CHAPTER 2
The following are excerpts and anecdotes gathered from different sources, which are relative in the direction of the study. All gathered materials hereon focused on two variables: employee and managerial motivation, and compensation, specifically in the US and Germany.
Related Literature
To know what motivates an employee and a manager to work is to basically know first what motivates people in general. And so, in this light, we will first have an overview on the concept of motivation. Let us first define motivation. According to Nuttin (1984), the general and abstract term motivation refers to the dynamic and directional (i.e., selective and preferential) aspect of behavior. It is motivation that, in the final analysis, is responsible for the fact that a particular behavior moves toward one category of objects rather than another. As for its concrete term (in the sense of specific motivation or motivations), motivation involves the dynamic and directional aspects of concrete action. It also refers to the very object or goal that motivates a subject. (p.14-15)
Does motivation play a role in a person’s behavior? For Nuttin, it does. Nuttin (1984) concluded that motivation is an ongoing regulatory function, a continuous dynamic orientation between the individual and his behavioral world, as exemplified in the regulating impact of a goal-object. This conception of motivation also applies to the role of physiological states underlying physiological needs. Each of these motivational states corresponds, in principle, to specific points along a curve representing the continuous influence of physiological factors on the person-environment interaction. For example, the state of dehydration that influences drinking behavior is just one point on a complete scale. The relationship that links the organism to relevant elements (such as water) in the environment involves a permanent regulatory process as a function of the scale values. He further adds that the impact of motivation, is characterized by an important property: Instead of being determined by an initial amount of energy or stimulation, as is the case in physical processes, motivated behavior is regulated by the sought-after result, i.e., the goal as it is cognitively represented. (p.75-77)
Likewise, Deci’s Cognitive Evaluation Theory explains that there are two kinds of motivation that affects a person’s behavior: the intrinsic and extrinsic motivation. According to Deci, human beings have two basic, survival-oriented needs: the need for Competence and the need for Self-Determination. As a result, every person tries to find situations that will challenge him to a certain extent; this challenge will be met by the person (or at least, he will try to). So herein come the two kinds of motivation, the intrinsic and extrinsic motivation, that predicts a person’s behavior. Intrinsically motivated behavior is the behavior that a person chooses so that he may feel competent and self-determining. This “intrinsically motivated behavior”, though, is being affected, every now and then, by primary drives like hunger and thirst, so there’s a need for contingent financial reward. But the theory further says that if a contingent financial reward is tied to intrinsically motivated behavior, the person will not credit the cause of his/her behavior to himself/herself anymore, but to the external source, so the level of intrinsic motivation decreases. Why is this so? Each outcome has two components, as Deci indicated: a controlling and an informational component. The first one is involved with respect to a contingent financial reward: A source external to the person indicates what is and what is not wanted and thus “controls” behavior. The second component prevails in the case of a contingent verbal reward, at least with males: Feedback provided relates to the extent of competence and self-determination. This causes an increase in intrinsic motivation. With females words of praise lead to some dependence of the “speaker,” and thus to less intrinsic motivation. (Thierry, 1990, p.74-75)
However, this theory is being disputed by Thierry (1990) as “delusional”. He explained: “Concepts like intrinsic and extrinsic motivation have gained a certain popularity, both in the literature and in practice. A closer analysis of the latter usage indicates that the well-known person-situation dilemma is at stake. Definitions of intrinsic motivation in the literature reveal various contradictory points of view as well as a lot of ambiguity. Then, Deci’s cognitive evaluation theory is scrutinized as well as relevant major research findings. The main statement of this contribution holds that the intrinsic-extrinsic motivation distinction is based on a delusion and ought to be skipped accordingly.” (p. 80)
Although, even if this is the conclusion derived by Thierry, the researcher of this study still found it necessary to include Deci’s theory because of its theoretical implications on the possible role of motivation in the behavioral process of a person.
Let us now focus on employee motivation. What kind of reward systems do high-involvement workplaces induce? According to Levine (1995), in the traditional rewards systems, the focus is on individual achievement and the skills used at the current job. However, there is a need for new forms of rewarding the cooperation and learning for new forms of work, such as in high-involvement workplaces. In addition, employees must be reassured of not being laid-off or punished by dismissal for their ideas. In relation, Levine cited the following reward systems that are present in high-involvement workplaces: Gain sharing, Employee Ownership, Pay for Knowledge, Group Cohesiveness, Employment Security, and Guaranteed Individual Rights.
Gain sharing is usually based on cost reductions at a particular department, plant, or office, and it is different from profit sharing that is usually based on the accounting profits of the enterprise. Some kind of sharing of rewards from involvement is a key element of all participatory systems. Accordingly, there are different types of gain sharing. There is the financial sharing, which can occur without participation and vice versa, but both theory and evidence suggest that the two are likely to go together in successful participatory systems. “In the short run, participation may be its own reward for many employees. In the long run, however, sustained, effective participation requires that employees be rewarded for the extra effort that participation entails and that they receive a share of any increased productivity or profits. Workers feel that it is unfair if their ideas generate cost savings and they do not share the benefits.” (Levine, 1995, p. 48) Another form of gain sharing is the group-based gain sharing, which provides workers with incentives to maintain norms of high effort, to monitor each other, and to discipline workers who are shirking. “More positively, group-based pay gives workers incentives to cooperate and not to try to advance at the expense of their colleagues.” (Levine, 1995, p.49) The success of gain sharing may be proved by the 1990 survey of Fortune 1000, which reported: “companies that reported above-average success from employee involvement provided higher levels of profit sharing, gain sharing, and non monetary awards.” (Levine, 1995, p.50)
On the other hand, employee ownership and participation, as well as the spread of ownership to many individuals, can be an attractive system that eliminates some of the disadvantages of extreme capitalism and socialism. Employee ownership and participation in modern capitalism can alleviate business cycles that are related to unemployment and inflation in capitalism; and bureaucracy and inefficiency, which are related to government ownership and control in socialism. The bad side effects of growing specialization that makes individual “stupid” and nervous can be reduced in employee ownership, and also, the human intellect is advanced through participating in democracy. (Gianaris, 1996)
“Employee stock ownership plans, or ESOPs, have been advocated as a management tool to transfer the benefits of capitalism to workers and motivate employee owners to new high levels of productivity. Currently, ESOPs are becoming increasingly popular with corporations attempting to control ownership of their shares in order to avoid hostile takeovers. Furthermore, tax considerations make ESOPs a very attractive management technique for companies planning to pursue employee leveraged buyouts.” (Gianaris, 1996, p.127)
The creation of incentives and increase in productivity, reduction in strikes and other labor disturbances, a better distribution of income and wealth, and the implementation of democratic principles in workplaces are the main advantages of such a management approach. On the other hand, due to the opposition of capital owners and management executives, difficulties may arise. This is because labor representatives will influence the decision-making. Furthermore, a spirit of mutual responsibility and cooperation among the employee owners, which may not exist, is required in such a system of management for a smooth operation. As for future enterprise expansion, the pressure of allocating extensive benefits to workers by the workers’ representative may also pose a problem. Yet, in the long run, the most important advantage of ESOP in decision-making may be the reduction of income inequalities, so the achievement of the control in wealth accommodation may happen and extreme solutions can be avoided. (Gianaris, 1996)
In the US, employee ownership occurs in two main forms: thousands of employee stock ownership plans, in which workers own a minority of the company’s shares, and a much smaller number of companies that are majority owned by the work force. Although some of the employees at the majority-owned companies own their stock via an ESOP, the companies are referred to here as worker cooperatives. (Levine, 1995, p. 51)
In Germany, on the other hand, similar characteristics of ESOP appear in what is called codetermination. “The German participants with their long experience of board representation and codetermination generally believe they are part of an important institution. They believe “codetermination leads to a different kind of capitalism,” one more sensitive and responsive to employee needs”. (Kassalow, 1989, p. 39+)
Likewise, the Pay for Knowledge rewards systems, also known as the Skill-based pay systems, “are non-traditional compensation practices that tie base wages and salaries to knowledge and skill rather than to position or the job actually performed. These systems are sometimes called skill-based compensation, knowledge-based pay, multi-skill compensation, and so on. Regardless of the name, these systems are distinguished by the fact that employees who can perform a wider repertoire of jobs than other employees receive a higher base compensation.” (Boyett & Boyett, 1998) Boyett & Boyett (1998) further discussed that there are two basic forms of skill-based pay, the increased knowledge-based systems and the multi-skilled based systems.
In the increased knowledge-based systems, employees are paid based on the range of skills they possess in a job classification. These systems are probably the most common of the skill-based pay systems and are sometimes called “Vertical” systems because pay is tied to the depth or skill in a defined job. (Boyett & Boyett, 1998) However, in the mutli-skilled based systems, pay progression is based on the number of different jobs an employee can perform throughout the entire organization. These systems are newer, less common and revolutionary. Employees who can perform most or all of the jobs within the plant would be paid maximum pay rates. These systems are also called “Horizontal” systems because the pay is tied on the number of different jobs a person can perform. (Boyett & Boyett, 1998)
Of course, in every system there will be advantages and disadvantages. Advantages of skill-based pay systems are greater flexibility, leaner staff, improved problem solving, improved horizontal communication, improved vertical communication, supports in employment security, and improved job satisfaction. Likewise, the disadvantages of the skill-based pay systems are the tendency of increased cost in labor, training and administration. (Boyett & Boyett, 1998)
On the other hand, policies to promote cohesiveness are more common at high-involvement companies. (Levine, 1995) Cohesiveness is “a measure of the attraction of the group to its members (and the resistance to leaving it), the sense of team spirit, and the willingness of its members to coordinate their efforts. Compared with members of a low-cohesive group, those in a high-cohesive group will, therefore, be keen to attend meetings, be satisfied with the group, use “we” rather than “I” in discussions, be cooperative and friendly with each other, and be more effective in achieving the aims they set for themselves. The low-cohesive group will be marked by absenteeism, the growth of cliques and factions, and a sense of frustration at the lack of attainment.” (Oxford Brookes University, 2003) The group-based pay systems are policies used to promote group cohesiveness.
Levine (1995) said group-based pay reduces individual pay differentials. “Numerous laboratory experiments have found that narrow wage dispersion increases worker cohesiveness and increases productivity.” (p. 54)
Accordingly, in group-based pay system, the pay and status differentials among employees (in particular, managers and workers) are reduced. This is based on three related reasons: first, narrow differences in wages and status help develop an atmosphere of trust and confidence between workers and management, so employees participate more because often, employees see large wage differentials as unfair that they are less supportive of the goals of the highly rewarded group; second, when wage dispersion is narrow, cooperation among workers are increased because competition between workers who try to win the bonus or promotion is decreased; and third, group-based systems is used to promote participation that may extend into the realm of compensation. (Levine, 1995)
Likewise, high-involvement workplaces are also those that provide employment security to their employees. They usually “have implicit or explicit long-term employment contracts with their workers, contracts that stress reciprocal commitments and management’s pledge to minimize the need for layoffs. Successful participatory systems usually avoid laying off workers for several related reasons. (Economic crises can prod management, workers, and unions to initiate participatory experiments. Nevertheless, employment stability reduces the costs of maintaining participation.)” (Levine, 1995, p. 55) Why? Levine (1995) explains that if workers fear that cooperating in increasing efficiency will jeopardize their employment, they will not participate. Only when employees share their ideas and their managers reward these increase in productivity will participation work. “In the short run, the rational strategy is for workers to hide productivity-improving techniques to enjoy more on-the-job leisure. Similarly, the company’s short-run rational strategy is to deny that productivity has increased to avoid raising pay. Only a long perspective can convince both players to cooperate.” (p.55) Also, long-term employment relations are essential when the extent of participation relies upon group cooperation and employees monitoring one another. Group-based rewards and social approval as motivators are more effective when an employee expects a long-term relationship with a work group. The longer an employee expects to be in a work group, the more effective are group-based rewards and social approval as motivators. (Levine, 1995)
Finally, the guaranteed individual rights. Guaranteed individual rights are important for employee motivation because people participate effectively only when they are assured “that they will not be penalized for their participation. Such acts as criticizing existing procedures or opposing proposed policy changes could invite reprisals from management.” (Bernstein, 1980, p. 75)
Accordingly, Paul Bernstein concluded that guaranteed rights are necessary component of workplace democratization, because in essentially all of the successful participatory companies he had studied, he found guaranteed rights as being present. (Levine, 1995)
Workers’ increased trust in the company is also one reason why guaranteed rights are important. Several studies also indicated how high-trust environments depend on employee perceptions of due process and facilitate employee participation, better performance, creativity, and communication. (Mowday et al, 1982, p.33-34)
Also, because workers have an alternative to quitting if they are unhappy about one aspect of their jobs, guaranteed individual rights are also an important part of long-term employment relations. Freeman and Medoff (1984) concluded, after surveying the evidence relating individual rights and performances, that union workers who were guaranteed their individual rights have higher productivity and are less likely to quit that their other workers.
In addition, for most employees, the most crucial right is for them to be assured that the company will only dismiss them after showing a good cause and not because of their critical ideas. If they are assured of their right, workers are motivated. (Levine, 1995)
After employee motivation, let us now look on managerial motivation. But not before describing first what a manager is. According to Callaway (1999), managers are commonly viewed as “colorless, bloodless bureaucrats who thrive on process and procedure. They are the organizers who, given the objectives and direction, create the plans and processes for every step of the way but seem unable to set the direction or establish the strategy in the first place. Managers are seen as the people who believe that, given the right process, they can use trained monkeys to achieve success. They are the planners who assemble and apply resources but do not motivate or inspire people to action. Managers do not have that aura of electricity and excitement associated with leaders.” (p.11) But, these concepts are “quite generic and imprecise” (Callaway, 1999. p.12), so these descriptions are not accurate. Accordingly, Callaway said that through history, there had been great managers that made a great impact in our society, “although once they become visible they are usually described as leaders. However, only time will determine if these managers are relegated to the footnotes of history like most managers, even though their impact on society is arguably greater than that of many better known people who are destined for the history books as the leaders of society.” (Callaway, 1999. p.13) Some of the popular and common roles a manager performs are: the necessary duties for personnel administration; mentoring, developing and training subordinates; planning (strategic, resource, marketing, projects, etc.); conducting interdepartmental relations; establishing and achieving performance goals and objectives for the group; monitoring the internal and external situation for changes requiring reaction; spokesperson for subordinates; decision-making. Yet, these are not the only duties of a manager, because at different levels there are different duties and even the common duties have variations. (Callaway, 1999)
So what motivates a manager to perform well and be committed to his work? McClelland’s Trichotomy of Need Theory may provide a plausible explanation for this question.
According to Stahl (1986), one of the most accepted theories of motivation since the 1960’s is that of Professor David C. McClelland’s trichotomy of needs theory, which produced three popular needs: the need for achievement (n Ach), the need for power (n Pow) and the need for affiliation (n Aff). These three needs have been found to possess predictive power in a wide variety of settings, especially organizational ones.
The n Ach is the goal directed behavior. The n Ach theory predicts that if detailed feedback is provided on the progress of achieving a goal, the high need achiever, because of his/her absolute dedication to goal achievement, will give almost whatever effort is required. “Since the goal must be one in which the person’s own effort is related to goal accomplishment, extremely high levels of n Ach are associated with individual activities. Common examples are sales, engineering research, academics, individual sports, and entrepreneurial activities. Moderately high levels of n Ach may be found where the link between individual effort and goal accomplishment is not quite so strong, such as team activities, team sports, and managerial activities.” (Stahl, 1986, p. 5) Stahl further discussed that McClelland’s theorizing became popular in the early 1960s through his pioneering work that correlated n Ach with levels of economic / business progress in several cultures, wherein McClelland’s work reported n Ach behavior can be learned and an increase in the entrepreneurial behavior of small businessman after receiving n Ach training have occurred. “A considerable body of literature has developed relating n Ach to many behaviors/outcomes in which the individual works toward accomplishing moderately difficult goals through his/her individual effort.” (Stahl, 1986, p.3) N Ach may be manifested in two ways: either hope of success or fear of failure.
On the other hand, n Pow had been related to executive behavior and stress. The n Pow influences the activities or thoughts of a number of individuals, such as politicians, military officers, clergy, managers and executives. Some researchers even reported n Pow as the strong characteristic discerning successful managers from the nonsuccessful. N Pow can also be manifested through either hope of success or fear of failure. (Stahl, 1986)
Otherwise, n Aff has been noted as important in the maturation and development process. It is defined as establishing and maintaining friendly behavior, and it had been observed in group activities and interpersonal relationship. It was found out that a person with high n Aff can become very frustrated if placed in a job that requires isolation from others. For this reason, it had been argued by researchers such as McClelland, Burnham and Boyatzis that high n Aff is not associated with effective managerial leadership, because friendship with subordinates may prevent objective dealing with subordinates. (Stahl, 1986) Unlike n Ach and n Pow, n Aff may be manifested from hope of inclusion or fear of rejection.
Related Studies
In this portion, we will to continue probing on the question: what motivates a manager to perform well and stay committed to his work? This time, we will try to answer the query through different studies and research made by other researchers that are relevant in this study.
In a research, Stahl (1986) hypothesized: “The presence of both high n Pow and high n Ach is indicative of high managerial motivation. Conversely, it is hypothesized that the lack of both motives is indicative of low managerial motivation.” (p. 35) This is in accordance to McClelland’s theory on n Ach and n Pow (n Ach relates to managerial/entrepreneurial behavior and economic achievement, while n Pow relates to managerial/ executive behavior and effectiveness), Campbell et al.’s analysis: “Better managers tend to show a lifetime pattern of high achievement, power and economic motivation” ( Campbell et al. 1970, p. 361), Steer’s proposition: “the most successful managers may be those who combine a power-orientation with an achievement-orientation” (Steers 1981, p. 76), Veroff’s (1982) comments on the fusing of n Ach and n Pow, and the like.
Stahl (1986) found out (based on data gathered from five samples from several organizations in different parts of the US) that high managerial motivation can be pinpointed to the presence of both high n Pow and high n Ach, while low scores in both needs pinpoints to low managerial motivation. Further, the study found out: percentage of high managerial motivation are greater among managers than nonmanagers; percentage of high managerial motivation are higher among promoted managers than nonpromoted managers; there was a noticeably higher percentage of high managerial motivation among supervisors than nonsupervisors; and that managers with higher managerial motivation than others have higher managerial performance, while “the opposite held true for low managerial motivation, except for managerial performance, which was untestable due to insufficient data.” (p. 41) Therefore, based on the said results, Stahl concluded that a person who scores high on both n Pow and n Ach can be categorized as high in managerial motivation, while a person who scores low on both n Ach and n Pow can be categorized as low in managerial motivation.
On the other hand, the research done by Stahl, Hendrix, Coleman and Gulati (1986), all from Clemson University, tried to determine whether power is the great motivator for executives. To do this, they tested and compared the two models of power and affiliation between several samples of executives and managers. The models are: “n Pow is greater than n Aff” , or, the manager’s need for power is greater than his need for affiliation or for being liked by people; and “high n Pow and low n Aff” model, the latter being based on McClelland and Burnham’s study in 1976 that produce a finding that says “better managers have high power motivation, low affiliation motivation and high in inhibition” (p. 103)
This research found out that among the samples, the model “n Pow is greater than n Aff” is more preferred. The findings showed that all senior executives (14 out of 14) and 41 out of 47 executive grade officers showed the “n Pow is greater than n Aff” pattern. “The higher military rank and the higher executive rank were associated with higher proportions of subjects who possessed the “n Pow is greater than n Aff” profile.” (Stahl et al., 1986, p. 81) However, the study also suggests a limitation. “The method by which the two models were specified, using percentiles, guaranteed that whenever an individual satisfied the “high n Pow and low n Aff” model, he or she also satisfied the “n Pow >> n Aff” model. A priori, the percent satisfying the “n Pow >> n Aff” model must be greater than or equal to the percent satisfying the other models. Not only was this lower bound equality met, but for each of the seven groups, a higher proportion exhibited the “n Pow >> n Aff” pattern than the “high n Pow and low n Aff” model. The fact that all seven exhibited a higher proportion mitigates the limitation. Therefore, this research supports McClelland and Burnham’s comment that to be effective, the top manager’s need for power ought to be greater than his need for being liked by people.” (Stahl et al., 1986, p. 81-82)
Stahl et al. (1986) states that even if their research was designed primarily to test a theory, there are certain applications that are evident from the results, like their implications on managerial training, career counseling, and executive selection implications come to mind. “Managers who view themselves as candidates for executive level positions could be exposed to these motivational profiles in managerial training sessions.” (p. 82)
Another relevant research was done by Michael Patrick Allen of Washington University. The study examined the relationship between the length of tenure among chief executive officer and directors of 218 large industrial corporations, and their managerial power in terms of the stockholdings. “Analysis of covariance is employed to assess the effects of different control configurations on the length of tenure, controlling for the simultaneous effects of corporate size and performance.” (Allen, 1981, p. 482) The study found out that longer tenure of the chief executive officer is associated with his significant stock ownership but in the case of other directors, significant stock ownership is not associated with shorter tenure. The study also yielded the result declaring the control configuration variables and the age of the chief executive officers or his years of service with the corporation have not consistent relationship. Lastly, the study found out that “the relationship between managerial power and tenure obtains even when the chief executive officer controls only a relatively small block of stock.” (Allen, 1981, p.482)
Also cited for this study was the research done by Mallette, Middlemist and Hopkins (1995). The purpose of this paper is to examine the relationship between CEO pay and several social, political, and economic factors. “Specifically, we argue that CEO compensation is determined by a complex set of these factors. This paper is not intended to diminish the importance of economic variables in the determination of executive pay, but rather to suggest that social and political variables also play an important role. By adopting an expanded view we can more fully understand both the forces that are involved in CEO pay determination, and those that contribute to governing effectiveness.” (Mallette, Middlemist and Hopkins, 1995, p. 253+)
Specifically, this study presented ten hypotheses: 1st, that there will be a curvilinear relationship between CEO tenure and chief executive cash compensation; 2nd, that the higher the proportion of independent directors on the board the lower the value of the CEO’s cash compensation; 3rd, that the higher the proportion of inside directors on the board the higher the value of the CEO’s cash compensation; 4th, that he value of the CEO’s cash compensation in companies where two persons serve in the roles of CEO and chairman of the board will be less than the value of the CEO’s cash compensation in companies where one person occupies both roles; 5th, that the higher the value of the cash compensation of members of the compensation committee with their primary employer, the higher the value of the cash compensation of the CEO on whose compensation committee they sit; 6th, that the higher the value of the CEO’s equity stake in the company, the lower the value of the CEO’s cash compensation; 7th, that the higher the equity holdings of a company’s inside directors, the lower the cash compensation of the firm’s CEO; 8th, that the higher the equity holdings of a company’s independent directors, the lower the cash compensation of the firm’s CEO; 9th, that the higher the equity holdings of institutional investors, the lower the value of the cash compensation of the firm’s CEO; and 10th, that the value of the cash compensation for the CEOs of firms with poison pill takeover protection in place will be higher than the value of the cash compensation for the CEOs of firms without this protection. (Mallette, Middlemist and Hopkins, 1995).
The study yielded the following results: that the chief executive pay is a complex process shaped by several different forces; that CEO’s in larger companies received larger compensation than those in smaller companies; that there is a strong curvilinear relationship between CEO tenure and pay, where the cash compensation increases with tenure up to a point, beyond which case earnings decrease; that board composition does not appear to be a contributing factor in CEO pay determination, but it appears that the governing effectiveness (at least from a compensation perspective) suffers when one person serves in the dual roles of CEO and chairman of the board; that the social comparison rationale may play a major role in the setting of CEO pay, because even though this process of comparison is not typically included in compensation research, it adds another dimension to pay equation; that CEOs were likely to be paid more, not less, as the value of their holdings in the company increased (this finding indicates that the interests of CEOs with large equity holdings and other shareholders do not meet as strongly as the agency literature suggests, so CEOs with large holdings appear to place a great deal of importance on enhancing their cash compensation rather than acting to lower a significant cost); and finally, that the relationship between various board attributes, leadership, and ownership characteristics and executive pay should be interpreted with care. (Mallette, Middlemist, Hopkins, 1995)
The research conducted by Michael Muller entitled “Employee Representation and Pay in Austria, Germany, and Sweden” was also cited for its implications and also, because it provided a description of pay practices in Germany. Muller (1999) hypothesized: that employee representation and pay practices in Austria, Germany and Sweden are, or will become, similar; and that the differences in employee representation and pay practice between Austria, and Germany will be less than those between these countries and Sweden.
The study found out that employee representation and pay in Austria, Germany and Sweden are all influenced by factors such as the law, the collective bargaining system, and relationships that lead to cross-national differences. However, these are less pronounced between Austria and Germany as compared with Sweden. The study also found out that a decentralization of pay from the industry or central level to the company level can be observed in all the three countries. Muller (1999) also concluded: “Pay has also become more individual and performance-related. Hence developments in Austria, Germany, and Sweden not only are similar, but also mirror those observed in Europe. The data, therefore, provide empirical support for those writers who suggest that management practices are influenced not only by nationally specific factors such as managerial values and institutions, but also by international best practice.” (p. 67)
Muller further discussed: “These results and conclusions point to the advantage of adopting a comparative approach to research. This establishes a broader conceptual lens in that both differences and similarities may be examined, rather than one or the other. This leads to more nuanced understanding when comparing phenomena across different countries. Furthermore, a comparative approach encourages us to move beyond descriptions of the extent to which the management of human resources varies between nations and toward examining the reasons for noted similarities and differences. Although this approach may be more time-consuming and resource-intensive, it nevertheless moves us away from the parochialism that currently permeates the international/comparative HRM literature.” (Muller, 1999, p. 67)
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