A Cross domain analysis of effectiveness of HR

policies towards employee motivation: An Indian

IT Industry Perspective

Submitted By:
Group 10
Aravind R
FPM-08/06/M
Krishnan Jeesha FPM-08/08/M
Praveen GP
PGP/18/099
Shahinsha S
PGP/18/107
Shijima Shareef PGP/18/108
Shraddha Jose PGP/18/346

A Cross domain analysis of effectiveness of HR policies towards employee motivation

Table of Contents
Introduction .......................................................................................................................................... 3
Literature Review:................................................................................................................................. 3
Research Model and Hypothesis........................................................................................................... 5
METHODOLOGY .................................................................................................................................... 6
FACTOR ANALYSIS RESULT FOR THE INDEPENDENT SURVEY ITEMS ..................................................... 7
FACTOR ANALYSIS RESULT FOR THE DEPENDENT SURVEY ITEMS ......................................................... 7
REGRESSION ANALYSIS ......................................................................................................................... 8
Results .................................................................................................................................................. 9
Conclusion .......................................................................................................................................... 10
Limitations and Future Scope ............................................................................................................. 11
References .......................................................................................................................................... 12
Appendix ............................................................................................................................................. 13
Questionnaire Used ........................................................................................................................ 13

A Cross domain analysis of effectiveness of HR policies towards employee motivation

Introduction
Extensive research on the effectiveness of HR policies on the performance of the employee
has documented a positive relationship between them. Many theories of the HRMperformance linkage rest on an assumption that employees have a positive motivational
response to HRM practices, but this is rarely tested in studies concerned with Indian IT
industry perspective. Our study, in this respect, establishes the relation between motivation
and effectiveness of HR policies across domains from an Indian IT industry perspective.
Motivation (as per Robbins & Judge, 2009) is defined as the processes that account for an
individual's intensity, direction, and persistence of effort toward attaining a goal. Cross
domain is referred in our study from White, M., & Bryson, A.,2011, has split the HR domains
in to 7 fields: Employee Participation, Development, Teams, Incentives, Recruitment, Equal
Opportunities, Family-Friendly. Our quantitative analyses were based on the questions
framed accordingly from these fields and their connection with motivation. Thus it will help
to fill the gap (From an IT Industry perspective) and, if the relationship is shown to be
positive, may help explain the HRM-performance relationship. Conversely, if HRM is not
accompanied by higher employee motivation, this may stimulate interest in other plausible
mechanisms.

Literature Review:
Another study explores the examining the relationship between HR practices and firm
performance, and research support has assumed HR as the causal variable. The study
demonstrates that HR practices are strongly related to future performance but that they are
also strongly related to past performance, suggesting caution among both academics and
practitioners in making any causal inferences. (Wright, Gardner, Moynihan & Allen, 2003)

A Cross domain analysis of effectiveness of HR policies towards employee motivation

MacDuffie (1995) found that bundles of HR practices were related to productivity and
quality in his sample of worldwide auto assembly plants. Delery and Doty (1996) found
significant relationships between HR practices and accounting profits among a sample of
banks. Youndt, Snell, Dean, and Lepak (1996) found that among their sample of
manufacturing firms, certain combinations of HR practices were related to operational
performance indicators. Guthrie (2001) surveyed corporations in New Zealand and found that
their HR practices were related to turnover and profitability.
A study of high-performance work practices, use a national probability sample of
establishments, measures work practices and performance that are comparable across
organizations, and, most important, a unique longitudinal design incorporating data from a
period prior to the advent of high-performance work practices. The outcome this study
measures are sales per worker, total labor costs per worker and the ratio of those two
measures. The conclusion of this study most strongly supported that work practices
transferring power to employees, often described as "high-performance" or "high road"
practices, raise labor costs per employee, suggesting that tbese practices raise employee
compensation, which represents a cost to employers. The evidence is also consistent with
these practices raising productivity (sales per employee). (Cappelli & Neumark, 2001)
Also In order for employees to act as a source of competitive advantage, i.e., to contribute to
the development of an enterprises competitiveness, they need to be knowledgeable and
motivated.( Voki, Klindi & akovi, 2008)
Another study advances the understanding of the link between systems of HR practices and
firm performance by examining middle managers affective and continuance commitment to a
firm. The authors identified commonly examined HR practices that apply to the middle
manager level and classified them into the maintenance- and performance-oriented HR
subsystems. The authors found support for the 2-factor model on the basis of responses from

A Cross domain analysis of effectiveness of HR policies towards employee motivation

2,148 managers from 463 firms operating in China. Regression results indicate that the
performance-oriented HR subsystems had a positive relationship with firm performance and
that the relationship was mediated by middle managers affective commitment to the firm.
The maintenance-oriented HR subsystems had a positive relationship with middle managers
continuance commitment but not with their affective commitment and firm performance.
(Gong, Law, Chang, & Xin, 2009)
After considerable Literature review we have arrived at a point where there was a glaring gap
which we wanted to explore which was that of the linkage of motivation to HR policies
prevalent in the organisations. Although we could find only one paper which was suggestive
in this direction there was no paper which had studied this in an Indian perspective. Our study
focuses on the IT industry since the background of majority of the team is from an IT
background and the industry is closest to the heart.

Research Model and Hypothesis

From the various literature studied we have arrived at mainly six domains for HR policies
namely Participation, Development, Incentives, Equal Opportunities, Recruitment and
Selection and Family Friendly. Also we have identified measuring the motivation using its
two components Intrinsic Job Satisfaction and Organizational Commitment. Based on these
the hypothesis we propose are:
Hypothesis 1(H1): HR policies in the Participation domain impacts the motivation levels of
the employees in an organisation
Hypothesis 2(H2): HR policies in the Developments domain impact the motivation levels of
the employees in an organisation
Hypothesis 3(H3): HR policies in the Incentives domain impact the motivation levels of the
employees in an organisation

A Cross domain analysis of effectiveness of HR policies towards employee motivation

Hypothesis 4(H4): HR policies in the Equal Opportunities domain impact the motivation
levels of the employees in an organisation
Hypothesis 5(H5): HR policies in the Recruitment and Selection domain impacts the
motivation levels of the employees in an organisation
Hypothesis 6(H6): HR policies in the Family friendly domain impacts the motivation levels
of the employees in an organisation

METHODOLOGY
The online questionnaire was distributed to a sample size of 111 obtained through
convenience sampling from the population with experience in IT services sector.
The questionnaire consisted of two sections one for measuring Motivation and the other for
measuring the effectiveness of HR policies across various domains

A Cross domain analysis of effectiveness of HR policies towards employee motivation

FACTOR ANALYSIS RESULT FOR THE INDEPENDENT SURVEY ITEMS

Sampling Adequacy was confirmed and 6 factors viz. Participation and Development
Policies, Incentives Policies, Recruitment and Selection Policies, Family Friendly Policies,
Equal Opportunity Policies and Disabled Employment Policies

1.
2.
3.
4.
5.
6.

Factors
Participation and
Development Policies
Incentives Policies
Recruitment and Selection
Policies
Family Friendly Policies
Equal Opportunity Policies
Disabled Employment
Policies

FACTOR ANALYSIS RESULT FOR THE DEPENDENT SURVEY ITEMS

Sampling Adequacy was confirmed and 2 factors viz. Organizational commitment and
Intrinsic job satisfaction was identified.

A Cross domain analysis of effectiveness of HR policies towards employee motivation

Factors
1. Organizational
Commitment
2. Intrinsic Job Satisfaction

REGRESSION ANALYSIS

Participation and development policies and favorable incentives policies have a positive
impact on intrinsic job satisfaction

A Cross domain analysis of effectiveness of HR policies towards employee motivation

Family friendly policies and favorable incentives policies have a positive impact on
organizational commitment

Participation and development policies and favourable incentives policies have a positive
impact on overall motivation.

Results
Hypothesis 1(H1): Has been rejected
HR policies in the Participation domain impacts the motivation levels of the employees in an
organization
Hypothesis 2(H2): Has been rejected
HR policies in the Developments domain impacts the motivation levels of the employees in
an organization

A Cross domain analysis of effectiveness of HR policies towards employee motivation

10

Hypothesis 3(H3): Has been rejected

HR policies in the Incentives domain impacts the motivation levels of the employees in an
organization
Hypothesis 4(H4): Has not been rejected
HR policies in the Equal Opportunities domain has no significant impact on the motivation of
the employees in an organization
Hypothesis 5(H5): Has not been rejected
HR policies in the Recruitment and Selection domain has no significant impact on the
motivation of the employees in an organization
Hypothesis 6(H6): Has not been rejected
HR policies in the Family friendly domain has no significant impact on the motivation of the
employees in an organization

Conclusion
From the analysis of the data we have collected, we observe that Organisational Commitment
is influenced by Incentive and Family friendly policies. On the other hand, Employee
participation Development and Incentives policies in organisations are the major factors
affecting Intrinsic Job Satisfaction and Motivation.
This throws out interesting implications for HR managers. While framing policies, a serious
focus has to be on Incentives and Family friendly measures. This increases commitment
towards the organisation from the part of employees.

A Cross domain analysis of effectiveness of HR policies towards employee motivation

11

To instil intrinsic job satisfaction and motivation, they must consider having policies for
employee participation and development. Here again, Incentive policies play a major role.

Limitations and Future Scope

The major limitation of this study is the sample taken. The size of the sample might not be
adequate to be representative of a two million strong IT Industry. Also by restricting the
study to one industry we cannot be sure that the importance of policies across industries
would be same. It would be interesting to see the study replicated across multiple industries
and a comparison across industries of impact of HR policies might give more insights for the
HR function to evolve.

A Cross domain analysis of effectiveness of HR policies towards employee motivation

12

References
Cappelli, P., & Neumark, D. (2001). Do high-performance work practices improve
establishment-level outcomes?. Industrial & Labor Relations Review, 54(4), 737-775.
Delery, J. E., & Doty, D. H. (1996). Modes of theorizing in strategic human resource
management: Tests of universalistic, contingency, and configurational performance
predictions. Academy of management Journal, 39(4), 802-835.
Gong, Y., Law, K. S., Chang, S., & Xin, K. R. (2009). Human resources management and
firm performance: The differential role of managerial affective and continuance commitment.
Journal of Applied Psychology, 94(1), 263.
Guthrie, J. P. (2001). High-involvement work practices, turnover, and productivity: Evidence
from New Zealand. Academy of management Journal, 44(1), 180-190.
MacDuffie, J. P. (1995). Human resource bundles and manufacturing performance:
Organizational logic and flexible production systems in the world auto industry. Industrial &
labor relations review, 48(2), 197-221.
Voki, N. P., Klindi, M., & akovi, M. (2008). Work Motivation of Highly-Educated
Croatian Employees - What Should Managers and HR Experts Know? South East European
Journal of Economics and Business, 3, 8996.
Wright, P. M., Gardner, T. M., Moynihan, L. M., & Allen, M. R. (2005). The relationship
between HR practices and firm performance: Examining causal order. Personnel psychology,
58(2), 409-446.
Youndt, M. A., Snell, S. A., Dean, J. W., & Lepak, D. P. (1996). Human resource
management, manufacturing strategy, and firm performance. Academy of management
Journal, 39(4), 836-866.

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Appendix
Questionnaire Used
Participation:
1. In your last/current job were you involved in formal participation processes such as
quality improvement groups, problem-solving groups, roundtable discussions, or
suggestion systems, pay discussion briefings?
2. In your last/current job, did you have a reasonable and fair complaint process?
Development:
3. With respect to your development in your last/current job, was their sufficient offjob training (eg: Instructor Led Training), required for the job, provided?
4. Do you agree that Systematic induction courses are provided in your organization
Incentives:
5. In your last/current job did you regularly receive a formal evaluation of your
performances?
6. Do you agree that pay raises for the employees in your last/current job are based on
job performance?
7. Do you have the opportunity in your last/current job to earn individual bonuses (or
commissions) for productivity, performance, or on other individual performance
outcomes?
Recruitment and Selection:
8. Do the applicants during the recruitment process undergo structured interviews (job
related questions, same questions asked of all applicants, rating scales) before being
hired?
9. In your last/current job, did the qualified employees have the opportunity to get
promoted to positions of greater pay and/or responsibility within the company?
10. Do the applicants of your last/current job take formal tests (paper and pencil or work
sample) during the recruitment process before being hired?
Family friendly:
11. Is working from home permitted (at least for a small period) in your organization?
Lets say for two days per month
12. Are flexible hours/ part time options available in your organization?
13. Are leaves available for elderly care or maternity/paternity (with paid) in your
organization?

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Equal Opportunities:
14. Are there equal opportunities for training for the employees at the same level in
your organization?
15. Are there equal opportunities for promotion of the employees at the same level in
your organization?
16. Do you agree that "My organization tries to recruit women returners"
17. Do you agree that "My organization tries to recruit people with disabilities "

Organizational Commitment:
18. I share many of the values of my organization - 5 point likert scale on Strongly
disagree to Strongly agree
19. I feel loyal to my organization - 5 point likert scale on Strongly disagree to Strongly
agree
20. I am proud to tell people who I work for - 5 point likert scale on Strongly disagree to
Strongly agree
Intrinsic Job Satisfaction:
21. The sense of achievement you get from your work - 5 point likert scale on Highly
unsatisfied to Highly satisfied
22. The scope for using your own initiative - 5 point likert scale on Unavailable to
Available
23. The amount of influence you have over your job - 5 point likert scale on Low to High
24. The work, on a whole is - 5 point likert scale on Highly unsatisfied to Highly satisfied