Extending past research in extra role behavior unleasing a new paradigm from the prism of knowledge sharing and whistleblowing

48 Figure 2: Interaction Between Appraisal, Bonuses and Knowledge Sharing with Close Friends 51 Figure 3: Interaction Between Appraisal, Bonuses and Knowledge Sharing with Coworkers 51 F

EXTENDING PAST RESEARCH IN EXTRA-ROLE BEHAVIOR THROUGH THE PRISM OF KNOWLEDGE

SHARING AND WHISTLEBLOWING

KAMDAR DISHAN

(BBA.(Hons.), NUS) (MSc.(Mgt.), NUS)

A THESIS SUBMITTED FOR THE DEGREE OF DOCTOR

OF PHILOSOPHY (MANAGEMENT)

SCHOOL OF BUSINESS NATIONAL UNIVERSITY OF SINGAPORE

2004

Acknowledgements

The process of doing this dissertation has been extremely arduous and its

completion would have been impossible if not for the following special people Firstly and

foremost, I would like to thank My Family, for their love, blessings, encouragement and prayer for my success “Hope I’ve done you proud.” To my “little partners,” Dhruv (Munna), Jitisha (Roshan), Shiv (Chattaan), and Jai (Ishu) for being my source of

inspiration and determination! To my wife Sejal for her unfailing support, love and

understanding

I am extremely grateful to Dr Chia Ho Beng, who has been a very helpful person

to me in the process of doing this dissertation He has been not only my supervisor, but also my mentor (for his right guidance and sound advice), my teacher (for imparting his research skills to me) and my friend (for being very approachable and for being a good

listener) I would also like to express my profound gratitude to Dr Glenn Nosworthy for

his help and support through out this academic exercise Dr Glenn, your contributions to this study really made a big difference and I am very grateful to your untiring efforts and vital advises Not to mention, your untiring efforts in proofreading my dissertation several times

A special thanks to Mr B.R Mehta and his team, who participated in my surveys

and, despite many pressures on their time, filled in the questionnaire and provided the

information that formed the basis of this study Mr Mehta, I thank you for patiently

allowing me to “disrupt” your subordinates’ work schedule, and encouraging them to respond to my questionnaires

I am also very grateful to the following people, who had helped me in getting appointments with various companies in Mumbai, vide their contacts I take this

opportunity to specially thank “Kakukaka”, Prashant, Kalpesh, Jyotiben, Yogita, Nikita,

Harshit, Hemali, Kajal and Viral for all their untiring efforts in getting companies to

participate in my survey

All and above, I thank God for His Blessings

Hereby, I dedicate my Dissertation to all these people mentioned

above.

Table of Contents

ABSRACT 19

CHAPTER 1: INTRODUCTION AND LITERATURE REVIEW 20 1.1 Introduction 20

1.2 Sharing knowledge 22

1.3 Rewards and knowledge sharing 24

1.4 Closeness of ties and rewards 29

1.5 Personal orientation and motives 31

1.5.1 Impression Management 33 1.5.2 Machiavellianism 35

CHAPTER 2: RESEARCH METHODOLOGY 39

2.1 Sample 39 2.2 Procedure 39

2.3 Treatment conditions and dependent variables 40 2.4 Impression management motive and Machiavellianism 42 measures 2.4.1 Confirmatory factor analysis 43 CHAPTER 3: RESULTS 45

3.1 Hypotheses testing 45

CHAPTER 4: DISCUSSION 60

4.1 Discussion 60

4.2 Managerial implications 64

4.3 Limitations and directions for future research 65

BIBLIOGRAPHY 71

APPENDIX 1: SAMPLE SCENARIOS 86

Table of Contents

ANNEX 2: ANALYTICAL CONCEPTS AND ASSUMPTIONS OF 90

EXCHANGE THEORIES

1.2 Salience of knowledge sharing in the knowledge 95

1.3.1 Obstacles to knowledge sharing 97

1.3.2 Knowledge sharing and expectations of rewards 97

1.3.3 Economic exchange, motivation and incentives 99

1.3.4 Ties and knowledge sharing 101

1.3.5 The role of impression management 103

Table of Contents

Study 3 151

ABSTRACT 152

CHAPTER 1: INTRODUCTION AND LITERATURE REVIEW 153

1.1 Whistleblowing 153

1.2 Situational factors (assurance of anonymity) and 157

whistleblowing 1.3 Motives and whistleblowing 160

1.3.1 Organizational concern motive 161

1.3.2 Prosocial values motive 163

CHAPTER 2: RESEARCH METHODOLOGY 167

2.1 Sample 167

2.2 Experimental design 167

2.3 Procedure and materials 169

2.4 Exploratory factor analysis for motives scales 170

CHAPTER 3: RESULTS 171

3.1 Demographics and descriptive statistics 171

3.2 Manipulation checks 171

3.3 Hypotheses testing 173

CHAPTER 4: DISCUSSION 181

4.1 Discussion 181

4.2 Limitation and future research 184

BIBLIOGRAPHY 188

APPENDIX 1: FACTOR STRUCTURE OF MOTIVE ITEMS 197

ANNEX 1: SAMPLE SCENARIOS 198

CONCLUSION 200

BIBLIOGRAPHY 204

List of Tables – Study 1

Table 1: Pearson’s Correlation, Cronbach's Alpha, Means,

and Standard Deviation

45

Table 2: Repeated Measures ANOVA: Intention to Share

Information

46

Table 3: Means, Standard Deviations and Confidence

Intervals for the 2 –way Interaction Between Appraisal and

Bonus

48

Table 4: Sheffe’s Post Hoc Comparisons: Sharing

Information with Close Friends

49

Table 5: Sheffe’s Post Hoc Comparisons – Sharing

Information with Coworkers

50

Table 6: Interaction Effects Between Appraisal and Person

Variables (Centered on Their Means) on Sharing Intentions

with Co-workers

53

Table 7: Interaction Effects Between Appraisal and Person

Variables (Centered on Their Means) on Sharing Intentions

with Close-Friends

54

Table 8: Standardize Beta for Regression of Appraisal

Condition, Predictors, and Interaction Terms on Sharing

Intentions

55

List of Tables – Study 2

Table 1: Responses Across Incentive Conditions 113

Table 2: Contextual Variables Across Incentive Conditions 114

Table 3: Univariate Analyses of Incentives on Knowledge

Sharing

116

Table 4: Standardized Beta for Regression of

Self-monitoring, and Inducements, and Interaction Terms on

Willingness to Share Knowledge with Coworker-Friends,

Coworkers in Unit and Coworkers in Other Units

122

Table 5: Unstandardized Betas for Simple Slope Analyses

Exploring Inducement conditions x Self-Monitoring (SM)

Interactions

126

List of Tables – Study 3

Table 1: Pearson’s Correlation, Cronbach's Alpha, Means,

and Standard Deviation

Table 4: Interaction Effects of Anonymity Condition on the

Relationship Between Motives (centered on means) and

Whistleblowing Intentions

177

Table 5: Unstandardized Beta for Regression of

Anonymous Condition, Predictors (centered on means),

and Interaction Terms on Whistleblowing Intentions

178

Table 6: Simple Slope Analysis for Interactions Between

Motive Variables and Anonymity Factor in Predicting

Whistleblowing Intentions

180

List of Figures – Study 1

Figure 1: Two-way Interaction Effects Between Appraisal

and Bonus on Sharing Intention

48

Figure 2: Interaction Between Appraisal, Bonuses and

Knowledge Sharing with Close Friends

51

Figure 3: Interaction Between Appraisal, Bonuses and

Knowledge Sharing with Coworkers

51

Figure 4: Interaction Between Appraisal Condition and

Impression Management in Predicting Knowledge Sharing

with Coworkers

56

Figure 5: Interaction Between Appraisal Condition and

Machiavellianism in Predicting Knowledge Sharing with

Coworkers

56

List of Figures – Study 2

Figure 1: Effects of Incentives on Knowledge Sharing with

Various Organizational Recipients

118

Figure 2: Knowledge Sharing with Close Friends,

Coworkers in Ones’ Unit, and Coworkers in Other Units

Across Incentive Conditions

118

Figure 3a: Moderating Effect of Self-Monitoring (SM) on

Relation Between Incentives and Knowledge Sharing With

Close Friends

123

Figure 3b: Moderating Effect of Self-Monitoring (SM) on

Relation Between Incentives and Knowledge Sharing With

Coworkers in Other Units

123

Figure 3c: Moderating Effect of Self-Monitoring (SM) on

Relation Between Incentives and Knowledge Sharing With

Coworkers in Unit

124

Figure 4: Summary Graph: Comparison of Low and High

Self-Monitors on Knowledge Sharing Under Different

Incentive Conditions

125

List of Figures – Study 3

Figure 1: Moderating Effect of Whistleblower Anonymity on

Relation Between Organizational Concern Motive and

Whistleblowing Intentions

179

Figure 2: Moderating Effect of Whistleblower Anonymity on

Relation Between Prosocial Values Motive and

Whistleblowing Intentions

179

Summary

This dissertation attempts to adopt an interactionist approach on extra-role behavior with a series of 3 independent, experiment-based field studies; 2 studies centered on knowledge sharing and 1 study on whistleblowing Study 1, based on a sample of 295 engineers, investigates and compares the effectiveness of performance appraisal vs performance bonuses in facilitating knowledge sharing as well as the moderating roles of impression management, Machiavellianism, and the potential beneficiaries of the knowledge sharing Including knowledge sharing in the appraisal system had a stronger impact on whether employees would be willing to share knowledge than the provision of bonuses; however, the impact varied according to whether the co-workers were considered close friends as well as the personality and motives of the employee Overall, results showed that Machiavellians responded instrumentally, whereas impression managers’ responses were consistent with a desire to maintain a public image

Study 2 (a follow up and extension of Study1), involving 150 engineers, explores the joint effects of employee self-monitoring disposition and explicit incentives for increasing employees’ willingness to share knowledge across various beneficiaries in a work setting I found that the presence of incentives was highly effective at increasing employees’ willingness to share work-related knowledge and that recognition-based incentives were, overall, as effective as pay-based incentives However, for high self-monitors, recognition-based incentives were more effective than pay-based incentives Willingness to share knowledge also varied according to whom the recipient would be (coworkers who are friends, coworkers in one’s work unit, or other employees in the organization) These findings highlight the importance of considering motivation and

incentives when implementing knowledge management systems, as well as the critical role of individual differences in impression management concerns

Study 3, involving 102 engineers, examined the role of organizational directed motives (motives of organizational concern) and co-worker directed motives (motives of pro-social values) on the intention to report company wrongdoings anonymously vs non-anonymously Results showed that organization-directed sentiments and whistleblowing intent were negatively correlated in the non-anonymous condition while uncorrelated in the anonymous condition; however, coworker-directed sentiments and whistleblowing intent were negatively correlated in the anonymous condition while uncorrelated in the non-anonymous condition These results demonstrate the importance of person-situation interaction in whistleblowing research The findings are interpreted in terms of individual’s level of affect toward organization vs co-workers and target of self-presentation (organization vs co-workers)

Overall, findings across the 3 independent studies highlight the usefulness of considering the joint effects of dispositional and situational factors in studying extra-role behaviors Results demonstrated that person-by-situation interaction effects could explain

a substantial amount of variance over and above either personality or situational variance taken separately From a theoretical perspective, the 3 studies reported in this dissertation provides further support for the proposition of Mischel and Shoda (Mischel & Shoda,

1998, Shoda & Mischel 2000) that personality / disposition should be conceptualized in terms of patterns of cognition, affect, and behavior that a person accesses for a particular situation rather than across situations

Keywords: Extra-role behavior, knowledge sharing, whistleblowing, motives,

Introduction

Discretionary behaviors are fundamental when we investigate work behaviors The paradigm of ‘discretionary work behavior’ is conceivably one of the most significant behavioral constructs in organizational science (Katz, 1964; Katz & Kahn, 1966) As a result, there has been growing emphasis in the organizational behavior literature on discretionary behavior, or employee behavior that goes beyond role expectations in a way that is organizationally functional Scholars have argued that this phenomenon is critical for organizational effectiveness because managers cannot foresee all contingencies or fully anticipate the activities that they may desire or need employees to perform (Katz & Kahn, 1966; Morrison & Phelps, 1999; Organ, 1988) Given the recognized importance of

discretionary behaviors such as organizational citizenship behavior (Organ, 1988),

prosocial organizational behavior (Brief & Motowidlo, 1986), civic organizational behavior (Graham, 1991), organizational spontaneity (George & Jones, 1997), contextual performance (Borman & Motowidlo, 1993), principled organizational dissent (Graham,

1986), taking charge at work (Morrison & Phelps, 1999), voice (Van Dyne & Lepine, 1998) and whistleblowing (Miceli & Near, 1992) numerous studies have focused on

identifying factors that predict this phenomenon (refer to Organ & Ryan (1995) and Podsakoff, MacKenzie, Paine, & Bachrach (2000) for a comprehensive review)

While we have seen various forms of discretionary behaviors studied hitherto, scholars have predominantly conceived these behaviors as a uni-dimensional construct, classified as extra-role behavior Extra-role behavior is defined as behavior that benefits the organization and/or is intended to benefit the organization, which is discretionary and goes beyond existing role expectations (Van Dyne, Cummings & Parks, 1995) According

to Van Dyne et al., (1995), this definition highlights the important point that extra-role behavior is not simply behavior that is outside role expectations within the organization; the behavior must be directed towards or be seen as benefiting the organization

With the initial articulation of extra-role behavior by Barnard (1938), Katz (1964) and Katz and Kahn (1966), researchers have progressively recognized the importance of such behaviors as it hold promise for long term organizational success Moreover, extra-role behavior is becoming increasing important to organizations today as they attempt to meet the challenges of a highly competitive business environment For instance, the challenge of global competition highlights the importance of organizational innovation, flexibility, productivity, and responsiveness to changing external conditions (Podsakoff, Ahearne, & MacKenzie, 1997; Podsakoff & MacKenzie, 1997; Van Dyne, Graham, & Dienesch, 1994) Furthermore, in an increasingly dynamic business environment, organizations must rely on employee initiative, responsibility and flexibility in order to remain competitive (Kanter, Stein, & Jick, 1992; Katz & Kahn, 1966; LePine & Van Dyne, 2001) Recent emphasis on flattened organizational structure, empowerment, and self-managed work teams (Galbraith, 1994; Howard, 1995; Mohrman & Cohen, 1995; Robert, Probst, Martocchio, & Drasgow, 2000) also highlight the importance of cooperative, discretionary behavior at all levels of the organization (LePine & Van Dyne, 2001; Van Dyne & LePine, 1998)

Given the clear importance of extra-role behavior to an organization, there has been great proliferation of research in this domain Researchers have suggested and found important relationships between extra-role behavior and other constructs such as

personality (Borman, Penner, Allen, & Motowidlo, 2001; Miceli & Near, 1988; Organ &

Ryan, 1995), satisfaction (Bateman & Organ, 1993; Lowery, Beadles, & Krilowicz, 2002), commitment (Cropanzano, Rupp, & Byrne, 2003; O’Reilly & Chatman, 1986), perception of fairness (Farh, Podsakoff, & Organ, 1990; Folger, 1993; Moorman, Niehoff, & Organ, 1993) perceptions of pay equity (Organ & Konovsky, 1989), organizational structure (King, 1999) intrinsic and extrinsic job cognitions (Williams

& Anderson, 1991), individual performance ( Allen & Rush, 1998; George, 1990, 1991;

LePine & Van Dyne, 2001; MacKenzie, Podsakoff, & Fetter, 1991; Puffer, 1987;

Schnake & Dumler, 1997; Scholl, Cooper, & McKenna, 1987), global performance (Graham, 1991), work group performance (Bachrach, Bendoly & Podsakoff, 2001; George & Battenhausen, 1990; Karambayya, 1991), moral development (Brabeck, 1984; Kidder & McLean Parks, 2001), ethical judgments (Chiu, 2003; King, 2001), leader behaviors (MacKenzie, Podsakoff, & Rich, 2001; Podsakoff, MacKenzie, Moorman, & Fetter, 1990; Smith, Organ, & Near, 1983), contextual factors (Dozier & Miceli, 1985; Karambayya, 1991; Perrucci, Anderson, Schendel, & Trachtman, 1980), perceived competition among peers (Puffer, 1987), retaliation (McLean Parks & Kidder, 1994; Near & Jensen, 1983), group cohesiveness and socialization process (George & Battenhausen, 1990), covenantal relationships (Van Dyne et al., 1994), work group climate (George, 1991) and international culture (Smith et al., 2002; Tavakoli, Keenan,

cause things to happen Prohibitive behaviors are protective and preventative; they

include interceding to protect those with less power as well as speaking out to stop

inappropriate or unethical behavior

Behaviors such as helping, sharing work and knowledge and cooperating with coworkers are primarily ‘promotive’ behaviors (e.g., organizational citizenship behavior and prosocial behavior) Although ‘promotive’ extra-role behaviors are important, Van Dyne et al., (1995) argued that they are not sufficient for ensuring the continued viability

of an organization and that organizations also need employees who are willing to exhibit

‘challenging/prohibitive’ extra-role behaviors (e.g., principled organizational dissent and whistleblowing), which fundamentally challenges the present state of operations by preventing or prohibiting illegal or unprincipled behaviors in the organizations

Van Dyne et al., (1995) highlighted that ‘promotive’ and ‘prohibitive’ extra-role behaviors are relatively different constructs with different antecedents and consequences According to them, researchers ought to acknowledge that extra-role behavior is a multi-dimensional construct and future research should be focused on specific types of extra-role behaviors (such as ‘promotive’ vs ‘prohibitive’) rather than a more global extra-role behavior construct Based on their proposition, I attempt to extend the work on extra-role

behaviors by empirically exploring unique antecedents of knowledge sharing (classified

as a ‘promotive’ role behavior) and whistleblowing (classified as ‘prohibitive’

extra-role behavior) not previously explored in past extra-extra-role behavior research

This dissertation will also contribute by addressing some yet unexplored issues1 in

the knowledge management and whistleblowing literatures through a set of 3

independent studies (these studies are intended to be taken as completely independent in

nature and as such, each study has its own abstract, body and bibliography) These three

independent research endeavors have been undertaken with the focal objective of investigating the interaction effects between situation x personality in predicting the intentions to engage in knowledge sharing (in studies 1 and 2) and whistleblowing (study 3) respectively

While there is a general dearth of empirical studies devoted to exploring antecedents of knowledge sharing and whistleblowing, it might be worthwhile to highlight that the theoretical underpinnings of these behaviors are analogous to other dimensions of extra-role behavior Both knowledge sharing and whistleblowing have deep roots in social exchange (Organ, 1988; Moorman, 1991) as well as classical organizational theory (Barnard, 1938; Katz & Kahn, 1966) In an attempt to relate knowledge sharing and whistleblowing to other similar extra-role behavior constructs, there appears to be some conceptual overlap between knowledge sharing and organizational citizenship behavior/prosocial behavior and between whistleblowing and voice/principled organizational dissent

While knowledge sharing and organizational citizenship behavior may be very much similar conceptually, the main difference between these two forms of promotive extra-role behavior lies in that knowledge sharing entails a clear personal sacrifice in terms on one’s competitive advantage in relation to one’s coworkers, while citizenship

1 To avoid repetitions, the gaps and shortcomings in the relevant literatures are discussed in the 3

behaviors like helping, sportsmanship, civic virtue do not entail sacrificing one’s potential

‘edge’ over fellow coworkers In essence, knowledge sharing involves one’s willingness

to ‘give up the secret of fire’ for the benefit of coworkers Therefore unlike other forms of organizational citizenship behaviors, knowledge sharing requires a thorough cost/benefit analysis on the part of the employee

Whistleblowing can be differentiated with other similar forms of prohibitive role behabiors such as voice and principled organizational dissent (although there exists substantial conceptual overlap) Voice is defined as non-required behavior that emphasizes expression of constructive challenge with an intent to improve rather than merely criticize (Van Dyne & LePine, 1998, p 109) According to Van Dyne and LePine (1998), voice is distinct from whistleblowing, as whistleblowing is critical and meant to

extra-stop some activity as opposed to being constructive and meant to change (improve) some

activity Principled organizational dissent focuses on objections based on conscientious or moral principles rather than suggesting more effective ways of doing things While both whistleblowing and principled organizational dissent represent an attempt to prohibit or stop certain behavior, whistleblowing, however concerns an illegal act while principled organizational dissent concerns a conscientious principle held by the person observing the misconduct

Despite these differences, due to some conceptual overlap between these constructs, I predict similar sets of antecedents to predict ‘promotive’ extra-role behaviors and another set of similar antecedents to predict ‘prohibitive’ extra-role behaviors While

I acknowledge that substantial progress that has been made in the study of situational factors as predictors of promotive forms of extra-role behavior such as organizational

citizenship behavior, research on the role of individual differences on the other hand is at

an earlier stage of development (LePine, Erez & Johnson, 2002; Podsakoff et al., 2000) This is especially true for research on promotive forms of extra-role behavior My argument is that individual differences both influence extra-role behaviors and moderate the relationship between situation and ERB Despite the fact that recent reviews of past empirical research on promotive extra-role behavior, such as organizational citizenship behavior have shown limited support for claims concerning systematic relationships between general facets of temperament (i.e., the ‘big five’) and organizational citizenship behavior (LePine, Erez, & Johnson, 2002; Organ & Ryan, 1995; Podsakoff et al., 2000), I contend that substantive reasons exist to support continued research on individual differences on organizational citizenship behavior as well as other forms of promotive as well as prohibitive extra-role behaviors like knowledge sharing and whistleblowing This

is because prior meta-analytic reviews of past research have not addressed the role of individual difference constructs as moderating rather than main-effect variables In addition, we know little about antecedents of prohibitive extra-role behaviors and that if they differ from antecedents of promotive behaviors LePine et al’s (2002) meta analysis did not include voice or whistleblowing, and that the authors asserted that they do not expect voice or whistleblowing (prohibitive extra-role behaviors) to function the same way as the other dimensions included in the meta analysis (such as helping, courtesy, sportsmanship etc)

With the arguments enumerated above, this dissertation attempts to contribute to the literature in two ways Firstly, I follow up from Lepine et al’s (2002) meta analysis and extend theory by integrating the promotive/preventive distinction that Lepine and Van Dyne have introduced (Lepine et al., 2002; Van Dyne et al., 1995) Secondly, I

adopt an interactionist approach towards studying knowledge sharing and whistleblowing, where my focal thrusts has been on investigating the interaction between situational factors and individual differences as antecedents of these behaviors A major gap in past research is the general dearth of empirical work that invokes an interactionist approach to studying extra-role behaviors

Study 1 looks at how different forms of tangible rewards, i.e., bonuses (no bonus

vs individual based bonus vs team based bonus) and a form of recognition (specifically appraising knowledge sharing vs not) affect knowledge sharing intentions This study also investigated if these tangible rewards interact with dispositional variables (specifically, impression management and Machaivellianism) to affect knowledge-sharing intentions with respect to coworkers and close friends in other work units

In study 2, I investigate the impact of situational and dispositional factors on employees’ willingness to share knowledge Specifically, I investigated the effectiveness

of explicit incentives for increasing employees’ willingness to share knowledge, considering both tangible and intangible incentives I also examined the moderating role

of employee self-monitoring disposition on the effects of these incentives

Study 3 is quite different in focus from the other two While studies 1 and 2 examined the role of situational and dispositional factors on knowledge sharing (‘promotive’ extra-role behavior), this study in contrast, explores the role of these factors

on whistleblowing intentions (‘prohibitive’ extra-role behavior) Specifically, this study examined the role of organizational-directed motives (organizational concern) and co-worker directed motives (pro-social values motive) on the intention to report company

wrongdoings I also explored the moderating effects of ‘whistleblower anonymity’ in these relationships

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STUDY 1

Relationship Between nducements and Knowledge Sharing Intentions Among Employees: Exploring the Moderating Effects of Friendship Ties and Dispositional Factors

I

Abstract

This study examined the effects of performance appraisal and performance bonuses on employees’ intention to share knowledge Two hundred and ninety-five oil refinery employees responded to three vignettes that described opportunities to share information with co-workers that would result in greater productivity In addition, the employees were given different information about the company’s appraisal system (i.e., whether knowledge sharing was formally recognized or not) and bonus conditions (i.e., whether bonus was pegged to team performance, individual performance or the absence

of such bonuses) Including knowledge sharing in the appraisal system had a stronger impact on whether employees would be willing to share knowledge than the provision of bonuses; however, the impact varied according to whether the co-workers were considered close friends as well as the personality and motives of the employee Overall, results showed that Machiavellians responded instrumentally, whereas impression

managers’ responses were consistent with a desire to maintain a public image

Chapter 1 Introduction and Literature Review

efforts.” (Wah, 1999, p 25)

Wah has clearly explicated the important role that knowledge sharing plays in the knowledge management process Similarly, Malhotra (1997) suggested that knowledge management does not reside in the collection of information According to him, unless interventions are made to facilitate sharing of knowledge in the firm, the whole knowledge management cycle will be futile

Knowledge sharing is an important element in knowledge management and refers

to the dissemination of job-relevant information to coworkers in a firm (Cummings, 2001) Knowledge sharing is especially important today because knowledge is supplanting land, labor, and capital as the primary source of competitive advantage, and

as such the ability to create new knowledge as well as to share existing knowledge becomes crucial for organizational success (Lesser, 2000; Weiss, 1999) However,

Chapter 1 Introduction and Literature Review

employees may consider knowledge to be a commodity that gives them personal competitive advantage over their coworkers in the pursuit of organizational rewards If this is the case, organizations will not be able to establish a knowledge-sharing environment simply by fiat

In order to craft interventions that facilitate desired behavior in this domain, we need to understand the motives and contingencies associated with knowledge hoarding and knowledge sharing Previous research on knowledge management has focused almost exclusively on the informational infrastructure such as communications media, databases, directories, and search engines In contrast, there has been relatively little consideration of the human part of the equation, particularly the motivational factors that drive individuals

to communicate, share, learn, and use knowledge For instance, in several in-depth interviews1 conducted by me, human resource practitioners and businessmen from prominent companies in India and Singapore had varied opinions as to how knowledge sharing can be achieved Some believe that knowledge sharing requires having strong ties through strong organizational culture and group cohesiveness, others believe that knowledge sharing has to be explicitly appraised or rewarded by providing performance bonus before it will be forthcoming, while still others believed that certain personal orientation/motives would suffice in promoting knowledge sharing, as some individuals may be predisposed to share knowledge with others

In a similar note, researchers have demonstrated that ‘promotive’ extra-role behaviors like organizational citizenship behavior are partially influenced by dispositional factors (Kamdar, Chia, Nosworthy & Chay, 2001; Organ & Ryan, 1995), and that they

1 A list of these persons and their credentials is pared in Annex 1

Chapter 1 Introduction and Literature Review

can also be induced through rewards systems (Kamdar et al., 2001; Lesser, 2000; Weiss, 1999) Extra-role behaviors have also been examined within the framework of exchange relationships (e.g., Deluga, 1998; Hui, Law, & Chen, 1999) However, the role of these factors in the sharing of knowledge within organizations has not been investigated

The present study, therefore, examined how these elements might affect employees’ intention to share knowledge that would otherwise give them a personal competitive advantage Specifically, I examined the relative and interaction effects of recognition and rewards, fostering close ties among co-workers and personal orientations (impression management motive and Machiavellianism) on the willingness to share knowledge with employees in one’s work unit

1.2 Sharing Knowledge

Knowledge is one of the most important resources in today’s competitive world (Drucker, 1997) According to Quinn, Anderson and Finkelstein (1996), intellectual capital generates the bulk of added value in both service and manufacturing industries As

a result, prominent organizations such as the World Bank, McKinsey & Company, Ernest

& Young and Accenture are devoting huge amounts of capital to devise elaborate ways to codify, store and provide access to both explicit and tacit knowledge (see Hansen, Nohria,

& Tierney, 1999; Pascarella, 1997; Smith, 2001 and Wah, 1999) With the apparent significance of knowledge / information, the importance of distributing information to co-workers and the prevention of information hoarding becomes especially vital for an organization’s overall competitive advantage

Chapter 1 Introduction and Literature Review

However, as argued by various researchers (Bartol & Locke, 2000; Bartol & Srivastava, 2003; Smith, 2001) the real challenge, success and a fundamental premise of

knowledge management today is in its ability to facilitate information sharing

Investing substantial capital in information technology, without creating a culture of sharing knowledge/information will do little to benefit the firm in the long run For instance, Parc Xerox director John Seely Brown observed that levels of efficiency and effectiveness of knowledge workers in US industry were little improved despite investments in technology of over $1 trillion (Brown & Duguid, 2000)

Employees may often have access to vital knowledge that may improve individual and, subsequently, firm performance; however, they may decide to hoard such information for personal competitive advantage over co-workers Such proprietary knowledge may be learned through experience, know-how based on practice or may be acquired from exclusive sources (Smith, 2001) For example, if an employee in a manufacturing unit has figured out a way to improve work process more efficiently, he/she may not share this ‘innovation’ with others but instead use it to improve personal productivity relative to fellow co-workers Hoarding such information/skill may improve the employee’s likelihood of a promotion or reward, but from the organizational standpoint it represents a major opportunity cost If the individual had shared his/her

‘innovation’ with co-workers, this could result in substantial costs savings and thereby increase the firm’s overall competitiveness

In addition to loss of opportunity, information hoarding may also lead to soured relationships among employees If coworkers find out that a particular colleague has withheld value-added knowledge for personal / selfish gain, relationships may become

Chapter 1 Introduction and Literature Review

strained This may indirectly affect unit performance through reduced teamwork effort and group cohesion and consequently may indirectly affect the firm’s productivity and efficiency Hence, organizations have to recognize, nourish and appropriately reward the sharing of information/knowledge to enable the exchange, flow and use of knowledge (Smith, 2001)

1.3 Rewards and Knowledge Sharing

Researchers (Bartol & Locke, 2000; Bartol & Srivastava, 2003; Gupta & Govindarajan, 2000; Stevens, 2000) have argued that a vital proponent in creating a knowledge sharing culture is the provision of rewards and recognition that are contingent

to sharing of both explicit (information that has been captured, codified and stored in some databases) and tacit (knowledge that is private / proprietary which resides in one’s head) knowledge According to DeTienne & Jackson (2001), effective knowledge sharing happens in an environment that respects individuals and encourages individual creativity (c.f Mullin, 1996) Rewards and recognition makes the importance of knowledge sharing visible (Mulin, 1996; Trussler, 1998) and demonstrates that the time and energy people spend sharing knowledge ‘counts’ in their performance and career (McDermott & O’Dell, 2001) For instance Buckman Labs makes knowledge sharing a top criterion in employee promotion (Buckman, 1998) While Buckman Labs have relied on individual based incentives, Gupta and Govindarajan (2000) argued that group based incentives, in contrast to individual-based ones will yield more sharing across co-workers in an organization They maintained that group based incentives (that are tied to knowledge sharing) will reduce knowledge hoarding and turn knowledge givers into heroes With group based rewards, individual group members are pressured to share knowledge and, as

a result, knowledge hoarders may eventually be expelled from the group by their group

Chapter 1 Introduction and Literature Review

members or forced to share knowledge Companies such as Nucor and Cisco have realized the effectiveness of group-based incentives in facilitating knowledge sharing and have explicitly structured their bonus plans on group performance

As an alternative to a focus on material incentives, others have argued that explicitly recognizing knowledge sharing in the appraisals system (or the joint usage of both appraisals and group based rewards) is the most effective strategy for promoting knowledge sharing in an organization At American Management Systems (AMS), for example, sharing knowledge is a criterion to get to the highest rating on a performance evaluation AMS recognizes contributions to its knowledge centers through annual awards, such as the ‘knowledge in action’ and ‘best practices awards’ and includes sharing knowledge as a general part of employees’ performance appraisal (McDermott & O’Dell, 2001) Nonetheless, other companies such as Ford Motor Company, Lotus Development Corporation, National Semiconductor Cooperations, and PricewaterhouseCoopers LLP do not think reward and recognition systems could effectively motivate people to share knowledge (McDermott & O’Dell, 2001) These companies, by contrast, do not use rewards and recognition systems to facilitate knowledge sharing

With the apparently diverse perspectives (from both researchers and employers), it would be fruitful to investigate the effects of inducement types in facilitating knowledge sharing In this study, I look at how two types of organizational control systems affect knowledge sharing intentions: (i) specifically appraising employees to share acquired proprietary knowledge or the absence of such appraisals and (ii) different types of performance bonuses (i.e., bonus pegged to team performance, individual performance or

Chapter 1 Introduction and Literature Review

the absence of such bonus) The main difference between the two types of reward is that while appraisals are explicitly tied to sharing knowledge, performance bonuses are not2 More importantly, the focal thrust of this study lies in exploring the interaction effects between these incentives and employee disposition in predicting knowledge sharing endeavours

Annex 2 describes the analytical concepts and assumptions of exchange theories The assumptions related to the concepts of exchange actors, the exchange network, exchange structures and exchange processes can be envisaged relatively easily in an organizational setting The term ‘exchange resource,’ however, in the form of knowledge, merits further discussion Although the original social exchange theory did not take into account information or knowledge as an exchange resource (Jarvenpaa & Staples, 2000,

p 132), this is now the case If it is assumed that knowledge is a private good then it is up

to the owner of the good to decide whether to share it or not To entice people to share their knowledge, in terms of a social exchange transaction, these actors need to be persuaded that it is worth entering into a transaction in exchange for some kind of resource Boisot and Griffiths (1999) explain, “the capture of knowledge involves more than simply making it easier for employees to articulate their idiosyncratic experiences and know how It involves creating an incentive structure making it worthwhile to do so” (Boisot & Griffiths, 1999, p 662) To some this is high priority management objective (Pederson & Larsen, 2001)

According to Hall (2001), rewards for knowledge sharing might be labeled as

“currencies” of exchange and the more specific and relevant they are tied to the sharing of

2

Chapter 1 Introduction and Literature Review

knowledge, the more likely will be its effectiveness According to Eisenberger, Pierce and Cameron (1999), relevant and specific extrinsic inducements (e.g., specifically appraising employees for sharing knowledge), in contrast to indirect and ambiguous ones (e.g., provision of general performance bonuses to encourage knowledge sharing), may have a positive effect on self-determination and additionally enhances intrinsic motivation

Using the framework of social exchange and the arguments presented above, it is clear that specifically appraising employees for sharing knowledge (when knowledge sharing behaviors are made one of the key criteria on performance evaluation, and decisions on merit pay and promotion) would be more effective than the use of general performance bonuses in motivating employees to share knowledge This is because the

‘currency’ for social exchange is more clearly defined in the case of appraisals and one party knows what he or she will get in return for his/her contributions In addition, various motivation theorists like Maslow, Alderfer and Hertzberg have suggested that valued rewards play an integral role in motivating desired behavior For instance according to Maslow, rewards such as pay and especially recognition serve as stimulus to high levels of motivation as it fulfills higher level esteem, relatedness and self actualization needs According to Frederick Hertzberg, the provision of recognition and rewards yields job satisfaction, thus motivating employees to divert their energy to achieve desired behavior In a similar vein, Victor Vroom’s (1964) expectancy theory contends that an individual will act in a certain way based on the expectation that the act will be followed by a given outcome and on the attractiveness of that outcome to the individual Therefore, the provision of valued rewards and recognition improves instrumentality and valence, thus motivating desired performance With these arguments,

I hypothesize that,