study in-
dicated that ATCs felt nervous, tense, ir-
ritated in difficult situations, were anxious,
trembling has increased perspiration, pulse
rate and heart ache and suffered from
sleeplessness and chronic fatigue. Urine
samples of ATCs also indicated increase
in Catecholamine after work as com-
pared with subjects who performed nor-
mal office work. Dell’Erba, Pancheri and
Intreccialagli (1988) found that stress
among ATCs increased after night shift.
Average cortisol, prolactin, testosterone
and thyrotropin–stimulating hormone val-
ues increased after night shift. Anxiety
scores also increased after the night, but
they were not correlated either with work
load or hormone values. Folkard and
Condon (1987) documented ATCs’ night
shift paralysis, which was largely caused
by 4 factors that appear to influence the
night workers’ deprivation of sleep or
sleepiness: these were the time of night,
the number of consecutive night shifts,
the requirement to work both morning and
night shift starting on the same day and
individual differences in the flexibility of
sleeping habits.
A stress related study conducted by
Repetti (1993) demonstrated that in-
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
creases in job stressors are associated
with same day deterioration in physical
and psychological well-being. There is
also evidence of direct spillover on par-
ent-child interaction. ATCs tended to be
more behaviourally and emotionally with-
drawn during their interaction with their
children at home. There was also evi-
dence of direct spill over of negative feel-
ings associated with distressing social
experiences at work to expression of
anger and greater use of discipline dur-
ing interactions with a child later in a day.
In line with the above findings Repetti
(1994) also noted that negative social cli-
mate at work was associated with a
father’s tendency to describe his inter-
action with a child as having a less posi-
tive and a more negative emotional tone.
An organizational climate that they
perceived as uncaring, uncon-
cerned for its people, uncommuni-
cative and unreceptive is all re-
sponsible for negative conse-
quences at the workplace.
Singer and Rutensranz (1971) re-
ported that high dissatisfaction among
ATCs is due to office administration, pay
and working conditions. Bowers (1983)
studied the reasons why 11,500 unionized
ATCs walked off their jobs in August,
1981. He found that ATCs managers held
and acted on the classic theory of X val-
ues and beliefs which created a sizeable
generation gap between the manager’s
attitudes and those of their counter-au-
thoritarian subordinates, thereby paving
the way for the strike. ATCs individu-
ally believed that an organizational cli-
289

mate that they perceived as uncaring,
unconcerned for its people, uncommuni-
cative and unreceptive is all responsible
for negative consequences at the work-
place. Shouksmith and Burrough (1988)
reported that both Canadian and
NewZealand ATCs perceived problems
of supervision, physical job conditions,
work organization and variability in task
load as major occupational stresses.
In comparison with the Western au-
thors’ attempt to investigate the charact-
eristics of high reliability organizations
such as ATCs work environment, nuclear
energy generation plants etc., virtually
very little work is done on ATCs in India.
Kumar, Kulkarni and Sayeed (1998) pro-
vided some exploratory data on the ex-
periences of stressors, strains and the
coping strategies used by ATCs in their
work environment. The study revealed
that the salient stressors generally expe-
rienced by ATCs were lack of housing
and welfare facilities, low monetary in-
centive, maintenance problems of equip-
ment, transfers, shift duties and owning
responsibility for traveling people. Dis-
turbance in Circadian rhythm, sleep dis-
turbance, tensions were the major strains
experienced. The coping strategies fol-
lowed by ATCs included (1) analyzing the
situation logically, (2) developing a posi-
tive attitude and (3) applying coping strat-
egies such as relaxation techniques.
In view of the above, the present
study is undertaken to understand the in-
trinsic quality of role perceptions (viz.
perceived role efficacy) of ATCs and the
level of role related stresses experienced
by them. In addition, their attitude to-
290 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Omer Bin Sayeed & Satish Chandra Kumar
wards their demanding professional work
in a high reliability context, wherein work
related dimensions such as attitude to-
ward work, working conditions, cowork-
ers, supervisors and management all have
critical influences to play in his working
life. Hence, more specifically, the objec-
tives of the present study are:
l To investigate the multivariate rela-
tionship between role stresses and the
work attitude facets.
l To study the multivariate relationship
between role efficacy dimensions
and work attitude facets.
Sample
The sample of study consisted of 52
(or 34%) of 150 ATCs working in the
Mumbai Airport. The respondents’ ages
ranged from 25 to 55 years with a mean
of 34.7 years. They had experience from
1 to 30 years with mean years of experi-
ence being 10.7. The 42 (or 81%) of re-
spondents had Bachelor of Engineering
degrees whereas 10 respondents (or
19%) had Master of Science degrees to
their credit.
Organizational Role Stress (ORS)
Scale
The ORS scale (Pareek 1983) was
used to measure organizational role
stress which consisted of 50 items and
specifically defined 10 dimensions of role
stresses likely to arise in a work context,
namely, inter-role distance, role stagna-
tion, role expectation conflict, role ero-
sion, role overload, role isolation, personal
inadequacy, self-role distance, role am-
 Role, Work Perception & Stress in a High Reliability Work Environment
biguity and resource inadequacy. The
items are rated on a 5-point semantic
anchors ranging from 0 to 4. Since the
items are tested in a variety of work en-
vironments (Pareek 1997) they were
found to be appropriate in ATCs work
environment as well.
Role Efficacy Scale
The Role Efficacy Scale (Pareek
1993) consisting of 20 triad items mea-
suring individual’s potential effective-
ness in his immediate role was used.
Combining two items together 20 triad
items allowed to score role efficacy for
10 dimensions, namely, Role centrality,
integration, proactivity, creativity, help-
ing relations, inter-role linkages, super-
ordination, influence, growth and con-
frontation. These dimensions are fur-
ther combined to obtain three major di-
mensions of role efficacy, namely, Role
Centering, Role Making, Role Linking.
The corrected item-total correlations
and Alpha reliabilities were found to be
satisfactory (Sen 1982, Sayeed 1985).
Employee Work Perception
Measure
Hafeez and Subbaraya’s (1988) Work
Perception Questionnaire was used,
which consists of 15 triad items specifi-
cally dealing with employees’ attitude to-
wards work, working conditions, manage-
ment, co-workers, and total organization.
The minimum and maximum obtainable
scores for the scale is 15 and 45. Higher
scores indicated positive attitude towards
each of the above dimensions.
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Results
Table 1 reports descriptive statistics of
work attitude, role stress and role efficacy
dimensions. It can be seen that higher
scores were obtained with respect to atti-
tude towards supervisors followed by atti-
tude towards management and work.
Attitude towards working conditions and
co-workers were relatively poor. Amongst
role stress factors, ATCs experienced high-
est role stress with regard to Inter-role dis-
tance, role isolation, resource inadequacy
role erosion and role stagnation. On the
other hand ATCs experienced lowest role
stress on personal inadequacy, role ambi-
guity and role expectation conflict. With
regard to one’s potential effectiveness in
ATC’s role it was noted that they seem to
have high role confrontation (problem solv-
ing) skill followed by helping relationship,
perceived integration with the job they are
doing and perceived inter-role linkages.
There were several inadequate aspects of
the role perceived by ATCs that yielded
lower scores on role pro-activity, role in-
fluence and role centrality.
ATCs experienced highest role
stress with regard to Inter-role
distance, role isolation, resource
inadequacy role erosion and role
stagnation.
Table 2 reports canonical correlation
between work attitude measures and role
stress dimensions. The reported statis-
tics included canonical correlations,
Wilks’ Lambda and F ratio testing sig-
nificance of the canonical correlation. In
addition, correlation with work attitude
291
 Omer Bin Sayeed & Satish Chandra Kumar

Table 1: Descriptive Statistics of Personal Correlates, Employee Attitude towards Work,

Role Stress & Role Efficacy among AIR Traffic Controllers.

Variable Mean SD Variable Mean SD Variable Mean SD

Attitude 6.94 1.33 Inter 9.15 5.17 Centrality 2.05 1.09
towards Role
work Distance
Attitude 3.80 0.76 Role 8.25 4.76 Integration 2.75 1.03
towards Stagnation
working
Condition
Attitude 4.73 1.10 Role 6.51 4.65 Proactivity 1.71 1.01
towards Expectation
Coworkers Conflict
Attitude 8.35 2.23 Role 8.53 4.43 Creativity 2.15 1.07
towards Erosion
Supervisors
Attitude 6.96 1.76 Role 7.21 5.13 Interrole 2.73 1.27
towards Overload Linkage
Management
Total work 30.75 4.68 Role 9.09 4.62 Helping 3.02 1.04
Attitude Isolation Relationship
Personal 3.84 3.70 Super 2.25 1.15
Inadequacy ordination
Self Role 6.29 4.18 Influence 1.59 1.29
distance
Role 4.78 4.47 Growth 2.17 1.02
Ambiguity
Resource 9.11 4.32 Confron- 3.48 1.04
Inadequacy tation
Total Role 72.61 31.97 Role 10.09 2.54
Stress Making Total
Role 5.83 2.32
Centering Total
Role 8.00 2.37
Linking Total
Role 23.92 5.38
Efficacy Total

measures and role stress dimensions with
their respective canonical variables have
also been reported to highlight the degree
of contribution of both the measures to
canonical function.
It can be observed that amongst work
attitude measures, attitude towards man-
agement, supervisors and co-workers con-
tributed maximum. As expected all the role
stress dimensions have shown correlations
with the respective canonical variable of
which role overload, role isolation, role stag-
nation and inter-role distance showed very
high canonical loadings (correlation with the
canonical variable), whereas personal in-

292 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
 Role, Work Perception & Stress in a High Reliability Work Environment

Table: 2 Canonical Correlations between Work Attitude & Role Stress

Root# Canonical Wilks F P

R Lambda
1 0.66 0.27 1.33 NS
Dependent Variable Correlation with Independent Variable Correlation with
Canonical Variables Canonical Variables
Attitude towards work 0.39 Inter-role distance - 0.58
Working Conditions 0.25 Role Stagnation - 0.76
Coworkers 0.66 Role Expectation Conflict - 0.50
Supervisors 0.73 Role Erosion - 0.48
Management 0.84 Role Overload - 0.78
Role Isolation - 0.77
Personal Inadequacy - 0.00
Self Role distance - 0.31
Role Ambiguity - 0.36
Resource Inadequacy - 0.37
Redundancy (%) 16.55 Redundancy (%) 29.55

adequacy showed zero relationship. The re-
dundancy statistics showed 16.55 and 29.55
per cent of variance with regard to work
attitude measures and role stress dimen-
sions respectively.
Table 3 presents regression results
using work attitude dimensions as depen-
dent variables and role stress dimensions
as independent variables. This table be-
ing an extension of canonical correlations
provides details about specific contribu-
tion of role stress variables to work atti-
tude dimensions in the form of Beta
weight and goodness of fit statistics (R-
square in percentage form).
As observed in the canonical correla-
tion results, the sign of all the regression
coefficients were negative indicating simi-
lar trend of relationship between role stress
variables and work attitude measures. Out
of 5 R-squares obtained 2 were found to
be statistically significant explaining 35.66
Percent and 32.82 percent of variance in
attitude towards supervisors and manage-
ment respectively. Amongst significant re-
gression results, role overload tended to
relate negatively with attitude towards
management. In addition, personal ad-
equacy as one of the role stress variable
showed positive relationship with attitude
towards coworkers.
Table 4 depicts canonical correlation
findings using work attitude dimensions
as dependent variable (First Set) and
Role efficacy dimensions such as role
making, role centering, and role linking
as independent variables (Second Set).
Canonical correlations with significance
statistics, correlations with canonical
variable and redundancy percentage
(variance explained) for each set of the
variables are presented in the table
It can be observed that the canonical
correlation indicative of goodness of fit
between the sets of variable was as high
as .64, significant well beyond the .01 level

The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 293
 Omer Bin Sayeed & Satish Chandra Kumar

Table: 3 Regression Analysis between Role Stress and Work Attitude

Dependent Variable Independent Variable

IRD RS REC RE RO RI PI SRD RA RI R2(%)
Attitude -.15 -.14 .05 .01 .17 -.37 .00 -.10 .21 .01 16.01
towards work
Attitude .18 -.31 .14 -.16 -.22 .25 .06 -.19 -.11 .24 11.69
towardsworking
conditions
Attitude -.09 -.18 -.12 -.27 -.26 .19 .38* .04 .00 -.03 30.18
towards
Coworkers
Attitude .13 -.39 -.19 -.04 -.13 -.27 -.09 .24 .09 .15 32.82*
towards
Supervisors
Attitude -.12 .07 .00 -.20 -.53** -.23 -.03 .14 -.04 .32 35.66*
towards
Management

*** p<.001; ** p<.01; * p<.05 n = 52

IRD - Inter-role distance RS

- Role Stagnation REC
- Role Expectation Conflict RE
- Role Erosion RO
- Role Overload RI
- Role Isolation PI
- Personal Inadequacy SRD
- Self Role distance RA
- Role Ambiguity RI
- Resource Inadequacy

Table 4: Canonical Correlations between Work Attitude and Role Efficacy

Root# Canonical Wilks F P

R Lambda
0.64 0.44 2.74 0.001

Dependent Variable Correlation with Independent Variable Correlation with

Canonical Variables Canonical Variables
Attitude towards work 0.66 Role Making 0.78
Working Conditions 0.55
Coworkers 0.55 Role Centering 0.77
Supervisors 0.55
Management 0.62 Role Linkage 0.54
Redundancy (%) 14.30 Redundancy (%) 49.91

294 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
 Role, Work Perception & Stress in a High Reliability Work Environment

of confidence. As against the findings of Table 5 reports multiple regression

role stress variables indicating negative analysis (as an extension of Table 4) be-
relationships, all the three role efficacy tween work attitude measures and role
dimensions and work attitude measures efficacy dimensions referred to above.
positively contributed to respective ca- These findings supplemented the findings
nonical functions. The correlations for of canonical correlation in that against
work attitude were found to be ranging each dependent variable, namely, work
from .55 to .66 and for role efficacy di- attitude dimensions, role efficacy dimen-
mensions it was from .54 to .78. The re- sions as independent variables are re-
dundancy percentages for respective sets gressed which yielded specific contribu-
of variables were 14.3 and 49.91. tion made by the role efficacy dimensions.
Table 5 : Regression Analysis between Role Efficacy and Work Attitude dimensions
Dependent Variable Independent Variable
RM RC RL R2(%)
Attitude towards work 0.22 0.29* 0.06 18.43*
Working Conditions 0.34* 0.30* - 0.27 19.08**
Coworkers 0.15 0.16 0.21 15.29*
Supervisors 0.02 0.30* 0.20 17.80*
Management 0.33* 0.05 0.18 20.69**

It is interesting to note that all the R-
squares were found to be significant, ex-
plaining percentages of variance that
ranged from 15.29 for attitude towards co-
worker to 20.69 for attitude towards man-
agement. In addition, Role Centering and
Role Making Behaviours taken together
received the highest number of positive
and significant regression coefficients
compared with Role Linking Behaviour,
which was not at all significant. It could
also be noted that both the role efficacy
factors taken together contributed to four
work attitude dimensions selectively and
the exception was attitude towards co-
worker, which was not at all contributed
by any of the role efficacy factors.
Discussion
Air Traffic Controllers are one of the
professional groups of high reliability or-
ganization which have to be taken seri-
ously due to two reasons, namely, (1) as a
professional group which experience job
stresses in a natural stressful work envi-
ronment, (2) as a group whose jobs place
extreme demand on individuals to be ex-
tremely efficient in their performance.
Zeier (1994) argues that this professional
group if not taken seriously by manage-
ment and policy makers of aviation indus-
try the consequences can be serious both
in terms of human lives and compensa-
tion to passengers along with damage to
the aircrafts and national property.
The findings obtained showed
that ATCs seem to maintain poor
attitudes towards working condi-
tions and co-workers besides
showing their stress level as
high.

The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 295

Work attitude plays a very important
role in a work environment exacting
higher standard of performance. It is
expected that in such an environment in-
dividuals bring out their best through posi-
tive attitudes towards work and various
aspects of the organization provided that
organization equally cares for them. The
findings obtained showed that ATCs seem
to maintain poor attitudes towards work-
ing conditions and co-workers besides
showing their stress level as high. In a
similar line of research, Kumar, Kulkarni
and Sayeed (1998) documented that sa-
lient stressors experienced by ATC’s in
India are lack of housing and welfare
facilities, low monetary incentive, main-
tenance problems of equipment etc. Mod-
ern navigational aids and sophisticated
computers and other facilities which are
easily available in Western countries are
either not available or they are not in good
working conditions in the Indian Airports.
Lack of welfare and recreational facili-
ties also add to poor work attitude. These
findings are fully supported in the present
study when we have noted that one of
the stress causing factors sharply per-
ceived by the ATCs is the resource in-
adequacy compared with personal inad-
equacy least recognized as a stress in-
ducing factor.
In India ATCs come under civil avia-
tion and in the last few years they have
been agitating for poor facilities, work-
ing conditions and low wages. The wage
agreement between government and
ATCs taking very long time to settle also
showed unconcerned and unsympathetic
attitude of management. It is possible
that due to lack of ATCs cooperation,
296 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Omer Bin Sayeed & Satish Chandra Kumar
team spirit and trust caused by above
conditions, management could have de-
veloped negative attitude towards them
resulting in myriad work-related problems
in the work environment. Bowers (1983)
has shown that managers who acted on
the Theory X values and beliefs contrib-
uted more to striking at the workplace
than those managers who acted on the
theory Y values and beliefs. If organiza-
tional climate is perceived as uncaring,
unconcerned for people, uncommunica-
tive and unreceptive it is more likely to
lead to greater stress among ATCs. The
role efficacy of ATCs, evaluating the
perceptions of their roles across 10 di-
mensions showed greater influence in
predicting or enhancing work attitude. In
this connection, Role Making and Role
Centering (global dimensions) as com-
pared with Role Linking were found to
be strongly influencing positive work at-
titude of ATCs. It is interesting to note
that when role occupants go beyond what
is expected from the role and perform
jobs with self-induced role behaviour, it
is more likely to increase positive work
attitude as individuals will have better
focus on problem solving behaviour of
their own, colleagues, superiors and sub-
ordinates.
Further, the results revealed that the
highest role stress experienced by ATCs
were inter-role distance, role isolation,
resource inadequacy, role erosion and
role stagnation. The reason for these
stresses could be due to the fact that their
role in aviation industry is not considered
as important as that of other roles. As a
professional group they always remained
in the background, whereas pilots and
 Role, Work Perception & Stress in a High Reliability Work Environment
other professional groups within the
aviation industry enjoyed greater impor-
tance. Feeling of isolation, perception of
inadequate resources at their disposal and
continued erosion of their roles are
caused by lower salary and perks as
compared to aircraft engineers and pi-
lots whose jobs require social interaction
with colleagues, seniors and management
as well. For the ATCs fewer promotional
opportunities, poor infra-structural facili-
ties and also lack of coordination between
various agencies at the airport seemingly
contributed to discontentment and poor
sense of well being at the work place. In
addition, it is also observed that role
stress played an important role in work
attitude. As role stress increases both
attitude towards supervisors and manage-
ment become unfavorable. Role overload
was found to be negatively related to at-
titude towards management. With the
increased workload without correspond-
ing increase in value addition in ATCs’
job profile, their perceptions towards
management have shown negative over-
tones. It is obvious that there is increased
stress created by both the work elements
and organizational settings. Mohler (1983)
documented that ATC’s heavy traffic
volume increases their physiological and
psychological stress, which has an ad-
verse impact on both physical and men-
tal health of ATCs. Another stressor,
which was positively related with attitude
towards coworkers, was personal inad-
equacy. As personal inadequacy in-
creases attitude towards coworkers be-
come less amicable, perhaps indicating a
phenomenon that people with lesser self-
esteem are more likely to be insecure and
therefore they tend to relate with their
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
coworkers less effectively. In all prob-
ability, this gives rise to a sense of indif-
ference and lower degree of involvement
in organization where they perform un-
der stressful condition.
Feeling of isolation, perception of
inadequate resources at their dis-
posal and continued erosion of
their roles are caused by lower
salary and perks as compared to
aircraft engineers and pilots.
It was also shown that role efficacy
enhances work attitude in some respects.
ATCs had high confrontation skills, fol-
lowed by helping relationship, integration
with the job and perceived inter-role link-
ages. In comparison with positive as-
pects mentioned above, the poor aspect
of their role was pro-activity, which indi-
cated that they were performing more of
the reactive functions of their roles and
fulfilling other’s expectations rather than
performing proactive functions in their
roles. They cannot initiate any action on
their own because of the nature of work
which demanded that everything has to
be performed in a structured way and as
per certain prescribed norms. They also
felt that they have least influence and
hold less central role compared with pi-
lots and other functionaries.
Implications
As the ATC’s role is very important
demanding high performance reliability,
they have to be potentially effective in
their roles, which can reduce their role
stress and enhances their work attitude
297

simultaneously. Some of the practical
implications drawn from the present
study include conducting counseling
programmes for ATCs, which could be
both personal and work related counsel-
ing. Provision of relaxation training, be-
ing a part of stress management training
programme such as yoga can also play a
very important role.
Some of the practical implications
drawn from the present study in-
clude conducting counseling
programmes for ATCs, which
could be both personal and work
related counseling.
More specifically a significant aspect
of stress that needs to be asserted as a
likely suggestion for improvement is that
the optimal level experiences of any type
of stressors tend to facilitate the func-
tioning of the individual and beyond cer-
tain limit, which may be different for dif-
ferent people, stressors tend to deterio-
rate performance level directly. How-
ever, with the repetitive experiences of
stressors performance levels of the indi-
viduals undergo a significant and positive
change giving him more latitude for en-
hancing the adaptation level. It is there-
fore, worth exploring whether with the
improved role efficacy or managing role
more professionally the stress level could
be managed? As suggested by our study,
management may like to look at the
stressful work environment and help
ATCs to manage their roles by inculcat-
ing some of the suggested qualities of role
efficacy so that their roles benefit from
managing their role through the role effi-
298 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Omer Bin Sayeed & Satish Chandra Kumar
cacy paradigm. But what is really re-
quired is the change of mindset at the
level of management to consider the oc-
cupation activities of the ATCs as a high
reliability profession compared with other
types of professional categories, wherein
mental alertness is undoubtedly required,
but not necessarily the premium placed
by the ATCs on the type of risks inher-
ently involved in their job profiles. On
a larger scale enhancing role efficacy of
various professional groups of aviation
industry as part of an OD intervention
programme could also be taken up as
suggested for various professional groups
of Indian Railways ( Pestonjee and
Pandey, 1996).
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299

Predictors of Occupational Stress: An Exploratory Study
Alok Chandra & Baldev R. Sharma
Based on an exploratory study
using a purposive sample of 53
managerial employees of a pub-
lic sector organization, this pa-
per has tried to assess the level
of occupational stress experi-
enced by the respondents. A sub-
sequent search for the predictors
of stress revealed that, out of the
eight potential predictors used
for the study, only two emerged
as the critical determinants of
stress. Both of these predictors
turned out to be aspects of the
organizational climate, suggest-
ing thereby the greater role played
by the situational factors (as
against the attributes of the per-
son) in creating occupational
stress. If subsequent research
studies come up with similar find-
ings, the outcome of this explor-
atory study should be of interest
to both academicians as well as
practitioners.
Alok Chandra is a serving officer in the Indian Army
(E-Mail: alok_chandra04@yahoo.com). Baldev R.
Sharma is Professor Emeritus, International
Management Institute, New Delhi.(E-mail:
baldevsharma@imi.edu).
300 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Alok Chandra & Baldev R. Sharma
Occupational Stress
Occupational stress has been defined
as the non-specific response of the body
to any demands made upon it (Selye
1976). According to Cooper et al. (1994),
it is a negatively perceived quality which
stems from inadequate coping with
sources of stress and which results in
negative consequences in terms of men-
tal as well as physical health. Stress is
considered to be an internal state or re-
action to anything consciously or uncon-
sciously perceived as a threat, whether
real or imagined (Clarke & Watson
1991).
Various research findings confirm
the relationship between stress and lack
of motivation, prolonged strikes, anxiety,
absenteeism, burnout, high turnover, in-
creased late coming, missing deadlines,
making careless mistakes, and so on
(Schabracq & Cooper 2000, Murphy
1995, McHugh 1993). Chusmir and
Franks (1988) have suggested that the
aforementioned consequences of stress
have an adverse effect on the overall
organizational efficiency and effective-
ness. Organizations are now realizing the
implications of the negative conse-
quences of occupational stress and feel
 Predictors of Occupational Stress: An Exploratory Study
the need to investigate stress- related
problems. This study is an attempt to as-
certain the level of stress among the
managers of a public sector company and
to determine the role of various factors
that contribute to occupational stress.
Correlates of Stress
The factors that are associated with
stress are usually called stressors. The
word “stressor”, like another term called
“driver”, has a strong causal connota-
tion. In the kind of research reported in
this paper, it is not possible to establish
cause- and-effect relationship between
variables. Hence we prefer to use terms
like correlates or predictors when refer-
ring the relationship between stress and
some other independent variable(s).
Previous studies on the subject have
identified three broad categories of pre-
dictors of occupational stress. Occupa-
tional stress may be caused by environ-
mental, organizational and personality-
related variables (Matteson &
Ivancevich 1999, Cook & Hunsaker
2001). Some individuals, irrespective of
their occupation, experience unaccept-
able levels of job-related stress (Schultz
& Schultz 2002). On the other hand,
certain organizational factors are also
known to induce stress and strain for
employees at the workplace (Greenhaus
& Bentell 1985).
Organizational Factors: in two re-
view articles on occupational stress, Coo-
per (1983, 1985) summarized the follow-
ing six groups of organizational variables
as correlates of stress:
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
(1) Factors intrinsic to the job (e.g., heat,
noise, chemical fumes, shift work.
(2) Relationships at work (e.g., conflict
with co-workers or supervisors, lack
of social support).
(3) Organizational role (e.g., role ambi-
guity).2
(4) Career development (e.g., role of
prospects for promotion, lack of a
career path, job insecurity).
(5) Organization structure and climate
(e.g., lack of autonomy, lack of op-
portunity to participate in decision-
making, lack of control over the pace
of work).
(6) Home and work interface (e.g, con-
flict between domestic and work
roles).
The above mentioned factors are
termed as organizational stressors since
they serve as agents that trigger the vari-
ous stress/strain reactions (Von Onciul
1996). Foot and Venne (1990) discov-
ered a positive relationship between bar-
riers to career advancement and stress.
According to Kanungo (1981), when
workers believe that there is a separa-
tion between their own job and other
work-related contexts, it creates a sense
of frustration that is eventually mani-
fested in a behavioual state of apathy.
This is particularly intense for employ-
ees whose social needs are high. Work-
ing alone on one’s supervisors would lead
to occupational stress (Mirovisky & Ross
1986, Eugene 1999). Work overload, both
quantitatively and qualitatively, has been
found to be linked to a variety of psy-
301

chological and beha-vioural symptoms
(Beehr & Newman, 1978, Greenhaus et
al. 1987, Miller & Ellis 1990, Roberts et
al. 1997).
Personal Attributes: Matteson and
Ivancevich (1999) suggest that stress is
influenced by certain personal attributes.
Past studies have also indicated that cer-
tain personality traits have an impact on
stress (Goldberg 1993), Deary and
Blenkin 1996, Snyder & Ickes 1985). For
example, locus of control, a personality
trait, is found to have a relationship with
stress. Weiner (1977) proposed that in-
dividuals with an internal locus of con-
trol attribute success and failure to their
own actions, whereas persons with an
external locus of control relate their per-
formance to task difficulty and luck.
Since there is an inverse relationship be-
tween perceived control over daily events
and stress (Averill 1973, Bernardi 1997),
persons with internal locus of control
(who believe that they have control over
events) experience lesser amount of
stress. Spector (1986) conducted a meta-
analysis and found significant correlations
between locus of control and occupa-
tional stress.
Apart from locus of control, it should
be of some interest to find out whether
personal attributes in terms of demo-
graphic background have any role to play
in influencing occupational stress. In our
review of literature, we have not come
across studies that investigate this rela-
tionship. Most of the studies were carried
out in the Western world. It would, there-
fore, be of interest to find out whether the
organizational factors and personality
302 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Alok Chandra & Baldev R. Sharma
traits found as the correlates of stress in
Western societies are also applicable in
the Indian situation. Therefore, we pro-
pose to examine the role of age, gender,
education, grade and work experience to
find out whether these factors have an
impact on occupational stress.
About this Study
This study is aimed at examining the
relationship between occupational stress
and a number of its potential predictors.
Based on this examination, it is intended
to isolate a set of critical determinants
that together explain maximum variance
in occupational stress. Guided by the
preceding review of literature, the follow-
ing, two sets of potential predictors were
selected for the present study:
(1) Personal Attributes
(a) Locus of Control
(b) Demographic Factors
(2) Situational Factors
(a) Job Content
(b) Organizational Climate
The hypotheses that are sought to be
tested through this study are:
Hypothesis 1: The managers with “in-
ternal” locus of control experience a
lower level of stress.
Hypothesis 2: The managers who
perceive their jobs as “enriched’ and “em-
powering” experience a lower level of
stress.
 Predictors of Occupational Stress: An Exploratory Study

Hypothesis 3: The managers who perceive their number scale, it did not
organizational climate (in terms of the selected di- allow a person to give a
mensions) more positively experience a lower level “neutral” response as
of stress. each person was required
to either agree (2, 3) or
The sample for this study is a purposive one of disagree (0, 1) with every
53 managerial employees working in a large public statement. The overall
sector company. The company is engaged in manu- score that a person got in
facturing high precision technical projects and its units terms of stress ranged
are located at various sties all over India. Since the between 0 and 30. The
purpose of the study was not to generalize the find- higher the score of a per-
ings for the company as a whole, we decided to cover son, the more stressed he
only one of its units located in the National Capital would be and vice versa.
Region (NCR). The unit covered was the Planning
(2) Locus of Control: To mea-
Division of the headquarters of the company. The total
sure this personality trait,
Table 1: Grade-wise Distribution of the Sample we used the scale devel-
Sl. Designation (Grade) Total Strength Sample Per Cent
oped by Rotter. The scale
has 10 pairs of statements
1. Assistant GM 17 11 64.7 of which one measures
2. Senior Dy.GM 8 3 37.5 “internal” and the other
3. Deputy GM 10 8 80.0 “external” locus of con-
4. Sr. Manager 8 5 62.5 trol. The respondent is
5. Manager 21 14 66.7 asked to tick mark only
6. Dy. Manager 26 12 46.2 one statement from each
Total 90 53 58.9 pair that comes close to
his own frame of mind. A
strength of managerial employees of the Planning Di- score of 1 was assigned
vision was 90 out of which sample covered (N=53) if the selected statement
constituted 59 per cent. Grade-wise distribution of the belonged to internal locus
sample vis-à-vis the total strength) is given in Table 1. of control and 0 if the se-
lected statement belonged
Data were collected with the help of a self-ad- to external locus of con-
ministered “structured” questionnaire over a period trol. Since our objective
of four days in the month of August, 2009. The ques- was to measure the ex-
tionnaire consisted of the following variables: tent to which a respon-
dent manifested internal
(1) Occupational Stress: This 10-item scale was spe- locus of control, the over-
cially designed by the first author for purposes of all score for this person-
this study. Response to each statement was sought ality trait ranged between
on a four-point scale ranging between 0 (strongly 0 (lowest) and 10 (high-
disagree) and 3 (strongly agree). Being an even- est).

The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 303
 Alok Chandra & Baldev R. Sharma

(3) Job Content: A five-item scale to (d) Objectivity & Rationality

measure job content (or job charac-
teristics) was previously developed
and standardized by the second au-
thor. Since response to each state-
ment was scored on a four-point scale
(0 to 3), the overall score for all five
statements ranged between 0 and 15.
(4) Organizational Climate: Organiza-
tional climate is a multidimensional
construct. For purposes of this study,
we have chosen the following six di-
mensions of climate the scales for
which were previously developed
and standardized by the second au-
thor:
(a) Benefits
(b) Career Opportunity
(c) Decision Making
(e) Recognition
(f) Training
Each of the above six dimensions of
climate was measured with the help
of five statements using the four-
point rating scale (0 to 3) already
explained. The score range for each
dimension was between 0 (lowest)
and 15 (highest).
Findings
Table 2 presents in a summarized
form the level of occupational stress and
its potential predictors in the organiza-
tion under study. Also presented in this
table are the details of each of the nine
variables used in this study. Barring two
variables (locus of control & benefits),

Table 2 : The Level of Occupational Stress and the Status of its Potential Predictors (N=53)

Var.No. Variable No. of Score Alpha Mean Std.Dev. ; Score

Items Range Score as %
Dependent Variable
1. Occupational Stress 10 0-30 .82 7.94 4.45 26.45
Independent Variables
(Personal)
2. Locus of Control 10 0-10 .58 7.32 2.00 73.20
Independent Variables
(Situational)
3. Benefits 5 0-15 .54 7.96 2.09 53.07
4. Career Opportunity 5 0-15 .72 8.19 2.36 54.60
5. Decision Making 5 0-15 .66 9.34 2.00 62.27
6. Job Content 5 0-15 .70 10.42 1.76 69.47
7. Objectivity 5 0-15 .71 8.98 2.31 59.87
8. Recognition 5 0-15 .82 7.98 2.47 53.20
9. Training 5 0-15 .81 8.28 2.31 55.20

304 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
 Predictors of Occupational Stress: An Exploratory Study

the remaining seven variables have Table 3: Incidence of Occupational Stress

emerged as highly reliable. In spite of among the Managerial Employees
the sample size being relatively limited in
Level of No. of Per Cent
size, Cronbach Alpha in the region of .7 Stree (%) Employees
and .8 is considered to be quite high.
0 24 45.28
10 8 15.09
Looking at the last column of Table
20 8 15.09
2, it is quite clear that the managerial
30 4 7.55
employees of this organization do not
40 4 7.55
experience high degree of occupational
50 1 1.89
stress. However, any amount of stress
60 3 5.66
experienced by people at work is dys-
70 1 1.89
functional for both the employees as well
as the organization. It is, therefore, de- Total: 53 100
sirable that even the present low level of
stress (26.45 per cent) be further re- the employees who experience varying
duced if not removed entirely. degrees of occupational stress as shown
above. For the sample as a whole, the
To pinpoint the incidence of occupa- incidence of stress is found to be quite
tional stress more precisely, we carried low.
out microscopic examination of the data
on hand. Stress was measured through
agreement or disagreement with each of Most of them are prone to at-
the 10 statements specially designed for tribute success and failure in life
this purpose. If a person disagreed with to their own ability, effort and/or
all the 10 statements, it would mean that actions instead of attributing their
he was experiencing no stress at all. If, poor performance to task difficulty
on the other hand, someone agreed with or bad luck.
all the 10 statements, it would mean that
the person experienced stress to the ex- Judging by the very high mean
tent of 100 per cent (which, of course, is score (73.20 per cent) for locus of
highly unlikely to happen). Using re- control, it is obvious that a vast majority of
sponses to the 10-item questionnaire, the employees fall in the category of
therefore, we have categorized the pre- “internals”. In other words Most of them
cise incidence of occupational stress are prone to attribute success and failure
among the sample of 53 managerial em- in life to their own ability, effort and/or
ployees (Table 3). actions instead of attributing their poor
performance to task difficulty or bad luck.
It should be clear from the Such employees are indeed a valuable asset
above distribution of respondents that 45 to the organization they work for. The status
per cent of them experience no stress at of the situational factors is arranged in a
all. There are, however, 55 per cent of descending order in Table 4.

The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 305
 Alok Chandra & Baldev R. Sharma

Table 4: Status of the Situational Factors
S.No. Situational Factor Mean
Score (%)
1. Job Content 69.47
2. Decision Making 62.27
3. Objectivity 59.87
4. Training 55.20
5. Career Opportunity 54.60
6. Recognition 53.20
7. Benefits 53.07
Out of the seven situational factors
studied, job content has been given
the highest rating by the respo-
ndents.
Out of the seven situational factors
studied, job content has been given the
highest rating by the respondents. This
shows that the employees of this organi-
zation find their jobs to be well-designed
in so far as there is (a) variety as well as
challenge in their work activities, (b) an
element of discretion to carry out the job
responsibilities, (c) clarity about what
they are expected to do, and (d) oppor-
tunities to utilize their abilities and exper-
tise in their jobs. Because of the pres-
ence of these job characteristics, the
employees feel that their jobs contribute
to their professional development.
With a mean score of 62 per cent,
decision-making has also received a fairly
high rating. This indicates that the man-
agement has empowered the employees
to take independent decisions without in-
terference from their seniors and also to
develop their subordinates through ac-
tions such as job rotation, training and
performance appraisal. The decision-
making in the company is perceived as
fair and transparent and the management
is viewed as supportive of spot decisions
taken by the employees during crisis situ-
ations.
Objectivity is the third situational fac-
tor that has been given a high rating (60
per cent) by the respondents. As seen
through the eyes of the employees, per-
sons are recruited and promoted in this
company by merit and not through
favouritism based on caste, creed or re-
ligion, etc. The performance appraisal
system of the company is seen as trans-
parent and fair and the personnel poli-
cies of the company are followed uni-
formly in all cases. Even though the three
situational factors described above are
reasonably well looked after by the man-
agement, there is still scope for further
improvement in each of these areas.
The remaining four situational fac-
tors (training, career opportunity, recog-
nition and benefits) are only moderately
well-looked-after, as reflected in their
mean scores ranging between 53 and 55
per cent. In other words, there is much
more scope for the management of this
organization to improve their HR policies
and practices that impinge upon these
four situational factors.
Analysis of Data
Apart from assessing the level of
occupational stress and the status of its
potential predictors, the other objective
of this study was to identify the critical

306 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
 Predictors of Occupational Stress: An Exploratory Study

predictors of occupational stress. In our seven independent variables is negatively

search for those predictors, we begin by
looking at the bi-variate relationships be-
tween and among the selected variables.
Table 5 presents the 9 × 9 inter-correla-
tion matrix. A look at column 1 (or row
1) will show that, except for just one vari-
able (training), each of the remaining
and significantly related to occupational
stress.
The observed relationships between
occupational stress and each of its pre-
dictors are consistent with the theoreti-
cal model on which the present study is

Table 5: Inter-Correlation Matrix for the Selected Variables (N = 53)

Variable Occup. Locus Benefits Career Decision Job Object Recogn. Training
Stress Of ctl. Opp. Making Content -ivity
1 2 3 4 5 6 7 8 9
Occup. Stress 1 1.00 -.431** -.514** -.316* -.329* -.410** -.596** -.352** -.143
Locus of Ctl. 2 -.431** 1.00 .155 .252 .381** .301* .502** .395** .189
Benefits 3 -.514** .155 1.00 .445** .265 .579** .466** .286* .384**
Career Opp. 4 -.316* .252 .445** 1.00 .511** .647** .530** .634** .668**
Decision Mkg. 5 -.329* .381** .265 .511** 1.00 .539** .464** .516** .442**
Job Content 6 -.410** .301* .579** .647** .539** 1.00 .533** .462** .378**
Objectivity 7 -.596** .502** .466** .530** .464** .533** 1.00 .496** .330*
Recognition 8 -.352** .395** .286* .634** .516** .462** .496** 1.00 .609**
Training 9 -.143 .189 .384** .668** .442** .378** .330* .609** 1.00
*P<.05 **P<.01

based. Employees who scored higher in
terms of “internal” locus of control are
found to experience less occupational
stress than those who scored lower on
this personal attribute. Likewise, employ-
ees who gave more positive ratings to the
various situational factors (except train-
ing) were found to experience less stress
than those who gave lower ratings to the
said factors.
The relationships among variables
depicted in Table 5 are only zero-order
correlations, which can sometimes be
spurious. To identify the true relationship
between any two variables (say, x and
y), it is necessary to introduce additional
variables to find out whether the ob-
served correlation between x and y is
genuine and not a reflection of the influ-
ence of some other variable (s). The lat-
ter possibility is always there where the
so-called independent variables are them-
selves highly inter-correlated, as is the
case in the present study. In such cases,
it is essential to undertake multivariate
analysis of data instead of relying only
on bi-variate relationships presented in
Table 5.
To discover the critical predictors of
occupational stress, it was decided to use
multiple regression as the tool for further
analysis of data. The purpose of this

The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 307
 Alok Chandra & Baldev R. Sharma

analysis is to identify (out of a large num-
ber of combinations possible) the one
combination of independent variables that
explains the highest amount of variance
in the dependent variable (occupational
stress). That combination may be of any
size, but it must satisfy the additional con-
dition that the individual contribution of
each predictor of stress in the selected
regression equation must not only be sta-
Table 6: Critical Predictors of Occupational Stress (N = 53)
tistically significant (P<.05) but also
negative (as postulated in the model).
Step-wise linear regression analysis
helped us in identifying the best equation
presented in Table 6.
Out of the eight potential predictors
of occupational stress selected for this
study, only two have emerged as critical.
These are two situational factors called

Sl.No. Predictors Zero-Order Std. Beta Individual

Correlation Coefficient Contribution
(A) (B) (A × B)
1. Objectivity -.596** -.455** .271180
2. Benefits -.514** -.303* .155742
F2,50 = 18.611 P<.01 Total (R2): .426922
* P<.05 ** P<.01

“objectivity” and “benefits”, which together
explain a little over 42 per cent of the
variance in stress. Moreover, the individual
contribution of each predictor is not only
statistically significant but is also negative
as hypothesized. Between these two
predictors, “objectivity” plays a more
important role than “benefits” in influencing
occupational stress. When the effect of
these two predictors is held constant (that
is, controlled), the relationship between
stress and each of the remaining six
variables becomes non-significant, as
shown in Table 7.

Table 7: 2nd - Order Partial Correlations Between Occupational Stress and each of the
“Excluded Variables”

Sl.No. Excluded Variables Partial t d.f. P

Correlation Value
1. Career Opportunity .098 .682 49 n.s.
2. Decision Making -.056 -.391 49 n.s.
3. Job Content .013 .092 49 n.s.
4. Locus of Control -.239 -1.722 49 n.s.
5. Recognition -.061 -.4251 49 n.s.
6. Training .180 .281 49 n.s.

Note: “n.s.” stands for not significant.

308 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
 Predictors of Occupational Stress: An Exploratory Study

Role of Background Variables graduates or post graduates. There was,

Apart from the variables already dis-
cussed in this paper, the questionnaire had
also sought data regarding the back-
ground profile of the respondents with
reference to the following five param-
eters: age, work experience, grade, edu-
cation, and gender. Data relating to gen-
der and education could not be used for
further statistical analysis due to the ab-
sence of adequate variation among the
respondents. To illustrate, out of the 53
respondents, 49 (92.5 per cent) were
males, while 47 (88.7 per cent) were
however, adequate variation in terms of
the remaining three variables.
An employee’s grade being an
ordinal-scale variable cannot be used for
purposes of correlation. Hence, we divided
the sample into two groups: grades 1 and 2
(low) with N = 26; and grades 3 to 6 (high)
with N = 27. Treating these two groups as
independent samples, we compared their
mean scores on occupational stress. The
results of the t-test show that employees
in higher grades experience greater stress
than those in lower grades (Table 8).

Table 8: Comparison of Mean Scores on Occupational Stress

Grade N ; Stress Standard t Value d.f. P

Score Deviation
Grades 3 to 6 (high) 27 9.59 4.68 2.947 51 P<.01
Grades 1&2 (low) 26 6.23 3.52

Total 53 7.94 4.45

Age and work experience were two variables is controlled, the partial
correlated with occupational stress and both correlation between the other variable
of them were found to be significantly and and stress becomes non-significant.
negatively related to stress (Table 9).
(a) Partial correlation between age and
Table 9: Correlation between Stress, Age & stress, controlling for the effect of
Experience
work experience. ….. -.040 (n.s)
Stress Age Experience (b) Partial correlation between work
Stress 1.00 .332 *
.347* experience and stress, controlling for
Age .332* 1.00 .979** the effect of age. ….. .114 (n.s)
Exp. .347* .979** 1.00
*P<.05 **P<.01
As both age and experience are
individually correlated with stress, it was
Since age and experience are highly decided to add both of them to the list of 8
correlated (r=.979), each of them is a independent variables already discussed for
mirror reflection of the other. As shown carrying out another regression analysis.
below, when the effect of one of these The purpose of the additional analysis was

The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 309

to ascertain whether age and/or
experience, in conjunction with certain
situational variables, turns out to be critical
predictor(s) of stress. The revised
calculations showed once again that the
same combination of the two variables
(objectivity and benefits) is a critical
predictor of occupational stress. When the
effect of these two predictors is controlled,
the partial correlation between stress and
the two background factors becomes non-
significant, as shown below:
(a) 2nd-order partial correlation between
age and stress, controlling for the
effect of “objectivity” and “benefits”
… .102 (n.s.)
(b) 2nd-order partial correlation between
work experience and stress, control-
ling for the effect of “objectivity” and
“benefits” … .055 (n.s.)
Conclusion
This exploratory study was designed
to assess the level of occupational stress
among the managerial employees of a
public sector organization. The other ob-
jective of the study was to identify the
factors that contribute to occupational
stress. As the findings show, the respon-
dents of this study experience a fairly low
level of stress (26.45 per cent). One
possible reason for this low level of stress
could be the choice of the unit selected
as the sample for this study. Work in the
Planning Division of an organization is
generally of an autonomous nature free
from bureaucratic hassles and interper-
sonal conflict. This view is corroborated
by “job content” scoring the highest rat-
310 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Alok Chandra & Baldev R. Sharma
ing (69.47 per cent) among the seven situ-
ational variables.
To discover the factors that contrib-
ute to occupational stress, we had se-
lected a set of eight potential predictors
on the basis of review of previous stud-
ies on the subject. Barring just one vari-
able (training), each of the remaining
seven variables was found to be nega-
tively and significantly correlated with
stress. Subsequent multivariate analysis
revealed only the following two situ-
ational factors as the critical determi-
nants of occupational stress:
(a) objective and impartial decision-mak-
ing; and
(b) adequate welfare benefits.
In other words, subjective and par-
tial decision-making and inadequate wel-
fare benefits are found to cause resent-
ment that leads to stress among the em-
ployee.
Subjective and partial decision-
making and inadequate welfare
benefits are found to cause resent-
ment that leads to stress among
the employee.
Although the incidence of
occupational stress is not very high among
the managerial employees of the
organization covered by this study, 55 per
cent of the respondents do experience
some degree of stress. If the management
of this organization were to reduce or
eliminate even this low level of stress,
they will have to concentrate on the two
 Predictors of Occupational Stress: An Exploratory Study
areas of concern to the employees –
namely, objectivity and benefits. An
improvement in these two areas is likely to
reduce occupational stress among the
employees.
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Emotional Intelligence & Managerial Effectiveness : Role
of Rational Emotive Behaviour
Nivedita Srivastava & Shreekumar K. Nair
In recent times, emotional intelli-
gence has been hailed by both aca-
demicians and practitioners as a soft
skill that is critical for managers to
succeed in their professional roles.
Considerable research interest is
seen today in the hitherto neglected
area of human emotions and their
impact at the workplace. This paper
presents the results of an empirical
study undertaken to see the influ-
ence of emotional intelligence and
rational emotive behaviour on mana-
gerial effectiveness. The study
sample consisted of 305 managers
from diverse industries in the public
and private sectors. Results showed
that both the variables positively in-
fluence managerial effectiveness.
Further, rational emotive behaviour
was found to moderate the relation-
ship between emotional intelligence
and managerial effectiveness. Impli-
cations of these findings are dis-
cussed in the paper.
Nivedita Srivastava is Fellow Student at National
Institute of Industrial Engineering (NITIE), Mumbai
and a Organisation Development consultant. E-mail:
nivedita.srivastava@gmail.com. Shreekumar K. Nair
is Professor (OB & HRM) in the same Institute
E-mail : shreekumar@nitie.edu
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Introduction
It is an undeniable fact that only high-
performing organizations employing
highly result-oriented managers can sur-
vive and grow in today’s globalized era.
High-performing organizations, no doubt,
try to attract the best talent from the job
market. In fact, hiring potentially effec-
tive and result-oriented managers has, in
recent times, become the greatest chal-
lenge for HR managers of any progres-
sive organization. However, hiring poten-
tially effective managers calls for a
proper understanding of the personality
related factors that invariably influence
a manager’s effectiveness in his job.
Only continuing research in this area
would help in identifying important per-
sonality variables which can predict
managerial behaviour.
Although by common understanding,
effective managers are those who deliver
results and add value to the company,
some of the researchers tried to define
the concept of managerial effectiveness
and distinguish it from other related con-
cepts. Reddin (1970:4) distinguished be-
tween managerial effectiveness, appar-
ent effectiveness and personal effective-
313

ness while defining managerial effective-
ness as “the extent to which a manager
achieves the output requirements of his
position”. Mintzberg (1973) observed
that all managerial jobs are similar in na-
ture and therefore they could be described
by certain common behaviours or roles.
He put forward ten managerial roles fall-
ing under three categories: (1) interper-
sonal (figurehead, leader, liaison), (2) in-
formational (monitor, disseminator,
spokesperson), and (3) decisional (entre-
preneur, disturbance handler, resource
allocator, negotiator). According to
Mintzberg, managers working in differ-
ent positions could be effective depend-
ing on the combination of these ten roles.
Das (1991) compared Mintzberg’s mana-
gerial roles with Indian managerial roles
and found certain skills such as interper-
sonal relations, crisis management, em-
ployee counselling, oral communication,
etc. as critical to become an effective
executive in India. A study by Das &
Manimala (1993) on middle and senior
level managers employed in a variety of
organizations revealed that several of the
roles suggested by Mintzberg are played
by Indian managers. Roles such as
‘leader’, ‘monitor’ and ‘entrepreneur’
were found to be the important aspects
of the managers’ job whereas, roles such
as ‘figurehead’, ‘negotiator ’, and
‘spokes-person’ were found to be less
important aspects of the managers’ job.
There are several theoretical conc-
eptualizations of managerial effecti-
veness incorporating various managerial
roles, skills, and competencies available
in literature. Yukl (1989) integrated sev-
eral decades of managerial-role research
314 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Nivedita Srivastava & Shreekumar K. Nair
into a taxonomy of managerial behaviour.
A role-based framework is consistent
with Katz and Kahn’s (1978) open sys-
tems approach in which roles are deter-
mined by inputs from the environment as
well as variations in style as determined
by the individual. They defined
behavioural roles as the “recurring ac-
tions of an individual, appropriately inter-
related with the repetitive activities of
others so as to yield a predictable out-
come” (p.125). Other significant models
of managerial effectiveness include the
ones proposed by Luthans et al (1988),
Balaraman (1989), Quinn (1990), Gupta
(1996), Hamlin (2002), and Srivastava &
Sinha (2007).
Gupta (1996:399) defined managerial
effectiveness as the “ability of a man-
ager to carry out the activities required
of his position while achieving the results
both current and in terms of developing
further potential”. Using factor analysis,
16 dimensions of managerial effective-
ness were identified, viz., confidence in
subordinates, communication & task as-
signment, networking, colleagues man-
agement, discipline, resource utilization,
management of market environment, con-
flict resolution, integrity & commun-
ication, client management & compe-
tence, motivating, delegation, image build-
ing, welfare management, consultative,
and inspection & innovation. This model
has been developed for the Indian con-
text and it seems to encompass all the
relevant dimensions of managerial effec-
tiveness incorporated in other models. A
closer look at these 16 dimensions reveals
that there is high degree of man-manage-
ment focus inherent in Gupta’s (1996)
 Emotional Intelligence & Managerial Effectiveness : Role of Rational Emotive Behaviour
construct. This means that personal vari-
ables that are related to managers’ abil-
ity to manage people can have a signifi-
cant impact on their managerial effec-
tiveness (Nair & Yuvaraj 2000).
Personal variables that are related
to managers’ ability to manage
people can have a significant im-
pact on their managerial effective-
ness
A few studies have examined the role
of certain personality variables on mana-
gerial effectiveness in the Indian context.
For instance, Rastogi and Dave (2004)
studied the managerial effectiveness of
top and lower level managers in produc-
tion and marketing departments in rela-
tion to their personality type using a
sample of 80 managers from various pri-
vate sector organizations from the state
of Uttar Pradesh in India. The Manage-
rial Effectiveness Questionnaire (Gupta
1996) was used to measure managerial
effectiveness. The major findings were
that in the production department, both
top and lower level managers having
Type-B personality were found more ef-
fective and in marketing department top-
level managers having Type-A personal-
ity and lower level managers having Type
B personality were found more effective
in comparison to their counterparts.
Emotional Intelligence &
Managerial Effectiveness
In the last decade, there has been a
growing interest in the role of emotions
and emotional intelligence (EI) on mana-
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
gerial behaviour (Callahan Fabian 1999,
Bryant 2000). Researchers are particu-
larly trying to understand the role emo-
tions and emotional intelligence play in
the organization through change efforts,
leadership effectiveness, training and
organizational performance.
The genesis of the study of EI has
its roots in David Wechsler’s idea of
“non-collective aspects of general intel-
ligence”, which reaches as far back as
1940 (Wechsler 1940). Subsequently,
Leeper (1948) proposed that “emotional
thought” is part of and contributes to “logi-
cal thought” and intelligence in general.
These early proposals were succeeded
nearly half a century later by the ideas
of Harvard University’s Howard
Gardner, who felt that intelligence en-
compasses multiple dimensions, combin-
ing a variety of cognitive aspects with
emotional intelligence (or “personal in-
telligence” as he called it). The emotional
or personal dimension of his concept of
“multiple intelligence” included two gen-
eral components that he referred to as
“intrapsychic capacities” and “interper-
sonal skills” (Gardner 1983). On the
other hand, Mayer and Salovey looked
primarily at six components of “emotional
intelligence” that are very similar to
BarOn’s components (Mayer et al.
1990).
Based on Gardener’s (1983) theory,
BarOn (1997a) defined emotional intelli-
gence as “an array of non-cognitive ca-
pabilities, competencies, and skills that
influence one’s ability to succeed in cop-
ing with environmental demands and
pressures”. This suggests that non-cog-
315

nitive intelligence helps to predict suc-
cess because it reflects how a person
applies knowledge to the immediate situ-
ation. In a way he suggested that mea-
suring emotional, personal, or social in-
telligence is to measure one’s ability to
cope with daily situations to get along in
the world.
A study by Singh (2001) concluded
that different professions do require dif-
ferent levels of EQ. However, having a
high or average EQ may not be labelled
as ‘good’ or ‘bad’ in a profession. It is
necessary to have a right balance of vari-
ous emotional competencies which may
help one become a star performer. It also
found that many professions exhibited
moderate EQ. However, it should not be
interpreted that high EQ is not required
in these professions.
Having a high or average EQ may
not be labelled as ‘good’ or ‘bad’
in a profession.
Studies have indicated positive rela-
tionship between emotional intelligence
and managerial success. For instance,
Daftuar et al (2000) investigated the re-
lationship between EQ and sixteen dimen-
sions of managerial effectiveness using
EQ Map of Cooper & Sawaf (1997).
They found the self- awareness of man-
agers to be positively correlated with 9
dimensions; resilience with 12 dimen-
sions, interpersonal connection with 12
dimensions, integrity with 12 dimensions
and intuition with 14 dimensions of mana-
gerial effectiveness. Shipper et al (2003)
explored the relationship between EI and
316 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Nivedita Srivastava & Shreekumar K. Nair
managerial effectiveness using a cross-
cultural sample of 3,785 managers of a
multinational firm located in U.S, UK, and
Malaysia. They found that empathy, self-
awareness, and self- regulation are highly
related to managerial effectiveness. In a
study by Sy et al (2006), participants were
187 food service workers and their 62
managers at nine divergent locations of
the same restaurant franchise. The re-
sults of this study also support previous
research (e.g. Wong & Law 2002, Law
et al. 2004) indicating that employees with
higher EI have higher job performance.
The study suggests that employees with
high EI are more adept at using their
emotions to facilitate job performance.
Employees with high EI are more adept
at using their emotions to facilitate job
performance. In the Indian context, simi-
larly, Kumar (2001) found high correla-
tions of emotional intelligence with team
cohesiveness, organizational effective-
ness, job satisfaction, and transforma-
tional leadership among executives.
Rational Emotive Behaviour
Rational Emotive Behaviour (REB),
another construct having emotional un-
dercurrents has, in recent times, been
found to have implications for manage-
rial behaviour. The theory behind Ratio-
nal Emotive Behavior Therapy (REBT),
developed by Albert Ellis (1973), posits
that our feelings are primarily caused by
the specific thoughts and messages we
Employees with high EI are more
adept at using their emotions to
facilitate job performance.
 Emotional Intelligence & Managerial Effectiveness : Role of Rational Emotive Behaviour
tell ourselves. Rational Emotive Behav-
ior Therapy (REBT) is active-directive,
but is also unusually post-modernistic and
constructivist in that it specializes in
showing clients how their conscious and
unconscious absolutistic philosophies lead
to much of their dysfunctional feelings
and behaviours, and what they can do to
make themselves more open-minded and
flexible in their intra-personal and inter-
personal relationships (Ellis 1998). Ellis
posited that if people could be prevented
from indulging in irrational thoughts and
beliefs, they would improve their ability
to direct their energy toward self-actu-
alization (the rational drive), which he
believed could best be accomplished
through reason (Ellis 1994). The ABC
framework is the cornerstone of rational
emotive practice. In this framework, ‘A’
stands for an activating event, ‘B’ stands
for beliefs or evaluative cognitions of the
world, and ‘C’ stands for emotional and
behavioural consequences.
Rational Emotive Behaviour Therapy
has been used to study the influence of
rational thinking and emotions and its in-
fluence on personality since long. REBT
consists of belief systems which further
comprises rational beliefs which are
provable and verifiable, are associated
with appropriate emotions, and more pro-
ductive and self- helping behaviours.
These are usually logical and consistent
and lead to desirable and happy feelings.
On the other hand, irrational beliefs deal
with no evidence to support the belief,
and are associated with inappropriate
emotions. They are also associated with
less productive and self-helping
behaviours. These beliefs are often illogi-
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
cal and inconsistent and often lead to
undesirable and miserable feelings.
Kilburg (1996) has described a num-
ber of the typical goals of coaching, in-
cluding (i) increasing the client’s
behavioural range, flexibility, and effecti-
veness; (ii) improving the client’s social
and psychological awareness and com-
petencies; (iii) increasing the client’s tol-
erance and range of emotional responses;
and (iv) strengthening the client’s hardi-
ness and stress management skills. Given
the identified outcomes of the REBT pro-
cess, they believed it is possible to use
the basic principles of this therapeutic
approach to meet a number of these
goals.
Executive coaching forms an impor-
tant aspect of Managerial Effectiveness.
Sherin and Caiger (2004) have suggested
behavioural change as an important com-
ponent of executive coaching and thus
suggested the use of REBT for execu-
tive coaching. The study suggested that
much of executive coaching involves as-
sisting them to strategically develop
adaptive work behaviours. Underlying
many of these interventions is the need
to effect behavioural change. Indeed,
many coaching models include
behavioural change as a fundamental
aspect of their process. For example,
Saporito’s (1996) four stages of execu-
tive coaching include effecting and moni-
toring behaviour change as a key com-
ponent of the coaching which is an im-
portant managerial process. An emotion-
ally intelligent person is high at traits like
assertiveness, independence, empathy,
inter-personal relationship, happiness, etc.
317

An emotionally intelligent person is also
efficient at stress tolerance and impulse
control. Additionally, such a person is also
optimistic and believes in reality testing,
thus, helping in understanding as to how
rational he or she is.
An emotionally intelligent person
is high at traits like assertiveness,
independence, empathy, interper-
sonal relationship, happiness, etc.
In a study by Spörrle and Welpe
(2006), by adopting the theoretical frame-
work of Rational Emotive Behavior
Therapy (Ellis 1962, 1994), the cognitive
antecedents of functional behaviour and
adaptive emotions as indicators of emo-
tional intelligence (EI) were examined
and central assumptions of REB were
tested. In an extension of REB, it was
hypothesized that adaptive emotions re-
sulting from rational cognitions reflect
more EI than maladaptive emotions,
which result from irrational cognitions,
because the former leads to functional
behaviour. The results of the first study
using organizational scenarios in an ex-
perimental design confirmed central as-
sumptions of REB and supported the hy-
potheses. In a second correlational study
the connection between rational cognitions
and EI by measuring real person data
using psychometric scales was replicated.
Both studies indicated that irrational atti-
tudes result in reduced job satisfaction.
The Study
This study was carried out with the
following objectives.
318 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Nivedita Srivastava & Shreekumar K. Nair
1. To find out the nature of relation be-
tween Emotional Intelligence and
Managerial Effectiveness.
2. To ascertain the nature of relation-
ship between Rational Emotive
Behaviour and Managerial Effective-
ness.
3. To study the role of Rational Emo-
tive Behaviour in the relationship be-
tween Emotional Intelligence and
Managerial Effectiveness.
Based on the review of relevant lit-
erature, the following hypotheses were
formulated and verified in the study.
Hypotheses
H1.Emotional Intelligence will be posi-
tively related to Managerial Effec-
tiveness.
H2.Rational Emotive Behaviour will be
positively related to Managerial Ef-
fectiveness.
H3.Rational Emotive Behaviour will mod-
erate the relationship between Emo-
tional Intelligence and Managerial
Effectiveness.
Methodology
1. Emotional Quotient Inventory
(EQi): BarOn (1997b, 2000) de-
scribes the Emotional Quotient in-
ventory as a self report measure of
emotionally and socially competent
behaviour which provides an estimate
of one’s emotional and social intelli-
gence. The instrument was initiated
in the early 1980s as an experimen-
tal tool. EQ- i, consists of 15 sub-
 Emotional Intelligence & Managerial Effectiveness : Role of Rational Emotive Behaviour
scales with 133 items. It has a five
point rating scale. A score of 1 is
awarded if the respondent has
checked on Very Seldom or Not True
of Me, 2 to Seldom True of Me, 3 to
Sometimes True of Me, 4 to Often
True of Me and a score to Very Of-
ten True of Me or True of Me. Out
of the 133 items belonging to differ-
ent sub-scales 57 are to be reverse
scored.
Emotional Self Awareness (ES), Self-
Regard (SR), Assertiveness (AS),
Independence (IN), and Self – Ac-
tualization (AS) constitute Intra-per-
sonal skills. Inter-personal skills on
the other hand consist of Empathy
(EM), Social Responsibility (SRES),
and Interpersonal Relationship (IR).
Additionally there is the adaptability
scale, which consists of Reality Test-
ing (RT), Flexibility (FL), and Prob-
lem Solving (PS). Equally important
is the Stress Management skill which
includes Impulse Control (IC) and
Stress Tolerance (ST). The General
mood scales on the other hand are
Happiness (HA) and Optimism (OP).
Bar On (2000) has reported the in-
ternal reliability by using the
Cronbach alpha ranging from 0.70
for Social Responsibility to 0.89 for
Self –Regard. Kumar (2001) in his
Indian study reported the internal
consistency of the 15 sub-scales
ranging from 0.65 to 0.89. The
Cronbach alpha value of EQi com-
puted in this study is 0.68.
2. Rational Behaviour Inventory: The
Rational Behaviour Inventory (RBI)
developed by Shorkey and Whiteman
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
(1977) has a five point rating scale.
It consists of 37 items. The reliabil-
ity index computed in this study is 0
.75.
3. Managerial Effectiveness Scale:
This scale developed by Gupta (1996)
consists of 45 items measuring 16 di-
mensions. The scale has been fur-
ther factor analysed giving 3 factors
named as Activities of His Position,
Achieving the Results and Develop-
ing Further Potential. It has positively
and negatively worded items with a
five point rating scale. Positive items
are scored by assigning 5 to a rating
of Always; 4 to Usually; 3 to Neu-
tral; 2 to Sometimes; and 1 to Never.
The test-retest reliability and split
half reliability are 0.73 (Gupta 1996).
The Cronbach alpha value computed
in this study is 0.88.
Sample
The present study consisted of 305
managers from several industries across
India including manufacturing, information
technology, human resource consulting,
banking, energy, and telecommunication.
Out of the 305 managers, 197 participants
were middle level managers and 108 were
entry level managers. A sample of around
300 executives was primarily the target
sample so as to ensure a good mix of
male- female, middle level- entry level, and
private-public sector categories of execut-
ives. It has been seen that the roles and
responsibilities of entry level and middle
level managers (viz. team working; deci-
sion making; planning and organizing) are
quite similar in nature in comparison to
319
 Nivedita Srivastava & Shreekumar K. Nair

senior level managers where the roles and average age of 28 years whereas, the
responsibilities include transformational middle-level managers ranged in age from
leadership, strategic thinking, mission and 24 years to 58 years with a mean age of
vision formation of the organization. First- 38 years. It was ensured that an entry
line managers are primarily involved in level manager has a minimum of 1 year
project management activities. Middle- of experience and a middle level manager
level managers are heavily involved in has a minimum experience of 3 years.
personnel supervision activities, though
they are still involved in project manage- Results & Discussion
ment. Upper-level managers are heavily
involved in strategic planning, however In order to study the distribution of
they also have involvement in project data, descriptive statistics like Means and
management and personnel supervision Standard Deviations were found out. For
but, comparatively to much lower extent the purpose of testing the hypotheses and
(Friedman & Fleishman 1990). For this establishing relationships among the vari-
purpose, it has been decided to adopt pur- ables, statistics like correlation and simple
posive sampling method to study entry regression were used. Further, Fisher’s r
level and middle level managers to main- to z transformation test was used to study
tain the homogeneity of the sample. To the effect of the moderating variable.
give a wider representation of the mana-
gerial population, the sample comprised In order to ensure that the public sec-
managers from public sector as well as tor and private sector samples do not dif-
private sector industries. Out of the 305 fer significantly on the variables under
managers, 148 were from public sector study, t-test was conducted. The results
and 157 from private sector companies. of t-test signify non-significant difference
These managers were from some of the in Emotional Intelligence (t = 1.056,
top companies located in the major metro p<0.06, df = 147). Hence, the two
cities of India where the need to manage samples were combined and all statisti-
risk, handle stress, and to adapt efficiently cal analyses were done for the total
is high. The entry-level managers ranged sample. The statistical package used for
in age from 21 years to 40 years with an data analysis in this study is SPSS 15.0.
Table 1: Descriptive Statistics of Independent and Dependent Variables
Variable N Mean Minimum Maximum SD
Intrapersonal 305 263.59 209 312 18.45
Interpersonal 305 103.83 61 135 16.89
Adaptability 305 88.95 58 115 10.61
Stress Management 305 60.54 34 82 9.149
General Mood 305 61.61 43 80 8.064
Rational Emotive Behaviour 305 21.03 7 34 5.135
Activities of his position 305 108.76 69 152 15.52
Achieving the results 305 23.90 10 32 4.309
Developing further potential 305 20.570 8 30 4.223

320 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
 Emotional Intelligence & Managerial Effectiveness : Role of Rational Emotive Behaviour

Table 1 shows the descriptive Intelligence and Rational Emotive

statistics of the independent and dependent Behaviour have high standard deviation
variables. Minimum- maximum ranges, values indicating a good spread of scores
means, and standard-deviations are listed while variables of Managerial
in table 1. All variables have a high mean Effectiveness have low standard deviation
value. The specific skills of Emotional value.
Table 2: Inter correlation Matrix
Intra- Inter- Adap- Stress General Rational AHP ATR DFP
personal personal tability Mgt. Mood Beh.
Intra-personal 1
Inter-personal 0.718** 1
Adap-tability 0.789** 0.658** 1
StressMgt. 0.591** 0.471** 0.698** 1
GeneralMood 0.728** 0.625** 0.713** 0.471** 1
RationalBeh. 0.214** 0.095 0.214** 0.342** 0.119* 1
AHP 0.04 0.11 0.125** 0.30** 0.31** 0.25** 1
ATR 0.004 -0.021 0.064 -0.04 -0.004 0.135** 0.682** 1
DFP 0.069 0.23** 0.179** 0.047 0.122* 0.064 0.867** 0.685** 1
* Significant at 0.05 level (2- tailed); ** Significant at 0.01 level (2- tailed)

Results of correlational analysis pre- and Achieving the Results factor of Mana-
sented in Table 2 reveal that there is a gerial Effectiveness. In addition, a strong
strong positive relation between Emotional correlation between Emotional Intelli-
Intelligence and Managerial Effective- gence and Rational Emotive Behaviour is
ness. Results also show a significant posi- seen. All of the five specific skills of Emo-
tive relation between Rational Emotive tional Intelligence are significantly corre-
Behaviour and Activities of His Position lated to Rational Emotive Behaviour.
Table 3: Simple Linear Regression of Activities of His Position with Factors of Emotional
Intelligence

DV IV R2 Adjusted R2 β F (1,303)

Intra-personal 0.001 0.000 0.030 0.484

Activities of His Inter-personal 0.012 0.008 0.11 3.724
Position Adaptability 0.105 0.051 0.124** 4.779
Stress Management 0.269 0.234 0.305** 4.786
General Mood 0.134 0.112 0.324** 4.35
** Significant at 0.01 level

Table 3 reveals that Emotional Intel- cant predictor of Activities of His Posi-
ligence (Adaptability Skills, Stress Man- tion factor of Managerial Effectiveness.
agement, and General Mood) is a signifi- It can be seen from Table 4 that emo-

The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 321
 Nivedita Srivastava & Shreekumar K. Nair

tional Intelligence is not a significant pre- of Activities of His Position, Achieving

dictor of Achieving the Results. Table 5 the Results, and Managerial Effective-
depicts that Emotional Intelligence (In- ness as a composite score.
ter-personal Skills, Adaptability, and Gen-
eral Mood) is a significant predictor of
Emotional Intelligence is not a sig-
Developing Further Potential. Also, it can
nificant predictor of Achieving the
be seen from Table 6, that Rational Emo-
Results.
tive Behaviour is a significant predictor

Table 4: Simple Linear Regression of Achieving the Results with Factors of Emotional Intel-
ligence

DV IV R2 Adjusted R2 F (1,303)

Intra-personal 0.001 0.000 0.003 0.004

Activities of His Inter-personal 0.000 0.000 -.020 1.131
Position Adaptability 0.032 0.028 0.113 1.225
Stress Management 0.011 0.001 0.041 0.139
General Mood 0.012 0.011 0.0296 1.501

Table 5: Simple Linear Regression of Developing Further Potential with Factors of Emo-
tional Intelligence

DV IV R2 Adjusted R2 F (1,303)

Intra-personal 0.004 0.001 0.068 1.437

Developing Inter-personal 0.16 0.13 0.130** 5.235
Further Potential Adaptability 0.22 0.21 0.179** 10.080
Stress Management 0.020 0.018 0.04 1.675
General Mood 0.14 0.11 0.121** 4.558
** Significant at 0.01 level

Table 6: Simple Linear Regression of Factors of Managerial Effectiveness and Managerial

Effectiveness with Rational Emotive Behaviour

IV DV R2 Adjusted R2 F (1,303)

RE B Activities of His Position 0.18 0.17 0.239** 6.19

Achieving the Results 0.15 0.146 0.135** 5.649
Developing Further Potential 0.004 0.007 0.06 1.232
Managerial Effectiveness 0.23 0.21 0.25** 5.92
** Significant at 0.01 level

322 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
 Emotional Intelligence & Managerial Effectiveness : Role of Rational Emotive Behaviour
It was hypothesized that Rational
Emotive Behaviour acts as a moderat-
ing variable in the relationship between
Emotional Intelligence and Managerial
Effectiveness. To study the effect of
this moderating variable, the significance
of difference of correlation has been
studied between the values of r of
Managerial Effectiveness corresponding
to ‘High’ Emotional Intelligence and
Table 7: Fisher r to z Transformation Test for Rational Emotive Behaviour as a Moderating
Variable for Emotional Intelligence (IV) and Managerial Effectiveness (DV)
Moderating Groups
Variable
Rational Emotive High Group (n=102)
Behaviour
Low Group (n=107)
**significant at 0.01 level
β The results of Fisher r to z transfor-
mation test reveal that Rational Emotive
Behaviour acts as a moderating variable
for the effect of Emotional Intelligence on
Managerial Effectiveness (z= 2.25**,
p< 0.01).
Significant positive relation has been
found between Emotional Intelligence (R2
= 0.19, = 0.37***, p<0.001) and
Managerial Effectiveness. This supports
Hypothesis 1 which states that Emotional
Intelligence will be positively related to
Managerial Effectiveness. It can be noted
from the results that Emotional Intelligence
is a significant predictor of Managerial
Effectiveness. This is in line with the
findings of the study by Shipper et al (2003)
which conclude that empathy, self aware-
ness, and self regulation are highly related
to managerial effectiveness.
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
‘Low’ Emotional Intelligence scores. For
this purpose, the Fisher r to z transfor-
mation test has been used. Required cor-
relation for high and low sub-groups
which were already formed were com-
puted. In order to implicate only extreme
sub-groups on each of the two dimen-
sions, those above P 66 and below P33 cut-
off points were considered in this analy-
sis (Table 7).
Correlated Variables r z
EI & ME 0.24 +2.25**
EI & ME -0.017
Significant positive relation has been
found between Rational Emotive Behaviour
(R 2 =0.18, = 0.239**, p<0.01) and
Activities of His Position factor of
Managerial Effectiveness. Significant
positive relation has been found between
Rational Emotive Behaviour (R2 = 0.15,
= 0.135**, p<0.01) and Achieving the
Results factor of Managerial Effectiveness.
Also, Rational Emotive Behaviour has been
found to significantly predict Managerial
Effectiveness as a whole (R2 = 0.23, =
0.25**, p<0.01). This partially supports
Hypothesis 2, which states that Rational
Emotive Behaviour will be positively
related to Managerial Effectiveness.
DiMattia (1993) argued that the rational
emotive behaviour approach suits the
organizational context because of its
preventive, psycho-educational emphasis
and its short-term, solution-focused
323

orientation. When successful, the REB
process functions to increase the client’s
capacity for rational, critical, and psycholo-
gically sophisticated reasoning and thereby
allows the client to challenge and replace
any unrealistic expectations that might have
negatively influenced his or her perform-
ance (Ellis 1994).
The Fisher r to z test confirms the
significant moderating effect of Rational
Emotive Behaviour (z= 2.01**, p< 0.01)
on the relation between Emotional
Intelligence and Managerial Effectiveness,
thereby, lending support to Hypothesis 3.
This suggests that when Emotionally
Intelligent executives display Rational
Emotive Behaviour, they can be predicted
to be effective on their jobs. Possibly,
Rational Emotive Behaviour provides
executives with a set of rational choices
to choose from (rather than being victims
of one’s own habit patterns), thereby,
ensuring high level of managerial
effectiveness.
Conclusions& Implications
Emotional Intelligence as a whole
seems to be a significant predic-
tor of Managerial Effectiveness.
The study reveals that Emotional In-
telligence as a whole seems to be a sig-
nificant predictor of Managerial Effec-
tiveness. Except Achieving the Results,
all other factors of Managerial Effective-
ness are predicted by Emotional Intelli-
gence. This helps to conclude that high
level of Emotional Intelligence could lead
to high Managerial Effectiveness. This
324 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Nivedita Srivastava & Shreekumar K. Nair
conclusion of the present study is sup-
ported by a few earlier studies (e.g.,
Daftuar et al 2000 and Shipper et al,
2003).
Also, the moderating effect of Ra-
tional Emotive Behaviour has been found
significant between Emotional Intelli-
gence and Managerial Effectiveness.
The effect of Emotional Intelligence on
Managerial effectiveness is affected by
Rational Emotive Behaviour. The ability
to behave in a rationally emotive way by
Emotionally Intelligent managers would
enhance managerial effectiveness in an
organisation.
Hiring managers on the basis of
their Emotional Intelligence as
well as Rational Emotive
Behaviour could ensure better fit
with managerial positions requir-
ing higher levels of effectiveness.
This study suggests the quintessen-
tial role of behavioural variables such as
Emotional Intelligence and Rational Emo-
tive Behaviour for identifying result-ori-
ented executives for organisations. The
two-fold approach of hiring new person-
nel with these two behavioural skills and
at the same time training the existing per-
sonnel on these skills would have a com-
pound leverage effect. EI is yet not in
ambit of organisational development ini-
tiatives of the Indian corporate sector.
Hiring managers on the basis of their
emotional intelligence as well as rational
emotive behaviour could ensure better fit
with managerial positions requiring higher
levels of effectiveness.
 Emotional Intelligence & Managerial Effectiveness : Role of Rational Emotive Behaviour
The present study has a few limita-
tions. Firstly, the sample is heterog-
eneous as the participants are from sev-
eral industries. However, it is argued that
heterogeneity of a sample contributes
towards wider generalization of the find-
ings and therefore it can be considered
to be the strength rather than the weak-
ness of a research (Kaur 1992, Shukla
1988, Srivastava 1990). The matter re-
mains debatable as the non-random sam-
pling method imposes further constraints
on the generalization issue. However,
since no significant difference was found
in the mean Emotional Intelligence scores
of public sector and private sector ex-
ecutives, the homogeneity of the sample
is ensured. Secondly, the sample chosen
consists of only entry-level and middle-
level executives and does not involve the
top-management. The top-management
executive could not be included in the
study because of the length of the ques-
tionnaire affecting the response time and
because of the differences in their com-
petencies when compared with the other
two levels. Thirdly, all the measures used
to assess the variables are self-report
assessments.
While extending this research, future
studies could focus on selecting a par-
ticular sector of industry to enhance the
focus of the study. Also, studies could
focus exclusively on the top management
of the corporate sector to study the ef-
fect of Emotional Intelligence and Ra-
tional Emotive Behaviour on strategic
competencies. Future studies could also
use qualitative data sources like 360 de-
gree feedback.
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
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Management Styles, Productivity &
Adaptability of Human Resources: An Empirical Study
Ravindra Jain & R. Premkumar
The participative, altruistic, profess-
ional and organic management styles
are the most desirable amongst the
various management styles. The
present study aims to assess the extent
to which such management styles are
practiced in Indian organizations
across public sector and private
sector enterprises and across
manufacturing and service providing
organizations and to measure their
impacts on ‘HR Productivity’ and ‘HR
Adaptability’. It has been found that
in Indian organizations across the
sectors, such management styles are
practiced to a ‘moderate extent’ and
have high positive correlation with
one another. ‘HR Productivity’ and
‘HR Adaptability’ are also found at
moderate levels. The selected four
management styles may be considered
as the safest and development
oriented to practice in a wide variety
of organizations.
Ravindra Jain is Professor in Business
Management, Faculty of Management Studies,
Vikram University, Ujjain 456010 E-mail:
jainravindrak@rediffmail.com. R. Premkumar is
Registrar in National Institute of Industrial
Engineering (NITIE) Mumbai. E-mail:
premilango@gmail.com
328 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Ravindra Jain & R. Premkumar
Management Styles
Management styles are collectively
learnt behaviours, subject to all the infirmities
of human learning. They incorporate both
the contents of decision making and the
process of decision making and are aligned
to goal setting, strategy formulations and
strategy implementation. They are
profoundly influenced by the distinctive
social culture and climate in which an
organization operates. The distinctive way
in which managers perform the various
functions in an organization decides their
management styles. There is a core
management style that reflects the values
and norms of a culture and this is practiced
in the given organizational climate and
culture. Such a core management style may
have variations and mainly include
conservative style, entrepreneurial style,
professional style, bureaucratic style,
organic style, authoritarian style,
participative style, intuitive style, familiar
style, altruistic style, innovative style etc.
Given the choices, unlimited number of
management styles can be visualized.
There is evidence that the use of a
nurtured, paternalistic, benevolent style of
management, especially when combined
 Management Styles, Productivity & Adaptability of Human Resources
with a demanding style that expects
subordinates to perform, is correlated with
aspects of organizational effectiveness
(Khandwalla 1995). The most predominant
leadership style among all categories of
scientist and administrative professionals
was found to be “direction oriented style”
followed by “participation oriented style”
(Muthayya & Vijay Kumar 1985). Ansari
(1986) found that “Nurturant Task
Leadership Style” positively influence
organizational commitment, job satisfaction
and HR effectiveness. The majority of
managers adopt “high task – high relatio-
nship” as their primary leadership style
(Kool & Saksena 1989). The study of
Sharma (1997) concluded that the human
and fair management style has been the
most critical determinant of organizational
commitment.
Unblemished participative, organic
and management styles are likely to be
effective in curbing a number of problems,
viz., delay in problem solving, problem of
poor team work and administrative problem;
such styles are also positively correlated
with the mechanism of organizational
learning; in the situation of greater rate of
change in industry, faster pace of
globalization, multicultural society, and
greater need for sustainable development,
the practice of participative, organic,
professional and altruistic styles would be
more effective and therefore the four
management styles, viz., participative,
altruistic, professional, and organic, are the
most desirable amongst the various
management styles (Khandwalla 1995).
The results of earlier researches, thus,
indicate that management styles vary from
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
culture to culture and within the specific
culture from industry to industry.
Management styles also vary from one
setting or situation to the other or within an
industry; and from time to time in the same
culture, industry and in an organizational
setting or situation. Styles vary widely
because organizations differ in terms of
their type, purpose, size, operating context
& environment, genesis etc. The
organization’s operating context influences
management styles only to some extent;
internal factors of an organization (including
role and style of top & senior executives)
shape management style to a greater
extent; thus, the management style, though
partially constrained by the organization’s
operating context, and is also, at least
partially, a strategic choice of management.
Keeping all the above mentioned
observations in mind, in the current context
of faster pace of globalization, multi-cultural
organizations, faster pace of internal and
external changes in organizational environ-
ment and fast growing need for sustainable
development, management styles practiced
in variety of organizations need to be studied
afresh in order to look for broad generali-
zation. Such an endeavour may reveal
ways by which organizations enable
themselves to perform better in future.
Management styles vary from
culture to culture and within the
specific culture from industry to
industry.
The Study
The present study was exploratory in
nature. The objectives of the study were
329
 Ravindra Jain & R. Premkumar

(i) to assess the extent to which the selected
four management styles, viz., participative
style, altruistic style, professional style and
organic style are practiced in Indian
organizations; (ii) to make a comparative
study as regards to ongoing practices of the
four management styles in private sector
and public sector organizations from
manufacturing and service providing sectors;
(iii) to study the effectiveness of human
resources in terms of their ‘productivity’ and
‘adaptability’ in Indian organizations and also
to make a comparative study of the same
regarding the private sector and public sector
organizations from the manufacturing and
service providing sectors ; and (iv) to
measure the impact of the ongoing practices
of the selected four management styles on
the ‘productivity’ and ‘adaptability’ of
human resources with reference to Indian
private sector and public sector organiza-
tions from the manufacturing and service
providing sectors.
Research Methodology
Primary data were collected through
administering the relevant questionnaires to
three hundred executives belonging to both
public sector and private sector
organizations from manufacturing and
service providing sectors, the details of
which are given in Table 1. Three hundred
respondent executives belong to various
strata of sex, age-group, qualification levels,
and group of varying length of work
experience, details of which are given in
Tables 2, 3 and 4.

Table 1 Coverage of the Executives in the Sample Survey

Type of Organization No. of Executives in the Sample Total No. of

Manufacturing Service Providing Executives in
Organizations Organizations the Sample
Private Sector Organizations 80 50 130 (43.3%)
Public Sector Organizations 106 64 170 (56.7%)

Total 186 (62.0%) 114 (38.0%) 300

Note: Figures in parentheses are percentages of the executives in respective categories to the total no.
of executives in the sample.

Table 2 Age and Gender Profile of the Respondents in the Sample Survey

Age Range (in years) No. of Executives in the Sample Total No. of
Male Female the Executives in
the Sample
Between 25 to 35 73 10 83 (27.7%)
Between 35 to 50 165 25 190 (63.3%)
Above 50 24 03 27 (9.0%)

Total 262 (87.3%) 38 (12.7%) 300

Note: Figures in parentheses are percentages of the executives in respective categories to the total no. of
executives in the sample.

330 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
 Management Styles, Productivity & Adaptability of Human Resources

Table 3 Profile of Educational Qualifications of the Respondents in the Sample Survey

Qualification in the Sample Number of Executives

Matriculation 07(2.3%)
Graduate Degree 163(54.3%)
Post Graduate Degree 70(23.4%)
Professional Diploma 60(20.0%)
Total 300
Note: Figures in parentheses are percentages of the executives in respective categories to the total no. of
executives in the sample.

Table 4 Profile of Length of Work Experience of the Respondents in the Sample Survey

Range of Length of Work Experience of Number of Executives in the

the Executives Sample
Below 05 Years 58 (19.3%)
Between 05 to 10 Years 88 (29.37%)
Above 10 Years 154 (51.4%)
Total 300
Note: Figures in parentheses are percentages of the executives in respective categories to the total no. of
executives in the sample.

Management styles Questionnaire two items of MSQ were subjected to items

(MSQ) (Four Point Likert Type Scale)
developed by Khandwalla (1995) and
Human Resource Effectiveness (Produc-
tivity & Adaptability) Scale (HRES) (Five
Point Likert Type Scale) developed by
Premkumar (2007) were used to collect the
relevant data for the study. The MSQ
contains forty two items which are listed
in Appendix I. The HRES contains eight
items which are listed in Appendix II.
A pilot study was conducted with a
sample of sixty managers of various public
sector and private sector organizations from
both manufacturing and service providing
sectors. The MSQ yielded an overall high
reliability coefficient [Cronbach Alpha ( α )
= 0.97 approx.] which indicates high
reliability of the instrument. All the forty-
sum correlation analysis which resulted into
strong correlation with each other. HRES
Scale has yielded approx. 0.65 as reliability
coefficient [Cronbach Alpha ( )] which
indicates towards the reasonable reliability
of the construct.
Data analysis was carried out using
statistical software SPSS. The various
statistical tools used for the analysis of data
include arithmetic means, standard
deviation, t-test, multiple regression analysis
and correlation analysis.
Key Variables
Participative Management Style:
The most common form of participative
management style is group decision-mak-

The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 331

ing in which the group head does not act
as a boss but coordinates and facilitates
decision making by the group as a whole.
This sort of decision making is based on
free and frank discussion, sharing of in-
formation and views, generation of many
alternatives and the gradual emergence
of a consensus view to which everyone
feels at least some commitment to the
decision made because it has emerged
through participation of all concerned
(Khandwalla 1995). Particip-ative man-
agement style is positively correlated with
the group’s performance / organizational
performance (Singh et al. 1979, Sinha,
1980, Khandwalla 1990, Maheshwari
1992). However, participative manage-
ment style is very difficult to practice as
sharing power / authority with subordi-
nates / peers is not easy for the manag-
ers who are more often delighted by exer-
cising their authority or they are often
driven by the need for power.
Participative management style is
very difficult to practice as sharing
power / authority with subordi-
nates / peers is not easy for the
managers.
Altruistic Management Style:
Altruistic is unselfish concern for other
people’s happiness and welfare as well as
a feeling of compassion for others. Almost
all the good management styles have the
altruistic base but they are often affected
by the organization centered considerations.
‘Altruistic Management Style’ goes beyond
organization centered considerations to
larger social concerns and the pursuit of
larger ideals / social goals (Khandwalla
332 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Ravindra Jain & R. Premkumar
1995). Such social concerns / social goals
may include affirmative actions for charity
for weaker sections of society, employment
of socially disadvantaged groups of people,
removal of discrimination against women,
maintenance of ecological balance,
regionally balanced economic development,
workers’ education & training, ensuring
representation of various stakeholders in
the decision making process etc. However,
excessive altruism in business organizations
may negatively affect organizational
effectiveness.
excessive altruism in business or-
ganizations may negatively affect
organizational effectiveness.
Organic Management Style: The
managers who practice organic style
believe: (a) in providing multi-channel &
multi-directional information network ;
(b) in creating widespread awareness of
organization’s goals, business strategies
and action plans among employees at all
levels ; (c) in using cross-hierarchical and
cross-functional teams; (d) in having flat
organizational structure and low formal-
ization; (e) in adopting decentralized de-
cision making; in giving prime importance
to those having expertise relevant to a
problem / situation in the process of de-
cision making; (f) in creating a work en-
vironment for nurturing flexibility, trans-
parency, openness, mutual understanding,
experimentation, learning, development,
creativity & innovation ; (g) exercising
control not through positional power but
rather by peer pressure and mutual in-
teraction; and (h) in emphasizing greater
commitment to the organization’s
 Management Styles, Productivity & Adaptability of Human Resources
progress, expansion & well being rather
than to loyalty to the position holders.
Wherever rapid changes in technology,
system, process and people’s behavior is
required, organic management style pro-
vides desirable results.
Professional Management Style :
The managers who practice professional
management style believe: (a) in deci-
sion-making by formally educated &
trained people having high technical /
professional qualifications; (b) in using
experts extensively for relevant action
researches before decision-making; (c)
in giving prime importance to long-term
planning and strategy formulation; (d) in
formulation, internalization and following
of code of professional ethics; (e) in us-
ing research and experience based high
standardized work-methods and proce-
dures; (f) in exercising control by sys-
tematic and sophisticated way; (g) in fol-
lowing an all-pervasive scientific ap-
proach for designing and implementation
of business strategies ; and (h) in using
‘management information system (MIS)’
for putting all the above mentioned things
into action. Professional management
style is also one of the four styles which
had the positive correlation with a num-
ber of indicators of organiz-ational effec-
tiveness. Despite the vast difference in
the matter of socio-economic and cultural
conditions among cross-cultural coun-
tries, professional management style may
yield good results across the countries /
cultures. However, in many cases / on
many occasions, it may be noticed that
professional managers have a tendency
to get stuck in endless systematization
and causal analysis without getting down
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
to decision-making and action. This kind
of potential flaws may be foreseen in the
practice of professional management
style.
Professional managers have a
tendency to get stuck in endless
systematization and causal analysis
without getting down to decision-
making and action.
‘Productivity’ of Human Resource
One of the major goals of HRD is to
ensure high ‘productivity of human re-
sources’ in an organization. Productivity
implies a concern for both ‘effective-
ness’ and ‘efficiency’ (Robbins 2004). If
human resources contribute to transfer-
ring inputs into outputs at the lowest cost
and thus contribute to the achievement
of organiz-ational goals, the human re-
sources will be termed as productive.
Productivity also depends on achieving
organizational goals efficiently. ‘Effi-
ciency’ is the ratio of effective output to
the input required to achieve it (Robbins
2004). In case of manufacturing indus-
tries, there is a potential to improve effi-
ciency and effectiveness by looking at
the hardware of machines as well as the
software of human resources. On the
other hand, in services sector, quality of
services (efficiency or effectiveness of
the services) exclusively depends on qual-
ity of human resources and their quality
of interactions.
‘Adaptability’ of Human Resources
‘Adaptability’ means one’s ability to
change one’s ideas or behaviour in order
333
 Ravindra Jain & R. Premkumar

to deal with new or changed situation
and in this sense adaptability of human
resources is the employees’ ability and
self-efficacy by which they can execute
courses of action required to deal with
prospective situation and to contribute to
introduce necessary changes in internal
organizational climate in fine tune with
the changes in external environment.
‘Adaptability’ of human resources also
refers to the employees’ confidence in
their competence and potential effective-
ness for mobilizing their cognitive re-
sources and courses of actions in the
matter of performing their jobs and roles.
Performance attainments, past experi-
Table 5 Four Management Styles Practiced in Indian Organizations
ences, behaviour of role models, social
persuasion, and psychological & physi-
ological arousal of the individuals influ-
ence the degree of adaptability of the
human resources.
Data Analysis & Findings
By analyzing the data given in Tables
5-14, the following findings have been
arrived at :
1. The selected four management styles
(viz., participative, altruistic, organic
and professional) were found to be
practiced to a moderate extent in both

Management Styles Mean values (N = 300) The Extent of Practice

Participative 2.93 Moderate Extent
Altruistic 2.89 Moderate Extent
Professional 2.77 Moderate Extent
Organic 2.65 Moderate Extent
Note:Set standards for the Statistical Analysis
High degree : For mean values 4 and above
Moderate degree : For mean values 3 and above but less than 4.
Low degree : For mean values less than 3.

Table 6 Management Styles in Indian Public Sector & Private Sector Organizations (t-test Results)

Management Private Sector Public Sector t-value Significance

Styles Organizations Organizations
(N = 130) (N = 170)
Mean Standard Mean Standard
Values Deviation Values Deviation
Participative 2.84 .64 2.99 .68 -1.86 .06
Altruistic 2.89 .69 2.89 .67 .029 .97
Professional 2.74 .62 2.99 .68 -3.15 .00*
Organic 2.55 .69 2.73 .69 -2.17 .03*
* Significant at 0.05 level of significance (Table value = 1.96)
Note: set standards for the Statistical Analysis:
High degree : For mean values 4 and above
Moderate degree : For mean values 3 and above but less than 4.
Low degree : For mean values less than 3.

334 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
 Management Styles, Productivity & Adaptability of Human Resources

Table 7 Management Styles Practiced in Indian Manufacturing and Service Providing

Organizations (t-test Results)

Management Manufacturing Sector Service Providing t-value Significance

Styles Organizations Organizations
(N = 186) (N = 114)
Mean Standard Mean Standard
Values Deviation Values Deviation
Participative 3.00 .62 2.74 .73 3.25 .00*
Altruistic 2.93 .65 2.77 .75 1.96 .05
Professional 2.96 .62 2.73 .70 2.91 .00*
Organic 2.72 .66 2.47 .74 3.01 .00*
* Significant at 0.05 level of significance (Table value = 1.96)
Note: set standards for the Statistical Analysis:
High degree : For mean values 4 and above
Moderate degree : For mean values 3 and above but less than 4.
Low degree : For mean values less than 3.

Table 8 Inter-Correlations among the Selected Four Management Styles as Practiced in Indian
Organizations

Karl Pearson’s Correlation

Dimensions Participative Altruistic Professional Organic
Participative 1
Altruistic .830(*) 1
Professional .819(*) .808(*) 1
Organic .764(*) .728(*) .778(*) 1
* Correlation is significant at the 0.05 level (2-tailed)

Table 9 Degrees of ‘Productivity’ and ‘Adaptability’ of HR in Indian Organizations

Dimensions of HR Effectiveness Mean Values Standard Degree

(N = 300) Deviation
Productivity of Human Resources 3.5 .65 Moderate
Adaptability of Human Resources 3.3 .77 Moderate
Overall Effectiveness of Human Resources 3.4 .64 Moderate
Note : Set standards for statistical analysis:
High degree : For mean values 4 and above
Moderate degree : For mean values 3 and above but less than 4.
Low degree : For mean values less than 3.

The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 335
 Ravindra Jain & R. Premkumar

Table 10 Degrees of ‘Productivity’ and ‘Adaptability’ of HR in Indian Private Sector and Public
Sector Organizations (t-test Results)

Dimensions of Private Sector Public Sector t-value Significance

HR Organizations Organizations
Effectiveness (N = 130) (N = 170)
Mean Standard Mean Standard
Values Deviation Values Deviation
Productivity 3.33 .25 3.12 .23 -1.865 .163
Adaptability 3.24 .45 3.22 .43 .029 .977
Overall HR Effectiveness 3.33 .65 3.49 .77 -3.115 .222*
* Significant at 0.05 level of significance (Table value = 1.96)
Note: Set standards for the Statistical Analysis:
High degree : For mean values 4 and above
Moderate degree : For mean values 3 and above but less than 4.
Low degree : For mean values less than 3.

Table 11 Degrees of ‘Productivity’ and ‘Adaptability’ of HR in Indian Manufacturing and Service

Providing Organizations (t-test Results)

Dimensions of Perceptions of Executive Perceptions of Executive t-value Significance

HR of Manufacturing Sector from Service Sector
Effectiveness (N = 186) (N = 114)
Mean Standard Mean Standard
Values Deviation Values Deviation
Productivity 3.5479 .56808 3.3273 .75610 2.860 .005*
Adaptability 3.4287 .72586 3.2018 .82484 2.481 .014*
Overall HR Effectiveness 3.4930 .56164 3.2696 .74688 2.93 .004*
* Significant at 0.05 level of significance (Table value = 1.96)
Note: Set standards for the Statistical Analysis:
High degree : For mean values 4 and above
Moderate degree : For mean values 3 and above but less than 4.
Low degree : For mean values less than 3.

Table 12 Correlation Between ‘Productivity’ and ‘Adaptability’ of HR

Dimensions of HR Effectiveness Karl Pearson’s Correlation

Productivity Adaptability
Productivity 1 .657(**)
Adaptability .657(**) 1
** Significant at 0.01 and above level (2-tailed).

336 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
 Management Styles, Productivity & Adaptability of Human Resources

Table 13 Multiple Regression of the Relationship between Management Styles and Effectiveness
of Human Resources
Model R R Square Adjusted Std. Error
R Square Estimate of the
Relationship Between the Overall HR .940(a) 0.885 .700 .57904
effectiveness and the Various Managerial Styles
Predictors: (Constant), Organic, Altruistic, Professional, Participative

Table 14 ANOVA Test for the Significance of Multiple Regression Analysis of the Relationship
Between Management Styles and Effectiveness of Human Resources
Model Sum of df Mean F Sig.
Squares Square
Relationship Between Regression 26.336 4 6.584 19.637 .000(a)
the Overall HR Residual 98.911 295 .335
effectiveness and Total 125.247 299
the Managerial Styles
Predictors: (Constant), Organic, Altruistic, Professional, Participative
Dependent Variable: Overall HR Effectiveness

private sector and public sector or-
ganizations as well as both manufa-
cturing and service providing sectors.
2. The professional management style
and organic management styles were
found to be practiced to a moderate
extent but with significant variation
(at 0.05 level of significance) be-
tween public and private sector or-
ganizations as well as between
manufacturing and service providing
organizations.
3. Altruistic management style
was found to be practiced to a mod-
erate extent but without signifi-cant
variation (at 0.05 level of signifi-
cance) between public sector and
private sector organizations as well
as between manufacturing and ser-
vice providing organizations.
4. Participative management style was
found to be practiced to moderate
extent without significant variation
between public sector and private
sector organizations but with signifi-
cant variations between manufac-
turing and service providing organiza-
tions.
5. The selected four management styles
were found to be positively correlated
with one another.
6. Both ‘Productivity’ and ‘Adaptabil-
ity’ of human resources in Indian or-
ganizations were perceived to exist
at moderate level and that too with-
out any significant variation between
private sector and public sector or-
ganizations, but with significant
variation between manufacturing and
service providing organizations at
0.05 level of significance.

The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 337

7. ‘Productivity’ and ‘Adaptability’ of
human resources were found to be
positively correlated with each other.
There exist a strong positive re-
lationship between the manage-
ment styles and the effectiveness
of human resources in terms of
their ‘Produc-tivity’ and ‘Adapt-
ability’.
8. There exist a strong positive relation-
ship between the management styles
and the effectiveness of human re-
sources in terms of their ‘Productiv-
ity’ and ‘Adaptability’. Multiple re-
gression analysis (Tables 10 & 14)
shows that the selected four manage-
ment styles (viz., participative, altru-
istic, organic and professional) have
significant impact on the effective-
ness of human resources in terms of
their ‘Productivity’ and ‘Adaptabil-
ity’ in Indian organizations.
Discussion & Implications
India has wide diversity in culture and
democratic nature of politics. In such a
background, the diverse management
styles are practiced in Indian organiza-
tions. Apart from the selected four man-
agement styles (viz., participative, altru-
istic, organic and professional), all other
varieties of management styles (e.g. au-
tocratic) are also operative though to a
lesser extent in Indian organizations. Due
to the practice of deep rooted political
and industrial democracy, participative
management style is always stressed to
practice. The transitional nature of In-
dian society (as it is changing rapidly
338 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Ravindra Jain & R. Premkumar
from a traditional, rural, less democratic
to a modern, dynamic, more democratic
and urban one), and the transitional na-
ture of Indian economy (as it is changing
from regional / national character to
trans-national / multinational one) rein-
forces the need for the practice of or-
ganic and professional management
styles. The globe is poised on the brink
of an ecological disaster; eco-friendliness
and sustainable development are likely
solution; and therefore, there is need to
stress on fast movement from self-
centeredness towards altruism and hence
more significant would be the practice
of altruistic management style along with
the participative, organic and professional
management styles. Growing awareness
of the social responsibility has also led to
the practice of altruistic management
style. Growing competition in domestic
as well as globalized economies also led
to the practice of team work oriented
organic management style.
In a study of 103 Canadian compa-
nies, the participative management style
was significantly associated with an in-
dex of organizational effectiveness
(Khandwalla 1977). Some Indian re-
search also indicated that participative
management style is associated with
employees’ productivity and job satisfac-
tion. (Singh et al. 1979, Moitra 1977,
Sinha 1980). The results of the present
study further validated the same relation-
ship. In a study of private sector compa-
nies operating across the countries, a
positive association was found between
the degree to which the manage-ment
was professionalized and the perceived
effectiveness of the organization
 Management Styles, Productivity & Adaptability of Human Resources
(Negandhi & Prasad 1971). The results
of the present study supported such a
finding.
In India nurturant and task ori-
ented style of leadership gives
good results in terms of their
produ-ctivity’, and ‘satisfaction’.
In the present study, organic and pro-
fessional management styles were also
found positively associated with HR pro-
ductivity and HR adaptability. In
Khandwalla’s (1995) study of Indian or-
ganizations, participative, organic, pro-
fessional and altruistic management
styles were found to have positive cor-
relation with ‘performance stability’ and
‘employees morale’ (which are indicators
of organizational effectiveness) whereas
only participative management style (not
the other three) was found to have posi-
tive association with the employees’
adaptability. However, in the present
study, both ‘productivity’ and ‘adaptabil-
ity’ of the human resources were found
to have positive correlation with the se-
lected four management styles and thus
the results of the present study support
the findings of the Khandwalla’s study
to a great extent but not fully.
Keeping the above mentioned re-
search findings in view, it is concluded
that the effectiveness of human re-
sources in terms of their ‘Productivity’
or job performance and ‘Adaptability’
are affected substantially by the practice
of the selected four management styles
across the manufacturing and service
providing organizations belonging to both
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
public sector and private sector.
Khandwalla (1995) assessed various
management styles in terms of the fol-
lowing criteria, viz., Organizational
Learning Capacity, Administrative
Smoothness, Managerial Development
Potential, and Versatile Excellence.
Based on such an assessment the four
management styles, viz., Participative,
Altruistic, Professional, and Organic
have been found as the four best man-
agement styles. The results of the
present study revealed that such man-
agement styles are good enough so far
as the effectiveness in terms of ‘Produc-
tivity’ and ‘Adaptability’ is concerned and
therefore it is concluded that such man-
agement styles may be considered as the
safest and development oriented styles
to practice in a wide variety of organiza-
tions. Managers must become more con-
cerned with developing their people. Such
concern would improve workers, attitude
and behaviour having implications for
change in the culture of the organization
and improvement in productivity (Joshi
2001). Organizational leaders are truly
effective only when they are motivated
by a concern for others, when their ac-
tions are invariably guided primarily by
the criteria of “the benefit of others even
if the results in some cost to self”
(Kanungo & Medonca 2001). Managers’
concern for the development of others
enables them to practice participative and
altruistic management styles more effec-
tively. Participative culture encourages
the use of personalized relationship, ex-
change of benefits and assertiveness, and
discourages the use of asserting exper-
tise and negative sanctions to facilitate
the success of organization; culture works
339

as a moderator, if managers use appro-
priate influence strategies contingent
upon the respective culture, it would be
more successful (Tripathi & Tripathi
2009).
References
Ansari, M.A. (1986), “Need for Nurturant – Task
Leaders in India: Some Empirical Evidence”,
Management and Labour Studies, 11 (1): 26-
36
Joshi, J.R, (2001), “High Performance Culture”,
Indian Journal of Industrial Relations, 37(1):
18-30
Kanungo, R. N. & Mendonca, M, (2001), Ethical
Dimensions of Leadership, Thousand Oaks,
Sage, California
Khandwalla, P. (1977), The Design of
Organizations, New York, Harcourt Brace
Jovanovich
Khandwalla, P.N., (1995), Management Styles, Tata
McGraw-Hill Publishing Co., Ltd., New
Delhi
Khandwalla, Pradeep N. (1990), Excellent
Management in Public Sector, New Delhi,
Vision
Khandwalla, Pradeep N. (1992), Organizational
Designs for Excellence,
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Kool, R. & Saksena, N.K. (1989), “Leadership Styles
and Its Effectiveness among Indian
Executives”, Indian Journal of Applied
Psychology, 26 (1):9-15
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Ravindra Jain & R. Premkumar
Maheshwari, B.L. (1980), Decision Styles and
Organizational Effectiveness, New Delhi,
Vikas Publishing House
Moitra, A. (1977), “Practice of Participative
Management”, Lok Udyog, 11 (2): 35-39
Muthayya, B.C. & Vijaykumar, S. (1985),
“Leadership Styles, Perceived Need Satisfa-
ction and Subjective Job Characteristics
Among Scientific Personnel”, Indian Journal
of Industrial Relations, 21 (2): 173-97
Negandhi, A. & Prasad, B. (1971), Comparative
Management, New York, Appleton – Century
– Crofts
Premkumar R. (2007), Strategic HRD Practices,
Facilitators and Managerial Styles in Indian
Organizations, (Unpublished Ph.D. Thesis),
Vikram University, Ujjain
Sharma, M.P. (1997), “Organizational Commitment
and Its Determinants”, Indian Journal of
Industrial Relations, 33(2): 193-210
Singh, P., Warrier, S. & Das G. (1979), “Leadership
Process and Its Impact on Productivity,
Satisfaction and Work Commitment”,
Decision, 6, 1979
Sinha, A. (1980), The Effect of Leadership Styles
on the Quality of Education, Doctoral
Dissertation, Patna; Patna University
Sinha, J. (1980), The Nurturant Task Leader: A
Model of the Effective Executive, New Delhi,
Learning Concept
Sinha, J.B.P, (2001), “Matching Leadership Roles
with the Nature of Organizations”, Indian
Journal of Industrial Relations, 37(1), 80-92
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“Influence Strategies & Organizational
Success: Moderating Effect of Organizational
Culture”, The Indian Journal of Industrial
Relations, 45 (2): 213-27
 Management Styles, Productivity & Adaptability of Human Resources

Appendix I
Variables Pertaining to Management Styles (MS) Selected for the Present Study*
(A) Goal Setting and Strategic Formulation
MS-1 (A) Organization’s goals are set and strategy for reaching them is evolved at meetings of
committees of senior and top level managers.
MS-2 (A) Departmental/divisional/sectional goals are set and strategy for reaching them is evolved
at meetings attended by most managers of the department/division/section.
MS-3 (A) At meetings to take major decisions, there is a great deal of openness, frankness,
sharing of information, and emphasis on looking several rather than a few alternatives,
examination of the pros and cons of each alternative, and selection of an alternative on
the basis of consensus.
MS-4 (A) There is a strong emphasis by management on team work and co-operation at the top
and senior levels of the organization.
MS-5 (A) The management gives great emphasis to the organization’s core values and ideals
while making major decisions.
MS-6 (A) The top management exhibits a great deal of integrity and honesty in pursuing goals
and implementing strategies.
MS-7 (A) The top management keeps in mind the interests of not only owners but also especially
of employees and customers’ organizations while taking major decisions.
MS-8 (A) Goals are set and strategy formulated on the basis of a lot of systematic research,
forecasts, and data based analysis.
MS-9 (A) The costs and benefits of alternative strategies are quantified to the extent possible,
and these data are carefully considered while making strategic choices.
MS-10 (A) The management devotes considerable efforts to evolve comprehensive strategic whose
elements fit in and support one another.
MS-11 (A) Management does a good deal of long term planning and goal setting.
MS-12 (A) The management makes it a point to share information about the challenges before the
organization and the organization’s goals and plans with not only top and senior
managers but also middle and lower level managers and even non-supervisory staff.
MS-13 (A) Information pertaining to the organization’s performance on its goals is widely shared
with managers and other staff.
MS-14 (A) In this organization goals and strategies emerge after a great deal of discussion and
interaction at all levels.
MS-15 (A) The organization is committed to playing a good corporate citizen role (special
employment opportunities for disadvantaged communities, investments in community
welfare, pollution control and proper waste disposal, etc.)
MS-16 (A) The organization makes it a point to disseminate among staff members information on
developments in the economy, significant innovations in its fields of operation
developments relating to the markets things in government policies etc.

The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 341
 Ravindra Jain & R. Premkumar

B. Co-ordination of Inter-dependent activities

MS-1 (B) Coordination of activities that need careful orchestration is usually sought by forming
committees of representatives of these activities.
MS-2 (B) There is great emphasis on co-operation and team work between heads of departments.
MS-3 (B) In sorting out co-ordination problems the management’s emphasis is on serving the
larger interests and goals of the organization, a spirit of sacrifice and accommodation,
fairness and justice.
MS-4 (B) There is great emphasis on sharing targets, budgets, and achievements of each
department/division with the rest, so that in planning and executing activities, managers
of departments/divisions are well aware of each other’s commitments, problems, and
constraints.
MS-5 (B) Management emphasizes that operating conflicts should generally be resolved as far
down the hierarchy as possible and preferably by people sitting down and talking out
their problems face to face.
MS-6 (B) For designing innovations and changes, or for tackling complex issues, management
often sets up inter functional or inter disciplinary task forces headed by effective
coordinators.
MS-7 (B) All major activities and new initiatives are carefully planned in advance to minimize
later coordination difficulties.
MS-8 (B) There is full freedom for managers to approach managers of other departments at any
level for getting jobs done, and no insistence at all that all such contacts must be
routed through ‘proper channels’.

C. Control of Operations
MS-1 (C) Operations at all levels are reviewed collectively through the mechanism of periodic
performance review meetings.
MS-2 (C) Control of operations is sought to be achieved by widely disseminating operating
information, widespread sharing of operating problems and constraints, and use of
task forces or teams to over come problems or constraints and get results.
MS-3 (C) Professionalism is strongly stressed in this organization, and professional identity
and pride ensure that task related commitments are met.
MS-4 (C) A fairly comprehensive formal management information and control system has been
institutionalized in the organization.
MS-5 (C) In this organization there is much peer group pressure for excellent performance and
for meeting task related commitments.
MS-6 (C) Managerial and other personnel so strongly identify with the mission of the
organization, its vision of excellence and core values that no effort is spared in their
pursuit.
MS-7 (C) Control and accountability are sought not primarily through cost or profit centers but
rather through responsibility centers in which accountability is for efficiency or
productivity, profitability, quality and innovation.

342 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
 Management Styles, Productivity & Adaptability of Human Resources

D. Human Resource Management

MS-1 (D) The practice in the organization is to involve even new employees in decision making
by making them members of appropriate committees.
MS-2 (D) As far as personnel matters are concerned, this organization operates on trust rather
than mistrust.
MS-3 (D) Supervisors and mangers of this organization are rewarded for practicing the
participative form of leadership.
MS-4 (D) Employees are well rewarded for their competence in solving problems at work.
MS-5 (D) Jobs are defined broadly rather than narrowly, and employees are encouraged to
interpret their roles creatively. Supervision is general rather than detailed.
MS-6 (D) Innovation and experimentation at all levels are rewarded.
MS-7 (D) The biggest rewards in this organization go to those who get results within time and
cost parameters.
MS-8 (D) There is a strong emphasis at all levels on research based rather than ad hoc or casual
decision making.
MS-9 (D) There is a strong emphasis on building up expertise at all levels and in all operating
areas, and a program of providing technical training to cover all employees has been
institutionalized.
MS-10 (D) There is a strong emphasise on human resource development through schemes of
human relations and competence building, training, rotation, job enrichment,
decentralization, counseling, career planning etc.
MS-11 (D) Functions, inductions and training programme, and in internal newsletters or other
forms of communication, norms of good conduct, values, the organization’s mission,
its vision of excellence, etc. is strongly emphasized.

*[Source : Khandwalla 1995]

Appendix II
Variables Pertaining to HR Effectiveness (HRE) (in Terms of ‘Productivity’ and ‘Adaptability’)**

HRE -1 Thinking now of the various things produced by people you know in your division,
how much are they producing?
HRE –2 How good would you say is the quality of the products or services produced by the
people you know in your division?
HRE –3 Do the people in your division seem to get maximum output from the resources
(money, people, equipment, etc.) available to them? How efficiently do they do their
work?
HRE –4 How good a job is done by the people in your division in anticipating problems that
may come up in the future and preventing them from occurring or minimizing their
effects?

The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 343
 Ravindra Jain & R. Premkumar

HRE –5 From time to time newer ways are discovered to organize work, and newer equipment
and techniques are found with which do the work. How good a job do the people in
your division do at keeping up with these changes that could affect the way do their
work?
HRE –6 When changes are made in the routines or equipment, how quickly do the people in
your division accept and adjust to these changes?
HRE –7 What proportion of the people in your division readily accepts and adjust to these
changes?
HRE –8 From time to time emergencies arise, such as crash programmes, schedules moved
ahead, or a break down in the flow of work occurs. When these emergencies occur
they cause work overloads for many people. Some work groups cope with these
emergencies more readily and successfully than others. How good a job do people in
your division do at coping with these situations?

**[Source : Premkumar 2007]

344 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Timely, Continuous & Credible Communication &
Perceived Organizational Effectiveness.
Reeta Raina
Managers typically spend between 60 %
and 80% of their time communicating.
Inability to communicate effectively and
efficiently can jeopardize the business
interests. The present study investigated
the effectiveness of downward communi-
cation as perceived by managers and
how it impacted the effectiveness of or-
ganization which was evaluated on five
parameters namely: planning, organizati-
onal structure, organizational culture,
communication, and outcome. Results
showed that there was a positive corre-
lation between effectiveness of down-
ward communication and the organiza-
tional effectiveness. The organizational
culture or the leaders at various hierar-
chical levels who provided accurate,
timely and clear information and correct
feedback to the subordinates improved
the performance in terms of planning,
structure, and communication. Such
firms enjoyed good reputation in the
market and the morale of the employees
has been high.
Reeta Raina is Assistant Professor& Chairperson
(Business Communications Area), Management
Development Institute, Gurgaon 122001. E-mail:
rraina@mdi.ac.in
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Organizational Communication
Internal communication activi-
ties are a determinant of how ef-
fectively organizations meet their
goals (Farace et. al.1977, Goldhaber
& Rogers 1979, Danowski 1980).
Coordination and integration of vari-
ous human activities are possible
only if there is an effective system
of communication in the organiza-
tion which provides for exchange of
information and sharing of various
ideas. Managers typically spend
between 60 % and 80% of their time
communicating. It is through mana-
gerial communication that the em-
ployees get their job instructions,
come to know about their job ex-
pectations, rationale behind the job,
their contributions, performance
feedback etc (Luthans & Larsen
1986, Kanter 1991). Inability to
communicate effectively and effi-
ciently can jeopardize the business
interest related managerial func-
tions, especially controlling and or-
ganizing (Koul 2000)
Communication is the process
most central to the success or fail-
345

ure of an organization. Many of the prob-
lems that occur in an organization may be
attributed to failure of communication. Re-
search suggests that poor communication
alone is a major contributor for most busi-
ness and industrial organizations running
at less than 12% efficiency. If employees
are not given adequate information nor
allowed to contribute to the solution of
problems, they may revert to being the
cause of them, resulting in increased ab-
senteeism, lower productivity and griev-
ances and so on (Hubbards1999, Hargie
et al. 1999, Armour 1998). Managers,
therefore, clearly have the main respon-
sibility of facilitating and encouraging open
communication, reducing barriers to com-
munication and eliminating boundaries,
which hinder the understanding of end-to-
end workflows so that it helps in achiev-
ing overall mission of the firm. Creating
and using symbolic behavior –walking the
talk-is a key (Kotter 2007 ). What lead-
ers do and how they direct their attention
allows followers to trust and understand
(Buckingham & Coffman 1999, Miller
1997). In “a key-perhaps the key-to lead-
ership… is the effective communication
of a story” (Harris & Nelson 2008). Ef-
fective interpersonal communication skills
allow various symbols –language, strong
images, metaphors, physical settings-to
influence the way people see their worlds;
the leader “ manages their meanings”
(Gabriel, Fineman &Sims 2000 :321).
Leaders use symbolic activities to direct
their followers.
Communication is the process
most central to the success or fail-
ure of an organization.
346 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Reeta Raina
Managers are also expected to de-
velop communication systems that are
characterized by effective listening, feed-
back, two-way process, and recognition
(Domerer 1998). Inadequate information
is the major cause of more than half of all
problems with human performance. By
improving the quality and timeliness of the
information people receive, you can im-
prove performance by as much as 20 to
50% (Boyett & Boyett 1998:288). Tradi-
tional hierarchies created and maintained
a power structure where managers made
decisions; passed judgments, gave assign-
ments, and determined success or failures
(French Bell & Zawacki 2000). Bureau-
cracy, structure and Tayloristic work prac-
tices produced powerlessness in subordi-
nates because superiors make the major
decisions. Establishing rules also to
achieve predictability also means impos-
ing control using power, and rewarding or
punishing. The consequence is a loss of
critical employee input, commitment. and
motivation especially given the changing
workforce (Chambers 1998). The more
your co-workers can depend on you, the
greater the trust and comfort among the
staff. Thus, creating an effective commu-
nication system also involves integrating
communication as a fundamental compo-
nent of the management role, obtaining the
commitment of top management, and
evaluating the communication process of
all its members on a regular basis. Co-
operation over work or relationship could
not occur at all without communication and
social interaction (Bovee 2005, Smith
1990, Argyle1991).
It has been established that commun-
ication is central to successful leadership
 Timely, Continuous & Credible Communication & Perceived Organizational Effectiveness
activities (Bennis & Naus 1997, Clemes
& Mayer 1987, Drucker 1998, Hackman
& Johnson 2000, Miller 1997). “In writ-
ing on leadership and in business people’s
accounts of their own leadership crises,
the ability to communicate effectively
emerges repeatedly as the most impor-
tant skill to cultivate”( Barrier 1999:28) .
The ability to communicate effectively
increases productivity, not only of man-
agers but of organizations as well.
Achieving success in today’s workplace
is closely tied to the ability of employees
and managers to communicate effec-
tively with each other and with people
outside the organization. While there is a
vast range of literature available in the
fields of communication both in the West
and America, research into organizational
communication area in the Indian con-
text is at an early stage.
The command-and–control style of
traditional management structures
are questioned by the new gener-
ation of employees.
Organizational effectiveness is an es-
sential part of competitiveness and India
needs to increase its competitiveness for
becoming a major economy of the world
(Pillania 2008a).With liberalization of In-
dian economy, one of the visible affect is
the dramatic change in the composition
of its workforce. This change in the com-
position of the work force is likely to be
unidirectional, as more and more business
is conducted in multicultural societies
across the global village. Secondly, the
system of hierarchy which is very strong
in the Indian culture finds itself being
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
challenged by the notion of collaborative
and team based organizations. The com-
mand-and–control style of traditional
management structures are questioned by
the new generation of employees who are
increasingly becoming more demanding,
expecting to be respected and valued as
individuals in the workplace and are quite
vocal about it. They like open communi-
cation with their managers, want to make
their own decisions, want to share their
ideas and their enthusiasm, and not just
be told what to do (Schaefer 1993,
Offerman & Gowing 1990, Loden &
Rosner 1991, Dean & Snell 1991).
These cataclysmic changes have put
organisations under tremendous pressure
calling, among other things, to employ
people: (a) who can best communicate
in cross-cultural environment, and (b)
reduce barriers to communication which
impede the understanding of end-to-end
workflow and better performance on
strategic goals. However, a corollary is
that important issues involving informa-
tion transmission from those with mana-
gerial power to those without have been
insufficiently explored by the Indian
scholars. In fact, communication as a
research has raised its profile only re-
cently in India (Prasad 2005).
The present study is undertaken to
find out the main effect of state, levels
of management and their interaction ef-
fect on the perceived effectiveness of
Downward Communication and also to
study the correlation between per-
ceived effectiveness of Downward
Communication and Organizational ef-
fectiveness.
347
 Reeta Raina

Hypothessis l Were large enough so that the statis-

tically significant sample size could
Based on the review of literature the be collected.
following hypotheses were formulated for
l Had similarity of business operations
the present study:
(say manufacturing sector, service
sector etc).
l There exists a significant positive
relationship between the Downward l Organizations should be in different
Communication and organizational states, to enable determining the ex-
effectiveness. tent to which Downward Communi-
cation processes are able to over-
l The state has a significant effect on
come the impact of socio-cultural,
the Downward Communication in the
economic and political influences.
automotive industry.
l The levels of management has a sig- Six large-scale automotive manufac-
nificant effect on the Downward turing firms from Punjab and Haryana
Communication in the automotive in- were selected on the basis of the crite-
dustry. ria that turn-over should be Rs.100 crore,
the number of employees should be 500
l There is a significant interaction ef-
or more and the product should be au-
fect of the state and the levels of
tomobiles or automobile parts. Since
management on the Downward Com-
these were large firms, the workforce
munication in the automotive indus-
was national in nature (from all over
try.
India), with a local bias normally man-
dated by the state because of political
Survey Instrument &the Sampling
reasons. The top management compo-
Process
sition is normally more national in char-
acter, compared to middle and lower
The study was based on the design
management, to enable better co-ordi-
and administration of a survey. For this
nation among employees from different
purpose two scales namely Downward
cultures and work environment. These
Communication Scale developed by
companies are governed by different
Gayatri (2001) and Organization Effec-
state legislations, have different pre-
tiveness Scale developed by the author
dominant religions, languages and cul-
were used.
tures. They compete against each other
in the process of industrialization. These
It was decided to study organizations
states have different political, economic,
which met the following criteria:
and social compulsions.
l Had more than three distinct man-
The management levels were clas-
agement levels which could be clas-
sified in different sets based on the cri-
sified as top, middle and lower man-
teria: top management level comprised
agement levels.

348 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
 Timely, Continuous & Credible Communication & Perceived Organizational Effectiveness

persons in policy planning and decision Data Collection & Statistical

making including heads of departments
and above. Middle management con-
sisted of assistant managers and above.
Lower management comprised engi-
neers, assistant engineers and junior
engineers. However, due to inadequate
number of personnel at top manage-
ment level, it was decided to take at
least ten persons from the top manage-
ment levels of each firm to have ap-
propriate representation in the sample.
A stratified proportionate random
sample of about 100 personnel work-
ing at three different management lev-
els of top, middle and lower manage-
ment were selected from each of the
six firms. They were all men falling in
the age group of 23-55. Thus the total
stratified sample for the study com-
prised 631 persons (Top management-
60; Middle management-209; lower
management-362) at different manage-
ment levels working in six large scale
automotive firms, three each from the
states of Punjab and Haryana.
Table 1: Summary of the 2 × 3 ANOVA for Downward Communication in Automotive Indus-
tries Punjab & Haryana
Techniques
Data was personally collected form the
six automotive firms selected for the study.
Scales on Downward Communi-cation and
Organisational Effectiveness were admin-
istered to managers at the top, middle and
lower management levels. A total of 631
scales were given to six firms and a total
of 538 filled in scales were received back.
To study the main effect of state, levels of
management and their interaction effect on
the perceived effectiveness of Downward
Communication , 2×3 ANOVA was applied
and t-ratios were worked out wherever F
was found to be significant. Product Mo-
ment Correlations were also arrived at to
determine the extent of the relationships
between Downward Communication and
Organizational Effectiveness.
Analysis & Discussion
Summary of 2×3 ANOVA applied on
Downward Communication scores is
given in Table 1

Sources of Variation Sum of Squares df Mean Sum F

of Squares
State (2) 214.25 1 214.25 1.91
Levels of Mgmt. (3) 1202.08 2 601.04 5.36
State into Levels of Mgmt. (2*3) 369.51 2 184.75 1.64
Within 59589.08 532 112.01
Total 62877.68 537 117.09
df 1, 532 F Significant at.01 level = 4.85
F Significant at.05 level = 3.01
df 2, 532, F Significant at.01 level = 6.69
F Significant at.05 level = 3.86

The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 349
 Reeta Raina

States & Downward Communication Downward Communication equally char-

It is evident from the insignificant F-
ratio of 1.91 (Table 1) that state had no
effect on Downward Communication.
The result implies that there were no sig-
nificant differences between the automo-
tive industries in Punjab and Haryana
with regard to the perceived effective-
ness of Downward Communication.
Table 2 shows the means and SD of
Downward Communication in the auto-
motive industries in Punjab and Haryana.
Table 2: Mean Scores and Standard Devia-
tion for Downward Communication
in the Automotive Industries of
Punjab & Haryana
acterized by appropriateness, precise-
ness, job instructions, explanation of ra-
tionale behind the task which helped them
in understanding their jobs and achieving
organizational goals and targets, use of
multiple channels of communication, per-
formance feedback, repetition of mes-
sages etc. The insignificant differences
in Punjab and Haryana automotive indus-
try could be due to similar culture of the
two states i.e. people within these two
states have more or less similar values,
ethics, habits etc.
(b) Management Levels and
Downward Communication

State No of Personnel Downward F-ratio of 5.37 (Table 1) for Down-

Communication ward Communication was found to be sig-
Mean SD nificant at.05 level indicating that there
Punjab 273 56.79 11.64 exist significant differences among top
Haryana 265 60.33 9.60 management, middle management and
lower management levels regarding per-
The mean scores on Downward ceived effectiveness of Downward Com-
Communication for automotive industry munication in the automotive industry.
in Punjab and Haryana were found to be Table 3 shows the means and t-ratios of
56.79 and 60.33 respectively. (Table 2) Downward Communication in the auto-
Personnel working in these firms find motive Industry of Punjab and Haryana.
Table 3: Significance of Difference between Means of Top, Middle and Lower Management
Level Personnel on Downward Communication

Management Levels Number Mean SEM Group Differences t-ratio

Top Mgmt™) 43 58.55 2.03 TM & MM 1.008
Middle Mgmt. 185 60.75 0.79 TM & LM 0.63
Lower Mgmt. 310 57.21 0.58 MM & LM 3.59**
t-Ratios
Df Significant at.01 level Significant at.05 level
226 2.60 1.97
351 2.59 1.97
493 2.59 1.96
** Significant at 1% (p=0.01 level)

350 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
 Timely, Continuous & Credible Communication & Perceived Organizational Effectiveness

between top and middle management per-

Middle management personnel
perceived Downward Communica-
tion to be more effective.
t-ratios (Table 3) indicate that there
were significant differences between
middle management and lower manage-
ment regarding perceived effectiveness of
Downward Communication in automotive
industry. Middle management personnel
perceived Downward Communication to
be more effective (M=60.75, Table 3) than
the lower management personnel
(M=57.21, Table3). They were of the opin-
ion that they received more appropriate,
adequate, clear job instructions than the
lower management personnel and that con-
structive feedback from superiors helped
them in improving their performance. In
addition, they felt that there was more use
of multiple channels of communication as
compared to lower management person-
nel. This could be explained on the basis,
that personnel at lower management lev-
els may be getting messages through too
many channels leading to confusion or they
may not be getting enough and timely in-
formation from their superiors. Differences
Table 4: Interaction Effect of State and Levels on the Per-
ceived Effectiveness of Downward Communication
in the Automotive Industry of Punjab and Haryana
State Mgmt. Levels Downward Communication
Mean
Punjab Top mgmt 59.80
Middle mgmt 58.75
Lower Mgmt 55.44
Haryana Top mgmt 57.47
Middle mgmt 62.46
Lower Mgmt 59.30
sonnel and top and lower management level
personnel were however found to be in-
significant as is evident from insignificant
t-ratios (t= 1.00; 0.63, Table 3). The per-
sonnel at top management level found
Downward Communication in the automo-
tive industry equally characterized by clar-
ity, preciseness and timely transmission of
information, appropriateness of feedback,
and use of multiple channels of communi-
cation as by the middle and the lower man-
agement personnel.
Interaction Effect
There exist no significant differences
among six groups on the basis of
state and levels of management.
As is evident from F-values.164
(Table1), Interaction effect of state varied
at two levels, and levels of management
varied at three levels was found to be insig-
nificant on Downward Communication. The
result indicates that there exist no signifi-
cant differences among six groups on the
basis of state and levels of management.
All the groups perceived Downward Com-
munication equally effective
in the automotive industry.
Means and SDs for six
groups entered in Table 4.
shows that middle manage-
SD
ment personnel in the auto-
18.00 motive industry of Haryana
12.97 had slightly higher mean ef-
9.71 fectiveness score on Down-
7.46 ward Communication
8.27 (M=62.46, Table4), than the
10.50 rest of the five groups.

The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 351

Downward Communication &
Organizational Effectiveness
Product moment correlations were
calculated to determine the extent of the
relationships between Downward Commu-
nication and organizational effectiveness.
Table 5: Correlations between (a) Organisational Effectiveness (OE) and
(b) Downward Communication (DC)
Downward Communication
Downward communication
df:536 Table value for r significant at.01 Level**
significant at.05 Level*
* Significant at 5% (p=0.05 level)
** Significant at 1% (p=0.01 level)
The correlations between Organiza-
tional Effectiveness and Downward
Communication were found to be signifi-
cant at 0.01 level. The results indicate
that there exists significant positive cor-
relation between Perceived Effectiveness
of Downward Communication and Or-
ganizational Effectiveness which implies
that higher the Perceived Downward
Communication, higher will be the Per-
ceived Organizational Effectiveness and
vice-versa.
Organizational Effectiveness &
Downward Communication
As is evident from Table I, the correla-
tion between Organizational Effectiveness
and Downward Communication (.67, Table
5) was found to be significant at.01 level of
significance indicting a significant positive
relationship between them. This implies that
higher the Perceived Effectiveness of Or-
ganizations, higher will be the Perceived Ef-
fectiveness of Downward Communication
352 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Reeta Raina
and vice-versa. In organizations perceived
to be effective, Downward Communication
will be characterized by accuracy, timeliness,
preciseness and clarity of information to
subordinates, constructive feedback, use of
different modes of communication, repeti-
tion of important messages.
The results of
the present study
indicate that ef-
Correlation with OE total fective organiza-
.67** tions are per-
=.115 ceived to be very
=.088 open to its em-
ployees. There is
transparency in
communication within the organizations.
Leaders at different levels of the manage-
ment communicate effectively with the em-
ployees of the organization. There are fre-
quent interactions among the supervisor and
the subordinates and the leaders ensure that
all the employees are knowledgeable about
the vision and mission of the organization.
This finds support in Farmer’s study (1999)
that the leader who flattened the communi-
cation hierarchy was more likely to achieve
shared vision.
Further, in the perception of the man-
agers at the three management levels, job
roles of the individual employees are
clearly defined. Appropriate job instruc-
tions are given which are precise, timely
and clear. Hence, the individual employee
of the organization has the knowledge
and skills to perform their respective jobs.
Employees are explained the rationale
behind the task, helping them to under-
stand what and why a job is being done
which thus, helps the leaders in meeting
 Timely, Continuous & Credible Communication & Perceived Organizational Effectiveness
the organizational requirements. This
finding is corroborated by Wanguri (1984)
who found that managers would share
confidential task related information to
subordinates to motivate them; to develop
team spirit, to solicit subordinate input;
to provide information when there was
need-to-know. Brenner and Segband
(1973) showed that the subordinates who
were given assignments, clear job instruc-
tions, and an easy access to their superi-
ors gave supervisors better feedback.
Those who received direct assignment
from their immediate supervisors felt
they were better informed, had more time
to complete assignments. Roy (1990)
however, in his study revealed that su-
pervisors, who practiced significant in-
tra level variability with regard to amount
of information to be given to subordi-
nates, did not receive high rating from
their subordinates about their credibility
and communication style. It signified lack
of intra group cohesiveness and the ten-
dency to hold back information in some
people.
The results of the present study also
imply that the leaders at different levels
of the management motivate staff to per-
form at their optimal level. They feel that
effective organization focuses on high
performance. Thus, performance of em-
ployees is closely monitored and regularly
appraised by the organization. The man-
agers think that the organization has a
well defined performance appraisal pro-
cedure and good performance of employ-
ees is rewarded. Corrective feedback is
provided to employees of the effective
organizations to improve their perfor-
mance. Employees receive regular
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
coaching from their manager\ supervisor
to improve their performance. Thus,
knowledge of performance level and sug-
gestions help improve skills and task per-
formance. This finding is supported by
the Pettit et al (1997) that supervisors
might be able to promote adequate lev-
els of job performance and job satisfac-
tion among their employees by providing
them with appropriate and accurate in-
formation and feedback.
Knowledge of performance level
and suggestions help improve
skills and task performance.
Managers at the three management
levels feel that individual employees of
the organization have access to informa-
tion needed for taking future career de-
cisions. In fact development plans of
employees of the organization are framed
every year in consultation with them, and
also, training of the employees is linked
to their career development. Thus, the
morale of the employees within the or-
ganization is high and turnover of the
employees is low in the effective organi-
zations. Nguyen (2005) study suggested
a significant correlation between mana-
gerial communication and leadership
skills and employees’ sense of empow-
erment and job satisfaction
Further the results suggest that mul-
tiple channels of communication-written;
circulars, meetings; person-to-person inter-
action, telephone- are used in order to in-
crease the chances of communication be-
ing received and also, facilitate accuracy
and reduce the ambiguity of information.
353

And, important messages are repeated to
ensure accuracy. The findings by Minsky
and Marin (2001) and Sullivan (1996)
showed that employees’ preferences for
communication channels vary according to
the type of communication task undertaken,
thereby lending partial support to the find-
ings of the present study.
It can also be implied from the re-
sults that managers think that the organi-
zational structure is flexible that many
times, formal channels in the organiza-
tions can be bypassed if the message is
not clear or if they want to save on time.
But Reif et al’s (1973) study contradicts
the findings of the present study. The
study reveals that respondents perceived
that the formal organizations were more
valuable in satisfying their needs. Reddy
and Gayatri (2000) revealed that large
organizations with higher level of bureau-
cratization were able to communicate all
policies and procedures accurately to
their members and functioned effectively.
Conclusions
Based on the findings of the study of
perceived Downward Communication
Effectiveness in relation to Organizational
Effectiveness in the Indian Automotive
Industry, the following conclusions can
be drawn from the results thus obtained:
l There is significant positive relation-
ship between Perceived Organiza-
tional Effectiveness and Downward
Communication. Thus the first hy-
pothesis that there exists significant
positive relationship between the
Perceived Effectiveness of Down-
354 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Reeta Raina
ward Communication and Organiza-
tional Effectiveness stands accepted.
These findings are corroborated by
other research studies such as by
Massey (1975), Muchinsky (1977),
Roy (1990), Maloney (1993), Kumar
(1994), Noone (1996), Pettit (1997)
etc.
l There exist insignificant differences
in Punjab and Haryana automotive
industry with regard to overall per-
ceived effectiveness of Downward
Communication implying that the
state had no effect on the overall or-
ganizational communication and its
dimensions. Thus the second hypoth-
esis that the state has a significant
effect on the perceived effectiveness
of Downward Communication in the
automotive industry stands rejected.
However, the researcher did not
come across a study that shows the
impact of state on the Perceived Ef-
fectiveness of Downward Commu-
nication
l There are significant differences
among the personnel at three man-
agement levels (top, middle and
lower) in the automotive industry with
regard to Downward Communication
Effectiveness indicating that levels of
management had an effect on Down-
ward Communication. Personnel
working at middle management level
perceived Downward Communica-
tion in the automotive industry more
effective than the personnel at both
top and lower management levels .In
the case of Downward Communica-
tion, significant differences were
found between middle management
 Timely, Continuous & Credible Communication & Perceived Organizational Effectiveness
and lower management. Thus, the
third hypothesis that the levels of
management have a significant ef-
fect on the Perceived Effectiveness
Downward Communication in the
automotive industry stands accepted.
Larson and King (1973), Smith and
Keil (2003), Rosen and Tesser
(1975), Jablin (1979) studies substan-
tiate the findings of the present study.
l The interaction effect of state and
management levels on the Perceived
Effectiveness of Downward Com-
munication in the automotive indus-
try was found to be insignificant.
Thus the fourth hypothesis that there
is a significant interaction effect of
the state and the levels of manage-
ment on the Perceived Effectiveness
of Downward communication in the
automotive industry stands rejected.
The researcher again did not come
across such a study highlighting the
interaction impact of both the state
and the management on the organi-
zational communication and its di-
mensions.
The managers in their perceptions felt
that leaders at various levels should keep
the employees informed about the impor-
tance of their contribution for the orga-
nizational functioning. They should en-
sure that the employees understand the
rationale behind the task that will help him
in achieving his goals\ targets easily. Ap-
propriate, timely, clear and accurate in-
structions should be given to the employ-
ees regarding their job performance.
Knowledge of performance level helps
improve skills. It is also important to iden-
tify the appropriate vehicle for commu-
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
nication –such as memos, speeches,
meetings, videos, newsletters, electronic
message boards, training sessions, news
releases, posters and so forth, keeping in
mind the rationale, the attitude and the
limitations of the employees or the na-
ture of the task involved. Preferably com-
plex job instructions should be in a writ-
ten form or properly documented to avoid
confusion.
The employees should be provided
with the correct feedback and sugges-
tions in order to improve their perfor-
mance. Organizations must have well
defined performance appraisal procedure
through which good performance of the
employees should be rewarded. Work
plans of individual employees of the or-
ganization should be developed collabora-
tively. There should be an easy access
of the information to employees of the
organization, needed for taking future
career decisions. The leaders at various
levels should give required resource sup-
port and training to its individual employ-
ees for performing their job.
However, the managers at three dif-
ferent management levels also, in their
perceptions felt that occasionally, the use
of too many communication channels
only added to chaos than facilitating com-
munication and further bypassing hierar-
chy created more of uncertainty about
who is the real boss. The desired fea-
tures of the Downward Communication
will lead to the satisfaction of employ-
ees. Their morale will be high and turn-
over of the employees will be low. Orga-
nizations enjoy good reputation in the
market.
355

Implications
A culture of engaged employees is one
of the things that can help a business get
through economic downturn, and high en-
gagement levels are often a result of strong
leadership communication. The research
findings of Kaufman et al (1994), Adams
et al (1995), Witherspoon et al (1996), Stroh
(2002), Appelbaum et al (2003), empha-
sized that communicating effectively both
with external and internal audiences in cri-
sis or change situations, is one of the key
factors in containing damage to the
company’s reputation and determining ef-
fectiveness. Kaufman et al (1994) sug-
gested that a careful and right kind of com-
munication from the management help or-
ganizations to survive the thorniest of the
challenges. Witherspoon et al (1996) find-
ings revealed that differential distribution
of Downward Communication and incon-
sistent use of the potential of new commu-
nication technologies such as e-mail af-
fected the functioning of the organization.
Daly et al (2003) found that there was a
strong relationship between efficacy of in-
ternal communication and change which
was dependent upon a host of common and
interdependent variables, communication
being one of them. Appelbaum et al (2003)
highlighted that mis-management of com-
munication strategies during organizational
downsizing by the management led to a lin-
gering and negative impact on surviving
employees behaviour and attitudes demon-
strated by decrease in productivity, moti-
vation, job satisfaction and increase in ab-
senteeism .
While most leaders accept this, many
still find it a challenge to actually com-
356 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Reeta Raina
municate in a way that inspires the
workforce to go the extra mile. Working
with leaders who claim to have no time
to focus on communication is one of these
barriers.
The challenge for the Indian manag-
ers, therefore, is to develop an effective
communication system by making commu-
nication a fundamental component of the
management role, ensuring transparency,
trust and interactive communication climate
where employees are given opportunities
to fully voice their opinions and deploy their
talents and competences. The ability to
communicate and seek communication
from people down the line will effectively
increase productivity, not only of manag-
ers but of the organizations as well.
This study can be further extended
to other automobile companies in India
or an international comparison can be
undertaken. Further, it can be extended
to other sectors of Indian economy.
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Behaviour, 14:531-44.
Witherspoon, D. Patricia, & Kathy, L. Wohlert
(1996), “An Approach to Developing
Communication Strategies for Enhancing
Organizational Diversity”, The Journal of
Business Communication, 33(4): 375-99
359

Book Review
WINNING IN EMERGING MARKETS –A ROAD MAP FOR
STRATEGY AND EXECUTION by Tarun Khanna & Krishna
G. Palepu, Harvard Business Press, 2010, pp 247.
This is a fascinating book that
captures the essence of ‘emerging
markets’ very well in about 250 pages.
Emerging markets are a source of
opportunity as well as threat, depending
on which lens you use to look at. The
authors, both originally from India, one
of the most important emerging markets,
have been writing on this theme for quite
some time, and this book captures their
accumulated thoughts on this topic.
The central message is that one has
to understand the socio – political and
economic landscape of the country before
doing serious business there. This lesson
per se is nothing new as the authors are
well aware of. As strategy gurus, they
know that a fundamental principle of
strategy is that it has to be context
specific, in all respects including time and
situation. What has happened over a
period of time is that companies have
either grown more over confident
(arrogant?) or have not been noticing the
rapid changes taking place in many of the
developing countries that are ‘emerging’
from the shadow. Also, organizational
rigidities have come in their way. Lack
of fast growth opportunities in their own
original backyard has added to the
compulsion for the companies from the
‘emerged markets’ to exploit these
emerging opportunities in countries like
360 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
The Indian Journal of Industrial Relations
India, Brazil and China. They should have
been careful to understand the landscape
and its dynamism. But unfortunately,
most of them are not entrepreneurial; on
the contrary, they are beauracratic with
too much of standardization in multiple
value adding links.
Khanna and Palepu have come out
not only with an explanation for the
variety of challenges faced by ‘incoming’
companies, but have provided a number
of check lists in their tool kit at the end
of all major chapters. These are
fundamental questions that each strategy
executive should ask without being
prompted, but as is clear from the varied
experiences of case studies included in
the book, that is not true across the table.
Besides, the book is very illustrative with
a number of case examples drawn from
different countries.
The authors have clearly explained
the ‘emerging market’ phenomenon and
how it is different from the others. In the
process, they have shown how not all
developing countries are the same. For
instance, India’s own membership into
this club was an after effect of economic
liberalization and restructuring that have
been going on for the past two decades.
They remind companies that they have
to invest in understanding the dynamics
Book Review
of these countries both at policy and
operational levels to make success of
their strategy. Besides, they have rightly
argued for identifying support resources
in host countries to strengthen or
supplement the value links and make
them relevant for the context. Joint
venture partnerships are relevant to
consider for this purpose. Perhaps the
authors should have added a line of
caution that one of the reasons for the
failure of some such partnerships was the
explicit abuse of such partnerships by
MNCs as learning vehicles and nothing
else. Many potential partners in the
emerging market are aware of such cases
and have become guarded.
The book is divided into two parts:
the short Part I provides a conceptual
introduction to managing in the emerging
markets. The running theme across is the
need to spot institutional voids in those
markets and responding to them. The
authors caution companies from
developed countries to assure existence
of organizational mechanisms as
understood by them, in the emerging
market economies. In fact, it is not
always institutional voids, but absence of
institutional mechanisms as understood in
the West that creates the problem.
Part II of the book has five chapters
of which one is on multinationals entering
emerging markets. The chapter on
exploiting institutional voids as business
opportunities (chapter three) is reflective
of the essence of entrepreneurship in
such economies. I have been arguing that
the source of an entrepreneurial
opportunity is customer dissatisfaction.
The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
Institutional voids represent some such
opportunities. Much of the development
of emerging markets can be traced to
filling such voids in different ways.
Chapter four is based on an analysis
of the experiences of multinationals in
emerging economies. The basic message
is that one should not enter without doing
adequate home work but if one is already
in, don’t run away without looking at
options to address the challenges.
Chapters five and six covering
companies from emerging markets
competing in their own countries and
abroad are interesting from different
perspectives. These reinforce the basic
argument to be context specific. They
understand the turf very well and play
accordingly. Also, they are largely
entrepreneurial and / or family businesses
with abundant flexibility and humility to
adapt.
One final chapter concluding the
discussion on the Emerging Arena leaves
the readers with a few capsules to consider.
They say, “throughout this book, we have
tried to show that companies need to
understand and respond to the
‘emergingness’ of emerging markets – the
persistent institutional voids embedded in
their market structure – to craft strategies
and operate successfully in these
economies”(P.203). The four action items
are worth reproducing here: experiment to
fit business models to emerging markets,
position your business as a partner in
progress, balance ambition with humility in
emerging markets, and appreciate the
inherent risks of emerging markets. In
361

essence, emerging market is for
entrepreneurial managers who constantly
look for innovative ways to address
challenges. The notes running into 14 pages
add to the scholarship of the book.
This is a relatively short book (will be
liked by managers!) that offers
tremendous insight into managing business
in emerging market economies. Given that
CHANGES IN LABOUR INSTITUTIONS IN CHINA: RIGHT
STEPS TOWARDS ACHIEVEMENT OF DECENT WORK By
K R Shyam Sundar, Bookwell, New Delhi, 2009; pp.120
The Chinese economy has
experienced higher rate of growth; its
impressive performance is held to be
largely due to the controversial
advantage it enjoyed in the labour sector
and this has been at the centre of debate
and a subject of corrective discourses by
the West. It is opined that the stupendous
success rate in the economic sphere has
come at a tremendous social cost, i.e. rise
in inequality, environmental damage,
heavy job losses, labour and social unrest,
sweatshop image etc. There have been
reform measures in the labour sector to
correct the institutional problems and
establish a just and harmonious society;
and new labour laws have been
introduced to compromise the warring
interests of labour and capital for the
sustainability of the firm.
The Chinese legal system has been
reconstructed to bring about “balanced
development” in all spheres of society
and to build a “harmonious develop-
362 The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010
The Indian Journal of Industrial Relations
emerging markets are going to continue
to be a key player in the global economy,
companies across the spectrum have to
be entrepreneurial to succeed. They will
find the toolkit of very high value.
K Ramachandran,
Thomas Schmidheiny Chair Professor of
Family Business & Wealth Management
Indian School of Business, Hyderabad
ment”. As a consequence the Chinese
Government has introduced some
significant “social laws”; as the social
laws which in the past accounted for
mere 2 percent of the total laws, now
account for around one-fifth at the
national level and 30-40 percent at
regional level. The social laws include,
Labour Contract Law, Law on
Mediation and Arbitration of Labour
Disputes, and Law on Employment
Promotion. The major objectives of
labour reforms were to:
l Institutionalize the employment
relationship by providing for
supporting labour contracts.
l Redress the imbalances in the
Industrial Relation System (IRS) by
providing for stronger labour
protections.
l Promote harmonious industrial
relations by strengthening the role of
trade unions.
Book Review

l Establish fair labour market Industrial Relation System and restructuring

practices; create effective dispute measures introduced during the
resolution mechanisms. marketisation period. The next chapter
analyses the reasons for introducing the new
l Provide for a comprehensive social
laws and regulations. Chapter four is devoted
insurance plan both for urban and
to the unique process of social consultation
rural citizens.
for the finalization of new laws and also
gives a detailed description of salient features
The Chinese policy makers face the
of new labour laws and regulation. Public
unenviable task of maintaining the labour
participation in the legislative process has
standards and yet cope up with the
been recently institutionalised in China as
problem thrown up by the economic slow
against the conventional “tripartite
down. The book under review is to dwell
consultation” process.
upon various aspects of changes in the
labour institutions in China.
Criticisms and shortcomings of the
two major laws namely, Labour Contract
The book is spread over six chapters,
Law (LCL)) and the Arbitration Law are
in addition to two appendices containing
reviewed in chapter five. It is viewed that
data tables and details of interviews. The
some new provisions will increase labour
first chapter gives a brief introduction of
unrest and litigations, or increase labour
labour market and industrial relations in
costs around 20-40 percent and that will
China. The structural changes in the
erode the low cost advantage enjoyed by
deployment of labour force over the years
entrepreneurs in China. Chapter six
lead to decline in employment over the
highlights the challenges arising from the
years owing to restructuring and lay off;
new laws including the challenge of
and also employment in the private sector
enforcement of labour laws. Conclusions
increased from 2.4 million in 1992 to 23
are contained in the last chapter.
million in 2005. The ‘hukou system’
(household registration) in a sense lead
The book is the outcome of a research
to absence of ‘labour market’ and the
project by the author and is a
workers enjoyed life time job tenure
comprehensive coverage on the subject
famously known as the “ rice bowl
of labour institutions in China. The book
system” and this restricted rural to urban
is well referenced, is a valuable
mobility; the hukou system was
contribution to the literature on the
gradually deregulated and the contract
subject and will be a useful resource for
system started in 1983 with certain
the researchers and policy makers.
employment features which changed over
the years.
Nand Dhameja
Professor, Indian Institute of Public
Chapter two briefly portrays the
Administration, New Delhi
features of the labour market and the

The Indian Journal of Industrial Relations, Vol. 46, No. 2, October 2010 363
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The Indian Journal of Industrial Relations

Announces

a special (April 2011) issue on

Beyond GDP

Guest Editor to the Issue

György Széll
Professor Emeritus,
University of Osnabrueck, Germany

Contact : A.C. Mishra, Asst. Manager (Admn.)

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