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The effects of profit sharing and employee share ownership schemes on employee motivation

This thesis investigates the effect of profit sharing and employee share ownership schemes on employee job attitudes and behaviours by taking into account the critical role of participation in decision making. The data were obtained from a large British retail organization operating profit sharing (PS) and save-as-you-earn (SAYE) schemes. This is a quantitative study in which the data were gathered through a questionnaire. The unit of analysis is the individuals who responded to the survey, and the study is cross-sectional. To analyse the data a variety of statistical techniques, namely frequency, Pearson correlation, partial correlation, t-test, chi-square (X2), reliability, multiple regression, hierarchical regression, and path analyses, were conducted using SPSS. The sample comprised 1,000 employees subdivided into groups of managerial and non-managerial employees, and participants in schemes and non-participants in schemes. The administration of the questionnaire resulted in 450 returns (430 usable), an overall response rate of 45%. This study addresses four main research questions: (1)What are the effects of profit sharing and employee share ownership schemes (financial participation) on the job attitudes of individual employees in a large organization? (2) What are the effects of participation in decision making on employee job attitudes in a large organization? (3) What are the relative effects of financial participation in comparison to the effects of individual participation in decisions? (4) Does the combination of financial participation and participation in decision making produce more favourable effects on employee job attitudes than does participation in decision making on its own? The aim of this study was to construct a more advanced model of profit sharing and employee share ownership schemes by reviewing the theoretical and empirical literature and testing two theoretical frameworks, those developed by Long (1978) and Florkowski (1989). After reviewing the employee participation literature and testing Long's and Florkowski's models, it was found that both financial participation and participation in decision making have separate effects on employee job attitudes and behaviours, even if financial participation has a small (not statistically significant) impact on some attitudes and behaviours. Since financial participation shows a negligible effect on some job attitudes, and participation in decision making has a stronger effect on job attitudes than has financial participation, the new model is constructed on the assumption that both (a) the combination of financial participation and participation in decision making and (b) participation in decision making produce favourable effects on employee job attitudes, such as integration, involvement, commitment, satisfaction, motivation, perceived pay equity, and perceived performance-reward contingencies. The test of the new model shows that both (a) the combination of fmancial participation and participation in decision making and (b) participation in decision making produce favourable effects on employee job attitudes and behaviours, but the combination of financial participation and participation in decision making does not produce more favourable effects on employee job attitudes than does participation in decision making on its own. It should be noted that it is not known in this research whether financial participation changed employees' actual influence in decision making, as the study did not collect any data on this question. Therefore, there is the possibility that if the same study were conducted in organizations with financial participation schemes which increase employees' influence in decision making, the effect of the combination of financial participation and participation in decision making might be found to be stronger than that reported in this dissertation.

Identiferoai:union.ndltd.org:bl.uk/oai:ethos.bl.uk:285523
Date January 1999
CreatorsBakan, Ismail
PublisherCoventry University
Source SetsEthos UK
Detected LanguageEnglish
TypeElectronic Thesis or Dissertation
Sourcehttp://curve.coventry.ac.uk/open/items/83c72d39-4fa0-f4ce-1163-f8eb35c3dd88/1

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