Knowledge Worker Trust Within Organisations

KNOWLEDGE WORKER TRUST WITHIN ORGANISATIONS

DOMINIC MCLOUGHLIN

BCom, MBus

A thesis submitted in fulfilment of the requirements for the award of the degree of Doctor of Philosophy in the School of Management, Australian School of Business, University of New South Wales

March 2014

PLEASE TYPE THE UNIVERSITY OF NEW SOUTH WALES Thesis/Dissertation Sheet

Surname or Family name: MCLOUGHLIN First name: DOMINIC Other name/s: JAMES Abbreviation for degree as given in the University calendar: PhD School: Australian School Of Business Faculty: School Of Management Title: Knowledge Worker Trust Within Organisations

Abstract 350 words maximum: (PLEASE TYPE)

Observers of structural changes in developed economies have generated widely accepted claims about the move to a society based on ‘knowledge’, ‘knowledge work’ and ‘knowledge workers’. These claims imply a need for more detailed research on the contexts, antecedents, and consequences of ‘trust’ in knowledge-based workplaces. That research is largely missing from the debates. This thesis assesses the claims regarding the knowledge worker relationship with management, which assumes high levels of trust, while more critical scholars challenge this assumption. One means of connecting the disparate theory and empirical research is used in this thesis, a thorough examination of workplace relationships.

There are three main aims for this research. The first is the development of a theoretical model that translates the claims regarding knowledge work into the expected circumstances for the relationships between workers and managers in knowledge-based workplaces. This thesis argues that the circumstances can notionally be separated into ‘Trust’, ‘Change’, ‘Management’ and ‘Organisational Outcomes’. Secondly, a new means of identifying knowledge workers is presented. Finally, the theoretical model is tested empirically.

Phase one consisted of developing and selecting items which were capable of capturing the various circumstances, including different levels of trust within an organisation (immediate manager, business unit and organisation). Focus groups within one Australian business unit of multinational information technology (IT) organisation provided feedback on the content and useability of the survey (n=23). Phase two included a redesigned survey, including items intended to identify knowledge workers, which was tested with a broader Australian IT population (n=96).

Phase three of the research was the main study where the final form of the survey was then used (n=255). Quantitative analyses were undertaken for the immediate work area, the organisation and a combined model, all using Partial Least Squares (PLS). Demographic variables (age, gender and supervisor/non-supervisor) had a negligible impact. A maximised model is described for each analysis and the possible implications for the theoretical model and knowledge- based workplaces are discussed. Finally the theoretical contributions and practical implications of this research are discussed.

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ORIGINALITY STATEMENT

I hereby declare that this submission is my own work and to the best of my knowledge it contains no materials previously published or written by another person, or substantial proportions of material which have been accepted for the award of any other degree or diploma at UNSW or any other educational institution, except where due acknowledgement is made in the thesis. Any contribution made to the research by others, with whom I have worked at UNSW or elsewhere, is explicitly acknowledged in the thesis. I also declare that the intellectual content of this thesis is the product of my own work, except to the extent that assistance from others in the project's design and conception or in style, presentation and linguistic expression is acknowledged.

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Date 15 October 2014

ACKNOWLEDGEMENTS

I express my appreciation to the many people who have made the presentation of this thesis possible. First amongst these are the various managers who made the surveys possible. Alex, Damian, Peter, John, Rob and Jacquie. Their active cooperation, genuine interest and openness to critique of their performance as managers, made the research possible. Likewise, many thanks to those who took the time to complete the surveys.

Thank you to Dr Rachid Zeffane who initiated my interest in trust and supervised me until circumstances made this no longer possible. Thank you to my supervisors, Dr

David Morgan and Dr Ian Hampson. David, thank you for trusting enough to take over supervision and then to spend a long time challenging me to overcome obstacles, particularly the fine tuning for the final ‘half-marathon’. Ian, thanks for your advice and your incredible efforts concluding the first ‘half-marathon’. Thank you to Dr Nicole

Gillespie and Dr Natalie Ferres who kindly allowed me to use, and publish the instruments they developed. Thank you to all those at UNSW who provided assistance and advice.

I also owe a debt of gratitude to my family. Firstly to my parents and grandparents, who instilled in all of their children a love of education, and struggled to ensure we had access to it. Secondly, to Leonie, whose child minding and statistics advice were very much appreciated. I also thank my children Nick, Nat and Pip who have endured the ups and downs of this project with tolerance, wisdom, humour and determination.

Finally, to my wife Sam, without whom I could not have reached the summit of Mt

Doom, and who helped cast the burden from me.

ABSTRACT ______

Observers of structural changes in developed economies have generated widely accepted claims about the move to a society based on ‘knowledge’, ‘knowledge work’ and ‘knowledge workers’. These claims imply a need for more detailed research on the contexts, antecedents, and consequences of ‘trust’ in knowledge work. That research is largely missing from the debates. This thesis assesses the claims regarding the knowledge worker relationship with management, which assumes high levels of trust, while more critical scholars challenge this assumption. One means of connecting the disparate theory and empirical research is used in this thesis, a thorough examination of workplace relationships.

Phase three of the research was the main study where the final form of the survey was then used (n=255). Quantitative analyses were undertaken for the immediate work area, the organisation and a combined model, all using Partial Least Squares (PLS). Demographic variables (age, gender and supervisor/non-supervisor) had a negligible impact. A maximised model is described for each analysis and the possible implications for the theoretical model and knowledge-based workplaces are discussed. Finally the theoretical contributions and practical implications of this research are discussed.

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TABLE OF CONTENTS ______

Abstract ...... i Table of Contents ...... ii List of Tables ...... v List of Figures ...... v Abbreviations Used in Thesis ...... vi

Chapter One Introduction ...... 9 Introduction ...... 9 Knowledge Work And Trust ...... 10 The Thesis - Argument and Methodology ...... 14 Conclusion ...... 21

Chapter Two Literature Review ...... 25 Introduction ...... 25 1. Section One: The New ‘Knowledge-Based’ Workplace: Claims And Critics .. 27 1.1 Ownership of the Means of Production ...... 33 1.2 Trust Within Knowledge-based Workplaces ...... 34 2. Section Two: Knowledge as Theoretical: Defining Knowledge ...... 40 3. Section Three: Defining Knowledge Work, Knowledge Worker And Knowledge-Based Workplaces ...... 45 4. Section Four: Trust And The Knowledge-Based Workplace ...... 49 4.1 Trust In the ‘Soft’ Human Resource Management Literature ...... 50 4.2 Theories of Trust In Other Disciplines ...... 54 4.3 Definition ...... 59 4.4 Trust Referent ...... 60 5. Section Five: Change ...... 61 5.1. High Levels of Change ...... 61 5.2. Change and Trust ...... 63 6. Section Six: Management ...... 66 6.1 Perceived Character ...... 67 ______Page| ii

6.2 Communication ...... 71 6.3 Participation ...... 73 7. Section Seven: Organisational Outcomes ...... 76 7.1 Organisational Citizenship Behaviour ...... 78 7.2 Job Satisfaction ...... 80 7.3 Support for Change ...... 81 7.4 Affective Commitment ...... 82 8. Section Eight: A Theoretical Model ...... 83 Conclusion ...... 88

Chapter Three Methodology ...... 93 Introduction ...... 93 1. Section One: The Method ...... 94 1.1 The Target Population ...... 94 1.2 Level of Analysis ...... 95 1.3 The Survey Method ...... 96 1.4 Survey Limitations ...... 97 1.5 Planned Data Gathering ...... 98 1.6 Data Gathering ...... 100 1.7 Analytical Procedure ...... 102 2. Section Two: Variables ...... 104 2.1 Identifying Knowledge Workers ...... 104 2.2 Trust ...... 106 2.3 High Levels of Change ...... 109 2.4 Management ...... 110 2.5 Organisational Outcomes ...... 113 2.6 Controls ...... 116 2.7 Phase One – Focus Group and Survey Trial ...... 118 3. Section Three: Confirming the Questions ...... 119 3.1 Assessing the Questions ...... 121 3.2 Validity and Reliability of Initial Variables ...... 124 3.3 Knowledge Worker Questions ...... 124 3.4 Dataset ...... 125 ______Page| iii

Conclusion ...... 127

Chapter Four Results for Immediate Work Area ...... 131 Introduction ...... 131 1. Section One: Assessing the Questions ...... 132 1.1 Discriminant Validity ...... 132 1.2 Composite Reliability ...... 133 2. Section Two: Establishing the Model ...... 137 3. Section Three: Assessing the Model ...... 141 3.1 Examining the Immediate Work Area ...... 141 3.2 Examining the Organisation...... 147 3.3 Examining a Combined Model ...... 152 Conclusion ...... 158

Chapter Five Discussion ...... 163 Introduction ...... 163 1. Section One: Limitations ...... 163 2. Section Two: Theoretical Contribution ...... 165 3. Section Three: Empirical Contribution ...... 171 Conclusion ...... 173

Chapter Six Conclusion ...... 177 Overview ...... 177 Thesis Structure ...... 183 Further Research ...... 184 Concluding Remarks ...... 185

Bibliography ...... 189

Appendices ...... 221

Appendix A: Ethics Approvals ...... 221 Appendix B: Survey ...... 223

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LIST OF TABLES ______

Table 2.1: Spender’s Knowledge Matrix ...... 43 Table 3.1: Summary of Data Collection, Phases 1, 2 and 3 ...... 102 Table 3.2: Likert Scale for Responses...... 106 Table 3.3: Conversion from Change “Type Descriptions” to Likert Scale ...... 110 Table 3.4: Conversion from Leadership Style “Type Descriptions” to Likert Scale .... 112 Table 3.5: Summary of Data Collection, Phase Two ...... 120 Table 3.6: Composite Reliability and Cronbach’s Alpha (Phase one and two) ...... 124 Table 3.7: Knowledge Worker Questions ...... 125 Table 4.1: Composite Reliability and Cronbach’s Alpha (Phase three) ...... 133 Table 4.2: Results of Independent Samples t-test ...... 135 Table 4.3: Descriptive Statistics ...... 136 Table 4.4: Regressions of outcome variables and trust on trust antecedents ...... 138 Table 4.5: Significance Testing, R2 and p value for Maximised Model - IWA ...... 146 Table 4.6: Significance Testing, R2 and p value for Maximised Model - ORG ...... 151 Table 4.7: Significance Testing, R2 and p value for Combined Model - Antecedents . 156 Table 4.8: Significance Testing, R2 and p value for Combined Model - Organisational Outcomes ...... 157

LIST OF FIGURES: ______

Figure 2.1: Proposed Theoretical Model of Trust in Knowledge-based Workplaces ..... 87 Figure 3.1: Initial Statistical Model in PLS (based on the theoretical model) ...... 123 Figure 4.1: Mediated Relationships for IWA ...... 143 Figure 4.2: Maximised Model for IWA ...... 145 Figure 4.3: Mediated Relationships for ORG ...... 148 Figure 4.4: Maximised Model for ORG ...... 150 Figure 4.5: Mediated Relationships for IWA and ORG Combined ...... 153 Figure 4.6: Relationships for IWA and ORG Combined – Maximised Model ...... 155

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ABBREVIATIONS USED IN THESIS ______

AO Affective Organisational Trust

BI Behavioural Integrity

BO Behavioural Organisational Trust

BTI Behavioural Trust Inventory

CO Cognitive Organisational Trust

CBSEM Covariance-based Structural Equation Modelling

DSCM Dunphy and Stace Contingency Model

GoF Goodness of Fit

HRM Human Resource Management

IT Information Technology

ITOF Information Technology Professionals Online Forum

IWA Immediate Work Area

KWT Knowledge Worker Thesis

NEO Neuroticism-Extroversion-Openness

OCB Organisational Citizenship Behaviours

ORG Organisation

PLS Partial Least Squares

SNO Social Normative Organisational Trust

WTS Workplace Trust Survey

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CHAPTER 1

INTRODUCTION

Chapter 1 |Introduction

INTRODUCTION ______

This thesis examines the claims about trust between workers and managers within

‘knowledge-based workplaces’. In continuing to develop useful knowledge about

‘knowledge-based workplaces’, scholars need to move beyond the current debates and explore the particular circumstances for these workers within their workplaces. This thesis draws on insights from the trust literature as a means of explaining employee’s experiences of work. The specific focus of this dissertation is to address the lack of a nuanced understanding of the dynamics of trust between ‘knowledge workers’ and management. This thesis establishes a theoretical model of trust within ‘knowledge- based workplaces’.

Utilising data from a survey of workplaces that employ workers meeting the criteria of the knowledge worker definition – predominantly software developers and software engineers – the analysis tests the mediating effect of trust between a number of trust antecedents and outcomes. The analysis suggests that associations between management behaviour and organisational outcomes are partially mediated by trust, lending credence to the argument that knowledge-based workplaces are similar to other workplaces. A number of important contributions to knowledge are made in assessing the theoretical model. The importance of ‘knowledge worker consciousness’ and ‘who trusts whom’ are highlighted. For example, those who perceive themselves as knowledge workers do have higher trust in organisations, yet do not have higher levels of trust in their immediate manager.

The dissertation is divided into six chapters. Chapter one introduces and sets out the thesis. Chapter two outlines the debates about ‘knowledge work’ and the influences on

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Chapter 1 |Introduction it at some length, concluding by proffering a theoretical model of trust in the knowledge-based workplace. The third chapter outlines the method by which the theoretical model is assessed. The results are presented in Chapter four, while the discussion, implications and theoretical contribution are contained in Chapter five.

Chapter six concludes the thesis. First, the remainder of this Chapter outlines the contents of this thesis in more detail.

KNOWLEDGE WORK AND TRUST ______

Many writers have argued that workplace and labour market changes in developed economies may be understood through the lens of an alleged move to an economy based on ‘knowledge’. Chapter two will outline how this altered society is seen as being composed of ‘knowledge workers’ employed in ‘knowledge-based workplaces’. This echoes earlier claims around the nature of a ‘Post-Industrial Society’ (Bell, 1973), a

‘Knowledge Economy’ (Reich, 1991), an ‘Information Society’ (Castells, 1996), and even a ‘Post-Capitalist Society’ (Drucker, 1993) – and claims about the ‘new class’ of worker, and the new type of employment relations to be found therein. What will here be labeled the ‘conventional view’ of these employment relations1 posits that in the knowledge economy the employment conditions of ‘knowledge workers’ in

‘knowledge-based workplaces’ differ from those in other sectors. The working conditions in knowledge-based workplaces are said to be superior. Because

‘knowledge’ is central to their work, ‘knowledge workers’ in a sense ‘own’ knowledge in a way that workers in previous eras did not own such an essential component of the production process. Therefore, this puts knowledge workers at an advantage in the

1 ‘conventional’ because it is broadly held by influential senior writers like those listed above as well as a large number of followers – which will be more fully explicated in Chapter two ______Page| 10

Chapter 1 |Introduction employment relationship, and accordingly, this conventional view posits, trust is a central component in the management of knowledge workers. Management has the role of eliciting knowledge, as knowledge workers must trust management to enable them to expend greater discretionary effort, to generate knowledge, which can then be utilised by the organisation. The tension between generating trust for eliciting knowledge and the potential for destruction of trust from the capturing of knowledge is largely ignored.

Accordingly, the role of trust within knowledge-based workplaces is the focus of this thesis.

The conventional view of the knowledge-based workplace emphasizes the cultivation of

‘soft focus’ management practices to maximize the eliciting of knowledge, but these ideas require considerable care in their elucidation and definition. This thesis will be careful to ensure that it sets itself clear boundaries and identifies central issues in the complexities and uncertainties raised in the above broad claims. Despite its centrality, the concept of trust, its antecedents and referents remain remarkably underexplored in the knowledge work literature. A major task for this thesis will be to include the more developed literature on ‘trust’ within the social psychology literature in the discussion of trust in knowledge-based workplaces. Until now this work has been largely quarantined from the knowledge work literature. This will be undertaken in the context of developing a theoretical model of trust in the knowledge-based workplace.

The following paragraphs will show the problematic nature of defining knowledge work, despite its broad application. Those who have grappled with this issue identify broad and narrow perspectives. On the ‘broad’ perspective, almost any employee can be defined as a knowledge worker, since almost everyone uses some knowledge in their work – particularly tacit knowledge (Nelson and Winter, 1982; Brown and Duguid, ______Page| 11

Chapter 1 |Introduction

1991; Davenport, 2005). Yet this renders the concept largely meaningless – in that few if any workers would not be knowledge workers in this sense. The ‘narrow’ perspective on which workers are knowledge workers, is associated with a discrete conception of knowledge. That is, knowledge is ‘theoretical’, and knowledge workers apply theoretical knowledge to particular tasks, usually involving information technology

(Zand, 1997). This underlies this dissertation, including selecting the sample of workers chosen for testing the theoretical model. The definition of ‘knowledge work’ outlined by Warhurst and Thompson (2006) is used in this thesis to define knowledge worker and knowledge-based workplace. It captures key themes revealed in the literature, that is knowledge as theoretical and abstract, the use of knowledge (by organisations in this case) and finally the comparative autonomy of knowledge workers (consistent with the need for trust and ‘soft focus’ management).

A second major task is utilising data from a survey of private sector Australian information technology (IT) workers. This target population is not only considered archetypal as knowledge workers, more importantly it will be shown that they meet the definition outlined above. The thesis seeks to look closely at the role of trust, its particular circumstances, antecedents and outcomes in ‘knowledge-based workplaces’.

The ‘conventional’ knowledge worker thesis is criticised from a number of vantage points. The ‘critical’ perspectives on the ‘knowledge worker’ thesis will be outlined in detail in Chapter two, but a brief outline is provided here. First, marxian social critics question Daniel Bell’s definition of knowledge as the new ‘axial principle’ of a new society, and more so Peter Drucker’s characterisation of the new society as ‘post capitalist’. Notwithstanding globalisation and the growth of information technology- based work, the critical view is that the fundamental relations of production remain ______Page| 12

Chapter 1 |Introduction unchanged – whatever the changes in the forces of production (i.e. technology).

Similarly, this thesis assumes capitalist relations of production to be broadly intact, notwithstanding the knowledge worker thesis. Moreover, the thrust of much of the

‘knowledge management’ literature, as the critical literature argues, accepts the existing structure of organisations which seek to ‘capture’ the knowledge possessed by workers, and to turn it into the property of management, with the possibility of then transferring captured knowledge to fellow organisation members to improve productivity. Despite the appearance of novelty, this understanding of appropriation essentially goes back to the work of Braverman (1974) and the thesis that employers under capitalism ‘deskill’ workers and capture their knowledge of the production process (Ehrenreich and

Ehrenreich, 1977; Edwards, 1978, 1979).

If society is to be thought of as in some sense a ‘knowledge’ society, it is important to specify what is meant by ‘knowledge’. Some of the key writers on the topic of knowledge work: Brown and Duguid (1991), Reich (1991), Blackler (1995), and

Spender (1996), all have different, if often overlapping definitions of ‘knowledge’ and therefore of ‘knowledge worker’. As mentioned, this thesis adopts a ‘narrow’ concept of

‘knowledge’ as primarily abstract and theoretical – but registering its application and utility. In general it is important to acknowledge, and to demarcate, alternative conceptions of knowledge which, whatever their advantages in terms of comprehensiveness, in their application, strain the coherence of the field. For example, the view that knowledge workers are empowered as individuals by their possession of knowledge – the new ‘means of production’ – clashes with other ‘radical’ conceptions of knowledge as the possession of collectives. Such popular theories as those surrounding the notions of communities of practice (Brown and DuGuid, 1991; Lave

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Chapter 1 |Introduction and Wenger, 1991) build on intertwined conceptions of learning, working, and the building of identity, and are the stuff of radical conceptions of knowledge hailing from a marxian perspective (for example Activity Theory). As mentioned previously, these points will be explicated more thoroughly in Chapter two. Here the point is to make clear that they do not play a role in theoretical perspective that this thesis adopts.

THE THESIS - ARGUMENT AND METHODOLOGY ______

In Chapter two, then, the arguments around the new society and the role of knowledge in it are explored in the first section. Section one (of Chapter two) discusses the literature clustered around debates about the emergence and nature of a ‘Post-Industrial

Society’ (Bell, 1973), ‘Knowledge Economy’ (Reich, 1991), ‘Post-Capitalist Society’

(Drucker, 1993), and ‘Information Society’ (Castells, 1996). The literature review traces the emergence of assumptions underpinning the concepts of knowledge, knowledge work, knowledge worker and knowledge-based workplaces. It identifies two main initial themes, namely: ownership of the ‘means of production’ and trust in knowledge-based workplaces. The argument that a ‘new class’ of worker has emerged is considered and the influence of this debate on understandings of knowledge-based work is traced, particularly consideration of who possesses knowledge. This first section of Chapter two also explicates the ‘conventional’ view of knowledge-based workplaces, where it is said that there exists a climate where workers have high levels of trust in management. As outlined above knowledge-intensive production sees ‘knowledge workers’ enjoying employment advantages accruing from their centrality to the production process. However, the dissertation will go on to argue that management has an inherent tension in its dual role. On the one hand, the role is to enhance trust, assisting in eliciting knowledge. On the other hand, capturing workers’ knowledge - ______Page| 14

Chapter 1 |Introduction through control systems and practices - is vital to organisations which utilise knowledge for profit. This capturing and utilising role can damage trust.

Before considering these issues further, Chapter two, Section two considers definitions, namely the various conceptions of ‘knowledge’ as they have implications for the

‘knowledge worker’ thesis. Much of the knowledge worker literature conceives of knowledge as theoretical and abstract, and possessed by individuals. However, knowledge may also be portrayed as tacit and invisible, very difficult or even impossible to encode, and even collectively held. These are very different conceptions, and pose definitional problems, which are canvassed in Section three of Chapter two.

To deal with the problems of definition, and having observed the tendency for the concept of ‘knowledge worker’ to expand, the review adopts the definition proposed by

Warhurst and Thompson (2006), citing the advantages already mentioned earlier in this chapter.

Another major task of Chapter two is to demonstrate that trust lies at the centre of the conventional knowledge worker thesis, and the claims of ‘soft focus’ management.

Despite the centrality of the concept of ‘trust’ to the ‘knowledge worker’ thesis, the literature contains sweeping generalisations about ‘trust’, rather than careful attention to theoretical connections. In reviewing the theoretical literature, Chapter two, Section four draws on work from a social psychology perspective, and the literature around the area of ‘soft’ human resource management. The section traces disparities in the understanding of trust, reflected in the diverse understandings of trust in knowledge- based workplaces. This dissertation suggests that a theoretical model of trust needs to consider the specific circumstances within knowledge-based workplaces, and therefore should consider the degree of trust at two conceptual levels: trust in the immediate ______Page| 15

Chapter 1 |Introduction manager and trust in the organisation. Clearly, it might be possible to trust one but not the other, but this distinction is lost in the broad claims about the importance of ‘trust’ in knowledge-based workplaces.

Section five of Chapter two points out that while change is implicit in many discussions, insufficient consideration has been given to the effects of high rates of organisational change. In particular, the potential for high rates of change to have a negative impact on trust is overlooked. Depending on its nature, high levels of change can be destructive of trust. High rates of change are another neglected element of knowledge worker research.

Chapter two, Section six shows the importance of management actions for understanding knowledge-based workplaces. It describes important trust antecedents which are derived from the overlapping ‘soft focus’ management, knowledge work, and trust literature, specifically: perceived character of managers (such as ability, benevolence, and integrity); communication and participation in decision making. This section proposes that the tension between the management roles of eliciting knowledge and capturing knowledge could lead to inconsistency in a manager’s behaviour. Trying to balance these competing objectives could lead to adverse perceptions of management character, poorer communication and participation, leading to lower trust. Many discussions of trust include the notion of people’s honesty and integrity. Perceived character comprises a number of such components drawn from the literature, particularly notions of behavioural consistency and fairness. Communication, for this research, has three key components drawn from the literature: the referent’s awareness of employee concerns; encouragement of openness; and encouragement of cooperation.

Section six of Chapter two concludes by identifying another tension in the literature - high rates of change (needing faster decision making) and the amount of time needed ______Page| 16

Chapter 1 |Introduction for widespread participation in decisions. It is argued that all of these management behaviours should be reflected in a detailed understanding of knowledge-based workplaces.

The literature review argues (in Section seven of Chapter two) that the conventional knowledge worker thesis, in assuming high levels of trust, also expects certain organisational outcomes. These organisational aspirations are seen as forming part of the benefits of knowledge-based workplaces to the organisation, although there may also be benefits to workers. The key themes in the literature are: organisational citizenship behaviour (OCB); job satisfaction; support for change; and increased levels of commitment to the organisation.

Chapter two concludes in Section eight by proposing a theoretical model with a nuanced understanding of the dynamics of trust within knowledge-based workplaces, as a means of filling a striking absence in the literature, and thereby contributing to knowledge.

Section eight also articulates a number of research questions, distilled from the extensive trust literature, and applied to knowledge-based workplaces. This includes the summarising of research questions identified in the course of the literature review regarding the role of trust in the immediate manager and senior management. Similarly a number of research questions about knowledge worker’s trust, trust antecedents and outcomes are restated. Research is then conducted to answer these questions and test the utility of the theoretical model, using surveys to gather the experiences of individual workers.

Chapter three begins by outlining the method by which the theoretical model is to be tested, addressing the research questions, and advancing knowledge. The reasons for the

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Chapter 1 |Introduction selection of private sector Australian IT workers as the target population are described first, including the steps taken to ensure that the sample population for the main study is consistent with the conditions in Warhurst and Thompson’s (2006) definition. The rationale for the level of analysis as the individual is then outlined. Section one of

Chapter three also discusses the survey as a method for gathering data and its various limitations. The section concludes by outlining the data collection plan, the actual data gathering and the choice of analytical procedures (including Partial Least Squares path analysis).

Section two of Chapter three outlines the emergence of new issue in the course of the research. Although the IT industry is widely regarded as the archetypal knowledge- based workplace, reflection on the pilot study and publication of new research made the salient point that not all those working in it are necessarily knowledge workers. This results in an additional research question, to better probe the dimensions of the identity and identification of knowledge workers. Similarly, a theoretical connection of identification as a knowledge worker is added to the theoretical model and new questions are developed to capture ‘knowledge workers’. Using the varying theoretical approaches to what constitutes a knowledge worker, the questions seek to capture aspects of knowledge workers in practice. Drawing on the literature, the central questions are conceptualised as ‘identity’, ‘education’, ‘ideas’, ‘use of symbols’ and

‘workplace experience’. The remainder of the section outlines the rationale for the other questions selected to make up the variables for testing the model, including trust, change, perceived character, communication, participation in decision making, organisational citizenship behaviour, job satisfaction, support for change direction, organisational commitment, and the controls. Section two of Chapter three concludes

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Chapter 1 |Introduction with a description of the conduct of a focus group with managers and two more with employees.

Chapter three then concludes by describing some initial testing of the questions selected in Section two. This assessment is conducted with an initial data set (n=119) gathered as a convenience sample of Australian IT workers from: a department in a multinational IT organisation, an IT department of a large finance organisation, a small IT organisation and an IT Professionals online forum. Preliminary results from the 119 respondents establish the statistical validity and reliability of the questions. The results also indicate that those questions which were specifically adapted for this research do provide sufficient information, and that an online survey is workable. A revised full survey is then conducted, as described in Section three of Chapter three. The final, larger sample is gathered from the same organisations, in departments which are chosen specifically for their eliciting, and capture of knowledge. The new dataset resulting from this additional and final survey (n=255) is then described, at the conclusion of Section three.

Chapter four reports the results from the data, beginning in Section one by assessing the questions used, specifically the discriminant validity and the composite reliability. This analysis reveals that of the various knowledge worker questions, those which are most effective are the ‘knowledge worker consciousness’ questions. Section two of Chapter four establishes the statistical model, drawn from the data and some initial implications are outlined. It establishes that the data provides support for the theoretical model of two pathways for trust. Accordingly, Section three moves on to a more nuanced analysis of how the variables are associated, using Partial Least Squares path analysis.

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Chapter 1 |Introduction

Section three of Chapter four also reports a procedure of refining the elements of the statistical model. The specific impact of the immediate work area and the organisation are described, followed by the specification of a nuanced and yet robust statistical model of the combined workplace effects. Chapter four concludes by outlining a number of important implications deriving from the data. Chapter four reports that the data supports the importance of trust to the ‘soft-focus’ organisational outcomes and that trust in manager operates differently to trust in organisation.

Chapter five begins the discussion of the results with the limitations that should be considered (Section one). Section two outlines the important theoretical contribution of the dissertation and answers the research questions from Chapter two. Due to the importance of the identity and identification of knowledge workers, that research question is discussed first. Section three briefly covers the empirical contribution of the research. Chapter five concludes by discussing the possibility of wider implications for theory and research.

Chapter six highlights the major conclusions, points to areas for further research, and concludes the thesis.

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Chapter 1 |Introduction

CONCLUSION ______

This Chapter has foreshadowed the methodology and main argument of the thesis – that a disparate ‘knowledge work’ literature contains the widespread assertion that knowledge-based workplaces depend on trust to be successful, and that this proposition, despite its importance and centrality, has not been developed into a theory. There is considerable theory and research on trust more generally, which this thesis reviews.

From this review, key theoretical connections are extracted to propose a theoretical model including the antecedents, outcomes and circumstances of trust within knowledge-based workplaces. The next chapter reviews the relevant literatures in some detail, before turning to an empirical inquiry in a sample of private sector Australian IT organisations in the remaining chapters.

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Chapter 1 |Introduction

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CHAPTER 2

LITERATURE REVIEW

Chapter 2 |Literature Review

INTRODUCTION ______

The introductory chapter briefly explicated claims in the conventional ‘knowledge worker’ literature, notably, work is more knowledge intensive; and ‘knowledge workers’ ‘embody’ the ‘means of production’ as their personal possession.

Accordingly, for this view, trust now plays a greater role in knowledge-based work and broader employment relations. Management must cultivate a climate of ‘trust’, and enhance the quality of social relations at work, to induce knowledge workers to make

‘their’ knowledge resources available for employers’ economic performance.

Surprisingly, theoretical discussion in the knowledge work literature of this essential role of ‘trust’ is largely absent, as is empirical support. Theory around trust is found elsewhere, inter alia in social psychology, sociology, economics (Rousseau et al, 1998), areas of strategic human resource management, and knowledge management. One main purpose of this chapter is to establish these points, drawing on relevant literatures. This will lay the groundwork for the subsequent empirical inquiry into the role of trust, and cognate social features in a sample of IT firms and employees in Australia. The detail of the research is described in subsequent chapters. Here the task is to lay the conceptual groundwork for this inquiry, and to emerge from this chapter with central research questions and a theoretical model of trust within knowledge-based workplaces.

This entails explicating the key components of the debates about knowledge work and knowledge workers. In this task, Section one covers the main building blocks of the

‘knowledge worker thesis’ (or KWT), characterised as the ‘conventional view’. The latter views work as being transformed by increasing knowledge dependency. From this greater workplace social cooperation is vital, particularly the role of ‘trust’ at its centre.

This section also canvasses criticism of the ‘rosy’ view of the future of work. While this Page| 25 Chapter 2 |Literature Review debate is not the central inquiry, it forms the backdrop to the sweeping, conceptually imprecise and empirically unexamined claims of the KWT. The fact that varying conceptions of knowledge exist in a variety of literatures is noted.

The ‘conventional’ KWT draws on a predominantly theoretical and abstract view of knowledge, possessed by individuals. However, alternative views around knowledge see it as tacit and invisible, difficult to encode, and collectively held. These different conceptions are discussed in Section two. As noted earlier, a central goal is to propose research questions distilled from the conceptual claims, which are operationalised (in

Chapter three) for later analysis (in Chapter four).

Section three turns to defining knowledge workers, mindful of the pivotal worker- manager relationship. Reviewing the broad theoretical literature, important issues neglected in the conventional view and extant research on knowledge work are identified. The theoretical importance of these to employment relations within knowledge-based workplaces is outlined, particularly trust.

From this, Section four examines the question of trust in more detail. As mentioned earlier, despite being a key component of the knowledge worker thesis, theoretical development on trust largely takes place in other disciplines. These explore the definition, antecedents, circumstances and consequences of trust. Section five considers what the knowledge worker literature characterises as rapid change, and the different types of change, with potentially different effects on trust. Section six turns to important aspects of trust neglected in the knowledge worker literature, namely trust varies with (a worker’s) perceptions of the character of managers, communication between trustor and trustee, and the extent of participation in decision making. The final section (seven) examines more carefully the theoretical outcomes of trust - the

Page| 26 Chapter 2 |Literature Review collaborative effects which emerge from higher ‘trust’. It is argued there are four consistent components – organisational citizenship behaviour, job satisfaction, support for change direction, and affective commitment. The chapter concludes by presenting the central research questions, and proposes a theoretical model of trust within knowledge-based workplaces. This is then tested empirically in Chapter four.

1. SECTION ONE: THE NEW ‘KNOWLEDGE-BASED’ WORKPLACE: CLAIMS AND CRITICS ______

This section examines the theoretical debates about social features of knowledge work, particularly trust, rather than following all the lines of argument in the broad literature.

It shows that the broad knowledge worker literature contains strong claims about the role of trust in knowledge work as well as other features of ‘the knowledge-based workplace’. The section goes on to expose tensions within the theory between eliciting knowledge from workers, (which requires trust and autonomy) and capturing knowledge (which requires control and can damage trust).

The rising interest in information and knowledge work from the 1950’s mirrors a qualitative shift in scientific and technological production in economically advanced countries. In the early 50s Mills emphasises the role of non-manual work in the economy:

"as a proportion of the labor force, fewer individuals manipulate things, more handle people and symbols" (Mills, 1951:65, emphasis in the original)

The contemporary feel resonates a generation later, where Zuboff (1988) argued that the rigid separation of mental and material work was now dysfunctional, and the future will see “earlier distinctions between white and blue ‘collars’ collapse” (Zuboff,

1988:393).

Page| 27 Chapter 2 |Literature Review

Previously, trends towards increasingly non-manual work were registered in predictions of a ‘Post-Industrial Society’ (Bell, 1973), ‘Knowledge Economy’ (Reich, 1991) ‘Post-

Capitalist Society’ (Drucker, 1993), and ‘Information Society’ (Castells, 1996). From the 1950s to the 1970s there was general acceptance of the post-industrial society thesis by what Darr and Warhurst (2008:27) call ‘conservative’ scholars, despite strong critiques from ‘marxian’ and critical perspectives. Writers here suggest that conservatives “…stress the role of knowledge in the abstract without asking how knowledge gets organized as work’ (Freidson, 1973:50 emphasis added; see also

Braverman 1974; Greenbaum, 1976, 1979; Ehrenreich and Ehrenreich, 1977). This is an important omission, in that organisations are generally seeking ‘use’ of the knowledge, particularly organisations seeking profits. Concomitant increases in science and service based occupations, computer use, and professional occupations from Census reports, were claimed to signal the arrival of increasingly theoretical work, “…the knowledge worker, the man or woman who applies to productive work ideas, concepts, and information rather than manual skill or brawn” (Drucker, 1969:263). It is important to note here the strong associations between the rise of the Information Technology (IT) industry and claims of a post-capitalist future (Drucker 1959; Bell 1973; Toffler 1980).1

Drucker (1969:263) also declaring knowledge as the central factor of production in advanced economies, echoed in Bell’s claim that ‘knowledge’ is the new ‘axial’ principle of the post-industrial society (Bell, 1973). This theme remains, with Flood and

Turner (2001:1152) asserting that “[t]heoretical knowledge rather than labour is becoming the new source of added value and growth, a new wealth of nations”.

Importantly, the connection between rising employment in ‘service’ occupations and the

1 Later theorists largely preserve this connection, see Castells (1996), Cortada (1998), Frenkel, Korczynski, Shire and Tam (1999), Florida (2002). Page| 28 Chapter 2 |Literature Review importance of ‘theoretical knowledge’ is assumed, as is the use of that knowledge for profit, rather than examined and established.

With Mills’ (1951:65) also identifying a new group of ‘white-collar’ workers, the conceptual ground for a heated debate on ‘class’2 structure emerged in the 1960s and

1970s (Darr, 2007). The debate on white-collar workers focussed on broad societal implications (e.g. Hayek, 1944) the nature of the new class, questioning whether the new occupational grouping actually constituted a class, either ‘technical’ (Gorz, 1968;

Mallet, 1975) or ‘professional’ (Ehrenreich and Ehrenreich, 1977). The management doyen, Peter Drucker (1969:263), blithely posited that “…the knowledge worker sees himself [sic] as just another ‘professional’…” While consideration of the many debated components lie beyond the bounds of this thesis, they influenced the literature on knowledge work and knowledge worker.

As mentioned earlier, Drucker (1969:263) theorises that knowledge workers are the successors of manual workers. However, in a confusing conception, the knowledge worker may be seen as a ‘non-subordinate employee’:

“He [sic] is not a “subordinate” in the sense that he can be told what to do; he is paid, on the contrary, for applying his knowledge, exercising his judgement, and taking responsible leadership. Yet he has a “boss” – in fact he needs a boss to be productive. And the boss is usually not a member of the same discipline but a “manager” whose special competence is to plan, organize, integrate and measure the work of knowledge people regardless of their discipline or area of specialization.” (Drucker 1969:276 emphasis added)

The non-subordinate applies knowledge, exercises judgement, and responsible leadership, yet labours under a ‘boss’ or perhaps as a contractor, to ‘be productive’.

Soon after, Drucker (1979) flirted with knowledge workers as successors to ‘skilled workers’. The tension of eliciting knowledge and capturing the value of knowledge is

2 ‘Class’, as used by Darr (2007), is distinct from other discussions of class, such as technocrats and party cadres (eg Burnham, 1941; Djilas, 1957) Page| 29 Chapter 2 |Literature Review implicit in this discussion. Not surprisingly then, a consistent key theme for Drucker

(1969; 1999a), is the problem of managing the new class: “…we did not have – and still do not have – much knowledge of how to manage the knowledge worker and how to make him [sic] productive” (1969:263 emphasis added).

Drucker does not link trust and knowledge workers initially, however the importance of trust within organisations does appear in his later writings: “Organizations are based on trust. Trust means that you know what to expect of people. Trust is mutual understanding” (Drucker, 1990:89). In Managing in a Time of Great Change Drucker writes:

“Even if twenty years hence the majority of managers and professionals will still be employees… the psychology of the workforce – and especially of the knowledge workforce – will largely be determined by the large minority who are not employees of that organization, whether [from] an outsourcing firm, of a partnership organization or half-independent contractors…their top managements… had better stop talking about ‘loyalty’. They will have to earn the trust of the people who work for them, whether these people are its own employees or not.” (1995:61, emphasis added)

Perhaps again confusingly, the contractor theme is sharper, but the social feature of trust is clearly and further accentuated. The difficulties of managing knowledge workers is echoed by Bell (1973), asserting that a younger, more educated labour force entering factories will demand more control over their work. For despite falling numbers of manual and unskilled workers, “at the other end of the continuum the class of knowledge workers is becoming predominant.” The importance of theoretical knowledge is paramount for Bell, stating:

“What has now become decisive for society is the new centrality of theoretical knowledge, the primacy of theory over empiricism, and the codification of knowledge into abstract systems of symbols that can be translated into many different and varied circumstances.” (1973:343 emphasis in original)

How to control the ‘new class’ at work was a serious conceptual problem for the ‘new economy’ theorists. Even so, descriptions of a ‘new class of knowledge worker’ were

Page| 30 Chapter 2 |Literature Review readily and uncritically accepted in later works (e.g. Reich 1991; Davenport 2005;

Pyoria 2005), or for others (e.g. Florida, 2002) it is a ‘creative class’ that “…in terms of influence… has become the dominant class in society” (Florida 2002:ix, emphasis added).

The putative ‘dominance’ of the new class rests on the assumption of its key role in national prosperity. Yet little attention is paid to how work is actually organised – noting its unsuitability for outsourcing to developing economies (Reich 1991). Reich

(1991) too,3 expects that this new class will achieve prosperity, leaving those outside it to languish. Their earning capacity also attracted the label ‘gold-collar’ workers (Kelley,

1985, 1990; Roe, 2001). More exaggerated claims for the ‘new economy’ are seen in

Leadbeater (1999) asserting that the ‘new economy’ would make possible living on

‘thin air’, as its driving forces (finance, knowledge and social capital) are all intangible in a changing world. Amidst these general claims Leadbeater (1999) identifies the increased value of trust to the ‘knowledge-driven economy’, while at the same time identifying the increasing elusiveness of trust in workplaces:

“Why should trust be of particular value in the knowledge-driven economy? Trust has become so valuable because we need it more and yet it has become more elusive: demand has gone up while traditional sources of supply have contracted. Trust has become more important because it fosters the co-operation and risk-sharing that promote innovation and flexible responses to change in a global economy…Yet trust has become harder to sustain, precisely because there is so much upheaval and change, which threatens the settled relationships which breed trust in the first place.” (Leadbeater, 1999:152)

He adds to this the social advantages of trust as a general organising principle, concluding that “Trust and mutuality should become stronger organizing principles in our societies as they become more dependent upon knowledge creation.” (Leadbeater,

1999:167, emphasis added).

3 Influenced by Mills (1951) and Zuboff (1988). Page| 31 Chapter 2 |Literature Review

However, Leadbeater’s (1999) understanding of trust is ill-defined - ranging from the buses arriving on time to trust in his wife:

“Trust is one way to achieve co-operation but it is not the same as cooperation… Trust has properties akin to knowledge… Trust can be embodied in a relationship with a person, or disembodied – when we trust rules, policies or procedures” (Leadbeater, 1999: 158-59).

In a similar vein, Kelley’s (1985) vision illustrates this utopian view of knowledge- based workplaces with a heavy reliance on trust:

“The gold-collar worker does not rise so readily to such Pavlovian bait [usual management systems]. They respond better to trust and truth... What’s the role of the leader? It’s to create a vision, not to kick somebody in the ass. The role of the leader is the servant’s role. It’s coming out with an atmosphere of understanding, trust, and love.” (Kelley, 1985:110-11, emphasis added)

Kelley’s focus on trust and autonomy will be drawn out further (in Section six), and linked to related theoretical elements of the social fabric at work – communication, consultation, and participation. For he claims “…gold-collar workers want access to relevant information, consultation, and true (rather than token) participation in management decision making” for “ if companies are going to make competitive gains, management must make their organizations more trusting and trustworthy” (1990:111).

A recent Polish study of computer programmers argues this level of commitment is now required of knowledge workers (Jemielniak, 2012:89).

Scholars from a more critical perspective view point to key flaws. First, many

‘knowledge worker’ jobs are routine, often little more than ‘data workers’ with low levels of autonomy (Greenbaum, 1976, Warhurst and Thompson, 1998). Thus they contribute to organisations in the same manner as ‘traditional’ employees subject to control in creating value via management-designed, routine jobs. Indeed, many point to an emerging polarisation in knowledge work as indicating its similarity to conventional work (Warhurst and Thompson, 1998; Sewell, 2000; Alvesson, 2004). These issues are not new, the same problems applied in theoretical debates about the management of Page| 32 Chapter 2 |Literature Review

‘professional workers’, difficulties of definition and attribution of characteristics

(Collins 1998). Indeed an important debate in the literature deals with the differing perspectives on control versus autonomy and the utilisation of theoretical knowledge.

1.1 Ownership Of The Means Of Production ______

There are both conventional and marxian theories on the ownership of knowledge as a means of production and its significance. In the former view, “[t]he comparative advantage [of firms] that now counts is in the application of knowledge” (Drucker,

1994:64). But who owns this knowledge? Over time the increasing importance of knowledge as an individual possession is seen to support the theory that workers

“control their own production” (Mandt, 1978:140). For Despres and Hiltrop:

“The knowledge carried by the employee becomes a real and controlling resource, perhaps a decisive factor of production, but it remains with the employee and in no real sense is it ever of the firm. . . it is impossible to separate knowledge from the knower” (1995:11, emphasis added).

Similarly, Zand (1997:23) represents knowledge workers as owning the means of production: “Knowledge is in people’s heads; it is elusive, difficult to access, and nonlinear”, a view echoed by Drucker (1998, pp. ix–x): ‘‘knowledge workers, unlike manual workers in manufacturing, own the means of production: they carry that knowledge in their heads and can therefore take it with them’’

These optimistic, even utopian, theories of the nature of ‘ownership’ in knowledge work hardly went unchallenged. From a marxian perspective, Ehrenreich and Ehrenreich

(1977) theorise the new ‘professional-managerial class’ as consisting of:

“…salaried mental workers who do not own the means of production, and whose major function in the social division of labour may be described broadly as the reproduction of capitalist culture and capitalist class relations’ (Ehrenreich and Ehrenreich, 1977:7, emphasis added).

Page| 33 Chapter 2 |Literature Review

Thus Ehrenreich and Ehrenreich (1977:17) argue that Drucker’s (1969) theory of the knowledge ‘professional’ is, ‘objectively antagonistic’ to the ‘working class’. A further strand echoes the deskilling thesis (Braverman, 1974, Kraft 1977, Greenbaum, 1979).

From this perspective as Darr and Warhurst (2008:33) note on examining the practice of

‘knowledge management’ “…reveals its task is to separate knowledge from the knower” so that it is no longer individual property but “…made explicit and collectivized…and then centralized in pursuance of the organization’s strategic goals”, set by executive management, and owners. Thus the problem for management was seen as ‘knowledge management’: the development of systems for extracting, storing and sharing knowledge, the ‘capital’ of the new economy. The goal is to improve the efficiency of creating, capturing and utilising knowledge (e.g. Ichijo, von Krogh and

Nonaka, 1998; Drucker 1999b). These theories raise questions about the nature of knowledge, which are addressed in Sections two and three below. First, consideration of what knowledge worker theorists say about trust within knowledge-based workplaces is outlined.

1.2 Trust Within Knowledge-based Workplaces ______

As pointed to above, there are consistent, if sometimes implicit, theories about the qualities of ‘social relations’ seen as essential for eliciting knowledge, covering dimensions such as: cooperation, communication, commitment, loyalty, mutuality and similar ‘social’ conditions. The role of ‘trust’ is central. Where trust arises in the early literature, it is part of a range of assumptions about the employment relationship, or is very broadly stated. More recently, research around knowledge-based workplaces have emphasised that as work moves away from routines and,

“…towards more creative, information and people-focussed activity involving intellective and social skills [it] is associated with higher levels of ambiguity and uncertainty. This in turn leads management to cede more control over the work Page| 34 Chapter 2 |Literature Review

process to employees and requires strategies to ensure reciprocated trust” (Frenkel, et al, 1995: 786, emphasis added)

For example, Bell (1973) saw relationships and communication as central to the new working relationship, clearly implying high trust.

As noted previously, Drucker (1979) identifies the new challenge of managing knowledge workers as “a far more demanding task [where] productivity and achievement are difficult to define and measure …. The knowledge workers are new.

They are the successors to the skilled workers.” (Drucker 1979: 12). It is argued here that this new challenge has not been sufficiently delineated. Within ten years Nomikos

(1989) opined that by not managing knowledge workers, expectations of autonomy emerged leading to some resistance, rather than trust:

“The problem is, it has been implicitly assumed that the knowledge worker does not need and does not want to be managed or led and, therefore, has been left alone. These workers have been taught to resist management intervention, and management believes that they, in turn, should not be managed: They are responsible and trustworthy enough to produce without overt supervision.” (Nomikos, 1989: 171, emphasis added)

Similar claims are made regarding trust in organisations, as Thite4argues,

“Since voluntary cooperation is the only way to unlock tacit knowledge, it is obvious that only organisations that are known as trust worthy and fair can persuade knowledge workers to share their experience and promote innovation. These organisations become ‘employers of choice’ amongst the highly networked knowledge workers. To recruit and retain best talent, organisations not only need to be high performing, but also seen to be of high character, credibility, integrity and value-driven.” (Thite, 2004: 55, emphasis added)

Another theory of knowledge-based workplaces that adopts the conventional view ignores the tension between eliciting knowledge, through trust and comparative autonomy, versus control and utilising knowledge. For Amar (2002:xii, emphasis added) the “main theme of the management of knowledge organizations is how to make employees think, research, and apply – how to make them innovate and create”.

4 referring to Smith and Kelly, 1997 Page| 35 Chapter 2 |Literature Review

Accordingly the objective of his book is to assist managers in utilising their

“employees’ knowledge and [to] get the most innovation and highest productivity for the organization”. Finally, (Amar, 2002) argues for workplace conditions as a ‘honey trap’ making it difficult for knowledge workers to stop working or leave an organisation:

“Knowledge organization managers’ goals are to redesign knowledge work so that a worker runs into it rather than away from it. The worker should find it hard to stop working while doing this job.” (Amar, 2002:67-68)

Trust is also a theme within the knowledge management literature, focussing more on knowledge exchange and therefore the eliciting or capturing knowledge, highlighting the potential contradictions. The links between trust and knowledge exchange are clear to Levin and Cross, 2004:1486)5: “benevolence based trust improves the usefulness of both tacit and explicit knowledge exchange, competence-based trust is especially important for tacit knowledge exchange” (Levin and Cross, 2004:1486).

It is argued here that three, often conflated, themes can be identified in the treatment of trust in the knowledge-based workplace: firstly, an assumed (positive) connection between trust and knowledge work, often without clear definitions for either; secondly, trust is assumed to be interpersonal, alterable by managers and connected with implied antecedents and outcomes; thirdly, that trust un-problematically assists in knowledge capture and/or profiting from knowledge. For example, Davenport’s (2005) Thinking for a Living. First the strong link between trust and knowledge work is simply stated:

“knowledge work is invisible and based on trust,” (2005:44, emphasis added).

Davenport’s discussion then uses trust in different but inconsistent ways. The definition of knowledge workers is circular: “knowledge workers are those whose jobs are

5 They label it knowledge transfer citing Andrews and Delahay (sic) (2000), Penley and Hawkins (1985), Tsai and Ghoshal (1998), Zand (1972) Page| 36 Chapter 2 |Literature Review particularly knowledge-oriented…apply[ing] those expert workers in jobs whose primary purpose is to create, distribute or apply knowledge” (2005:24). Second,

Davenport assumes that trust is interpersonal and linked to a manager’s behaviour:

“Doing what you say you will do not only gets your work done, but also allows people to rely on you to come through.” (2005:154). This proposition is accompanied by a prescriptive list of assertions around autonomy, intelligence, unstructured work, and affective commitment in knowledge-based workplaces. Third, Davenport suggests that doing what you say you will do “…also builds trust critical for knowledge transfer”

(2005:154).

Just as Amar (2002) and Davenport (2005) see affective commitment as a desirable outcome of trust for knowledge-based workplaces, others argue that reciprocity also emerges as “[c]ollective trust strengthens obligations and expectations.” (Hoffman,

Hoelscher and Sherif, 2005:97 emphasis added). Finally, Shuaib’s (2008) managerial prescriptions clearly draw links between the various employment conditions: trust, commitment and organisational outcomes:

“managing knowledge workers is how to earn their loyalty for the organisation. Loyalty translates itself into commitment at work. Commitment is the key to success. The best way to gain their loyalties (sic) is to have full trust in these workers which will in turn boost their morale and result in better performance.” (Shuaib, 2008:124 emphasis added)

These prescriptions however, overlook the theoretical claims of Frenkel et al (1995:

788), in that: “[m]anagement may deliberately or, more likely, inadvertently fail to satisfy worker expectations regarding work and employment conditions.” They see that the new economy is characterised by rapid change and restructuring, and therefore employers cannot offer employment security – a major component of a ‘trusting’ employment relationship. Employers cannot offer long-term employment (strongly contributing to the elicitation of discretionary effort), and the knowledge held by

Page| 37 Chapter 2 |Literature Review symbolic analysts is highly transferable (Frenkel et al, 1999:101). From this perspective therefore, knowledge workers are less dependent on individual employers for their fortunes (Frenkel et al, 1999:232), and employers have to entice discretionary effort by other means. This theory of the knowledge-based workplace requires a ‘new psychological contract’ (Frenkel et al, 1999:11), attempted primarily through increasing

‘employability’ via employee development.

While the link between trust and knowledge work is pervasive in the literature, only in

2001 did Adler offer the first theoretical discussion of trust and knowledge work. He makes three important theoretical contributions. Firstly, proposing a trust based type of economic organisation - the ‘community’ form – adding to Coase’s (1937) original

‘market’ and ‘hierarchy’ forms. In essence, trust is extracted from the social milieu of the ‘clan’ (see Ouchi, 1980) and elevated to a vital principle of the ‘knowledge economy’. Secondly, Adler emphasises that “…trust has uniquely effective properties for the coordination of knowledge-intensive activities within and between organizations.” (Adler, 2001: 215-16, emphasis added). Finally, his third point flows from the above, that “…given a broad consensus that modern economies are becoming increasingly knowledge intensive, the first two premises imply that trust is likely to become increasingly important in the mechanism mix.” (Adler, 2001:216). Important and largely unanswered questions remain in the knowledge work literature: what is

‘trust’ within knowledge-based workplaces? and, accepting its claimed importance, what are the antecedents and outcomes of trust within knowledge-based workplaces?

In sum, this section has established that a number of ‘knowledge worker’ theorists claim a crucial role for ‘trust’ in knowledge-based workplaces, but that it is largely undefined and unexamined. A conventional view optimistically sees the increased demands for

Page| 38 Chapter 2 |Literature Review knowledge work as heralding a new era of ‘enlightened’ management, implicitly placing considerable importance on vertical relations in such organisations. This familiar tale, told in a variety of contexts, is extensively criticised by critical theorists, drawing on experiences of actual workplaces, and suspicious of prescriptive abstractions. Yet even scholars inclined to an optimistic reading of events raise questions. Frenkel et al (1999), is illustrative, accepting ‘trust’ as important for knowledge-based workplaces, yet recognising providing conditions for the generation of ‘trust’, as problematic6. Inherent tensions exist between trust and utilising knowledge, and between knowledge worker autonomy and management control.

Similarly, competitive pressures undermine the very conditions required for trust. This implies the need for a theory of the circumstances, antecedents, and consequences of

‘trust’ in knowledge-based workplaces. Two important questions have been uncovered at this stage in the review:

 what is ‘trust’ within knowledge-based workplaces? and;

 what are the antecedents and outcomes of trust within knowledge-based

workplaces?

Determining the antecedents and outcomes of trust in knowledge based workplaces can be assisted by considering workplaces more generally. Dirks and Ferrin (2002) offer a theoretical framework of the development and consequences of trust, based on a meta- analysis of the trust literature. The analysis considered 106 independent samples reported in the literature, containing 27,103 individual responses. However, before reviewing such theory and research from beyond the knowledge work literature, and adopting definitions, it is important to take a closer look at the concept of ‘knowledge’ and its role in the debates around knowledge work.

6 One example provided is the prevalence of change, as will be discussed in Section five Page| 39 Chapter 2 |Literature Review

2. SECTION TWO: KNOWLEDGE AS THEORETICAL: DEFINING KNOWLEDGE ______

As the section title implies, ‘knowledge’ is capable of a number of conceptualisations.7

The theory of the knowledge society posits that increasingly knowledge-intensive production sees those working with knowledge – or ‘knowledge workers’ – increase in economic and social significance, moreover they enjoy employment advantages accruing from their centrality to the production process (or, as mentioned earlier, their

‘ownership’ of an embodied ‘means of production’ – namely knowledge). Finally to elicit and capture economic value from such ‘knowledge workers’, management is bound to cultivate ‘trusting’ relationships with them. The aim here is not to analyse extensively all conceptions of knowledge, but to acknowledge and recognise them, and briefly chart their relation to developing a theory of ‘trust within knowledge-based workplaces’.

It is illustrative to begin with the embodied conception of knowledge (held exclusively in individual minds). This view is contested in epistemology by contemporary and managerialist versions of knowledge management (e.g. Nonaka and Takeuchi, 1995), in the critical skills recognition literature (Hampson and Junor, 2010), and by labour process theorists. The latter point to the process of controlling labour through deskilling or ‘Taylorising’ – that is, capturing the knowledge (or the broad ‘conception’ of work) that is held by workers and making it the property of management. This form of

‘knowledge capture’ involves unceasing analysis and continuous standardising of work

(leaving only ‘execution’ to workers), with the process extending to the conditions of knowledge work. While Taylorist management of work initially applied to manual

7 For example the influential writer Nonaka (1994) asserts that “Knowledge is a multifaceted concept with multilayered meanings” (Nonaka,1994:15), yet adopts the classical definition of ‘justified true belief’, focusing particularly on the process of justification for individual beliefs and aspiration for the truth. Page| 40 Chapter 2 |Literature Review work, the rationalising trajectory applies to work arising from applying scientific and technical knowledge. As illustrated in Barrett’s (2005a) collection of qualitative research in IT, it brings new challenges for social relations in the workplace (e.g.

Barrett, 2005b). Management increasingly seeks to balance innovating with business imperatives, with techniques of specifying and automating work, goal-setting, and appraisals deployed to capture knowledge (Barrett, 2001:29-31; Barrett, 2005a).

Correspondingly, as new forms of work relations, more complex features of

‘knowledge’, where it resides, how it can be shifted and captured all lead to the question

‘what is knowledge’?

That knowledge is predominantly theoretical is one of the key themes in the knowledge work debates. But even in its own terms, this view is problematic. From Plato’s formulation, knowledge is an intellectual task (‘knowing that’, in subsequent formulations – e.g. Ryle, 1949) and involves working with abstract and generalisable ideas. Nevertheless knowledge must incorporate manual elements, if it is to have physical effects. So it entails tasks associated with deploying practical knowledge and even technical skills (Welbourne, 2001: 7-8; or ‘knowing how’, Ryle, 1949). This tension persists in the literature in varying guises. Some draw a hard distinction between knowledge and physical work as separate concepts (e.g. Drucker 1969). From this view knowledge work is purely theoretical and abstract, as Reich states:

“Symbolic analysts solve, identify, and broker problems by manipulating symbols. They simplify reality into abstract images that can be rearranged, juggled, experimented with, communicated to other specialists, and then, eventually, transformed back into reality.” (Reich, 1991:178)

Page| 41 Chapter 2 |Literature Review

Acknowledging that all work has a mental component, Cuvillier (1974: 292-293) uses training to distinguish ‘intellectual work’ from ordinary work because “the mind must first be trained, by dint of protracted study, to deal with abstract ideas.”8

However, this ‘theoretical’ view of sharply separating theory from other work is challenged by those arguing for a more comprehensive conceptualisation. These include the theory of knowledge as residing in ‘communities of practice’ (Brown and Duguid,

1991; Lave and Wenger, 1991) and in other forms of collectivity – as in the notion of

‘collective competence’ (Sandberg, 2000), and ‘work process knowledge’ (Boreham et al, 2002). In these, ‘theory’ is essentially embedded in all practice, and reciprocally the latter is inherently informed by theory.

Accordingly the conventional view sees knowledge as utilised or commoditised (Bell,

1973, 1978), others view both elements – theoretical knowledge and technical expertise

- as ‘axial principles’ of post industrialism (Blackler, Reed and Whitaker, 1993).9

Castells (1996) adopts Reich’s (1991) the language of symbols in assuming knowledge to be theoretical and abstract. Following Bell (1973), he argues that a ‘knowledge’ driven technological revolution is reshaping the material basis of society.

“In the new, informational mode of development the source of productivity lies in the technology of knowledge creation, information processing, and symbol communication... However, what is speciﬁc to the informational mode of development is the action of knowledge upon knowledge itself as the main source of productivity.” (Castells, 1996:17)

More pointedly from more recent writers, “Theoretical knowledge rather than labour is becoming the new source of added value and growth, a new wealth of nations” (Flood and Turner, 2001:1152).

8 Cuvillier (1974:292) argues that “[a]ll human activities, including the so-called manual ones, have a mental component…”, but immediately distinguishes ‘intellectual work’ thus preserving the dichotomy. 9 Drucker’s later writing again follows Bell (1973, 1978), reiterating the linking of data, information and knowledge, asserting that: “Information is data endowed with relevance and purpose. Converting data into information thus requires knowledge. And knowledge, by definition, is specialized” (Drucker, 1988: 4). Page| 42 Chapter 2 |Literature Review

Against this, there are a number of cross-cutting and complementary perspectives around Ryle’s (1949) ‘knowing that’ and ‘knowing how’ (or abstract and practice approaches). Spender’s (1994: 393) matrix shows the alternative conceptions of knowledge – set out in Table 2.1 – where each type can be found in a myriad of workplace combinations.

Table 2.1: Spender’s Knowledge Matrix Site of Knowledge Social Individual Type of Explicit Scientific Conscious Knowledge Taken for granted Collective Nonconscious

The two dimensions are, the site, and the type of knowledge – respectively categorised as social and individual, vs explicit and taken for granted, or nonconcious or ‘tacit’. On the popular understanding of knowledge, as explicit and codified, knowledge may reside in scientific literature and in individuals’ conscious minds. The taken-for-granted type arises from Polanyi’s (1958) famous statement that ‘we know more than we can tell’. This elegantly points to a person’s wealth of ‘knowledge’ or capability, which remains ‘tacit’, that is unarticulated, or even unconscious. An ‘opposing’ kind of knowledge underlies this thesis - explicit conscious knowledge of the theoretical and abstract kind, which is individual or social. For example, a production manual, or an individual’s memory of a production manual, or a computer program and may incorporate applied elements. Yet it is acknowledged that ‘knowledge’ may also be collective, and non-conscious. Although interesting, it is not the subject of this dissertation. It is noted here that to assist in reflecting the various views of ‘knowledge’ as it exists in ‘knowledge worker’ literatures as illustrated by Nonaka and Takeuchi

(1995).10 As will be discussed in more detail below, individually held tacit knowledge

10 These writers discuss the process by which individually held, tacit knowledge is converted into explicit and social, then tacit, knowledge held by a collective. The process of converting conscious knowledge Page| 43 Chapter 2 |Literature Review may become the ‘property’ of the organisation by its capture as collectively held knowledge through modelling, social learning – or by a process of converting back to conscious explicit (public, social) knowledge, then, through practice, into organisational routines (e.g. Nelson and Winter, 1982, Senge, 1990; Nonaka, 1994). Similarly, Brown and Duguid (1991) see knowledge as communal and oppose the idea that it is purely abstract, in reprising Orr’s (1986) study of photocopier repair technicians. Instead, they seek to combine the concepts of learning, working, innovating – and identity construction.

While these concepts are certainly of interest, as indicated above they lie outside the scope of this thesis in developing a theory of the conditions of trust, in knowledge-based workplaces. And, notwithstanding a conception in which all work contains knowledge, and all work is therefore knowledge work, Alvesson (1993) makes the point that the conceptions of knowledge work and knowledge intensive firms can become so broad that they capture “...everything and nothing” (Alvesson, 1993: 1012).

For Blackler (1995), abstract knowledge is given a “privileged status” because in “…the organizational learning literature a number of commentators have emphasised its importance" (Blackler, 1995:1023). He generates a more dynamic model: "Rather than regarding knowledge as something that people have, it is suggested that knowing is better regarded as something that they do" (Blackler, 1995:1023). Blacker also examines conceptions of knowledge in the organisational studies literature, categorising knowledge as: ‘embrained’ where dependent on conceptual and cognitive ability;

‘embodied’ when only partly explicit; ‘encultured’ when achieving shared understanding; ‘embedded’ when residing in routines; and ‘encoded’ when conveyed by

into tacit knowledge is a process of learning which, in the case of the individual converts propositional knowledge (where is first gear?) to unconscious (tacit) knowledge (muscle memory) (e.g. Dreyfus and Dreyfus, 1986; Shuell, 1990). Page| 44 Chapter 2 |Literature Review signs or symbols (Blackler, 1995:1023-1025). Using these terms, this thesis inquiry is concerned with a conception of knowledge worker deploying knowledge as ‘encoded’, and potentially also embrained’. As the understanding of knowledge is contested, so are the terms knowledge work, knowledge worker and knowledge-based workplace. In the next section, the definition of knowledge work is considered.

3. SECTION THREE: DEFINING KNOWLEDGE WORK, KNOWLEDGE WORKER AND KNOWLEDGE-BASED WORKPLACES ______

Having explored key themes in the KWT, we now turn to closely examining definitions, drawing attention to issues flowing from conceptual difficulties in the widely used

‘knowledge work’ and ‘knowledge worker’ concepts. There are different definitions of

‘knowledge’ and therefore of ‘knowledge worker’, which, Blackler et al. (1993) identify. They also identify a number of ‘definitional possibilities’ beginning with the

(conventional) view of knowledge workers as a ‘highly qualified elite’ (e.g. Richman,

1994) or ‘the strategic core’ of an information society (Blackler et al., 1993:858).

Blackler et al. (1993) then contrast the other (critical) concerns in the literature with

‘occupational control strategies’ and ‘knowledge work as a discourse’ (Blackler et al.,

1993:858). These tensions between the different theoretical and methodological approaches are apparent in the literature.

Many of the definitions reflect the same challenges highlighted earlier: differences of philosophy and categorisation around the nature, context and site of knowledge. Many use census based occupations of ‘professional’ or a similar approach (e.g. Raelin, 1986;

Reich, 1991; Cortada, 1998; Jarenpaa, and Beers, 1996; Pyoria 2005). Some of the different ways of identifying knowledge workers have more recently included: levels of education (Davenport, 2005), occupational categories (Fauth and McVerry, 2008) and

Page| 45 Chapter 2 |Literature Review types of work (Dankbaar and Vissers, 2009). Early critics of this approach (e.g.

Warhurst and Thompson, 1998) stress the need to examine the actual use of knowledge in the workplace, rather than proxies such as occupation, as the latter often include routinised ‘data workers’, not knowledge workers.

As identified in Section two, the debate over definitions also encompasses the debate about possession of knowledge as collective (Nelson and Winter 1982; Brown and

Duguid, 1991), or individual knowledge as ‘embedded’ (Blackler 1995). The narrower concept assumes knowledge is as an individual possession, a means of production and something that can be lost to another organisation (Zand, 1997; Frenkel, et al., 1999).

The disadvantage of the narrow definition is that it overlooks the concept of tacit knowledge, particularly between workers (called by Frenkel et al, 1999, ‘horizontal relations’), which also rely heavily on trust, for the sharing of knowledge and include trust. More recent research has shown that there can be differing levels of expertise within categories previously considered as entirely the domain of knowledge workers, suggesting there is little difference from traditionally understood technical work

(Fincham, 2006; Marks and Scholarios, 2007).

On the other hand, an expansive concept of ‘knowledge worker’ has difficulties in excluding any components of knowledge (e.g. Davenport 2005). Major theorists such as

Senge (1990) and Nonaka (1994) draw on Polanyi’s (1958) ‘tacit knowledge’ in linking multiple skills and abilities, such that every workplace is knowledge-based. Alvesson

(1993) and Kelloway and Barling (2000) make the significant observation that if knowledge worker is defined so broadly that every worker is a knowledge worker, then the term becomes meaningless (Kelloway and Barling 2000). As Fleming, Harley, and

Sewell (2004:729) put it:

Page| 46 Chapter 2 |Literature Review

“As the concepts of the knowledge worker and knowledge management have become increasingly fashionable some research has defined knowledge so broadly that practically every worker now belongs to the knowledge workforce.”

Yet, on closer consideration, unique knowledge used in successful implementation may constitute knowledge work in itself. As Despres and Hiltrop (1995) identify in their definition of knowledge work:

“...systematic activity that traffics in data, manipulates information and develops knowledge. The work may be theoretical and directed at no immediate practical purpose, or pragmatic and aimed at devising new applications, devices, products or processes.” (Despres and Hiltrop, 1995:12, emphasis added).

Crucially, this definition encompasses pure, and applied (pragmatic) theoretical knowledge. This may be illustrated by the contrasting knowledge bases of software engineers and a chief information officer. In short, the narrow/expansive tension reflects the two distinct trajectories of the view of knowledge noted earlier, based largely on the abstract and practice elements found in theories of knowledge. It is proposed here that this research focuses on theoretical knowledge in these two domains. A definition offered by Warhurst and Thompson (2006:787) encompasses these dimensions:

“The central characteristics of knowledge work are that it draws on a body of theoretical (specialized and abstract) knowledge that is utilized, under conditions of comparative autonomy…”

This is the definition of knowledge work adopted in this thesis. This definition accords primacy to theoretical knowledge but recognises its utilisation or application (see also

Drucker, 1994). Moreover, the definition recognises that in practice these dimensions require comparative work autonomy.11 From this definition, the definition of knowledge worker is ‘a person who undertakes knowledge work’ and the definition of a knowledge-based workplace is ‘those workplaces in which knowledge work is performed’.

11The role of comparative autonomy is noted by Thompson, Jones and Warhurst (2007:636) where musicians “self-manage their own creativity but within a framework whereby production and business managers set the terms of access to resources and influence and ultimately to the market-place. Page| 47 Chapter 2 |Literature Review

This section detailed contested understandings of ‘knowledge’, ‘knowledge work’,

‘knowledge worker’ and ‘knowledge-based workplace’, particularly in the claims of the conventional literature. It has shown the tension between knowledge as theoretical

(abstract and codified) and knowledge in context (practice and tacit). The section has also traced the debate about this new category of worker and shown that there are competing views of the knowledge-based workplace. From the conventional perspective, posed the problem of how to manage the new workers, and how to elicit the knowledge they possess. From the critical perspective, knowledge work is often routine, belying the claims of complexity and novelty (Barrett, 2005a), with less mobility than claimed (Donnelly, 2006).

These debates lead to differing theories of the knowledge-based workplace. The conventional KWT envisions a climate of high worker trust in managers, vital for managing the ‘new’ workers and eliciting knowledge for economic value. This will be discussed in more detail in Section four. From this view, high trust is associated with other positive features of workplace social relations, such as autonomy, communication and participation, which will be discussed in more detail in Section five. From the critical perspective, attempts by managers to control workers, and to capture or codify worker’s knowledge are part of deskilling, which diminishes autonomy and skill, leading to lower worker trust in management.

Page| 48 Chapter 2 |Literature Review

4. SECTION FOUR: TRUST AND THE KNOWLEDGE-BASED WORKPLACE ______

Section 1.2 above has shown the centrality of ‘trust’ in conceptions of the knowledge- based workplace. However, as noted earlier, little attempt is made to draw on or apply the theoretical developments from other disciplines to knowledge-based workplaces.

This section reviews this literature, particularly ‘soft’ strategic human resource management and social psychology, to chart a theory of trust within knowledge-based workplaces. It will be argued that ‘soft’ management practices are implied or included in the literature to assist in resolving the tension between worker autonomy and management control identified in preceding sections. Similarly, the importance of trust in eliciting knowledge compared to capturing knowledge is discussed. Equally, the external environment may undermine trust – in particular, where management is unable to offer long-term security of employment, nor certainty in work. Paradoxically, conventional claims about knowledge workers may not be dependent on such certainty, with some workers perhaps preferring transient and instrumental employment relations.

In this light, one may expect considerable theoretical discussion of, and research into the antecedents, contexts and consequences of ‘trust’ in knowledge-based workplaces.

This thesis seeks to address this important gap in theoretical development.

Accordingly, the next sub-section first reviews ‘trust’, from the ‘soft’ HRM perspective, then discusses relevant theories which extend this perspective to knowledge-based workplaces. This is a precursor to examining the theories on trust in the workplace from other disciplines. The section establishes that the literature on trust within knowledge- based workplaces is fragmentary, with inconsistent theories and contradictory claims and belies the grand assertions about the importance of trust for knowledge-based workplaces. What is needed is to concentrate on specifying details of employee trust at

Page| 49 Chapter 2 |Literature Review work – particularly towards their immediate manager and towards the organisation as a whole. This section accordingly goes on to develop a definition of trust applicable to knowledge-based workplaces.

4.1. Trust In the ‘Soft’ Human Resource Management Literature ______

The previous discussion about trust within knowledge-based workplaces (Section one) emphasised the challenge of managing these ‘new’ workers, what Frenkel et al. (1999) call ‘vertical relations’ between workers and management. The emphasis on trust, is also reflected in research which indicates the need for trust rising, as formal authority declines (Hodson 2004; Frenkel and Orlitzky, 2005; Levin and Cross, 2004). Trust is also considered important between knowledge worker peers, or ‘horizontal relations’

(Frenkel et al. 1999), where interpersonal relationships and effective communication are

“continually identified by case studies to be critical in maintaining trust between partners and encouraging learning” (Dodgson 1993:91). Tsai and Ghoshel’s (1998:473) empirical study confirmed that “… social interaction and trust were significant determinants of resource exchange/combination.” Further studies by Andrews and

Delahaye (2000: 797, emphasis added) report “an unanticipated finding, [that] micro- processes emerged as highly influential, with individual perceptions of approachability, credibility and trustworthiness [of peers and managers] mediating knowledge importing and knowledge sharing activities.” Here the authors importantly include peers and managers, concluding:

“The role of trust was seen as central: without trust, regardless of any formal knowledge-sharing requirements in place, scientists would not share knowledge.” (Andrews and Delahaye, 2000:804)

Research by Newell and Swan (2000:1323) similarly emphasises the importance of trust in collaboration across firms, noting that developing different kinds of trust is vital, and correspondingly, the “result of [a] failure to develop trust is likely to be a mechanistic Page| 50 Chapter 2 |Literature Review pooling of knowledge, rather than joint knowledge production”. Significantly the crucial role of trust extends to peers and managers, yet the mainstream12 literature sees knowledge as a resource to be managed and controlled (Swan and Scarbrough, 2001).

Some exhort organisations to use HR policies to generate trust to capture knowledge:

“[t]rust and fairness are at the very heart of knowledge management…” requiring “an

HR philosophy that ‘restores people to the heart of organisation’.” (Thite, 2004:54 emphasis added).

Critics note that the act of capturing or codifying knowledge can in itself diminish trust

(e.g. Kitay, 1997; Kitay and Wright 2004). As alluded to earlier, there is a body of theory that sees the codification of knowledge as a precursor to deskilling and increased management control (Braverman, 1974, Kraft 1977, Greenbaum, 1979). Mainstream theorists solve the problem for management by the development of systems for capturing sharing knowledge, the ‘capital’ of the new economy. From this perspective the goals are improving efficiency in creating, capturing and capitalising on knowledge

(e.g. Ichijo, von Krogh and Nonaka, 1998), and thereby maximising the productivity of human ‘capital’, albeit while allowing the autonomy needed for the creativity inherent in knowledge development. These themes resonate in ‘soft’ HRM theory, as does the language of competitive advantage:

“In our view, the central competitive dimension of what firms know how to do is to create and transfer knowledge efficiently within an organizational context” (Kogut and Zander, 1992)

And similarly, Drucker’s (1994: 63) concern that the “comparative advantage that now counts is in the application of knowledge” Broadly, ‘soft’ HRM theory asserts that certain bundles of practices increase employees’ knowledge, skills, and abilities and

12 In the ‘soft’ HRM discussion, what we call here ‘mainstream’ is often referred to as ‘managerialist’ Page| 51 Chapter 2 |Literature Review motivation, benefitting the organisation (Becker and Huselid, 1998; Delery and Shaw,

2001; Coombs, Liu, Hall and Ketchen, 2006).

Of particular relevance for this review is the ‘soft’ theoretical perspective in HRM which focus on productive ‘good’ social relations in the workplace. This corresponds to the knowledge-based workplace literature, particularly the exhortation to ensure that employees are trusted, trained and developed, allowed to work autonomously, with high control of their work (Mahoney and Deckop, 1986; Guest, 1987; Hendry and Pettigrew,

1990; Kamoche, 1994; Purcell and Ahlstrand, 1994; Tyson, Witcher and Doherty, 1994;

Colbert, 2004). This is then said to deliver highly committed workers and improved organisational performance (Dunham and Smith, 1979; Walton, 1985; Beaumont, 1992;

Guest, 1987; Lundy, 1994; Legge, 1995; Delery & Shaw, 2001). The organisational outcomes are similarly familiar - greater job satisfaction, lower employee turnover, increased productivity, better decision making and therefore improved organisational performance (Becker, Huselid, Pickus and Spratt, 1997; Coombs et al, 2006).

These soft HRM themes are also apparent in the ‘knowledge management’ literature.

Despite the primarily focus on the economic value of knowledge (Swan and

Scarbrough, 2001: 914)13, and therefore the potentially damaging nature of knowledge capture, the literature contains many assumptions of high levels of communication

(Nonaka and Krogh, 2009), trust (Jennex, 2007; Chung and Jackson, 2011), and change

(Ruggles, 1998; Baron, Hannan, and Burton, 2001; Scholarios, Van der Heijden, Van der Schoot, Bozionelos, Epitropaki, Jedrzejowicz, Knauth, Marzec, Mikkelsen and Van der Heijde, 2008) and their inter-relations.

13 The authors commented that interest in debate was “…based, it seems, on only one of the strands highlighted in that issue, namely the view of knowledge as an economic resource” Interestingly, the earlier issue (and forum) critically questioned the notions of ‘knowledge work’ and the ‘knowledge society’ - Special Issue, Journal of Management Studies (1993). This was overtaken by interest in knowledge management (Swan and Scarbrough, 2001). Page| 52 Chapter 2 |Literature Review

This dissertation argues that the expected relationships between these variables, as outlined in the overlap or parallels in the literature, provide a basis for a theory of trust within knowledge-based workplaces. However, knowledge workers need not experience

‘soft’ HRM practices, nor need they view it as positive to have their knowledge captured. Therefore, the assumption of high levels of knowledge worker trust in managers may be questioned. As discussed earlier, the tension between autonomy and control may have an impact on trust, illustrated in Zuboff’s (1988) description of the potential for surveillance. This conflict remains largely unaddressed in the conventional

KWT or ‘soft’ HRM literature. Rather, the focus is on controlling the risks associated with a reliance on (potentially aberrant) knowledge workers (Fuller, 2001).

Critical writers question the expected high levels of participation in decisions, greater communication, and high trust (e.g. Harley, Hyman and Thompson, 2005). Advocates of the broader role of trust (e.g. Adler, 2001), leave tensions of trust and hierarchy theoretically unresolved:

“For trust to become the dominant mechanism for coordination within organizations, broadly participative governance and multistakeholder control would need to replace autocratic governance and owner control – even if hierarchy, in a high-trust form, continued to characterize large scale enterprise” (Adler, 2001: 230, emphasis in the original).

In sum, the understanding of trust in the knowledge work literature is not robust, overlooking substantial interdisciplinary theory and research on trust in other disciplines, such as social and organisational psychology (e.g. Politis, 2003). Given the centrality attributed to trust in knowledge-based workplaces, it is important to consider this work. Developing and testing a theory of trust in knowledge-based workplaces may throw light on the inherent contradictions in advocating trust as central to a strategy aimed at eliciting and capturing knowledge. The strong alignment between trust a

Page| 53 Chapter 2 |Literature Review number of trust antecedents14 and outcomes15 will be covered in more detail after concluding this section on trust.

4.2. Theories of Trust In Other Disciplines ______

The view that ‘trust in management’ is important for organisational performance is widespread, however some important aspects of the relationship remain unclear. Two examples are the relationship between trust and performance, and precisely who trusts whom. Although Rousseau, Sitkin, Burt, and Camerer (1998) developed a broadly accepted integrated definition of trust, Colquitt, LePine, Zapata and Wild (2011) suggest that the literature still has two distinct streams: one exemplified by Mayer,

Davis, and Schoorman’s (1995) model which emphasises the vulnerability aspect of the definition, and the other emphasising the expectations aspect of Rousseau et al.’s

(1998). This sub-section traces the differences in the definitions of ‘trust’.

Differing theoretical perspectives on trust have meant that the definition is much debated in the literature, despite considerable acceptance of Rousseau et al.’s (1998) definition of trust as a

“psychological state comprising the intention to accept vulnerability based upon a positive expectation of the intentions or behavior of another” (1998: 395).

Reviews of the trust literature (Clark et al., 1997; Kramer, 1999; Kramer et al., 1996;

Mayer et al., 1995) identify the lack of a common approach to, and clear definition of, the construct. The abundance of approaches partly reflects differing perspectives of researchers and concomitant differing views of the social bases of trust, where:

“…the model of human nature and/or of social interaction underlying theories, i.e. whether man is primarily seen as a rational egoist, or whether social interaction is viewed as being informed by either moral considerations or by cultural scripts and meaning systems.” (Lane, 1998: 4)

14 participation in decision making and communication in Section six 15 job satisfaction and affective commitment in Section seven Page| 54 Chapter 2 |Literature Review

Accordingly, the number of dimensions used in framing theories of trust vary. Levin

(1999) suggests three dimensions: cognitive trust, affective trust and cognitive-affective trust, others suggesting that trust has cognitive, affective and behavioural bases

(Albrecht & Sevastos, 2000; Clark & Payne, 1997; Cummings & Bromiley, 1996b).

Cognitive Theories: Economic and Psychological Approaches

Turning first to cognitive theories, there are two major approaches to trust (Lewicki,

Tomlinson and Gillespie, 2006), the ‘behavioural (or economic) approach’ which is more calculative, sometimes called an ‘economic’ or ‘cognitive’ approach, and the

‘psychological’ approach which is more interpersonal. The unique aspect of the economic approach is the assumption of rationality, understood in utilitarian terms as

‘calculative’16, choosing that action that is most likely to use the highest ‘utility’ for the actor (Misztal, 1996). For example, Arrow (1974) saw trust as an efficient lubricant for economic exchange. More recently economic trust theorists have tended to favour

Coleman’s (1990) rational choice approach where a rational actor bestows trust, based on an expected gain from reciprocated trust that is higher than the loss threatened by a betrayal of trust.

The assumptions underpinning the economic approach and the rational choice model have been criticised by theorists from the social-psychological perspective. Kramer

(1999) observed that there is substantial evidence to suggest many assumptions of rational choice models are invalid. Specifically;

“…the large and robust literature on behavioural decision making suggests that many of the assumptions of rational choice models are empirically untenable... rational choice models overstate decision makers' cognitive capacities, the degree to which they engage in conscious calculation, and the extent to which they possess stable values and orderly preferences” (Kramer, 1999: 573).

16 Williamson (1993) questions whether trust can be anything beyond a calculative economic relation – addressing risks Page| 55 Chapter 2 |Literature Review

The psychological perspective treats trust as intrinsically individual, and is in that sense similar to the economic approach, where collective trust results from aggregating individual trust.

Affective and Behavioural Theories

A number of scholars have argued that trust needs to be conceptualised as a state that includes affective and behavioural components, not just cognition (Cummings and

Bromiley, 1996; Kramer, 1996; McAllister 1995; Tyler and Degoey, 1996; Lewis and

Weigert 1985; Rempel, Holmes and Zanna, 1985). A fundamental difficulty for the economic approach is the assumption of rationality, because of the argument that trust begins where rational prediction ends, given that trust is only necessary when there is uncertainty (Gambetta, 1988; Lane, 1998; Luhmann, 1979; Zucker, 1986). These theories build on early theories and definitions of trust which defined trust predominantly in terms of feelings (e.g. Gibb, 1964) where Fine and Holyfield

(1996:25) note that trust is affect-based, "one not only thinks trust, but feels trust".

Behavioural intentions are also central to a number of theories of trust (Gillespie and

Mann, 2000; Cummings and Bromiley, 1996; Currall and Judge, 1995; Albrecht and

Sevastos, 1999). Ajzen and Fishbein’s (1980) theory of reasoned action sees behavioural intentions as most proximal to trusting behaviour and therefore intentions are thought to be one of the most important predictors of trust behaviour. This is reflected in Currall and Judge’s (1995:154) definition of trust, as the “willingness to engage in trusting behavior”. Clark and Payne (1997) make an important distinction between trust as an intention, and trust as a behaviour – as discussed below.

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Sociological Theories

By contrast, the sociological theories of trust describe a high level cultural construct or social phenomenon which applies to social wholes rather than at the level of an individual or group (Albrecht, 2001). This theoretical approach was outlined initially by

Garfinkel (1963, 1967) and Luhman (1979, 1988) where trust is a generalised expectancy about others. As such it is “normative” and influenced by the social systems in which people find themselves, illustrated by Fox (1974) in high and low trust dynamism. For Barber (1983:164-65) trust is a set of:

"…socially learned and socially confirmed expectations that people have of each other, of the organizations and institutions in which they live, and of the natural and moral social orders that set the fundamental understandings for their lives".

However, some argue that using such a theory has limited utility for workplaces because “…one cannot identify specific actions a particular party might undertake in order to become more trusted by a given other or others” (Mayer and Davis, 1999:123).

Kramer (1999) describes trust as rule-based, where shared understandings of the rules of appropriate behaviour in an organisation, sustained by socialisation and reinforced through adherence to norms. Therefore, social norms can still play an important part in workplace trust (Albrecht, 2001).

Searching for Definitions

Attempting to overcome these diverse bases of trust, scholars theorising about workplaces have defined trust as “confident, positive expectations” having regard to the trust referent’s conduct, motives and intentions, as well as how trusting may entail risk

(e.g. Roberts and O’Reilly, 1974; Gabarro and Athos, 1976; Cook and Wall, 1980;

Lewicki and Bunker, 1995; McAllister, 1995; McAllister, Lewicki, and Charturvedi,

2006). These expectations create a willingness to act on the words, actions and decisions of the trust referent (Cook and Wall, 1980; McAllister, 1995). On this view,

Page| 57 Chapter 2 |Literature Review knowledge-based trustworthiness grows from past promise keeping, while goodwill- based trust grows from emotional investment and caring, and identification-based trust is rooted in a sense of shared values (Colquitt et al., 2011).

A major alternative definition offered by Mayer et al (1995:712) defines trust as the

“willingness to be vulnerable” to the actions of the trust referent “irrespective of the ability to monitor or control that party”. This definition asks whether trust referents may hold significant influence over the trustors’ working lives (Mayer and Davis, 1999;

Mayer and Gavin, 2005; Schoorman, Mayer and Davis, 2007). Mayer et al (1995) also posited “trustworthiness” as constituting three qualities of the trust referent: ability, benevolence, and integrity. Ability and integrity are the rational aspects of the reasons to bestow trust in the referent, and they grow from past success and consistency between words, deeds, and values (Colquitt et al., 2011:1000). Mayer et al (1995) reason that a person will be willing to be vulnerable to another if the latter is perceived as possessing such trustworthy traits. Similar and consistent themes in the literature are identified by Clark and Payne (1997) where trustworthiness is based on: integrity, competence, consistent behaviour, loyalty, openness and showing respect. Theories positing trust as an intended action (Clark and Payne, 1997; Albrecht and Sevastos,

1999) also highlight a distinction between trust as a state of mind or feeling, and trust as an “overt behaviour” (Clark and Payne, 1997:206).

The importance of viewing trust as a behavioural intention accords with arguments presented by Currall and Judge (1995) and Albrecht and Sevastos (2000), which formally recognise the trustor’s willingness to act on perceptions of others’ trustworthiness. Within this behaviourist view, cognitive, affective and normative perspectives may help outline the trustworthiness rather than trust itself: “It is the

Page| 58 Chapter 2 |Literature Review willingness to engage in trusting behaviour…which defines trust” (Albrecht and

Sevastos, 2000: 36). While it is possible to see Rousseau et al’s (1998) definition as encompassing that of Mayer et al (1995), scholars have pointed out (Colquitt, Scott and

LePine, 2007; Ferrin, Bligh and Kohles, 2008) that this definition itself stresses two key elements – the willingness to be vulnerable and the positive expectations of the intentions or behaviour of the other.

4.3. Definition ______

These key features result in Rousseau et al.’s (1998) definition being the most widely used, especially in workplace-based research. In addition it allows comparisons with other theoretical contributions. The definition contains expectations about the behaviour of another which fits well with the focus on trust in managers and organisations in the other literature discussed in this section. Accordingly, the definition that is adopted for this thesis is trust as a:

“psychological state comprising the intention to accept vulnerability based upon a positive expectation of the intentions or behavior of another” (1998: 395).

This definition of trust as a psychological state implies that the theory proposed at the end of this chapter will deal with individuals within knowledge-based workplaces. It also implies that trust in this thesis be treated as an attitude, and this will become clearer when examining existing theories of the antecedents and consequences of trust. At this stage, it is appropriate to note that this dissertation is proposing an answer to the question: ‘what is trust within knowledge-based workplaces?’ by theorising how trust operates in knowledge-based workplaces. This may be in the same way that it operates in other workplaces (e.g. Dirks and Ferrin, 2002), rather than in a unique way.

Page| 59 Chapter 2 |Literature Review

4.4. Trust Referent ______

In proposing a theory of trust within knowledge-based workplaces, an important research question is who trusts whom, and what impact (if any) does that have. Dirks and Ferrin’s (2002) argued that differing ‘trust referents’ (who is being trusted) can systematically alter the relationships between trust antecedents and outcomes (see also

Ferres and Travaglione, 2003).17 This is also important in the KWT discussion mentioned in Section 1.2. The style of management is important in eliciting and capturing knowledge (Thite, 2004), as is the autonomy granted (Frenkel, et al, 1995) and a manager’s behaviour (Davenport, 2005). Section six will consider the various aspects of management that can contribute to trust in the knowledge based workplace.

Dirks and Ferrin’s (2002) meta-analysis found that the referent operated as a moderator of the relationship between trust and several outcomes: job performance, OCB altruism, job satisfaction, and affective commitment, with direct managers being “particularly important” (Dirks and Ferrin 2002:611). In addition, the relationship between trust and affective commitment was higher when the referent was organisational leadership, as opposed to direct leader.18 The specific workplace circumstances will therefore be important in formulating a theory of trust in knowledge-based workplaces. Therefore, in this dissertation, the proposed theory attempts to identify the different workplace circumstances, including the potentially different impact of trust in an immediate manager and trust in senior management.

This section has shown that there are contested understandings of trust for knowledge- based and other workplaces. In this thesis, both trust in the immediate manager, and

17 recent trust research also stresses that the trust referent is important (McEvily and Tortoriello, 2011) 18 There is a connection here with the KWT, see Shuaib’s (2008) managerial prescriptions, considered in more detail in Section seven, as one example Page| 60 Chapter 2 |Literature Review trust in the organisation, are based on Rousseau et al.’s (1998) definition. Other circumstances of knowledge-based workplaces, such as organisational change and managerial action or lack of action have also been identified as important for a trust within knowledge-based workplaces theory. Now the exposition considers high rates of change, which can be detrimental to trust, as the first of the contextual influences on trust within knowledge-based workplaces.

5. SECTION FIVE: CHANGE ______

In this section, the context for the organisation is considered. As discussed earlier, knowledge workers inhabit an environment of high rates of change. The potentially conflicting demands of increased change and increased trust however, are seldom considered.

5.1. High Levels Of Change ______

In stark contrast to the heated debates about some other aspects of western economies, sociologists generally agree that the rate of change in the economy has increased

(Ehrenreich and Ehrenreich, 1977; Walker, 1978; Gouldner, 1979). However, there is little discussion of the effects on the workplace, the jobs or the employees. Rather much of the debate is focused on the macro economy and society. In the management literature, the early debates about managing change centred predominantly around the organisational development perspective. Perhaps consistent with the era, this literature presented an:

“…ideology of gradualism, for effective change is seen to proceed by small, incremental adjustments. Usually change is seen also as synonymous with growth, and the strategies for organizational change advocated typically involve widespread employee participation to ensure emergent consensus among the key parties affected.” (Dunphy and Stace, 1988:317)

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During the 1990s the consensus fragmented (Buchanan, Claydon and Doyle, 1999) resulting in various perspectives including: organisation development (e.g. Greiner and

Schein, 1988; Cummings and Worley, 1993; French and Bell, 1995), planned change (e.g. Ward, 1994; Eccles, 1994; Burnes, 1996), business process re-engineering

(e.g. Hammer and Stanton, 1995; Oram and Wellins, 1995), and processual or contextual accounts (e.g. Pettigrew and Whipp, 1991; Pettigrew, Ferlie and McKee,

1992). In spite of this fragmentation, the underlying assumption of an increased rate of change remained unchallenged. Dunphy and Stace (1993) responded to the fragmentation of models by providing a synthetic and flexible perspective, grounded on a contingency approach to change. Building on their earlier work (Dunphy and Stace,

1988, 1990), they developed a contingency model (DSCM) where the structure and the performance of an organisation are dependent on the situational variables that it faces

(Dunphy and Stace, 1993, By, 2005). The DSCM shows that there are demands for, and distinctions between collaborative, directive and coercive management of change.19

Despite difficulties in the DSCM of relating structure to performance and the theory’s assumption that organisations and managers do not have significant influence over situational variables (e.g. Burnes, 1996, By, 2005) this treatment of organisational change as an ongoing process is useful for the purposes of examining change within organisations, where many of the situational variables that concern By (2005) will be similar. Therefore, Dunphy and Stace’s (1993) definitions for the scale of change are adopted here. Organisational change is defined as an ongoing process, the scale of which can be identified by various characteristics. Various points on the continuum of organisational change are identified by Dunphy and Stace (1993) and can be identified by their characteristics such as fine tuning, incremental adjustments through to major

19 building on the work of Heller and Wilpert, 1981 Page| 62 Chapter 2 |Literature Review realignments of departments and radical shifts in strategy. It is apparent from the literature that there is broad agreement that high levels of change are a feature of knowledge-based workplaces (Rusly, Corner and Suns, 2012; Peet, 2012). However, as will be detailed further in Section 6.3, in a rapidly changing environment the DSCM suggests that there may not be sufficient time for participation, in which case change may undermine trust.

5.2. Change and Trust ______

An increased rate of change can itself undermine trust, including perhaps the increased rate of change in forms of work organisation identified by Zand (1997).

“Fads increase the sense of uncertainty among both managers and lower-level employees alike and, paradoxically, diminish the chances of success, which requires vision and strategy, and trust.” (Frenkel, et al., 1999:1, emphasis added)

As seen earlier, authors such as Drucker (1959, 1969, 1970), Nonaka (1994), Despres and Hiltrop (1995), and Frenkel et al. (1999) see the future of knowledge work as involving less directive management as a response to greater complexity, and it is also expected that the term ‘manager’ will become less meaningful (Frenkel et al. 1999:276).

This raises another dimension as the role of managers is important in capturing and appropriating knowledge. However, change management theorists expect a knowledge- based workplace to have continuous change while worker autonomy is increasing, and where communication from management is vital (e.g. Blackler, 1995).

Yet little consideration is evident of the potential for change to damage trust (although see Mishra and Mishra, 1994; Mishra and Spreitzer, 1998; Morgan and Zeffane, 2003) particularly where there is frequent structural change (Littler, Dunford, Bramble, and

Hede, 1997). Within the trust literature too there are calls for more research in change situations (e.g. Dirks and Ferrin 2000). Similarly, Morgan and Zeffane (2003:55)

Page| 63 Chapter 2 |Literature Review identified “[f]ew models of organizational change encompass the role of trust in the process of change.” Although a number of studies have suggested that change and trust are linked in various ways (e.g. Butler and Cantrell 1999, Rousseau and Tijoriwala

1999), rapid and frequent change undermine trust: “Trust and associability are most readily created in stable work environments and can be threatened or undermined by change that is too rapid, frequent, or unpredictable” (Leana and Barry, 2000:755). In addition, this may become a cycle of lower and lower trust resulting in poorer organisational outcomes:

“Lowered trust makes it still more difficult to confront management about gaps between what they say they intend to change… and the reality of what is happening as the change unfolds… The inability to confront gaps leads to a further reduction in trust, increased cynicism, and reduced commitment.” (Beer, 2000:432)

Frenkel et al (1999), in studying ‘front line’ service work, observed increased organisational restructuring and nonstandard employment, leading to expectations of decreased job security, and breaches of the psychological contract. However knowledge workers in their study valued job security less than other workers.

Theories and research regarding psychological contracts also suggest that trust may be diminished by change. Where change leads to perceived violations of a psychological contract it can then result in lower trust, lower affective commitment and higher turnover (e.g. Robinson and Rousseau, 1994; Robinson and Morrison, 1995; Robinson,

1996; Millward and Hopkins, 1998; Turnley and Feldman, 1999). The nature of the change is also important as Andersson and Bateman (1997) found that harsh changes can increase worker cynicism which would be important in an environment which is changing frequently. More recently, radical change (such as downsizing) has been shown to have a significant negative impact on trust in management (Tourism, Paulsen,

Holman, & Boride, 2004).

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One suggested way to offset these reactions to change is through employee participation as some empirical research suggests: “Employee participation in the change effort also had a positive impact on trust in management…” (Weber and Weber, 2001:296).

Importantly, Morgan and Zeffane’s (2003) examination of AWIRS data suggested that consultation at different levels within the organisation may have different effects:

“Initially, consultation with supervisors is rated positively by employees for trust, but was not significant in the tests on major change. However, consultation with higher level managers was stronger initially and remained the only positive type of involvement in the major change regressions.” (Morgan and Zeffane, 2003:71)

The possible impact of participation on trust will be discussed in more detail as part of the particular management circumstances in Section 6.3.

In sum, the conventional KWT envisages a high trust environment in knowledge-based workplaces. While there is general agreement that rapid change is evident, neither the conventional nor the critical perspective directly considers the effect on trust. This dissertation argues that a theory of trust within knowledge-based workplaces should consider the high levels of organisational change, and its impact on trust. The thesis now turns to the important trust antecedents implied in the knowledge worker literature and which form aspects of the management circumstances for knowledge workers, including participation in decision making, the perceived character of managers (such as ability, benevolence, and integrity), and communication, which will now be considered in the next section.

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6. SECTION SIX: MANAGEMENT ______

This section argues that, in addition to the centrality of trust for knowledge-based workplaces, the conventional KWT literature expects soft HRM practices. As discussed earlier, this approach is expected to elicit knowledge which can then be used to generate profits. The role of management is crucial to the implementation of practices in the workplace. The tension between the management roles of eliciting knowledge and capturing knowledge, mentioned earlier, implies that any inconsistency in the manager’s behaviour, while trying to balance these competing objectives, could lead to adverse perceptions of management character, poorer communication and participation.

All are likely to lead to lower trust.

The conventional KWT perspective requires high trust, which implies the presence of a number of other factors widely regarded as trust antecedents. However, the critical perspective suggests that there is still a logic and pressure for deskilling:

“There is a consensus, for example, that a shift from manufacturing to knowledge work has occurred in the developed countries of the West, and is beginning to occur in developing countries… Furthermore, there is agreement that a dynamic process of deskilling, upskilling and reskilling is taking place in the occupational hierarchy… Nevertheless, there is also agreement that companies have benefitted from reducing the skill component of jobs, or from eliminating jobs and replacing them with automated systems.” (Mosco and McKercher, 2007: ix)

These pressures also apply to specific workplaces, pressures to ‘deskill’, as well as to

‘reskill’ or ‘upskill’. Similarly, over time it has become apparent that some work formerly called ‘knowledge work’ can be automated or outsourced.20 The phenomenon of outsourcing even small components of work to the ‘lowest bidder’ has become feasible through ‘crowdsourcing’. However, the implications of these changes for the

20 e.g. software development for airline systems has largely moved to India Page| 66 Chapter 2 |Literature Review role of managing knowledge workers, and the tensions it creates for the role of managers, remain largely unexamined.

Dirks and Ferrin (2002:622) argue that “there have been few attempts to determine contextual factors… [of trust]” in spite of earlier studies highlighting the importance of contextual variables for the workplace in general (Podsakoff, MacKenzie, and Bommer,

1996). Clark and Payne (1997:218-19) in considering workplace contextual variables found that increased participation in the change process improves perceptions of honesty and integrity.21 In the knowledge work literature however, scholars seldom consider the theoretical antecedents of trust and those empirical studies that do consider the workplace (e.g. Benson and Brown, 2007) often overlook trust, or fail to define it

(e.g. Frenkel et al., 1999; May, Korczynski, Frenkel, 2002). This section argues that a theory of trust within knowledge-based workplaces should consider widely identified or implied trust antecedents from both the trust and knowledge work literature. These factors are: high levels of participation in decision making (e.g. Bell 1973, Adler, 2001,

Morgan and Zeffane, 2003) and communication (Morgan and Zeffane, 2003).

6.1. Perceived Character ______

This section argues that a manager’s character is a key theme in the trust literature that is largely overlooked in the knowledge work literature. The management literature, particularly theories from an organisational behaviour perspective, contains a clear link between perceptions of honesty, integrity and trust. The perceived character of the immediate manager and senior management shape attitudes and reactions of employees.

The literature strongly indicates that the concepts of trust and character are related and a

21 This statement interprets the study as being carried out in a background of change. The language used by Clark and Payne 1997 is ‘openness’ (called participation in this research) and ‘integrity’, which includes ‘honesty’. Page| 67 Chapter 2 |Literature Review theory of trust within knowledge-based workplaces should include the perceived character of managers. The tension between eliciting and capturing knowledge could impact on perceptions of a manager’s character. This review argues that key concepts of honesty, integrity and doing ‘the right thing’ are dimensions of trust (identified earlier) and are also part of the management circumstances that are called here the ‘perceived character of managers’.

The presence of trust in organisations pre-supposes a number of antecedents as seen in both the management and trust literature. An early example is McGregor (1967: 164), who argued that "[i]nconsistencies between words and action decrease trust". It is at this point that the notion of worker’s perceptions of the character of the manager parallels key components of their trust in management, notably integrity and competence. This also implies a judgement about the correctness of a manager’s behaviour.22 It is reflected in the leadership literature, where leaders should be: trusted, admired, and respected by followers (Bass, 1985). However this does not address the issue arising from unethical and immoral keaders (Giampetro-Meyer, Brown, Browne, and Kubasek,

1998; Parry and Proctor-Thomson, 2002; Yukl, 1998). Ciulla (1988) argues that the important question is not ‘What is the definition of leadership?’ but rather ‘What is good leadership?’ (1998:13)23, where the “… use of the word good here has two senses, morally good and technically good or effective” (Ciulla, 1998: 13).

Sison develops this theory further, suggesting that social capital is morally ambivalent and in order to distinguish the trust present in the Mafia, the notion of character must be introduced:

22 For example, Burns’ (1978) discusses morality in leadership “…leaders and followers raise one another to higher levels of motivation and morality" (1978: 20). 23 arguing that Burns’ (1978) theory implied a ‘good’ leader, Page| 68 Chapter 2 |Literature Review

"Moral capital may be defined as excellence of character, or the possession and practice of a host of virtues appropriate for a human being in particular sociological context. Nowadays, its meaning could also be expressed by the word 'integrity', a trait suggesting wholeness and stability in the person as someone on whom others could depend or rely.” (Sison, 2003:31)

The concept of integrity is used in organisational theory, but is not clearly defined and understood (Rieke and Guastello, 1995). Various aspects have been emphasised: Butler and Cantrell, (1984) and Yukl and Van Fleet (1992) viewed integrity, trustworthiness and honesty as synonymous (Dineen, Lewicki, and Tomlinson, 2006), while Becker

(1998) similarly uses integrity, honesty, and conscientiousness interchangeably. More recently however, Simons’ (2002) developed a model of ‘behavioral integrity’ (BI) by looking at the consistency of behaviour with espoused views. This approach examined

“the perceived pattern of alignment between an actor’s words and deeds” (Simons,

2002:19). In other words, this refers to “the extent to which employees believe a manager ‘walks her talk’, and conversely, reflecting the extent to which they see her as

‘talking her walk’” (Simons, 2002:19). For our concerns here, a manager’s behaviour must balance the eliciting of knowledge and the capturing of knowledge. Inconsistency, as perceived by workers is likely to diminish trust. Therefore, a ‘perceived character’ element is essential to a theoretical model, particularly notions of following words with actions and honouring commitments.

Other aspects of trust theory are relevant too as these notions have an effect on organisational outcomes:

“BI is a key antecedent to trust that describes responses to a wider range of organizational experiences than the psychological contract, but is both conceptually and practically simpler than trust. We assert that BI is highly problematic in today’s managerial environment of rapid competitive, technological, and organizational change, that it has profound consequences for employee retention and performance, and that it has been the subject of little direct empirical research.” (Simons, 2002:32)

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However, there is a need for the broader notion of character with a perceived moral dimension, as Locke (2003) argues:

“…it is widely recognized that trust is an important concept in organizations, but there is rarely any mention of where it comes from. Moral trust comes from an appraisal of the manager's or leader's moral character. For example, to be trusted a manager should be honest” (Locke, 2003:434).

For this reason ‘perceived character’ should include notions of honesty and doing ‘the right thing’. This view intersects well with Dirks and Ferrin’s (2002) theory of

‘character based’ trust focused on the perception of the leader’s character:

“This perspective implies that followers attempt to draw inferences about the leader’s characteristics such as integrity, dependability, fairness and ability and that these inferences have consequences for work behavior and attitudes” (Dirks and Ferrin, 2002:612).

To capture dependability and fairness, ‘perceived character’ should include notions of a manager overcoming difficulties and putting subordinates’ needs before their own. This section has attempted to establish what some of these key qualities may be.

When defining the related concept of integrity, Becker (1998:157-158) suggested an objective definition: “integrity is commitment in action to a morally justifiable set of principles and values…” while Mayer and Gavin (2005:874) suggest a subjective definition: “Integrity is the perception that the trustee adheres to a set of principles that the trustor finds acceptable”. These two approaches are also applicable to the definition of character. Adapting Sison’s (2003) definition of moral capital and Mayer and

Gavin’s (2005) definition of integrity, this dissertation defines perceived character as: the perception that the trustee adheres to a host of virtues appropriate for a human being in the particular sociological context.

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6.2. Communication ______

Strong links between communication and trust, emerged in early management theory:

“Unless mutual trust is a characteristic of the system, the openness of communications (as well as the effectiveness of other aspects of team operation) will be severely limited.” (McGregor, 1967:163, emphasis added)

As mentioned earlier Bell (1973) similarly sees communication as central to the new work relationships, while more recently Creed and Miles (1996: 35) argued:

“In light of management’s impact on trust within an organization, one could argue that management institutionalizes its collective view of trust and trustworthiness by enacting the organizational context for intramural exchanges, communication and fair dealing.”

Several social psychologists such as Deutsch (1958, 1960a, 1960b) and Loomis (1959) stressed the importance of features such as confidence in others, context, cooperation and communication in building trust. Similarly, Gibb (1964, 1972) stressed that trust is reliant on openness, citing effective communication and Giffin (1967) also argued that trust relies on communication. More recent research has also suggested that open communication facilitates organisational trust (Mishra and Morrisey, 1990; Whitener,

Brodt, Korsgaard, & Werner, 1998; Gilbert and Tang, 1998). As Allert and Chatterjee

(1997:14) suggest: “Trust is built largely through the way a leader develops the culture of communication ...”. One scholar has argued that the importance of communication is overly emphasised, while other antecedents of trust receive limited attention (Musacco,

2000). The literature identifies the positive impact of communication on trust as such.

Similarly, the review has shown that managers may be required to balance eliciting knowledge and knowledge capture. The degree of openness about the organisation’s goals may also be important. Accordingly, a definition of management communication should include elements of openness.

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The organisational trust climate is largely seen as created by a supervisor or manager who is the physical embodiment of the organisation (Daley and Vasu, 1998:77) and:

“…transmits and translates the organization's missions, values, and messages…” while also voicing “…employee concerns to those further up the hierarchical chain.” From this perspective perceptions of the supervisor inform perceptions of the organisation

(Graen, Novak, and Sommerkamp, 1982; Graen and Scandura, 1987; Kozlowski and

Doherty, 1989). Thus, the concept of workplace communication used in this thesis should include a manager’s awareness of employee concerns.

A supplementary theoretical perspective on workplace communication is found in discussions of ‘organisational justice’. Bies and Moag (1986) identified four criteria needed for the perception of justice: honesty, respect, considerate communications, and an explanation for decisions. Similarly, organisational communication is strongly related to perceptions of justice and outcome acceptance (Pincus, Knipp, and Rayfield,

1990; Kickul, Neuman, Parker, and Finkl, 2001; Byrne and LeMay, 2006, and Edwards,

2010), all of which are important for trust.

In sum, the literature identifies communication as a key antecedent of trust and is therefore included in the theoretical model of trust within knowledge-based workplaces developed in this thesis. It is defined as: the extent to which a manager encourages openness, cooperation and is perceived to be aware of employee concerns. Another important element of the specific circumstances of a workplace is related to communication, but theoretically distinct in the literature - participation in decision making.

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6.3. Participation ______

In the knowledge work literature, Bell (1973) asserted that, both organisations and society in post-industrialisation, generally increase participation for individuals and groups. As shown earlier (Section four), the knowledge work literature claims there are higher levels of participation in decision making, either stated directly, or implied by high trust:

“Employee involvement has now been accepted and understood by world class organizations… These same organizations, working predominantly in the fast- moving world of information and knowledge application, recognize the value of decisions made at the lowest qualified level and the payoff from smart workers who know their jobs.” (Bennet and Bennet 2002:11)

However, there is a potential conflict between the high rates of change mentioned earlier, and the time required for widespread participation - another tension within the literature.

As mentioned earlier, concepts and assumptions from the soft HRM literature entered the knowledge work literature, including expectations of greater employee participation

(Huselid, 1995; Pfeffer, 1998; Colbert, 2004, Coombs et al, 2006). However, there is inherent tension between the ability to provide participation in decision making and undertake the rapid change that is said to be present for knowledge-based workplaces

(see Section 5). As has been seen by many during the global financial crisis, at times of economic crisis, worker’s participation in decision making tends to be put aside.

However, Clark and Payne (1997) found that increased participation in the change process improved perceptions of honesty and integrity, important elements for high trust

(as discussed in Section 6.1) and which can, in theory, “counterbalance the negative effect of change on trust” (Morgan and Zeffane, 2003:69).

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Another confounding factor is the potential dichotomy between the rhetoric and the reality of greater participation in decision making. Yetton and Crawford (1992) found that a change program, aimed at increasing participative behaviour, increased levels of the espoused style but left a large gap between espoused style and actual practice. This led to widespread dissatisfaction and morale problems. Similarly, in their work on participation in decision making, Dunphy and Stace (1993) also point out the problems of policy versus reality and perceptions:

"…the field research showed that senior executives espoused consultative values, had embodied these values in a formal corporate value statement, and had also devoted considerable time and energy to a range of consultative activities. However, these activities were not necessarily perceived by supervisors, or if perceived evaluated as consultative. When asked, most supervisory respondents favored a directive corporate leadership style for their senior executives." (Dunphy and Stace 1993:910-911)

This difference between espoused and actual style is also important for worker’s view of the ‘integrity’ of managers and therefore trust. Similarly, soft HRM practices are not necessarily altruistic (Harley, 2005), the perception of participation being ‘used’ to elicit knowledge could undermine trust, a further tension in the role of managers.

Another potential tension in the role of managers is identified by critical scholars, arguing that lower levels of participation are likely. This view extends from an early radical view that “…there is a massive imbalance of power with workers and unions largely excluded from the decision making process” (Davis and Lansbury, 1986:11) to a more recent stating of the aim for employers to “use [workers’] initiative, creativity and knowledge in the interests of the organisation” (Applebaum, 2002:123), and an important distinction between participation and autonomy:

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“…direct workplace participation appears to be central to the efficiency objectives of many employers, and such practices have… proved to be relatively durable… employee involvement is contested and negotiated continually…it would be wrong to assume that those who are really doing knowledge–intensive work automatically experience high levels of autonomy.” (Harley, Hyman and Thompson, 2005:15-16)

Participation in decision making is also important in workplaces, due to the likely impact on commitment to the organisation (see Section 7.4). Frenkel et al. (1999) found: “…influence in decision making was significant for knowledge worker’s job satisfaction but not their organisational commitment…” (Frenkel, et al., 1999:250).

Therefore, because the degree of participation in decision making is contested and may have effects in a number of important areas, it is included as a key theme emerging from both the knowledge work and the trust literatures. As a key antecedent of trust, this thesis argues that participation in decision making should be included in a theoretical model of trust within knowledge-based workplaces. This research will adopt the DSCM definition of participation in decision making as “asking for worker’s opinions about planned changes” which allows for different approaches to participation by managers.

Concluding this section, the literature shows the importance of management for understanding the circumstances of knowledge-based workplaces. The literature has shown three key themes as important; perceived character of managers, communication, and participation in decision making. Section seven argues that trust is also associated with certain outcomes that are seen as desirable for organisations, called here the organisational outcomes.

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7. SECTION SEVEN: ORGANISATIONAL OUTCOMES ______

This chapter has drawn out connections between the soft HRM perspective and the conventional KWT. The expectation of high levels of trust has already been shown to be associated with a number of trust antecedents. Similarly, in this section, the links between high trust and a number of trust outcomes are identified. As in the previous section, it is argued here that these outcomes are intended to benefit the organisation, although there may also be benefits to workers. This chapter will argue that these

‘organisational outcomes’ are intended to assist in creating an environment where workers can be innovative and knowledge can be elicited. It is further argued that there is a tension in the role of managers between ensuring the desired organisational outcomes and the need to control workers and capture knowledge for organisational benefits such as profit. Earlier discussion of the knowledge work literature is revisited in more detail, highlighting the common themes in the trust, soft HRM and knowledge work literature, namely: eliciting discretionary effort (OCB), ensuring satisfaction with the work (job satisfaction), cultivating support for change and retaining knowledge workers within the organisation. Once identified, these organisational outcomes are included in a proposed theory of trust within knowledge-based workplaces.

Based on Blau’s (1964) theory of social exchange, individuals receiving benefits from trusting a particular referent will reciprocate benefits. On this basis trust in a manager should produce behavioural outcomes that are beneficial to the organisation such as organisational citizenship behaviour (Dirks and Ferrin, 2002, Kannan-Narasimhan and

Lawrence, 2012). Likewise trust in management is said to lead to affective commitment

(Dirks and Ferrin, 2002; Dirks and Skarlicki, 2004, Kannan-Narasimhan and Lawrence,

2012). As outlined earlier, there is a lack of agreement regarding trust within knowledge-based workplaces. Some theorists argue that it consists of high levels of Page| 76 Chapter 2 |Literature Review knowledge worker trust in management (Jennex, 2007; Chung and Jackson, 2011) where knowledge workers are less dependent on their employers for their living, and employers have to entice discretionary effort by other means (Kanter, 1997; Frenkel, et al., 1999). From the more critical theoretical perspective, the act of enticing effort or overtly codifying knowledge can lead to a decrease in trust and precipitate the process of distrust (Hoffman, Hoelscher, and Sherif, 2005; Adler 2001), as can the monitoring of persons in a subordinate role (Strickland, 1958, Korsgaard and Sapienza, 2002).

There is likely to be a tension in balancing the requirements of eliciting and capturing knowledge in the role of managers within organisations.

The aspirations of the organisation have implications for knowledge-based workplaces.

As Zeffane and Connell (2003: 8) theorise:

"The degree to which trust exists determines much of an organization's character, impacting on such things as an organization's structure and control mechanisms, job design, effectiveness and the extent of communication, relationships with other organizations, innovation, job satisfaction, commitment, organizational citizenship behavior, goal sharing and coping with crises."

The conventional view of the knowledge worker (echoed in the soft HRM view) depicts organisations generating high trust (e.g. Huselid, 1995; Pfeffer, 1998) as a means to achieve higher levels of: affective commitment (Albrecht and Travaglione

2003); organisational citizenship behaviour (Podsakoff, MacKenzie, Moorman, and

Fetter, 1990; Robinson and Morrison, 1995; Mayer and Gavin, 2005); job satisfaction

(Cunningham and MacGregor, 2000); organisational performance (Dwivedi, 1980,

1983; Becker et al., 1997); and support for change (Andersson and Bateman, 1997;

Butler, 1991).

Frenkel et al. (1999) examined a number of forms of work organisation between service, sales and knowledge workplaces, and the differences between them. The results for various aspects of knowledge workers’ employment relationships were mixed. The Page| 77 Chapter 2 |Literature Review trustworthiness of management did enhance the commitment of knowledge workers but not their job satisfaction (Frenkel, et al., 1999:248). Influence in decision making was significantly related to knowledge workers’ job satisfaction, but not their affective commitment (Frenkel, et al., 1999:250), and overall knowledge workers did exert higher discretionary effort (Frenkel, et al., 1999:163). Storey and Qunitas (2001) argue that the need for: greater discretionary effort; sharing of knowledge; retention of knowledge and lower employee turnover means that the trust and affective commitment of knowledge workers is critical. There are important similarities between this knowledge work literature and the trust literature, with Dirks and Ferrin’s (2002:611) finding that direct managers are “particularly important” to the relationship between trust and OCB altruism, job satisfaction, and organizational commitment. We now look at these key overlapping themes that make up the organisational outcomes.

7.1. Organisational Citizenship Behaviour ______

Knowledge work and discretionary behaviours are so strongly linked in the literature, that Kelloway and Barling (2000:288) actually define knowledge work as “discretionary organizational behaviour”. Organisational citizenship behaviour (OCB) is a widely recognised proxy for discretionary effort - Organ (1988) first defined it as a specific form of discretionary effort. Discretionary effort is also a theme emerging from the knowledge work literature. As Frenkel, et al. (1999:163) theorised:

“Given that knowledge workers have been shown to work under more benign systems of employment relations and, through their higher levels of participation, to enjoy more influence in decision making, we hypothesized that knowledge workers will reciprocate by exerting higher discretionary effort…” (emphasis in the orginal)

A contrary view of discretionary effort, generally connected with labour process theorists, sees workers generally becoming responsible for more (e.g. career

Page| 78 Chapter 2 |Literature Review development), being more insecure and being assisted less by employers (Cappelli,

1999; Beynon et al, 2002; Thompson and Smith, 2009). On this view, the collectivisation of effort in the work process is matched by a de-collectivisation of risk where individuals face individualised performance management (Burchell, Ladipo and

Wilkinson, 2002; Thompson and Smith, 2009). Such systems in this view undermine both trust and OCB. Due to its applicability as a proxy of discretionary effort, suitability for knowledge-based workplaces and widespread use, Organ’s (1988) definition of

OCB is adopted for this thesis.

There is some debate about what actually drives OCB within organisations. Smith and

Kelly (1997) see trust in managers as enhancing the voluntary cooperation by workers essential to eliciting and sharing knowledge. Coff and Rousseau (2000:36) argue that it is affective commitment that produces: “…higher rates of discretionary behaviours that are aligned to the firm’s interests, including citizenship behaviour…”. However, the more widely accepted view is that trust is the vital underlying relationship. Trust is thought to generate OCB (Robinson, and Morrison, 1995), and have a direct impact on

OCB (e.g. Podsakoff, MacKenzie, Moorman, and Fetter, 1990; Robinson and Morrison,

1995; McAllister, 1995; Korsgaard, Brodt, and Whitener, 2002; Rubin, Bommer and

Bachrach, 2010; Kannan-Narasimhan and Lawrence, 2012) and an indirect effect on

OCB (e.g. Mayer and Gavin, 2005). It is argued here that, the different expected outcomes for OCB are largely based on trust, and therefore form a part of a theoretical model of trust within knowledge-based workplaces. Similarly, this thesis argues that the same is true for the next theme in the literature concerning organisational outcomes, namely job satisfaction.

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7.2. Job Satisfaction ______

Frenkel, et al. (1999:22) argued that: “…the trend toward higher skilled jobs and high- skill, autonomous work systems encourages greater job satisfaction”. In the organisational literature, studies have made theoretical links between trust and overall satisfaction (Barnard, 1938; Goldhaber, Yates, Porter, and Lesniak, 1978; Morley,

Shockley-Zalabak, and Cesaria, 1997; Shockley-Zalabak and Morley, 1994). More specifically, trust has been linked to increased job satisfaction as an antecedent, mediator and outcome (Muchinsky, 1977; Cunningham and MacGregor, 2000; Flaherty

& Pappas, 2000; Tan & Tan, 2000; Wagner and Rush, 2000; Goris, Vaught & Pettit,

2003; Tuten, 2005; Gill, 2008; Wulandari and Burgess, 2011). Ellis and Shockley-

Zalabak (2001) found that trust in top management and trust in one’s immediate supervisor have different impacts on satisfaction.

More recently, research into knowledge worker’s reactions to HR systems found that the autonomy given to knowledge workers, did generate job satisfaction (Monks, Kelly,

Conway, Flood, Truss, Hannon, 2012). The same study found that knowledge-based workplaces that had an HR focus on “high productivity and efficiency” resulted in “low levels of job satisfaction” but they also enjoyed “…high productivity because those who did not reach the required targets simply lost their jobs.” (Monks, Kelly, Conway,

Flood, Truss, Hannon, 2012: 13). As discussed earlier, the capturing of workers’ knowledge could diminish trust, but it could also directly diminish job satisfaction.

Based on the existing theory, job satisfaction is included in the theoretical model of trust within knowledge-based workplaces proposed in this dissertation, as an organisational outcome. Another theoretical outcome of trust, derived from the overlap between the knowledge worker and trust literatures is support for change.

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7.3. Support For Change ______

This thesis has argued that knowledge-based workplaces are faced with high rates of change. It has also been shown that the conventional KWT assumes a high level of knowledge worker trust in managers. From a soft HRM theoretical perspective, high trust is regarded as strengthening an organisation’s competitive position (e.g. Horton and Reid, 1991; Reynolds, 1997; Shaw, 1997; Williams, 2001). Albrecht and

Travaglione (2003:77, emphasis added), drawing on Kramer (1999) argue that competitive advantage is assumed to accrue from “…more effective communication, increased co-operation among organizational members and diminished resistance to change”.

Another consideration in support for change is the extent to which individual knowledge workers perceive the change as positive or negative. Individual workers may respond to change differently. Where a worker perceives a change in organisational direction as providing personal opportunities, there would likely be support for that change (Dutton and Jackson, 1987). The perception of a situation as positive or negative may also be based on the nature of the change (Kovoor-Misra and Smith, 2011), the amount of management support for the change, and the direction of the change. Indeed, attitudes toward change are, in theory, an outcome of trust (Andersson and Bateman

1997; Butler 1991; Butler & Cantrell, 1999; and Rousseau and Tijoriwala 1999;

Albrecht and Travaglione, 2003).

Importantly, managers in knowledge-based workplaces are seen as having to balance high rates of change and the retention of knowledge workers. In sum, the role of a manager is likely to include cultivating trust and support for change, as one means of dealing with the increased frequency of change established earlier. Therefore, support

Page| 81 Chapter 2 |Literature Review for change direction should be included in the theoretical model of trust within knowledge-based workplaces as a trust outcome. It is defined here as “the extent to which the direction of change is considered positive”. The final organisational outcome identified in the overlap between the knowledge work and trust literature is affective commitment.

7.4. Affective Commitment ______

In an echo of Drucker (1969), the literature which views knowledge as a ‘resource to be managed’, focuses on the affective commitment of knowledge workers in sharing knowledge. To increase knowledge worker productivity, according to Drucker’s later theory (1999:142, emphasis added): “…requires that knowledge workers want to work for the organization…” which is a characteristic of affective commitment (Meyer and

Allen 1997; Kelloway and Barling, 2000). Workers are seen to be more likely to share knowledge when they claim high levels of commitment to their organisation (Robertson and O’Malley Hammersely, 2000). This theoretical perspective can also be identified in

Nonaka, Konno and Toyama (2001:28, emphasis added):

“…as knowledge needs to be shared to be created and exploited, it is important for leaders to create an atmosphere in which organisation members feel safe sharing their knowledge. It is also important for leaders to cultivate commitment amongst organisation members to motivate the sharing and creation of knowledge, based on the knowledge vision.”

Similarly Takeuchi (2001:322) argues:

“It is not just about putting together diverse bits of data and information. The personal commitment of the employees and their identifying with the company and its mission become crucial.”

Hislop (2003) extends the argument, seeing affective commitment as the key link between the employment relationship and knowledge sharing.

Page| 82 Chapter 2 |Literature Review

However there may be challenges, as Kim and Mauborgne (1997:71) suggest: “Creating and sharing knowledge are activities that can neither be supervised nor forced out of people. They happen only when people cooperate voluntarily.” Alvesson and Karreman

(2001:995) argue that the knowledge management approach:

“… is as likely , or more so, to operate as a practice for managing people or information than as a practice attuned towards facilitating knowledge creation”

This is closer to Alvesson’s (2001) argument that high levels of commitment to the organisation help in knowledge generation, but also in the appropriation of worker’s knowledge. Importantly for managers in knowledge-based organisations, retention of knowledge workers and the need to elicit knowledge both suggest a need for affective commitment. This dissertation argues that the different expected outcomes for affective commitment are largely based on the different visions of trust and therefore form a part of the theoretical model of trust within knowledge-based workplaces. Affective commitment is defined in this thesis as “an emotional attachment to the organisation” and included as an outcome of trust. However, it is noted that an argument may be mounted for an alternative theory which includes it as an antecedent of trust.

8. SECTION EIGHT: A THEORETICAL MODEL ______

An important gap in the knowledge worker literature is created by broad assumptions about the nature of the workplace of knowledge workers. Importantly, there is a lack of a nuanced understanding of the dynamics of trust between knowledge workers and management. This review of the literature has sought to distil the lessons from the extensive trust literature, including ‘who trusts whom’, trust antecedents and outcomes, in linking it to the knowledge worker literature. The resulting key themes provide a basis from which a detailed theoretical model of the circumstances of trust within

Page| 83 Chapter 2 |Literature Review knowledge-based workplaces can be proposed. This thesis and the proposed model explore trust in knowledge-based workplaces, especially ‘trust in management’.24

As mentioned earlier (section 4.3) the definition of trust as a psychological state implies that the theoretical model developed here deals with individual workers.25 Trust in this thesis is also treated as an attitude, this being selected as a way to include the antecedents and consequences of trust in a workplace model. The theoretical model is proposed to answer two important research questions identified earlier:26

RQ1: what are the antecedents and outcomes of trust within knowledge-based workplaces? RQ2: does who trusts whom have an impact on trust within knowledge-based workplaces?

As a contribution to answering the first research question, the theoretical model adapts the framework of trust in workplaces generally (Dirks and Ferrin, 2002) and proposes two aspects of trust within knowledge-based workplaces. The first is based on a worker’s personal trust in the immediate manager and the second, on a worker’s

‘general’ trust in the organisation. However, although these two bases of trust refer to different trust referents in the model, they still form the basis of an individual’s trust, and influence the individual’s attitude. In this sense the theoretical model is one of an individual worker’s trust in management, although the various influences on that individual’s trust may derive from different levels in the organisation (see Figure 2.1 below). This is an emerging issue of importance for the theoretical understanding of the circumstances of trust, in that it is plausible to trust a manager, but not an organisation.

Equally, it is entirely possible to trust a senior manager but not my own manager. This

24 Drawing on the extensive literature from this review, this dissertation theorises that trust operates in knowledge-based workplaces in a similar way to trust in other workplaces, however that proposition will need to be tested (in the following chapters). 25 It should be noted that this is also a way of theorising ‘intention’ 26 currently unanswered in the literature Page| 84 Chapter 2 |Literature Review issue is not mentioned in any of the knowledge work literature, and yet it is potentially vital where trust and hierarchy seek to co-exist within organisations.

It is also argued here that a theoretical model of a trust in a knowledge based workplace is situated in the worker’s particular circumstances of change, management style and organisational outcomes. The conventional knowledge worker thesis suggests a high trust environment, and this has implications for the expected management style and organisational outcomes. Similarly, the literature which highlights the need to elicit knowledge and retain knowledge workers within the organisation contains the same expected style and outcomes. Conversely, a more critical perspective questions the conventional KWT scenario. This literature identifies drivers of low trust, such as the need to capture workers’ knowledge for use by the organisation, which has contrary consequences for the expected management style and trust outcomes. In applying the theoretical model, variables based on the theory can plausibly be developed, to assess the extent of trust and the impact of particular workplace circumstances. This would help answer the third research question:

RQ3: do knowledge workers have high levels of trust?

This chapter has also established that, within the knowledge work and trust literature, there are two specific workplace circumstances that are generally neglected in theories of workplace trust. The first, high rates of change, is widely accepted but may negatively affect trust in the workplace. Similarly, high rates of change may be detrimental to worker’s participation, and therefore it is included as an antecedent of trust. The second is the perceived character of managers. Given a definition of trust as an attitude of an individual, perceptions of the character of a manager, particularly an immediate manager, are potentially important to trust in that manager. These two

Page| 85 Chapter 2 |Literature Review plausible contributions to trust theory can be captured in the following research question:

RQ4: are ‘character of manager’ and ‘change’ antecedents to trust within a knowledge-based workplace?

In proposing a theoretical model of trust within knowledge-based workplaces, the overlap of the knowledge work and trust literature has established a number of antecedents and outcomes. These are included in the theoretical model to ensure it reasonably reflects current theory, and to increase knowledge, by adding to existing work. The established antecedents and outcomes can be summarised in these two research questions27:

RQ5: do ‘communication’ and ‘participation in decision making’ increase trust within knowledge-based workplaces? RQ6: does trust increase ‘organisational citizenship behaviour’, ‘job satisfaction’, ‘support for change direction’ and ‘affective commitment’ in knowledge-based workplaces?

Chapter three will outline the method by which this theoretical model will be applied empirically, as a way of generating new knowledge in answering the research questions, and as an exploration of the theoretical model’s utility. In addition, Chapter three outlines the emergence of the need to develop new specific measures of ‘knowledge worker’. Chapter three explains that although the IT industry is widely regarded as the archetypal knowledge-based workplace, not all those working in it are necessarily knowledge workers. This resulted in an additional research question being added in

Chapter three, and a new theoretical connection of ‘knowledge worker’ being added to the model in the course of the research (in green in Figure 2.1). This will be outlined in detail in Chapter three.

27 These research questions assume a direction of relationship based on the literature Page| 86 Chapter 2 |Literature Review

Figure 2.1: Proposed Theoretical Model of Trust in Knowledge-based Workplaces

Page| 87 Chapter 2 |Literature Review

CONCLUSION ______

This chapter has examined the literature on ‘knowledge’, ‘knowledge work’,

‘knowledge workers’ ‘knowledge-based workplaces’, identifying central theoretical claims, particularly on the role of trust. Section one discussed the literature clustered around debates about the emergence and nature of a ‘Post-Industrial Society’ (Bell,

1973), ‘Post-Capitalist Society’ (Drucker, 1993), ‘Knowledge Economy’ (Reich, 1991) and ‘Information Society’ (Castells, 1996). The chapter traced the emergence of assumptions underpinning the concepts of knowledge, knowledge work, knowledge worker and knowledge-based workplaces, as well as documenting a welter of competing and contradictory views in this literature. The argument is laid out as follows.

Increasingly knowledge-intensive production sees the development of the conventional

KWT where the role of managing ‘knowledge workers’ requires high levels of trust in management. Trust is seen as essential for creating and eliciting knowledge, and for the retention of these knowledge workers who are central to the knowledge production process. Out of this discussion two main themes were initially identified, namely: ownership of the means of production and trust within knowledge-based workplaces.

Section two considered various conceptions of ‘knowledge’, surveying the most salient of these in situating research on trust within knowledge-based workplaces. Knowledge can be seen as visible and/or tacit; individually and/or collectively held. The thesis proposed to concentrate on abstract theoretical knowledge, visible and individually held. The conventional knowledge worker thesis envisions a climate of high worker trust in managers, required to manage the new workers and to elicit their knowledge for the benefit of the organisation. From the critical perspective, attempts to capture or codify worker’s knowledge are part of reducing autonomy and deskilling which will ______Page| 88

Chapter 2 |Literature Review lead to low levels of worker trust in management. Having acknowledged the problems of definition, the review adopted the definition proposed by Warhurst and Thompson

(2006).

Section four examined the literature on trust at work. Divergence in the understanding of trust was outlined, as were the contested theories and understandings of trust within workplaces. The influence of the soft focus HRM literature on the conventional knowledge worker thesis was traced. Having adopted Rousseau et al.’s (1998) definition of trust, the potential for contributing new knowledge by addressing two important research questions was outlined, namely:

 what are the antecedents and outcomes of trust within knowledge-based workplaces?  does who trusts whom have an impact on trust within knowledge-based workplaces?

This thesis has proposed a theoretical model of knowledge worker trust in management to answer the first question. It has also been proposed that to answer the second question, the model should specify the different conceptual levels as: trust in the immediate manager and trust in the organisation. This is because it might be possible to trust one, but not the other.

Section five argued that no theoretical perspective on trust has given sufficient consideration to the effect of high rates of change. This section argued that a theory of trust within knowledge-based workplaces should consider the high levels of organisational change, and the potential for high rates of change to have a negative impact on trust.

Section six described other important trust antecedents implied in the knowledge worker literature, including participation in decision making, the perceived character of ______Page| 89

Chapter 2 |Literature Review managers (such as ability, benevolence, and integrity), and communication. This section proposed that perceived character be made up of a number of components drawn from the literature, particularly notions of: honesty; doing ‘the right thing’; behavioural consistency; dependability and fairness. Communication, in this dissertation has three theoretical components: the awareness of employee concerns; encouragement of openness; and encouragement of cooperation. Finally it is argued that Dunphy and

Stace’s (1990) collaborative, directive and coercive management of change should be included in the model as participation in decision making.

The review has argued that the conventional knowledge worker thesis, in assuming high trust, also expects certain organisational outcomes discussed in Section seven. These organisational aspirations form part of the benefits of knowledge-based workplaces to employers as a means of eliciting knowledge and of retaining knowledge workers. From the overlap of the knowledge work and trust literature reviewed, the theory of trust within knowledge-based workplaces included: organisational citizenship behaviour, job satisfaction, support for change and increased levels of commitment to the organisation.

Finally, Section eight outlines the research questions arising from the review of the literature. The identified themes from the literature are developed into a theoretical model of trust within knowledge-based workplaces to answer the research questions.

The methodology for operationalising and testing the theoretical model is explained in the next chapter.

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CHAPTER 3

METHODOLOGY

Chapter 3 |Methodology

INTRODUCTION ______

The literature review in the previous chapter set out important research questions and a theoretical model of key circumstances of trust within knowledge-based workplaces to answer these questions. This chapter considers the research strategy and method in operationalising this task.

This chapter is organised in the following manner. Section one outlines the considerations in selecting a research method to test the theoretical model, including the sample population, level of analysis, and the survey method and its limitations. The section addresses the initially planned sample for gathering data and subsequent amendments. Section one concludes by outlining the analytical procedure using Partial

Least Squares (PLS) analysis.

Section two will outline the variables used for the research1. It first describes the emergence of the need for greater clarity in identifying knowledge workers, deriving from reflection on the pilot study and the publication of new research. Drawing on varying theoretical approaches underpinning the features of knowledge workers, new questions are developed. These seek to capture aspects of: ‘identity’, level of education,

‘use of ideas’, ‘use of symbols’ and ‘knowledge from the experience of work’. The remainder of the section outlines the rationale for designing questions intended to capture variables in the model. As set out in Figure 2.1 (Chapter two), these include trust, change, perceived character, communication, participation in decision making,

OCB, job satisfaction, support for change direction, and affective commitment. The section concludes with a description of the focus group technique, one focus group

1 In this thesis ‘questions’ are the items or measures used in the survey. ‘Variables’ are made up of single or multiple questions and reflect a concept drawn from the theoretical literature. ______Page| 93

Chapter 3 |Methodology conducted with managers and two conducted with employees, to assess the face validity of the survey.

The final section of Chapter three (Section three) concludes by describing the initial pilot testing of the questions selected in Section two. This assessment is conducted with an initial data set (n=119) gathered as a theoretically informed convenience sample of

Australian Information Technology (IT) workers. Preliminary results for statistical validity and reliability are provided. Section three shows that the questions developed for the research provide sufficient information. Moreover, online survey delivery is successful, using an appropriate page layout. Lastly, it describes the dataset from the conduct of the main survey (n=255), administered in one small organisation, two departments in two large organisations – one multinational IT organisation and one internal IT department for a financial institution, and an IT professionals online forum.

1. SECTION ONE: THE METHOD ______

This section begins by describing the target population and level of analysis. The survey method and some of its limitations are then discussed, with actions taken to offset those limitations. The planned data gathering is outlined, followed by a description of the actual main data gathering, and finally the analytical procedures utilised in this thesis.

1.1. The Target Population ______

As outlined in Chapter two, the knowledge-based workplace is described in highly varied ways. For this research the target population was identified by organisational function and occupation. That is workers in IT organisations (or functions) in the private sector. There were a number of reasons for this decision. In Phase one, the decision was driven by the need to select knowledge work that meets Warhurst and

______Page| 94

Chapter 3 |Methodology

Thompson’s (2006:787) definition2, as well as displaying high levels of change. Public sector organisations were excluded on this basis. To ensure that the sample population approximated the definitional features, organisations and departments with high degrees of work autonomy and knowledge were selected - such as software developers, software engineers and database administrators. In contrast, departments that were essentially call centre or help desk related were avoided. This selection process was designed to ensure the maximum number of respondents draw on a body of theoretical knowledge that is specialised and abstract, which is utilised under conditions of comparative autonomy.

Moreover, the IT industry, IT organisations and IT functions are strongly associated with theories of post-industrial society, information society, and more recently the knowledge-economy (as identified in Chapter two). IT organisations are also considered the archetypal knowledge-based workplaces, particularly those containing ‘software developers’ and ‘software engineers’ (Frenkel, et al, 1995). A final pragmatic consideration is the researcher’s access to these organisations through personal contacts.

1.2. Level of Analysis ______

Rousseau et al’s (1998) definition of trust as a psychological state was adopted in

Chapter two. A theoretical model of the key circumstances of trust within knowledge- based workplaces was developed, based on an individual worker’s trust in management.

In addition, the definition led to trust in this thesis being treated as an attitude. These two factors determine the level of analysis as the individual worker. Because of the importance of identifying ‘who trusts whom’, and the possibility of influences on an

2 See Chapter two, Section three: “The central characteristics of knowledge work are that it draws on a body of theoretical (specialized and abstract) knowledge that is utilized, under conditions of comparative autonomy…” ______Page| 95

Chapter 3 |Methodology individual’s trust being affected by different layers of management within a workplace, trust in immediate manager and trust in senior management are dealt with separately.

1.3. The Survey Method ______

In attempting to draw a reasonable sample of IT workers, access to the workers would be needed. Several IT organisations (especially multinational IT companies) have a culture of institutionalised change3 – an example being six-monthly organisational restructures, creating an environment of almost permanent uncertainty for workers and managers. Second, managers have led change using a variety of approaches, centring on personal attributes, skills, communication, and participation in change-related decision making. Third, the often chronic understaffing in IT organisations and the time pressures on managers, suggests that requests for additional time for alternative methods, around ‘HR initiatives’ is challenging. A survey, being less time consuming, would yield more participants than interviews for example.

The survey method provides efficiency of time and resources, statistical validity and reliability and generalizability (Kan 2002), on the other hand surveys lack the capacity to capture the individual’s complex point of view (Denzin and Lincoln, 2000), and rely on self-reporting, which may lead to fictitious or incorrect answers, and low response rates. The method may also lead to the ‘illusion of precision’ with a potential bias to the status quo, thereby acting as: “obstacles to paradigm shifts in our understanding…”

(Conger and Toegel, 2002:176). However, surveys are particularly useful in describing the characteristics of larger populations by covering large samples and standardised measurement (Babbie, 1992).

3 This paragraph draws on several years of personal employment relations experience in the sector ______Page| 96

Chapter 3 |Methodology

1.4. Survey Limitations ______

The use of surveys has a number of limitations, which may be partially offset by good research design. In operationalising the survey, an initial focus group technique was used to: identify key issues, clarify and validate survey questions, variables and respondent understanding (Morgan, 1990; Stewart and Shamdasami, 1990; Kitzinger and Barbour, 1999). In research exploring new areas, the focus group technique assists in evaluating item content, and highlighting issues of understanding as:

“…surveys are inherently limited by the questions they ask, it is increasingly common to use focus groups to provide data on how the respondents themselves talk about the topics of the survey.” (Morgan 1996:134)

Moreover, focus groups may better capture respondents’ lexicon, building on their reaction to ideas, which in turn may lead to new ideas (Stewart and Shamdasami, 1990).

The combination of survey and focus group methods can extend the depth of understanding, while providing the breadth of surveys (Morgan 1996).4 Corresponding issues with focus groups needed to be considered, such as the role of the group moderator, polarization effects, gender and sensitive topics (Morgan, 1996; Pini, 2005).

These were addressed by the moderator (researcher) having experience in the industry and the assurance of confidentiality as part of academic research. The first focus group was also overseen by the original thesis supervisor. The focus group selected was a small business unit of software developers and software engineers, within a multinational IT organisation. In addition, employees’ roles displayed knowledge content and the unit employed a mixture of younger, formally qualified software developers and older ‘learned by doing’ practitioners and managers.

4 A “key trade-off between the depth that the focus groups provided and the breadth that surveys offered” (Morgan 1996:138) ______Page| 97

Chapter 3 |Methodology

An important limitation of survey based behavioural research is identified by Podsakoff,

Mackenzie and Lee (2003), the potential for common method bias (CMB), although the literature is divided on the overall effect (Spector, 2006; Conway and Lance, 2010;

Lance, Dawson, Birkelbach and Hoffman 2010). The absence of resources and data access limits precluded the precise calculation of sources of various method biases a priori. However, a number of the procedural steps advised in the literature were taken to reduce the potential impact of CMB. Firstly, the questions were randomly ordered

(using a random number generator), avoiding blocks of questions relating to their variable, and some questions were reversed. After conducting the small groups in Phase one, all those who completed the surveys were anonymous, completing the survey online. 5

The use of an online survey has some specific limitations such as self-selection. It must be assumed that participants provided accurate demographic or characteristic information (Wright, 2005). This limitation was partially offset by targeting an IT professionals online forum (ITOF). Another potential issue is the difficulty of determining non-response rate in large online communities (Andrews, Nonnecke, and

Preece, 2003), which was addressed by limiting the size of the ITOF sub-sample. As detailed later in the chapter, differences between sub-samples were not statistically significant.

1.5. Planned Data Gathering ______

The data gathering process was initially designed in two phases – testing of the survey method and the questions (in 2004), followed by a larger group of IT workers in early

2005 to 2006, for the purpose of statistical analysis. Knowledge worker identification

5 Note: In Phase one, managers answered the questions separately to the staff reporting to them ______Page| 98

Chapter 3 |Methodology within knowledge-based workplaces (detailed in Ch.3, Section 2.1 below) became more central in 2007, leading to the development of a series of knowledge worker questions.

These were then tested before a final Phase three of the main data collection in late

2007. Because the survey was introducing new questions, good research practice suggested that all questions required some preliminary testing before the final phase of the data collection.

The first step – Phase one in the research process – was to conduct a focus group of IT managers. The logic of the focus group was to gain access to a small department in an organisation, primarily to assess the extent to which a sample may meet the definition of knowledge work, particularly the level of autonomy which was not being captured by the survey. At a secondary level, managers were to be consulted on the likely interest in the research and asked to complete the survey themselves. Following the survey completion the managers would be asked to identify anything which was confusing, unclear or did not seem applicable. Finally the managers were to be asked about gaining access to their staff and their preferences in terms of how the data could best be gathered.

The second step in Phase one was to conduct a focus group for IT workers in the same department. The logic was to test the survey with workers who may have differing views and the levels of interest in the research. Volunteering workers were asked to complete the survey; and then discuss its applicability, clarity and utility.

Phase two was designed to maximise the number of volunteer organisations and respondents, to gather survey data from a wide cross section of IT workers.

Advertisements were placed in publications of the Australian Information Industry

Association and the Australian Human Resources Institute. The researcher also

______Page| 99

Chapter 3 |Methodology approached personal contacts in the IT industry. Phase two ended with the testing of the survey and a new set of knowledge worker questions via an IT professionals’ online forum. Phase three became necessary once knowledge worker identity emerged as a central feature.

1.6. Data Gathering ______

For the focus group, a small department (46 employees) of a multinational IT company was selected. All managers from that department attended the focus group. It was a convenience sample (through personal contacts). It was hoped that a successful pilot may encourage other, larger departments and organisations to participate.

Phase one involved the focus group survey completion (n=23) and Phase two involved online survey completion (n=96). Phase one tested the survey questions in a focus group of managers and two larger focus groups of employees in two locations (Sydney and

Melbourne) within the same organisation. An amended survey was then to be deployed in other departments and organisations to ensure a sample size sufficient to validate the questions used, and to conduct statistical analysis. Reflection on the pilot and newly published work in the field alerted the researcher to the need for more probing of the dimensions of the identity of knowledge workers and the identification of the features of the work within knowledge based workplaces well into Phase two (in 2007).

Benson and Brown’s (2007) three dimensional conceptualising of knowledge workers was particularly influential. Benson and Brown (2007) persuasively argued that research relying on broad categories such as “…employees of ‘new economy’ sectors or

______Page| 100

Chapter 3 |Methodology occupations such as scientists and IT experts…” was imprecise (Benson and Brown

2007:125). This led to a new research question being added as follows:

RQ7: How can knowledge workers be identified?

Therefore a new variable of ‘knowledge worker’ was also included in the theoretical model (Ch.2, Figure 2.1, above). Addressing this research question led to the development of a number of new ‘knowledge worker’ questions (discussed in detail in

Ch.3, Section 2.1, below) which were then tested before being used in the main study for Phase three.

In Phases two and three of the research, managers of the various business units distributed an email invitation, with workers wishing to participate completing the survey. A link to the online survey was provided in the invitation email. This same process was followed in all research sites for Phase three: a small IT company, one large IT company, one IT department within a large financial institution. Two departments participated within each of the large organisations, including one department of Database Administrators. A thread was started on an IT professionals online forum, inviting IT professionals to complete the online survey and a link provided. Each of these participating organisations were surveyed at different times within Phase three. Participants did not know if their colleagues had completed the survey in Phase three, unless they discussed it. A summary of the data collection activity is provided in Table 3.1.

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Chapter 3 |Methodology

Table 3.1 Summary of Data Collection, Phases 1, 2 and 36 Stage of the Surveys Total Response Research Particicipants Used Invited Rate Phase One Department 1 of Large IT Organisation 23 46 50% Phase One Total 23

Department 1 of Large IT Dept Finance Phase Two Industry 22 30 73% Small IT Organisation less than 150 employees 21 121 17% IT Professionals' Online Forum 53 769 7% Phase Two Total 96

Phase Three Department 2 of Large IT Organisation 31 102 30% Department 3 of Large IT Organisation 34 62 55% Small IT Organisation less than 150 employees 42 121 35% IT Professionals' Online Forum 71 1258 6% Department 1 of Large IT Dept Finance Industry 11 30 37% Department 2 of Large IT Dept Finance Industry 66 70 94% Phase Three Total 255

Before discussing the conduct of the focus group in detail (Ch.3, Section 2.7), the analytical procedure that was selected (Ch.3, Section 1.7) and the development of the questions that were tested in the focus group should be outlined (Ch.3, Section 2.1 to

2.6).

1.7. Analytical Procedure ______

As this research explores the interrelation of the various circumstances affecting trust, the issues may be addressed using Partial Least Squares (PLS). As a component-based structural equation modelling technique, PLS offers several advantages over the better known covariance-based SEM (CBSEM) methods. Where CBSEM relies on a maximum likelihood function to obtain parameter estimates for latent structural modelling, PLS focusses on the explanation of covariance across the model. Both

6 For the online forum, the ‘total invited’ is the number of views that the invitation received. As mentioned (Ch.3, Section 1.4 above) the reasons for non-response are unknown ______Page| 102

Chapter 3 |Methodology

CBSEM and PLS enable researchers to answer a set of interrelated research questions in a comprehensive model simultaneously (Gefen et al., 2000). The PLS technique however, offers a stronger explanatory rationale for multiple variables and a more nuanced understanding of possible pathways. This capability is particularly important in this dissertation, because the broader psychological trust research has established a number of different mechanisms through which trust may operate.

The PLS technique also offers a number of other advantages (Chin, 2010). Perhaps the most important for this research is the predicative ability of the model, its superior suitability in newer exploratory research, and in handling high model complexity. As has been discussed in Chapter two, this research, in part, seeks to establish whether trust in manager and trust in organisation operate differently within knowledge-based workplaces.

Importantly, PLS also has an advantage over CBSEM when dealing with CMB:

“Specifically, PLS uses a component based procedure where every construct in the model eventually is estimated as a weighted average of its indicators, while the CBSEM algorithm estimates all parameters in the model with the objective of getting the implied covariances to closely match the sample covariances... In fact, we would expect the more indicators used in a model, the more likely the negligible path estimates from the method construct, implying no CMB.” (Chin, Thatcher and Wright, 2012:1017, emphasis added).

In the following sections the various questions used to test the theoretical model from

Chapter two are outlined (Section two), beginning with the identification of knowledge workers. All of the questions are then assessed for statistical validity (Section three) based on the data gathered in Phases one and two. Chapter four then sets out the data analysis for the main survey, conducted in Phase three.

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Chapter 3 |Methodology

2. SECTION TWO: VARIABLES ______

This section commences with a discussion of the identification of knowledge workers.

The resulting questions were developed from the competing theories discussed in

Chapter two. The questions were tested briefly at the end of Phase two and then used in the main study (Phase three, discussed in Chapter four). The various circumstances for knowledge-based workplaces are then discussed and the survey questions which are selected to represent those circumstances are outlined. Various existing research instruments were reviewed, a number of the concepts being examined called for new questions. The section concludes with a discussion of a focus group conducted to test the face validity of the survey.

2.1. Identifying Knowledge Workers ______

In defining and identifying knowledge workers for this research, a number of challenges were encountered. As mentioned above, more aspects of the features of the work within knowledge based workplaces required assessment, given Benson and Brown’s (2007) strong warning against relying on broad occupational categories (as mentioned in

Section 1.6).

Chapter two pointed to difficulties in defining ‘knowledge workers’. For Alvesson

(1993) the ambiguity in knowledge work is a rhetorical device, and he argued research should focus on the ‘claims to knowledge’ rather than knowledge itself. Blackler (1995) points to the ‘system of persuasion’ creating a mystique attracting new generations of knowledge workers using terms such as knowledge work as a normalising discourse

(Knights et al. 1993). Therefore, consideration was given to the use of identity. Identity writers have argued that the categorisation of individuals by demographics, and organisational image, with accompanying privileges (Mael and Ashforth, 1992; Dutton, ______Page| 104

Chapter 3 |Methodology et al. 1994) is sufficient to enhance the identification with the group. In turn identity builds a cognitive basis of group behaviour, and a sense of belonging and pride in the self (Hogg and Terry, 2000; Ashforth and Mael 1989; Lewicki et al. 2006).

As discussed in Chapter two, organisations and individuals may identify knowledge workers as part of an organisational culture (Ravasi and Schultz, 2006) that drives them to produce desired organisational outcomes: “A growing literature explores the mechanics by which collectives create distinctions, establish hierarchies, and renegotiate rules of inclusion...” (Cerulo, 1997:394-395). The research here draws on different theoretical perspectives to generate questions, beginning with how workers identify themselves and how their organisation identifies them (Cerulo ,1997; Alvesson,

2000). Discussions of what it means to be a ‘knowledge worker’ were distilled from the literature, with questions on the degree to which their work involves the manipulation of ideas, use of symbols (Reich, 1991), and use of their highest qualification (Fleming,

Harley and Sewell, 2004). Finally, the use of knowledge that is not written down and from experience on the job (Brown and Duguid, 1991; Despres and Hiltrop, 1995) were included. 7

The questions outlined below are intended to answer the research question ‘how can knowledge workers be identified’, in the context of their activities (area addressed is contained in italics). The first three focus on identity. The strong theoretical base of support for the knowledge worker as a highly educated, ‘symbolic analyst’ (Reich,

1999) underpin the middle three questions. The experiential dimensions of knowledge; are addressed in the final two questions:

I am a knowledge worker (exploring self-identity) This organisation considers me a knowledge worker (exploring organisational identity)

7 The initial theoretical model established in Chapter two did not contain ‘knowledge worker’ until the end of phase two (2007). ______Page| 105

Chapter 3 |Methodology

This organisation calls me a knowledge worker (exploring specific categorization) My job involves the use of symbols (use of a technical or dedicated ‘language) My job involves the manipulation of ideas (creation or use of ideas) My work requires use of the knowledge I gained in my highest qualification (use of education) Much of the knowledge required to do my job is not written down (experience) My work requires knowledge that can only be gained from working in this organisation (learning only by doing the job)

Responses are registered using a five point Likert Scale for all questions as set out in

Table 3.2. The response scale is not mentioned in subsequent sections, unless it deviates. We now examine Trust.

Table 3.2: Likert Scale For Responses 12345 Neither Strongly Strongly Disagree Disagree nor Agree Disagree Agree Agree

2.2. Trust ______

As reviewed in Chapter two, trust within knowledge-based workplaces can be conceptualised as consisting of two distinct referents, the immediate manager and senior management.

 Trust in Manager

As outlined in Chapter two, Rousseau et al.’s (1998) definition contains expectations about the behaviour of another which fits well with the focus on trust in managers and organisations. Gillespie (2003) developed and validated the Behavioral Trust Inventory

(BTI), which was specifically designed to assess the willingness to be vulnerable in interpersonal work relationships. Responding to Currall and Judge’s (1995) concern that most research on trust in organizations has not linked the conceptual definition of trust with its operational definition, Gillespie (2003) examined the trust between peers, manager and subordinates using two domains of trust behaviour. The BTI uses

‘reliance’ and ‘disclosure’, explicitly linking to the acceptance of vulnerability (Mayer,

Davis and Schoorman, 1995, Rousseau et al., 1998). The Chronbach alphas for these ______Page| 106

Chapter 3 |Methodology two variables were 0.91 (disclosure) and 0.92 (reliance). In the focus group discussion, the need to clarify which manager was meant in larger organisations was identified, and for this research the term ‘manager’ was replaced with ‘immediate manager’. In addition, the five questions which represent disclosure to the immediate manager were adapted8 as:

I am willing to discuss how I honestly feel about my work, even negative feelings and frustration with my immediate manager. I am willing to share my personal feelings with my immediate manager I discuss work-related problems with my immediate manager that could potentially be used to disadvantage me I am willing to share my personal beliefs with my immediate manager I am willing to confide in my immediate manager about personal issues that are affecting my work

Similarly the five questions which represent reliance on the immediate manager were adapted to:

I rely on my immediate manager's task related skills and abilities I rely on my immediate manager to represent my work accurately to others I depend on my immediate manager to back me up in difficult situations I depend on my immediate manager to handle an important issue on my behalf I rely on my immediate manager's work related judgments

As discussed in Chapter two, an important research question is who trusts whom, so a different emphasis is given to the questions related to trust in senior management9.

 Trust in Organisation

The BTI is most suitable for measuring interpersonal trust between employees and managers it does not include questions for the less personal ‘organisational trust’.

Accordingly the Ferres (2003) Workplace Trust Survey (WTS) is used for measuring trust within an organisation (organisational, immediate manager and co-worker).

Quantitative analyses by Ferres (2003) of 299 respondents showed that the internal reliability, variable validity, partial known-instrument validity and divergent/convergent

8 Gillespie’s (2003) scale was formulated as “How willing you are to do the following with your Manager?” followed by a series of statements. 9 Lack of personal contact with senior management could render the notions of ‘reliance’ and ‘disclosure’ used for the immediate manager less appropriate. ______Page| 107

Chapter 3 |Methodology validity of the three emergent WTS variables (Trust in Organisation, Trust in Co- workers, Trust in Immediate Manager) was supported. The Cronbach Alpha was 0.86 for trust in management (Ferres, 2003). A major amendment was made to the question

“I believe that my business unit recognises and rewards employees' skills and abilities” by deleting ‘and rewards’ to focus clearly on the single dimension of recognition.

The questions were developed by Ferres (2003) to assess various aspects of organisational trust; Affective Organisational Trust (AO), Behavioural Organisational

Trust (BO), Cognitive Organisational Trust (CO), Social Normative Organisational

Trust (SNO) (Ferres 2003). The twelve ‘Trust in Organisation’ questions from the WTS were used here:10

I feel encouraged to perform well in this organisation (AO) I feel that information can be shared openly within this organisation (AO) I have positive feelings about the future direction of this organisation (AO) I act on the basis that this organisation follows plans with action (BO) I perform knowing that this organisation will recognise my work (BO) I honestly express my opinion in this organisation with the knowledge that employee views are valued (BO) I think that processes within this organisation are fair (CO) I think that this organisation offers me a supportive environment (CO) I believe that this organisation recognises employees' skills and abilities (CO) There is a widely held belief that this organisation is moving forward for the better (SNO) Employees commonly believe that they are treated fairly in this organisation (SNO) It is generally accepted that this organisation takes care of employee interests (SNO)

 Disposition to Trust

Much of the trust research points to the importance of some understanding of the extent to which a person is already prepared to be more (or less) trusting than others. The focus of the research here is greater understanding of the circumstances of trust, and therefore an individual’s Disposition to Trust should be captured separately. Five questions that represent ‘being trusting’ as a personality trait were taken from the trust subscale in the

10 In Phase one the business unit was represented by replacing the word ‘organisation’ with ‘business unit’ for these questions and replacing ‘Senior management’ with ‘The senior manager of my business unit’ for other questions. This additional nuance of referent made the survey too long and was removed. ______Page| 108

Chapter 3 |Methodology

Revised NEO Personality Inventory (Costa and McCrae, 1985).11 The Cronbach Alpha of the original NEO subscale was .90 (Costa and McCrae 1985). The questions are as follows:

I think that most people I deal with are honest and trustworthy (general perception) I tend to assume the best about people (general assumption) My first reaction is to trust people (speed of trust) I believe that most people are generally well-intentioned (general perception) I have a good deal of faith in human nature (general assumption)

Having now described the questions used to assess the different dimensions of trust, we now examine change.

2.3. High Levels Of Change ______

As discussed in Chapter two, the literature explicitly or implicitly embeds knowledge- based organisations in a hyper-change and high trust environment, overlooking the poentially negative implications of change on trust. In addition, change can vary over time, having different effects in different business units of the same organisation.

Questions concerning change were developed to explore the impact of change on trust.

The Dunphy and Stace (1990, 1993, 1994, 1996) contingency model (DSM) addresses the style of change management and the scale of change. As discussed in Chapter two the DSM identifies five points on a continuum of organisational change; from no change through to fine tuning, incremental adjustment, major realignments of departments and radical shifts in strategy. The DSM used ‘type descriptions’ for the scale of change. In this research, these type descriptions are adapted in statements. A

11 Although in some ways a control variable, this variable is discussed here as an important antecedent of trust. Three negatively worded items from the original scale were omitted because of problems with negatively worded trust items (Kramer 1996). ______Page| 109

Chapter 3 |Methodology five point Likert scale (Table 3.3) is provided for the respondent’s assessment of change:12

The change in (my immediate work area/my business unit/this organisation) in the last two years is best described as

Table 3.3: Conversion from Change “Type Descriptions” to Likert Scale DSM Type Statement Scale Responses Neutral response 1 = No change Fine Tuning 2 = Gradual change Incremental Adjustment 3 Modular Transformation 4 Corporate Transformation 5 = Radical change

In order to assist in establishing the validity of the responses a general evaluative change question was also included:

(My immediate work area/This organisation) has undergone a lot of organisational change in the last 2 years

Having outlined the questions chosen to represent high rates of change, the next consideration is management.

2.4. Management ______

As discussed in the literature review, the impact of management for this research consists of perceived character, communication and participation.

 Perceived Character

Perceived character of management required the development of new questions for both character of manager and senior management, by adapting existing questions such as those used by Kouzes and Posner (2002), Muczyk and Adler (2002) and those suggested by Locke (2003). For managers, credibility in word and action is critical since, arguably, “Credibility is the foundation of leadership.” (Kouzes and Posner

2002:37). This is particularly crucial in managing change. In their sample of 350,000

12 This change is also assists in overcoming a difficulty some respondents had in categorising their organisation type – see Stace (1989:70-71). ______Page| 110

Chapter 3 |Methodology respondents on transformational leadership, credibility was the most frequent issue – seen as “They do what they say they will do” (Kouzes and Posner 2002:37). Where employees experience previous changes, the observed behaviour of leaders would logically be expected to contribute to trust in their immediate manager and organisation.

Following Sison’s (2003) suggestion that integrity is based on the Aristotelian notion of character or virtue, new questions were developed which operationalised dimensions of this notion:

(My immediate manager/Senior management) bases decisions on the ‘right thing to do’ rather than ‘making money’ (Prudence) (My immediate manager/Senior management) honours (his/her/their) commitments (Integrity) (My immediate manager/Senior management) overcomes difficulties (Perseverance) (My immediate manager/Senior management) put the needs of those reporting to (his/her/their) before his/her own needs (Selflessness)

Many discussions of trust include the notion of people’s honesty and integrity. In a similar way, Locke (2003) suggests a “Proposed Manager Morality Scale”, the operationalisation of which includes honesty, integrity and justice. For honesty, he suggests: “My manager is honest: he or she never tries to fake reality” (Locke 2003:

442).

(My immediate manager/Senior management) is honest (Honesty)

Similarly, Muczyk and Adler (2002) treat reliability as equivalent to the concept of integrity:

“Leaders must be willing to behave in ways that are consistent with the publicized values of the organization, thereby setting an example for others…If an organization preaches performance, quality, and customer service, then they must be rewarded…Also, little acts of consideration such as hospital visits, attending weddings, funerals, and other important occasions, having lunch with subordinates from-- time-to-time, are appreciated and serve to build a reservoir of good will.” (Muczyk and Adler 2002:14-15)

In this research the question was operationalised as:

(My immediate manager/Senior management) follows words with actions (Integrity)

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 Communication

As discussed in Chapter two, there are strong links in the literature between communication and trust. Many studies that operationalise communication do so in a way which is specific to the area of research. For example, Korsgaard and Roberson

(1995) used employee ‘voice’. Korsgaard, Sapienza, and Schweiger (2002) discuss communication more as an opportunity to provide input, Gopinath and Becker (2000) study the communication efforts of a parent company. For this research, communication was operationalised as follows:

(My immediate manager/Senior management) promotes cooperation between different areas/work units (Communication between work areas) (My immediate manager/Senior management) is aware of employee concerns in this workplace (Understanding of employees’ concerns) My immediate manager/Senior management) encourages opportunities for open communication between co-workers (Communication between co-workers)

 Participation

The DSM used participation in change decision making as a measure of style of change leadership.13 To develop an equivalent of the ‘style of change leadership’ or

‘participation’ axis in the DSM, the question in the research here was phrased:

(My immediate manager/This organisation) asks for my opinion about planned changes

Answers on the Likert scale (described in Table 3.4) reflect the DSM type statements as follows:

Table 3.4: Conversion from Leadership Style “Type Descriptions” to Likert Scale DSM Type Statement Scale Responses Coercive 1=Strongly Disagree Directive 2= Disagree Neutral Response 3= Neither Disagree nor Agree Consultative 4= Agree Collaborative 5 = Strongly Agree

13 The DSM operationalised these as three ‘Type statements’ (Stace, 1989:70) differentiated primarily on the degree of participation in decision making. ______Page| 112

Chapter 3 |Methodology

A reverse question was also included in the questionnaire to assist in establishing the validity of the responses captured:

(My immediate manager/This organisation) implemented planned changes without asking for my opinion.

Having discussed the questions used for the expected antecedents of trust, the next section discusses the questions used for the organisational outcomes.

2.5. Organisational Outcomes ______

In the literature review a number of ‘soft focus’ organisational outcomes are identified as flowing from trust within knowledge-based workplaces. It was also argued that as the tension between eliciting knowledge and capturing knowledge impacts on trust, it may similarly influence organisational outcomes directly. The soft HRM themes identified in

Chapter two are: organisational citizenship behaviour, job, support for change direction, and affective commitment.

 Organisational Citizenship Behaviours

Organisational Citizenship Behaviour (OCB) is generally accepted as representing the amount of extra effort that participants put into their organisation, above and beyond the simple ‘fair day’s work for a fair day’s pay’. As identified in Chapter two, within the knowledge-based workplace literature, there is some debate about the role of OCBs, however it is more widely accepted that trust is vital in the relationship. Coyle-Shapiro and Kessler (2000) identified four OCB questions particularly directed at individual behaviours which are used here to assess OCB. A new combination of questions for

OCB was suggested for this research as follows: three of Coyle-Shapiro and Kessler’s

(2000) questions:

I frequently make suggestions to improve the work of my department (individual initiative) Part of my job is to think of better ways of doing my job (individual initiative)

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Chapter 3 |Methodology

I participate in activities that are not required but that help the image of my company (civic benefit)

The fourth suggested item on keeping up with developments that occur in the respondent’s organisation was amended and a final item added from Podsakoff,

MacKenzie, Moorman and Fetter (1990):

I keep up with changes in the industry that might affect my company (civic benefit) I often volunteer to help others with work-related problems (helping behaviour)

 Job Satisfaction

As discussed in Chapter two, the capturing of workers’ knowledge could diminish job satisfaction directly, as well as impacting on trust. Job satisfaction is operationalised by adapting questions from Hackman and Oldham (1974), later adapted by Zeffane (2006) and used for a longitudinal study in an Australian food processing organisation. The

Chronbach Alpha for the ‘Satisfaction with Pay and Rewards’ questions was 0.69, the

‘Satisfaction with Physical Working Conditions’ was 0.81, while the ‘Overall Job

Satisfaction’ variable achieved only 0.63. It was expected that combining the key questions into a single variable would improve the Cronbach alpha. Zeffane’s (2006) adaptation was also preferred due to the Australian application of this research and the need to limit the number of questions. One “intention to leave question” was added using Hackman and Oldham’s (1974) original questions.14

Due to the nature of IT jobs, a slight adaptation was made from “I frequently think of quitting this job” to “I frequently think of quitting my job”. Following the Phase one focus group, some of the Zeffane (2006) questions were also altered from ‘this job’ to

‘my job’ at their suggestion. Similarly the adaptations from “on” to “in” were suggested by the focus group as a more suitable expression. The Phase two and three questions were as follows:

14 Based on Dirks and Ferrin (2002) ______Page| 114

Chapter 3 |Methodology

Generally speaking, I am very satisfied with this job (general satisfaction) I frequently think of quitting my job (intention to leave - reverse scored) I feel my job is secure (job security) I feel my performance in this job is adequate (general satisfaction) I am satisfied with the supervision I receive in my job (general satisfaction) I am satisfied with the pay I receive in this job (satisfaction with pay) I am satisfied with the physical working conditions in my job (such as lighting, noise, safety) (satisfaction with physical working conditions) The physical effort required of me on this job is adequate (satisfaction with physical working conditions)

 Support for Change Direction

As identified in Chapter two, another important dimension of the literature is the extent to which workers perceive change as positive versus negative. A number of questions were developed to give an indication of the overall support for changes in the organisation. Firstly, questions related to the amount of support for change provided by management, were created, followed by a negatively worded version:

(My immediate manager/Senior management) supports plans for change in the organisation with actions (support for change) (My immediate manager/Senior management) resists change in the organisation (resistance to change – reverse scored)

One question addressed the clarity of organisational objectives:

I am clear about the objectives of this organisation

The final series of questions addressed respondents’ feelings about the direction in

which the change was leading:

I feel positive about the direction in which my immediate manager is leading my immediate work environment I feel positive about the direction in which senior management is leading my immediate work environment15

 Affective Commitment

The level of organisational commitment of knowledge workers is seen as important for eliciting and sharing knowledge. Specifically affective organisational commitment is seen as a product of trust (Albrecht and Travaglione, 2003), and as one example of

15 The final question should have referred to “my organisation” but this error was not picked up. ______Page| 115

Chapter 3 |Methodology organisational commitment (Dirks and Ferrin, 2002). Therefore it was decided to use three questions taken from the original commitment scale by Meyer, Allen and Gellatly

(1990) which were the most parsimonious (Travaglione, Firns, Sevastos, Albrecht and

Savery, 1998) and achieved a Cronbach Alpha 0f 0.80 (Ferres, Connell and

Travaglione, 2004). The affective commitment questions are:

I would be very happy to spend the rest of my career with this organisation (long term prospects) This organisation has a great deal of personal meaning for me (meaning) I really feel as if this organisation's problems are my own (ownership)

Having now described the questions selected for assessing the impact of management on the workplace, a number of control variables are considered to assist in providing statistically robust results.

2.6. Controls ______

A number of control variables were included in the survey, including age, gender, highest qualification and supervisor/non supervisor.

 Age

The question asked was:

Please indicate your age group at your next birthday (years):

Possible responses were: Under 26, 26 to 34, 35 to 44, 45 to 54 and Over 54.

 Gender

The influence of gender, particularly in generalized trust, has not generally been replicated since the study by Johnson-George and Swap (1982), nevertheless it will be used as a control.

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 Highest Qualification

The knowledge worker literature has a widespread expectation of a correlation between higher qualifications and knowledge worker status (and the use of education levels as a proxy for knowledge workers), the following question was included:

Please indicate your highest level of qualification:

Response choices relate to the Australian qualification system as follows: Year 12 (HSC) or below (secondary level) Technical Qualification (e.g.: TAFE Diploma, Microsoft Certification) (post- secondary) Bachelor Degree (tertiary level) Postgraduate Degree (tertiary level) Other (please specify)

 Supervisors

It is possible that those that have been appointed by their organisation to supervise others have a different view than their subordinates. Therefore a yes or no response was sought to the question:

Have you been appointed by your organisation to supervise others?

A secondary question asked for information on the number of employees managed or supervised (directly or indirectly). The possible answers are: None, 1 to 10, 11 to 20, over 20.

 Employment Status

This issue was drawn from the focus group expressing concern in including contractors.

Employment status is considered as potentially important in trust research due to the greater exposure of full-time employees to managers (when compared to part-time and casual employees). In addition contractors may have a different relationship to managers than employees, particularly in the IT industry. To identify respondent employment status, the following question was included:

Please indicate your employment status:

Possible responses were: Full time, Part time, Casual, Contractor. ______Page| 117

Chapter 3 |Methodology

 Time in Industry and Organisation

Trust is considered to be at least partially based on inter-personal relationships and therefore the amount of time spent in an organisation may have an impact on trust in managers. Similarly the amount of time spent in the industry may give an indication of experiential learning ‘on the job’ and so the following question was asked:

Please indicate the number of years you have worked in your organisation/industry

Participants were able to write the number of years for each into the box provided.

 Customer Satisfaction and Financial Performance

As Dirks and Ferrin (2002) suggest, some research has also shown positive associations between trust and organisational performance. Dwivedi (1980, 1983) found a moderate relationship between trust and levels of production, however Musacco (2000) found a non-significant relationship between trust and performance. Similarly it was thought possible that higher levels of trust may increase the perception of customer satisfaction.

At the commencement of the research it was expected that these questions would be verified against actual organisational unit performance on both indicators, but this was not feasible. Thus questions centre on the respondent’s perceptions, and are worded:

(My business unit/My organisation) is performing well financially (perceived financial performance) (My business unit/My organisation) is providing a great service to our customers (perceived customer satisfaction)

2.7. Phase One – Focus Group and Survey Trial ______

After receiving ethics approval for the research process – Phases one, two and three16 – a focus group was conducted (October 2004) in one business unit of a large multinational IT company. To assist in the process of encouraging participation in the research, five members of the management team took part in the first focus group to

16 see Appendix A ______Page| 118

Chapter 3 |Methodology provide feedback on the content of the survey, including relevance, effectiveness and ease of understanding the proposed survey questions.

The focus group suggested minor amendments (discussed under the appropriate sub- sections above) and also suggested it could be conducted online. The focus group also agreed to assist further survey testing by each manager sending an email invitation to their employees (but not contractors). Each manager’s invitation email had attached to it the required information statement, and consent forms were collected by the researcher from those who chose to attend the focus group.

Two small focus groups in different cities resulted from acceptance of the managers’ invitations. The groups received a presentation on the study from the researcher, completed the survey and provided feedback on its useability. In total, 23 of the 46 employees in the department completed surveys (a response rate of 50%). The main recommendation from Phase one was to shorten the survey, citing length and repetition.

Accordingly the business unit questions were removed.17 The revised survey was extended to a broader population in Phase two.

3. SECTION THREE: CONFIRMING THE QUESTIONS ______

After the Phase one pilot, the redesigned survey18 was tested with a broader population.

Volunteer IT organisations and managers of IT workers were sought through advertisements at the Australian Human Resources Institute, the Australian Information

Industry Association, an online call for expressions of interest (blog), an invitation posted on an IT professionals’ online forum (ITOF), and by using the researcher’s personal IT contacts.

17 This cut the number of questions by a third. 18 see Appendix B ______Page| 119

Chapter 3 |Methodology

In expanding the number of participants, Phase two had three initial aims. The first was to gain access to a broad cross section of the Australian IT Industry (including general

IT workers in the online forum), the second, to minimise any organisation specific bias, and third, to test the amended survey with a more robust numerical sample.19 A total of

96 responses were received in Phase two (as outlined in Table 3.5) including a small private sector IT organisation, a large IT department in the Finance Industry and the

ITOF. It should be noted that 26 ITOF surveys were commenced, but only the biographical information on the first ‘page’ was completed. These surveys were excluded from the analysis and the numbers in the table above. Had they been included, the ITOF (Phase two) completed box would have been 80, rather than 53.

Table 3.5: Summary of Data Collection, Phase two Stage of the Surveys Total Response Research Particicipants Used Invited Rate Department 1 of Large IT Dept Finance Phase Two Industry 22 30 73% Small IT Organisation less than 150 employees 21 121 17% IT Professionals Online Forum 53 769 7% Phase Two Total 96 NOTE: The knowledge worker questions were deployed only to the IT Forum20

In the following section the effectiveness of the questions is tested. The knowledge worker questions were deployed only to the ITOF consisting of the 53 responses (see

Table 3.5). However for the remaining questions, the 23 Phase one participants are added to the Phase two responses for the purpose of the analysis (n=119). Of the 119

19 A fourth aim emerged in the course of Phase two, testing new knowledge worker questions, once it became clear that this was better than using IT worker as a proxy for knowledge worker. 20 The benefits of the IT Professionals Online Forum were the relevant IT audience from a broad range of organisations, the ease of access and the rapidity of responses. The message inviting people to participate in the survey asked that they self-select according to the set criteria. 769 people viewed the message, providing an indicative response rate. ______Page| 120

Chapter 3 |Methodology responses, 18 participants did not answer all of the survey questions (18/119=15%).

PLS analysis can accommodate missing data such as this.21

3.1. Assessing The Questions ______

This section outlines the method for assessing the Phase one and two survey questions using PLS. The same methods will also be used for Phase three (in Chapter four). For this thesis, the writing up and reporting of PLS analyses follow the recommendations of

Chin (2010), as noted in the following discussion. In this section only those steps involved in testing the questions are outlined.

Turning first to the ‘validity’ of the questions: The initial testing addresses discriminant validity, ensuring the questions are more strongly related to the variable they seek to capture, rather than any other question or variable. This testing is initially conducted by checking the cross loadings for all of the questions against all of the other questions (the monofactorial cross loadings). Each question loading on its own variable must be the highest number both across that row and down that column. A second test of discriminant validity is recommended using Fornell and Larcker’s (1981) Average

Variance Explained (AVE). The latent variables should be greater than the square of the correlations among the latent variables. Chin (2010) recommends that the AVE should also be higher than 0.5 for all questions, meaning that questions should account for at least 50% of the variance.

Once the discriminant validity has met the benchmarks, the next test considers the consistency of the questions within the variable using Cronbach’s Alpha. The calculation of Cronbach’s Alpha holds all of the paths from the questions to the variable as equal, although some questions may be stronger representatives of the variable than

21 Missing observations in this research are replaced using the accepted ‘mean or mode’ method ______Page| 121

Chapter 3 |Methodology others. PLS accounts for this by giving each question a weighting that maximises the variance explained for the prediction of the variable. Therefore, a better measure of internal consistency in PLS is Composite Reliability which allows variable path weights

(Chin, 2010). However, due to Cronbach’s widespread use, and for comparability with other studies, both Cronbach’s Alpha and Composite Reliability (Dillon-Goldstein's rho) are reported here. It should be noted that Composite Reliability will always be higher than Cronbach’s Alpha and sometimes markedly so.22 Finally, the weighting in

PLS also enables the retention of weaker questions because the weighting minimises those questions, or those questions can be removed. On balance, a superior internal

‘reliability’ can often be obtained in PLS by removing problematic questions.

The review of the literature was used to develop an exploratory theoretical model for examining trust in knowledge-based workplaces. Because all of the testing mentioned so far is done in the context of a structural model, the theoretical model is specified as a statistical model in XLStat.23 The theoretical model is assumed (and specified in

XLStat) until both discriminant validity and Composite Reliability have been established, although the poor questions relating to a variable may be removed. Only then does the testing of the statistical model itself commence. The model as specified is shown at Figure 3.1.

22 For example, if there are two questions that are very strongly related to the variable, and a third which is very weak. In those circumstances Cronbach’s Alpha will give each question an equal weighting of 33.3% to each relationship, whereas Composite Reliability will use a weighting based on strength of relationship, say 45% for the two strong measures, and 10% for the weak one. 23 The analysis for this chapter was initially done in SPSS and PLSGraph, but is redone in XLStat, version 2013.4.08, for consistency with Chapter four. ______Page| 122

Chapter 3 |Methodology

Figure 3.1: Initial Statistical Model in PLS (based on the theoretical model)

______Page| 123 Chapter 3 |Methodology

3.2. Validity and Reliability of Initial Variables ______

At this stage, the statistical model itself is not being tested, rather the discriminant validity and reliability of the variables are being assessed. Weaker questions are noted for the main survey in Phase three (Chapter four) and are then removed. Table 3.6 indicates that now the variables which have been proposed do meet the reliability criterion with D.G. rho above 0.7 with conventional Cronbach’s Alpha comparison. Therefore, statistical support for the validity and reliability of the initial variables created for this research is established. The analysis now moves to establishing the validity and reliability of the Knowledge Worker questions.

Table 3.6: Composite Reliability and Cronbach’s Alpha (Phase one and two) n=119 Cronbach's D.G. rho Latent variable Dimensions alpha (PCA) Change IWA 3 0.781 0.873 Communication IWA 2 0.724 0.879 Character of Manager 6 0.903 0.926 Participation IWA 2 0.743 0.886 Change ORG 2 0.725 0.879 Communication ORG 3 0.741 0.854 Character of Senior Management 6 0.891 0.918 Participation ORG 2 0.544 0.814 Trust in Manager 10 0.852 0.883 Trust in Organisation 12 0.939 0.947 OCB 5 0.538 0.729 Job Satisfaction 3 0.750 0.858 Organisational Commitment 3 0.575 0.779 Support for Change Direction 7 0.755 0.827

3.3. Knowledge Worker Questions ______

As for the earlier questions, a statistical model specified in XLStat reflects the theoretical model, this time explicitly identifying knowledge workers by using their responses to questions and using the 53 surveys containing the knowledge worker questions.24 Analysis of the monofactorial cross loadings and the Composite Reliability

24 Eight of the 53 respondents did not complete all of the information (15%).

______Page| 124 Chapter 3 |Methodology

shows that three knowledge worker questions form one variable, while the ‘symbolic analyst’ and ‘experiential dimensions’ are weak. The ‘result’ column in Table 3.7 shows the loading of the question onto the overall variable.

Table 3.7 Knowledge Worker Questions Code Result Question KNOW_WKR5 0.697 This organisation considers me a knowledge worker KNOW_WKR2 0.679 My job involves the manipulation of ideas KNOW_WKR6 0.662 This organisation calls me a knowledge worker KNOW_WKR4 0.407 I am a knowledge worker KNOW_WKR3 0.203 My job involves the use of symbols KNOW_WKR1 -0.001 My work requires use of the knowledge I gained in my highest qualification My work requires knowledge that can only be gained from working in this KNOW_WK_EXP2 0.603 organisation KNOW_WK_EXP1 -0.552 Much of the knowledge required to do my job is not written down

The initial findings from this pilot sample support the view that knowledge workers are identified as such by their organisation, and the use of ideas in their work. The use of symbols in work, the use of qualifications, and knowledge characterised as experience, or learned on the job seem to be less important. The three ‘knowledge worker’ questions meet the AVE benchmark and have a Composite Reliability of 0.75. Given the need to include the knowledge worker questions and more data, the statistical model is not tested further at this point. This is undertaken in Chapter four with the main Phase three data. A description of all of the data collected is now provided.

3.4. Dataset ______

As outlined, this dissertation utilises data from three surveys of Australian IT workers.

The first to be surveyed were software developers in an Australian unit of multinational information technology (IT) organisation, conducted in New South Wales and Victoria in 2004, which provided feedback on the useability of the survey (n=23). Phase two included an amended survey, conducted between 2005 and 2007 and tested nationally

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with a broader Australian IT population (n=96), including an Information Technology

Professionals’ Online Forum, the Database Administrators from a large financial institution and the IT professionals from a small software development company. At the end of Phase two, 53 surveys were completed which contained new questions designed to capture various aspects of being a ‘knowledge worker’. Having established that all of the questions developed for the research provide sufficient information, and that an online survey was workable, a final main survey was conducted. This survey (n=255) targeted one small organisation, the IT professionals’ online forum and two departments in two large organisations – one multinational IT organisation and one internal IT department for a financial institution. Across all three surveys, 374 useable responses were received (42% response rate).

Respondents were predominantly male (86%). Although permanent full time employment was dominant (87%), the workforce was comparatively young (57% under

35) and almost evenly split on supervision (46% supervised the work of others). The relatively low job tenure points to a relatively high organisational turnover of employees (70% had been in the organisation for 3 years or less). On the other hand fifty percent had eight or more years’ experience in the industry, pointing to stronger

‘experience knowledge’. In terms of education, most had tertiary education - a Bachelor degree (44%) or a higher degree (18%), while those without had a technical qualification (26%, including MCSE, Oracle DBA and other software specific qualifications). Those remaining hold a Year 12 qualification or below (12%). It is difficult to get national Australian Bureau of Statistics (ABS) data after 2005 due to funding changes (ABS, 2007). However, for the dimensions where comparisons could be made (age, gender and employment status) the sample is similar to the general

Australian IT workforce (ABS, 2005). In comparison to the Australian workforce as a

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whole, the IT workforce (and by implication members of the sample used in this dissertation) is male dominated, born overseas and works relatively long hours (ABS,

2005).

CONCLUSION ______

Chapter three has reported on the processes undertaken to test the variables in the theoretical model using initial pilot surveys gathered from Australian IT workers.

Chapter two identified a number of circumstances, centred on trust, that were operationalised as survey questions, tested and analysed. In Phase one, an initial focus group and small survey sample helped to identify issues, clarify and validate survey questions, and enhance respondent understanding.

Analysis of the combined Phase one and two data has shown initial support for the variables ‘trust in manager’ and ‘trust in organisation’ as potentially different mechanisms for trust within knowledge-based workplaces. Likewise, there is support for the new questions that were adapted for this research. Importantly, there is preliminary support for a means of identifying knowledge workers.

Some questions, used successfully by other researchers, were unable to meet the relevant statistical thresholds. However, as this may be due to the sample size, all of the questions were retained for the main survey. The results for Phases one and two provide initial support for the view that trust in an immediate manager and trust in an organisation operate differently within organisations, which informs the Phase three examination.

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From the lessons learnt in Phases one and two, some important changes are made in conducting the main study. First, an improved survey layout.25 Second, Phase three will also seek to confirm in a larger sample the utility of the ‘knowledge worker’ variable.

Third, because the Change ORG variable is low in reliability terms, there may be some confounding of the type of change being considered by respondents. In the Phase three study, an ‘extent of change’ question and a ‘speed of change’ question, were deployed in place of the single question. The thesis now turns to examining the main Phase three survey (n=255).

25 Online surveys will be presented as one ‘page’ to avoid the problems of people missing out the ‘next’ tab to proceed – some 26 online surveys contained only biographical information. ______Page| 128

CHAPTER 4

RESULTS

Chapter 4 |Analysis and Results

INTRODUCTION ______

This Chapter draws on the discussion of the various circumstances set out in the theoretical model, and examines the relationships identified in the research questions.

The theoretical model was operationalised in questions in Chapter three. As discussed, the potential for differing impacts resulting from the immediate manager, and the organisation are both considered. The logic of this analysis, and the following sections is, first to provide a nuanced understanding of pathways claimed in the literature, and set out in the theoretical model. The second aim is a robust statistical interrogation of the theoretical model, to establish whether the data confirms the relationships specified in the theoretical model, and thereby address the research questions. The data is gathered from a theoretically informed sample of knowledge-based workplaces, with further questions to test aspects of identifying knowledge workers. Due to the importance of ‘who trusts whom’ in the trust literature, the data analysis examines the impact of the immediate work area, the organisation, and finally a combined model. The purpose is to analyse and explore the potentially different trust pathways in the theoretical model, using the capabilities of PLS.

The Chapter is organised as follows. Section one focuses on the reliability and validity of the questions used in setting out a structural model. In particular, both discriminant validity and reliability of the variables (or convergent validity) are examined using

Partial Least Squares. In Section two an initial statistical assessment is conducted to establish the two pathways for trust described in the theoretical model. The Chapter then moves, in Section three, to confirming the extent of mediation for the trust

Page| 131 Chapter 4 |Analysis and Results variables. Possible models are analysed for identifying the different relationships between the trust antecedents, components of trust, and organisational outcomes. As mentioned in the previous paragraph, the differing impact of the immediate work area, the organisation, and a combined model are set out, seeking to capture the various circumstances of trust in the knowledge-based workplace.

1. SECTION ONE: ASSESSING THE QUESTIONS ______

This section turns first to the validity of the questions for the IWA, using the main survey data from Phase three (n=255). As described in Chapter three, the initial testing is carried out on the questions to ensure that they are more strongly related to the variable they seek to measure, rather than any other question or any other variable

(discriminant validity). This testing is initially conducted by checking the cross loadings for all of the questions against all of the other questions (the monofactorial cross loadings). Each question loading on its own variable must be the highest number both across its row and down its column. A second test of discriminant validity is recommended (Chin, 2010), using Fornell and Larcker’s (1981) Average Variance

Explained (AVE).1 The latent variables should be greater than the square of the correlations among the latent variables and greater than 0.5.

1.1. Discriminant Validity ______

Following the procedure in Chapter three, the monofactorial cross loadings are run to test discriminant validity. Using that analysis and the AVE analysis, weak questions are

1 Missing observations in this research are replaced using the accepted ‘mean or mode’ method for 49 participants (49/255 = 19%).

Page| 132 Chapter 4 |Analysis and Results identified and removed to ensure the discriminant validity of the variables. Two sets of questions were not sufficiently robust to be used for both the IWA and ORG. These questions were combined and were shown to be statistically robust as single variable -

Participation and Change.

1.2. Composite Reliability ______

As discussed in Chapter three, PLS provides a better measure of internal consistency, namely Composite Reliability. In using variable path weights, Composite Reliability is a more subtle test of the role of questions (Chin, 2010). Following the previous procedure (in Chapter three) for comparability, both Cronbach’s Alpha and Dillon-

Goldstein's rho (Composite Reliability) are shown in Table 4.1.

Table 4.1 - Composite Reliability and Cronbach’s Alpha (Phase three) n=225

Cronbach's D.G. rho Latent variable Dimensions alpha (PCA) Participation 3 0.687 0.828 Character of Senior Management 6 0.878 0.909 Communication ORG 3 0.752 0.858 Knowledge Worker 4 0.792 0.866 Character of Immediate Manager 6 0.882 0.911 Communication IWA 3 0.755 0.860 Disposition to Trust 5 0.822 0.878 Change 6 0.870 0.906 Trust in Organisation 12 0.938 0.946 Trust in Manager 9 0.810 0.856 Affective Commitment 3 0.690 0.829 Job Satisfaction 3 0.731 0.849 Support for Change Direction 4 0.754 0.844 OCB 3 0.555 0.771

At this stage in the analysis, it is important to note that the knowledge worker questions have performed differently to Phase two. With the larger number of participants the four

Page| 133 Chapter 4 |Analysis and Results questions which best represent the knowledge worker variable are based more on the

‘identity’ aspects as follows:

I am a knowledge worker This organisation considers me a knowledge worker This organisation calls me a knowledge worker My job involves the manipulation of ideas

However, the manipulation of ideas is not strictly related to the ‘identity’ literature discussed in this thesis, so these aspects will be collectively labelled as ‘knowledge worker consciousness’. The character of manager and communication questions have also performed well, however the knowledge worker experience variable was not statistically robust.

Prior to running regressions to determine the relationships between the questions, an independent samples t-test is conducted to determine whether there is a difference between the means of those who considered themselves a knowledge worker and those who did not2. Logically, if there is a difference between the two means then the variable is capturing a real difference. Notably, eighty four percent of respondent employees identified themselves as knowledge workers (based on questions about knowledge worker consciousness). Table 4.2 shows the results for the trust variables and the organisational outcome variables.

2 An average of the knowledge worker questions greater than 3 indicates a positive response (yes)

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Table 4.2 – Results of Independent Samples t-test

Effect Variable Knowledge Worker? Significant? Difference Eta squared size No Yes (Between Means) Affective Comittment 39 202 Yes .56 .06 moderate Job Satisfaction 39 202 Yes .45 .04 small Support for Change Direction 39 202 Yes .55 .10 moderate OCB 39 202 Yes .33 .04 small Trust in Organisation 38 196 Yes .63 .09 moderate Trust in Manager 39 202 No .06 N/A N/A

These results have important implications. First, there is a significant difference between the results for those who consider themselves knowledge workers and those who do not for all of the organisational outcome variables and for trust in organisation, albeit the differences varying from small to moderate (Cohen, 1988). There is no significant difference for trust in manager. Overall, these results demonstrate that knowledge worker consciousness is measureable and does have an effect (refer to

RQ73). Second, there is a strong indication that trust in manager has a different impact to trust in organisation. Finally, the results strongly indicate that knowledge worker consciousness does produce higher trust in organisation and organisational outcomes, on average4. Before proceeding to introduce all of the other variables and analysing the relationships between them, the descriptive statistics for the questions used are provided in Table 4.3.

3 Relevance to addressing the research questions is noted in this way in Chapter four, and discussed in detail in Chapter five. 4 From the difference between the means

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Table 4.3: Descriptive Statistics Highest Code Construct Loading Highest PAR_CHG1 0.813 Code Construct Loading PAR_CHG2R 0.787 Participation PAR_CHG_ORG1 0.767 OCB2 0.643 CHAR_ORG1 0.826 OCB4 0.788 OCB CHAR_ORG2 0.609 OCB5 0.737 Character of CHAR_ORG3 0.891 DISP_TRUST1 0.670 Highest Senior Code Construct CHAR_ORG4 0.891 DISP_TRUST2 0.811 Loading Management Disposition CHAR_ORG5 0.829 DISP_TRUST3 0.776 CHAR1 0.711 to Trust CHAR_ORG6 0.654 DISP_TRUST4 0.810 CHAR2 0.809 Character CMN_ORG1 0.736 DISP_TRUST5 0.708 CHAR3 0.818 of Communication CMN_ORG2 0.878 CHAR4 0.828 Immediate ORG CHG1 0.760 CMN_ORG3 0.803 CHG_SP1 0.802 CHAR5 0.679 Manager KNOW_WKR2 0.615 CHG_EX1 0.786 CHAR6 0.889 Change KNOW_WKR4 0.707 Knowledge CHG_ORG1 0.719 CMN1 0.812 Communic KNOW_WKR5 0.929 Worker CHG_SP_ORG1 0.688 CMN2 0.826 KNOW_WKR6 0.856 ation IWA CHG_EX_ORG1 0.694 CMN3 0.813 AC1 0.801 Affective Trust_Org_BO1 0.758 TrustD1 0.780 AC2 0.834 Commitment Trust_Org_BO2 0.869 Trust BO TrustD2 0.875 Trust AC3 0.738 Trust_Org_BO3 0.869 TrustD4 0.708 Disclosure JSAT2 0.708 TrustD5 0.767 JSAT3 0.893 Job Satisfaction Trust_Org_CO1 0.830 JSAT4 0.832 Trust_Org_CO2 0.899 Trust CO TrustR1 0.682 DIR1 0.803 Trust_Org_CO3 0.831 TrustR2 0.743 Support for Trust DIR_ORG1 0.697 Trust_Org_SN1 0.720 TrustR3 0.777 Change Reliance SUP_CHG2 0.775 Trust_Org_SN2 0.868 Trust SN TrustR4 0.758 Direction SUP_CHG_ORG1 0.757 Trust_Org_SN3 0.908 TrustR5 0.872

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2. SECTION TWO: ESTABLISHING THE MODEL ______

Before examining the nuanced relationships among the variables, the associations between the trust antecedents, trust and organisational outcomes must be established. To assess the extent to which the trust antecedents have their effects by contributing to organisational outcomes it is necessary to test for mediating effects. This involves three steps (Baron and Kenny, 1986). First, it is necessary to test whether the trust antecedents are associated with the outcome variables, to see if the evidence was consistent with trust antecedents contributing to OCB, support for change direction, job satisfaction and affective commitment. Second, it is necessary to test whether trust antecedents are associated with trust as a means to see whether the presence of the antecedents appear to enhance trust. Logically, if the trust antecedents are not associated with either the outcome variables or trust, then they cannot have their effects through enhancing trust (RQ1). The regression analysis testing these two sets of associations is presented in Table 4.4.

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Table 4.4 – Regressions of outcome variables and trust on trust antecedents5 Dependent Variables Support For Job Affective Trust in Trust in OCB Change Satisfaction Commitment Manager Organisation Independent Variables Direction Step 1: Control Variables Age -.14 -.12 -.16 -.11 -.07 -.23* Gender .10 -.04 -.05 -.05 -.08 -.01 Supervisor -.25** -.06 .03 .03 -.10 -.03 Years in Org .07 -.10 -.06 .02 .05 -0.19* Years in Industry .04 .13 .19 .12 .11 .24* Highest Qualification .01 .11 .03 .01 .00 .16* Employment -.02 -.12 -.01 -.15* -.18* -.09 Disposition to Trust .37** 0.28** 0.21** .30** .21** .35** Step 2: Trust Variables Participation .23** .07 .21** .29** .10 .13** Change .07 .03 .04 .11* .00 -.02 Character of Immediate Manager .08 0.38** .37** .19* .48** .04 Character of Senior Management .02 0.25** .08 .20* -.01 .42** Communication IWA -.08 .09 -.05 -.16* .23** .06 Communication ORG .10 .11 .16 .18* -.05 .28** Knowledge Worker .26** 0.16** .09 .13* -.06 .04

Step 1: adj R2 .18.11.03.09.08.21 2 Step 2: Change in adj R .36.55.39.38.42.54 ΔF 2.7** 53.25** 22.2** 21.81** 26.74** 65.47** N 255 255 255 255 255 255 * Significant at .05 level ** Significant at .01 level

The regression is run in two steps, with the control variables in the first step and the trust antecedents added in the second step6. Participation is associated with OCB, job satisfaction, affective commitment, and trust in organisation (all associations mentioned in this paragraph are positive). Character of the immediate manager was associated with support for change direction, job satisfaction, affective commitment, and trust in manager. Character of senior management was associated with support for change direction, affective commitment, and trust in organisation. Communication IWA was associated with affective commitment, and trust in manager. Communication ORG was associated with affective commitment and trust in organisation (RQ2,4,5). Neither

5 Analysis conducted using SPSS Statistics 21 6 In each case the R2 for the control variables was small, and the addition of the trust antecedents increased R2 considerably.

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knowledge worker consciousness nor change, however were statistically significantly associated with trust (RQ3).

There are important implications from these results. First, they suggest that knowledge worker consciousness as a variable does not lead to higher trust, but does increase some organisational outcomes. Second, the results imply that change is neutral in its impact on trust, but does increase affective commitment. This is a surprising finding, for which a speculative explanation may be that IT workers are largely inured to change and feel the need to be constantly working on new things. Logically, if neither knowledge worker consciousness nor change has any significant association with trust, then they cannot have any effect on other variables via trust. Consequently, knowledge worker consciousness and change should only be included in the analysis as directly impacting on the organisational outcomes.

Returning to the analysis presented in Table 4.4, the participation variable was statistically significantly associated positively with OCB, job satisfaction, affective commitment and trust in organisation. This suggests that the more participation in decision making a knowledge worker has, the more likely s/he is to experience work positively and engage in behaviours viewed positively by the organisation. The participation variable was also significantly, and positively associated with trust in organisation, suggesting the possibility that participation has its impact on organisational outcomes via trust.

Table 4.4 also shows that perceived character of the immediate manager is strongly, significantly and positively associated with trust in manager and all of the organisational outcomes except OCB. Character of senior management is significantly

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associated with support for change direction and OCB and is also strongly, significantly associated with trust in organisation and not significantly associated with trust in manager. The data shows no significant association between character of immediate manager and trust in organisation, nor between character of senior management and trust in manager. There are two important implications here. First, who is being trusted does have a distinguishable effect, and second, perceived character of manager has a strong relationship to trust. Because the two perceived character variables appear to operate on their respective trust variables, it is plausible that there are two ‘paths’ for trust operating within organisations – one local (IWA) and one organisational (ORG).

Table 4.4 also shows that communication IWA has a small, negative significant association with affective commitment, which is unexpected, and a significant positive association with trust in manager. Communication ORG has a small positive and significant association with affective commitment, and a significant positive association with trust in organisation. The data shows no significant association between communication IWA and trust in organisation, nor between communication ORG and trust in manager. This again implies that who is being trusted within an organisation does have an effect. Thus it may be possible to uncover a more nuanced understanding of the pathways through which trust antecedents, the components of trust and organisational outcomes operate. Therefore, three different statistical models are now specified in PLS for the IWA, the ORG and a Combined model. The logic of this analysis is to establish the extent of trust as a mediator, reveal any relationships which may be hidden in a combined model, and to identify any specific differences between the pathways for trust in manager versus trust in organisation.

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Similarly, in attempting a more nuanced analysis, the components of trust may be tested separately, potentially revealing relationships that the aggregation into ‘trust in manager’ or ‘trust in organisation’ may hide. As outlined previously, among the advantages of using SEM, is the opportunity to ensure that “…all the relevant paths are directly tested...” (Baron and Kenny, 1986:1177).

Having established that the data provides support for the theoretical model of two pathways for trust, the analysis now moves to establishing how the variables are related using PLS, including tests for mediation.

3. SECTION THREE: ASSESSING THE MODEL ______

Introducing PLS as a method requires that the analysis returns to the first step. Each of the Models (IWA, ORG and Combined) are specified in PLS where all of the variables are regressed on the organisational outcomes and trust variables.

3.1. Examining the Immediate Work Area ______

The variable trust in manager is separated into its two components - trust reliance and trust disclosure to provide a more detailed analysis of the pathways for the immediate work area. Each of the variables7 are given direct effects on the organisational outcomes and the benchmarks are assessed. The relationships specified in the theoretical model are then assessed, as illustrated in Figure 4.1. The PLS analysis shows that knowledge worker consciousness is strongly related to the outcome variables and not significantly related to trust, as was identified using a different method in Table 4.4.

7 Disposition to Trust, Participation, Change, Character of Manager, Communication IWA, Knowledge Worker, Trust Reliance and Trust Disclosure

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Comparison of the direct effects model, the partial mediation model, and the trust mediated model allows for completion of the three steps recommended by Baron and

Kenny (1986) to demonstrate mediation. These tests reveal that the ‘trust only’ mediated model does not provide the best fit with the data. As expected from the earlier analysis indicating that knowledge worker consciousness is related to organisational outcomes rather than to trust, the established benchmarks are improved – that is the path coefficients, the mean communality, goodness of fit (GoF) and variance explained (R2).

Comparing the mediated model, partial mediation and direct effect models, a feature of the difference in the strength of the relationships is apparent. Communication IWA mediates between character of manager and organisational outcomes in a similar way to trust. In other words, specifying the model with communication as a mediator improves the established benchmarks further. Disposition to trust, change and OCB are not statistically robust in this analysis. Additional testing of relationships between the variables, using the procedures outlined above identifies the model which most robustly represents the data collected, as set out in Figure 4.2. It shows the highest GoF of

0.907*8 and the mean R2 also improves to 0.3779. Table 4.5 provides the details of the values, with all of the values and paths significant at the 0.05 level (using bootstrapping).

8 above the recommended standard of 0.90 and significant at the 0.05 level 9 higher than any other model, as is the mean Communality (AVE) at 0.621

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Figure 4.1: Mediated Relationships for IWA10

10 XLStat diagram including the Path values or regressions (Reg) and variable R2. Tests for the control variables are conducted.

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The logic of this method has been to compare three possibilities. The first step is to specify a model where all of the variables directly impact on the outcome variables and trust. The second step is to specify a model where all the trust antecedents impact on the trust variables and the outcome variables. The next step is to specify the trust antecedents which influence the outcome variables solely through the trust variables.

Establishing that the strongest model is the mediated one meets Baron and Kenny’s

(1986) three step assessment of mediation. In this research, the process revealed that knowledge worker consciousness does not operate through trust. As a corollary it shows that communication IWA operates directly on the outcome variables, rather than through trust. Further testing using the same procedures demonstrated that the effect of character of manager on organisational outcomes is mediated by trust reliance, trust disclosure and communication IWA. Participation is mediated only by trust disclosure.

In contrast OCB, change and disposition to trust were not statistically robust for the immediate work area.

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Figure 4.2: Maximised Model for IWA

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Table 4.5 Significance Testing, R2 and p value for Maximised Model - IWA Standard Critical Lower Upper Value Latent variable Value error ratio bound bound Dependent Variable R² p (Bootstrap) (Bootstrap) (CR) (95%) (95%)

Character of Manager 0.749 0.749 0.040 18.964 0.653 0.817 Communication 0.561 0.05 Participation 0.245 0.251 0.037 6.657 0.174 0.320 Trust Disclosure 0.228 0.05 Character of Manager 0.292 0.295 0.040 7.257 0.215 0.372 Character of Manager 0.693 0.695 0.045 15.426 0.598 0.776 Trust Reliance 0.481 0.05 Communication IWA 0.238 0.241 0.037 6.455 0.170 0.316 Affective Knowledge Worker 0.227 0.231 0.044 5.221 0.146 0.318 0.277 0.05 Commitment Trust Disclosure 0.280 0.283 0.036 7.747 0.213 0.352 Communication IWA 0.267 0.269 0.025 10.458 0.218 0.317 Job Trust Disclosure 0.269 0.272 0.031 8.560 0.212 0.331 0.346 0.05 Satisfaction Trust Reliance 0.196 0.199 0.031 6.355 0.132 0.256 Communication IWA 0.330 0.333 0.032 10.334 0.273 0.398 Support for Knowledge Worker 0.263 0.264 0.048 5.507 0.166 0.353 0.370 0.05 Change Direction Trust Reliance 0.240 0.243 0.029 8.207 0.180 0.296

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Important implications derive from these results. First, they continue to suggest that knowledge worker consciousness does not lead to higher trust, but does increase affective commitment and support for change direction (RQ6). Second, the two components of trust in manager, trust reliance and trust disclosure, have different effects. Third, communication is an important mediator for the immediate work area.

Finally, the perceived character of the immediate manager is a strong influence on trust and communication. Having identified the maximised model for the immediate work area, where all of the pathways and values are significant at the .05 level, a similar analysis is conducted for the variables that represent the organisational influence on the workplace circumstances.

3.2. Examining the Organisation

______

The variable trust in organisation is separated into its four components (trust AO, trust

BO, trust CO and trust SN11) to provide a more detailed analysis of the pathways for the organisational impact. Analysis of the questions shows that trust AO has high correlations with non-trust variables and so it is removed, leaving the three components of trust. Each of the variables12 are given direct effects on the organisational outcomes and the benchmarks are assessed. The relationships specified in the theoretical model are then assessed, as illustrated in Figure 4.3.

Comparison of the direct effects model, the partial mediation model and the trust mediated model reveals that the ‘trust only’ mediated model is the one that best fits the data, unlike the IWA pathways. Unexpectedly, knowledge worker consciousness is not strongly related to organisational outcomes or the trust variables.

11 Affective Organisational Trust (AO), Behavioural Organisational Trust (BO), Cognitive Organisational Trust (CO), Social Normative Organisational Trust (SNO) 12 Knowledge Worker, Disposition to Trust, Participation, Change, Character of Senior Manager, Communication ORG, Trust SN, Trust CO and Trust BO

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Figure 4.3: Mediated Relationships for ORG

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As outlined above for the IWA, this method similarly compares three possible models.13

Establishing that the ‘trust only’ mediated model is the strongest (for the ORG) meets

Baron and Kenny’s (1986) three step assessment of mediation. Additional testing of relationships between the variables, using the procedures outlined above identifies the model which most robustly represents the data collected, as set out in Figure 4.4. It shows the highest GoF of 0.955*14 and the mean R2 also improves to 0.50415. Table 4.6 provides the details of the values, with all of the values and paths significant at the 0.05 level (using bootstrapping).

This method has revealed the pathways for the impact of the organisational variables present in the data, allowing comparison with the immediate work area variables prior to establishing a consolidated model. At this point in the analysis it is important to note that disposition to trust is significantly associated with one component of trust in organisation, behavioural trust (trust BO). Participation is significantly associated with two components of trust in organisation, behavioural trust and cognitive trust (trust

CO). Organisational communication and character of senior management are mediated by all three trust components in influencing organisational outcomes. Social normative trust (trust SN) does not impact significantly on OCB but the other two trust components do impact on all of the organisational outcomes significantly. Change was not statistically robust for this analysis.

13 First, a model where all of the variables directly impact on the outcome variables and trust, second a model where all the trust antecedents impact on the trust variables and the outcome variables and finally a model where the trust antecedents influence the outcome variables solely through the trust variables. 14 above 0.90 and significant at the 0.05 level 15 higher than any other model, as is the mean Communality (AVE) at 0.629

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Figure 4.4: Maximised Model for ORG

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Table 4.6: Significance Testing, R2 and p value for Maximised Model - ORG Standard Critical Lower Upper Value Dependent Latent variable Value error ratio bound bound R² p (Bootstrap) Variable (Bootstrap) (CR) (95%) (95%) Participation 0.230 0.229 0.016 14.452 0.195 0.259 Character of Senior Management 0.319 0.318 0.014 22.219 0.290 0.347 Trust BO 0.644 0.05 Communication ORG 0.293 0.292 0.014 20.878 0.264 0.320 Disposition to Trust 0.164 0.166 0.017 9.744 0.133 0.200 Participation 0.240 0.242 0.026 9.262 0.186 0.288 Character of Senior Management 0.343 0.343 0.016 21.183 0.310 0.373 Trust CO 0.653 0.05 Communication ORG 0.352 0.352 0.013 26.287 0.325 0.377 Character of Senior Management 0.431 0.431 0.015 28.964 0.400 0.458 Trust SN 0.649 0.05 Communication ORG 0.421 0.422 0.016 26.998 0.388 0.451 Trust BO 0.245 0.248 0.017 14.728 0.213 0.280 Affective Trust CO 0.217 0.219 0.021 10.478 0.174 0.257 0.388 0.05 Commitment Trust SN 0.208 0.210 0.017 12.439 0.175 0.242 Trust BO 0.241 0.242 0.018 13.449 0.208 0.275 Job Trust CO 0.256 0.257 0.017 14.730 0.222 0.290 0.455 0.05 Satisfaction Trust SN 0.230 0.232 0.017 13.642 0.198 0.264 Trust BO 0.268 0.270 0.013 21.235 0.244 0.293 Support for Trust CO 0.276 0.278 0.013 20.775 0.249 0.302 Change 0.521 0.05 Trust SN 0.234 0.235 0.017 13.568 0.199 0.266 Direction Trust BO 0.248 0.252 0.030 8.158 0.189 0.306 OCB 0.211 0.05 Trust CO 0.237 0.242 0.032 7.317 0.178 0.306

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These results have important implications. First, consistent with the results above, they suggest that the knowledge worker consciousness does not lead to higher trust in an organisation (RQ7). Second, there is a difference in operation of the components of trust in organisation. Social normative trust is not associated with OCB however the components of trust in organisation do have a significant impact on organisational outcomes. Finally, communication and the perceived character of senior management are strong predictors of trust in organisation. Participation and disposition to trust are also important to some components of trust in organisation. Having identified the maximised model for the organisation, a similar procedure and analysis is conducted for the combined model which includes all of the variables influencing workplace circumstances.

3.3. Examining a Combined Model ______

The analysis so far demonstrates that there is a difference between the impact of the immediate work area and the organisation on the variables. As mentioned in Chapter three, PLS allows for the weighting of questions, and an assessment of all of the variables simultaneously. All of the variables are now considered together, so that a combined model may be assessed. Each of the variables are initially given direct effects on the organisational outcomes and the benchmarks are assessed. As in preceding sections, the relationships between variables are then specified as in the theoretical model and assessed as shown in Figure 4.5.

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Figure 4.5: Mediated Relationships for IWA and ORG Combined

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As outlined above for the IWA and ORG, this method compares three possible models.16 Establishing that the strongest model is the mediated one meets Baron and

Kenny’s (1986) three step assessment of mediation. Additional testing of relationships between the variables, using the procedures outlined above identifies the model which most robustly represents the data collected, as set out in Figure 4.6. It shows the highest

GoF of 0.940*17 and the mean R2 of 0.49318. Tables 4.7 and 4.8 provide the details of the values, with all of the values and paths significant at the 0.05 level (using bootstrapping). The logic of this analysis has been to utilise the capacity of structural equation modelling to develop a nuanced understanding of how trust operates within knowledge-based workplaces.

Table 4.7 shows that the following antecedent associations are significant at the .05 level. Participation, character of senior management, organisational communication and disposition to trust are significantly associated with behavioural trust. Similarly participation, character of senior management and organisational communication are associated with cognitive trust. Only character of senior management and organisational communication are associated with social normative trust. Participation and character of immediate manager are associated with trust in immediate manager, specifically trust disclosure. Character of manager is also associated with communication in the immediate work area.

16 First, a model where all of the variables directly impact on the outcome variables and trust, second a model where all the trust antecedents impact on the trust variables and the outcome variables and finally a model where the trust antecedents influence the outcome variables solely through the trust variables. 17 above 0.90 and significant at the 0.05 level 18 higher than any other model, as is the mean Communality (AVE) at 0.628

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Figure 4.6: Relationships for IWA and ORG Combined – Maximised Model

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Table 4.7: Significance Testing, R2 and p value for Combined Model - Antecedents

Standard Critical Lower Upper Value Latent variable Value error ratio bound bound Dependent Variable R² p (Bootstrap) (Bootstrap) (CR) (95%) (95%) Participation 0.226 0.226 0.017 13.487 0.190 0.259 Character of Snr Management 0.321 0.319 0.015 21.421 0.292 0.351 Trust BO 0.635 0.05 Communication ORG 0.293 0.292 0.015 19.904 0.264 0.321 Disposition to Trust 0.163 0.167 0.017 9.295 0.129 0.199 Participation 0.235 0.238 0.027 8.767 0.181 0.283 Character of Snr Management 0.346 0.346 0.017 20.457 0.312 0.379 Trust CO 0.642 0.05 Communication ORG 0.349 0.350 0.014 24.496 0.322 0.378 Character of Snr Management 0.430 0.431 0.015 28.537 0.401 0.458 Trust SN 0.644 0.05 Communication ORG 0.420 0.421 0.016 26.926 0.389 0.450 Participation 0.236 0.239 0.040 5.907 0.162 0.317 Trust Disclosure 0.216 0.05 Character of Manager 0.291 0.296 0.046 6.365 0.200 0.379 Character of Manager 0.744 0.746 0.040 18.585 0.661 0.820 Communication IWA 0.553 0.05

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Table 4.8: Significance Testing, R2 and p value for Combined Model - Organisational Outcomes

Standard Critical Lower Upper Value Dependent Latent variable Value error ratio bound bound R² p (Bootstrap) Variable (Bootstrap) (CR) (95%) (95%) Trust BO 0.243 0.246 0.017 14.223 0.211 0.276 Affective Trust CO 0.212 0.215 0.020 10.547 0.174 0.252 0.372 0.05 Commitment Trust SN 0.204 0.206 0.017 12.054 0.171 0.238 Trust BO 0.196 0.198 0.014 13.986 0.171 0.225 Trust CO 0.211 0.212 0.014 14.704 0.184 0.240 Job Trust SN 0.187 0.189 0.014 13.456 0.161 0.215 0.503 0.05 Satisfaction Communication IWA 0.144 0.144 0.016 8.832 0.111 0.175 Trust Disclosure 0.150 0.151 0.019 7.899 0.111 0.186 Trust BO 0.235 0.236 0.011 20.957 0.215 0.258 Trust CO 0.245 0.246 0.011 22.905 0.225 0.267 Support for 0.587 0.05 Trust SN 0.206 0.207 0.013 15.428 0.178 0.231 Change Direction Communication IWA 0.208 0.210 0.014 14.402 0.181 0.238 Knowledge Worker 0.211 0.218 0.031 6.849 0.156 0.280 Trust BO 0.222 0.225 0.022 10.184 0.181 0.266 OCB 0.280 0.05 Trust CO 0.213 0.216 0.023 9.119 0.169 0.261

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Table 4.8 summarises the significant pathways (all p>.05) between the mediators and the organisational outcomes. Behavioural trust, cognitive trust and social normative trust are associated with affective commitment, job satisfaction and support for change direction. Behavioural trust and cognitive trust are also associated with OCB.

Communication in the immediate work area is associated with job satisfaction and support for change direction. Trust disclosure is only associated with Job Satisfaction and knowledge worker consciousness is only associated with OCB. The results contained in this section and in this chapter have important implications which will be discussed in detail in Chapter five.

CONCLUSION ______

Having examined the impact of the IWA and ORG variables separately, this chapter has developed a nuanced and yet robust statistical model of the combined workplace effects.

Four questions were identified as statistically robust in the knowledge worker variable, indicating that knowledge worker questions based on self-identification and use of ideas are more effective. These same questions have been consistent whether examining the

IWA, ORG or Combined models, providing strong support for ‘knowledge worker consciousness’ as a robust means of identifying knowledge workers. Equally, the same questions were consistently excluded each time, suggesting that some aspects of knowledge work drawn from the literature – namely the use of symbols, highest qualification and on the job experience – are less useful in identifying knowledge workers (RQ7).

In concluding the data analysis in the thesis, there are a number of important implications from the results. First, increased understanding of the antecedents,

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outcomes, and role of trust in the knowledge-based workplace (RQ1). Second, ‘who trusts whom’ does make a difference as the different operations of trust at different hierarchical levels within the organisation attest (RQ2). Third, it is clear that while trust is central to the workplace, knowledge worker consciousness is not central to trust

(RQ3).

Character of manager is a strong driver of trust for the IWA (and communication), perhaps because of the interpersonal dimensions of trust. Character of senior management and participation in decision making are shown to be the strongest drivers of trust for the organisation, assisted in one aspect by disposition to trust (RQ4). High levels of ‘change’, do initially have a small negative effect on trust, however the effect is weak and not significant, leading to the variable having no part in the analysis (RQ4).

The importance of participation in decision making for trust has been highlighted

(RQ5). Communication is clearly important in the workplace, although analysis of the data suggests that communication IWA operates directly on organisational outcomes, while communication ORG has an impact through trust (RQ5).

The results from the data also support the importance of trust to the ‘soft-focus’ organisational outcomes. Communication IWA drives more outcomes than trust disclosure, but trust in organisation acts strongly on all organisational outcomes (RQ6).

Finally the results suggest that knowledge worker consciousness is significantly associated with the organisational outcome OCB. A detailed discussion of the answers to the research questions commences in Chapter Five.

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CHAPTER 5

DISCUSSION

Chapter 5 |Discussion

INTRODUCTION ______

Chapter two discusses the relationships drawn from the literature and set out in the theoretical model (Ch.2, Figure 2.1). Chapter three outlines the development and initial testing of the questions and variables used in testing the model. Chapter four reports on the analysis of the main survey data from Phase three, including relationships for the immediate work area, the organisation and a combined model. This chapter discusses the significant implications of the results. As the theoretical model being tested is drawn from claims in the literature, there are significant limitations in the data. Therefore, the chapter begins by acknowledging those limitations in Section one.

Section two outlines the theoretical contribution of the dissertation, discussing the results and answering the research questions. Section three briefly covers the empirical contribution of the measures developed in the research. The conclusion considers the possibility of wider implications.

1. SECTION ONE: LIMITATIONS ______

The results in Chapter four have significant implications for understanding trust in knowledge-based workplaces, and in identifying knowledge workers. However, it is necessary to consider the limitations. The first is that the study relies only on employee data. It is important to be very clear that, strictly speaking, the conclusions reached are about employee perceptions (Harley, Sargent and Allen, 2010). This analysis is capturing the extent to which employees report trust practices, rather than directly measuring the presence of the practices in knowledge-based workplaces. Second, the sample was a convenience sample with the majority of respondent organisations

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emerging from personal contacts. Nevertheless the research sites in the sample were consistent with the definition adopted in Chapter two. Third, respondents were self- selected - nothing is known about those who chose not to respond, or their reasons for not responding.

Fourth, the research design introduces the possibility of common method bias (CMB).

Data were collected using the same instrument and respondents, making it possible that associations between variables may be artificially inflated (Podsakoff et al., 2003), although the literature is divided on the importance of this phenomenon (Spector, 2006;

Conway and Lance, 2010; Lance, et al., 2010). Nevertheless, recommended steps were taken to reduce CMB, as mentioned in Chapter three, including ordering the questions randomly, reversing some questions, and ensuring anonymity (Podsakoff et al., 2003).

Post-hoc testing was not undertaken for this research. CMB cannot be entirely ruled out.

Fifth, PLS is less susceptible to concerns regarding nested models, however as our understanding of modelling the complexities of the workplace continues to evolve, there is a possibility that an unmeasured aspect of the management culture in the various sites has had an influence. No statistical controls for the possible impact of clustering or nesting were undertaken in this research.

Sixth, it is only possible to generalise with confidence about private sector IT workers in the organisations surveyed. Having said this, the sample is broadly similar to the

Australian IT workforce. It differs significantly, however, on various dimensions from the Australian workforce in general (gender is one example). This suggests caution in generalising to other sectors and occupations. It is possible, nonetheless, to make

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theoretically informed inferences about the applicability of the findings to other parts of industry (Harley, Sargent and Allen, 2010), which is done at the end of this chapter.

Seventh, this thesis has assumed capitalist relations of production to be intact, notwithstanding claims in some strands of the broad knowledge worker thesis. This dissertation adopted a narrow concept of knowledge. This is not intended to suggest that other concepts of knowledge could not be used in research.

Finally, the research design used in this dissertation has similarities with many other studies exploring associations between trust and other workplace phenomena (see Dirks and Ferrin, 2002). The study is cross-sectional and, unable to address causal relationships, in a strict sense. The strongest claim that can be made is that the results are consistent with the trust antecedents and outcomes in knowledge-based workplaces.

2. SECTION TWO: THEORETICAL CONTRIBUTION ______

Discussion now turns to the substantive implications of the findings. There were a number of questions that this thesis set out to answer. However, the discussion begins with the question that emerged in the course of the research (RQ7). As explained in

Chapter three, it became more important in the course of the research to answer the question ‘how can knowledge workers be identified?’. Eighty four percent of respondent employees identified themselves as knowledge workers, based on self- identification (Cerulo, 1997; Alvesson, 2000) and the use of ideas. Therefore this

‘knowledge worker consciousness’, is one method of answering the research question.

The results suggest the other possibilities for identification of knowledge workers, based on highest qualification Fleming et al., 2004), workplace experience (Brown and

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Duguid, 1991; Despres and Hiltrop, 1995) or the use of symbols (Reich, 1991) are less likely to be successful.

Returning to the implications of the findings for trust, Chapter two established a theoretical model of trust in knowledge-based workplaces which drew on the extensive trust and knowledge work literature. Specifically, this dissertation theorised that trust operates in knowledge-based workplaces in the same way that it operates in workplaces generally, adapting Dirks and Ferrin’s (2002) theoretical framework. However, the direct effects of knowledge worker consciousness, change and communication, demonstrate that the initial theoretical model, while confirmed in some aspects, requires amendment. Similarly, in answering the question (RQ1) ‘what are the antecedents and outcomes of trust within knowledge-based workplaces?’ the findings highlight the importance of the trust subcomponents. Trust in manager is composed of ‘relying on’ and ‘disclosing to’ the immediate manager. However, in knowledge-based workplaces, trust disclosure was the important component, but only for the one organisational outcome of job satisfaction. It may be that trust reliance is more important in other industries. The results indicating that trust disclosure and immediate work area communication are important for job satisfaction are not surprising; neither is the strong association between immediate work area communication and support for change direction. In this, knowledge-based workplaces mirror other workplaces trust (e.g. Mishra and Morrisey, 1990; Whitener, Brodt, Korsgaard, & Werner, 1998; Gilbert and Tang, 1998) in that communication is clearly important for successful change. However, variations appear in other organisational aspects.

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Addressing the related research question (RQ2) ‘does who trusts whom have an impact on trust within knowledge-based workplaces’, the finding is that trust in the immediate manager does operate differently to trust in the organisation. This is expected, given that

Dirks and Ferrin (2002) and others theorised that ‘who trusts whom’ is important.

However, new knowledge is gained through the finding that other associations may also depend on who the referent is. The implication is that one should be wary of theorising about trust and communication in general, but rather specify ‘trust in whom’, and

‘communication with whom’ in knowledge-based workplaces. Furthermore, the tension between eliciting knowledge and capturing knowledge may be addressed by assigning a different emphasis in the roles of immediate managers and senior managers. For example, the immediate manager may be charged with capturing knowledge while the organisation implements the ‘soft focus’ practices needed to maintain trust and organisational outcomes, however this possibility was not explored in this research.

An important contribution to knowledge in this thesis is the use of knowledge worker consciousness to answer the research question (RQ3) ‘do knowledge workers have high levels of trust?’ Critical theories of the workplace expected that knowledge workers would not have higher levels of trust, due to knowledge capturing, while the conventional KWT expected higher levels of trust. Where respondents had knowledge worker consciousness, they were more likely to report greater affective commitment, job satisfaction, OCB, support for change direction, and trust in the organisation.

However, when more of the workplace circumstances are considered, the results are more nuanced, showing that knowledge worker consciousness operates more strongly as a direct effect on some organisational outcomes, rather than through trust. Therefore,

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the answer to the research question is that at some level, those who perceive themselves as knowledge workers do have higher trust in organisations, but do not have higher levels of trust in their immediate manager.

The stronger relationship of knowledge worker consciousness with organisational outcomes provides some support for a more critical view of knowledge-based workplaces. Specifically, workers’ identification of themselves as knowledge workers

(Cerulo 1997; Alvesson 2000) has direct effects on organisational outcomes, supporting the critical view of ‘the knowledge worker’ as more of a normalising discourse

(Knights, Murray et al. 1993), and a system of persuasion (Blackler, 1995). This is another important contribution of the research.

Turning to the next research question (RQ4) ‘are character of manager and change antecedents to trust within knowledge-based workplaces?’, the ‘change’ aspect is considered first. In this research, change is shown to be an antecedent of trust. The results confirmed high levels of change, but surprisingly this did not have a significant negative impact on trust, contrary to the result expected from the literature (e.g. Mishra and Mishra, 1994; Mishra and Spreitzer, 1998; Morgan and Zeffane, 2003). One possible explanation is that workers within the IT industry have adjusted their understanding or expectations regarding the pace of change, or indeed welcome change as a means of retaining and/or learning new skills. In an industry where new players continually appear and new coding languages, such as android, spread rapidly an IT worker may conceivably wish to be exposed to new things on an ongoing basis. This view is often reported anecdotally.

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The findings related to perceived character are another important contribution to knowledge. Character of manager emerges as a highly influential antecedent for both trust disclosure and immediate work area communication. Character of senior management also emerges as one of the strongest drivers of trust in organisation. A manager’s character is a key theme in trust theory (e.g. Dirks and Ferrin, 2002), yet largely overlooked in the knowledge worker literature. As discussed in Chapter two, the knowledge work literature generally does not consider the ‘trust antecedents’ present in various theories of workplace trust. The findings show that trust antecedents are an important component of any theory of trust in the knowledge-based workplace. The perceived character of the immediate manager and senior management are shown in the results to shape the attitudes and reactions of workers. This thesis clearly indicates that, in the context of knowledge-based workplaces, ‘perceived character’ plays a greater role than recognised in the literature. This represents a new understanding of trust in knowledge-based workplaces, and conceivably other workplaces.

The answer to the (RQ5) ‘do communication and participation in decision making increase trust within knowledge-based workplaces?’ is equivocal. As mentioned earlier,

‘communication with whom’ is important in knowledge-based workplaces. The fact that communication in the immediate work area has important direct effects on support for change direction and job satisfaction, is perhaps unsurprising. However, the mediation of immediate work area communication in a similar way to trust was unexpected. Less surprisingly, organisational communication is mediated through three subcomponents of trust indicating an important difference in the referent for communication.

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The importance of the subcomponents of trust in organisation to organisational outcomes is also contained in the results. The research question (RQ6) ‘does trust increase ‘organisational citizenship behaviour’, ‘job satisfaction’, ‘support for change direction’ and ‘affective commitment’ in knowledge-based workplaces?’ is answered as follows. In the combined model, all three organisational trust subcomponents (AO, BO,

SN) were important for organisational commitment, OCB, support for change direction and job satisfaction (with the single exception of social normative trust and OCB). The effects on organisational outcomes differed depending on whether the immediate work area, the organisation or a combined model is considered, supporting the contention that the specific circumstances of knowledge-based workplaces should be considered to better understand their relationships. The findings of strong relationships between trust and organisational outcomes are unsurprising given the large body of research showing similar results (e.g. Dirks and Ferrin, 2002). The results show that trust does increase organisational citizenship behaviour, job satisfaction, support for change direction and affective commitment in knowledge-based workplaces.

Having answered the research questions, other findings from the research are considered. This research provides some support for the inclusion of ‘knowledge worker consciousness’ and trust in a definition of knowledge workers. Consideration could be given to adapting Warhurst and Thompson’s (2006) definition to create a new definition of knowledge workers as follows:

‘The central characteristics of knowledge workers are that they identify themselves as knowledge workers and draw on a body of theoretical (specialized and abstract) knowledge that is utilized, under conditions of comparative autonomy and trust.’

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This is an important contribution to knowledge. If this definition is used by others in future research into knowledge workers, it may lead a better understanding of knowledge workers and their workplaces. It may also assist in establishing whether knowledge workers differ from other workers in high trust environments.

Another contribution is the differentiated nature of the results for the impact of character of managers and senior management. As with other trust antecedents, the theoretical model was confirmed in positing that immediate managers have a different impact on trust when compared to senior management. Although there is logic in this statement, even the extensive trust research from other disciplines does not usually consider differences of trust within organisations. These findings have identified the antecedents and outcomes of trust within knowledge-based workplaces, however, there is a strong possibility that these findings have implications for theories of trust within other workplaces.

Disposition to trust is a long standing antecedent of trust, in both theory and research

(generally as a control variable). This research shows that it is associated with only one sub-component of trust in organisation. It is possible that this indicates that where trust is less interpersonal, a general propensity to trust is more important.

SECTION THREE: EMPIRICAL CONTRIBUTION ______

This study utilised Gillespie’s (2003) Behavioral Trust Inventory (BTI), designed to assess the willingness of an individual to be vulnerable in interpersonal work

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relationships, as the measures for trust in manager. Acknowledging the importance of differing trust referents (Dirks and Ferrin, 2002) the thesis argues that Ferres’ (2003)

Workplace Trust Survey (WTS) measures are the most appropriate for measuring trust in the organisation. The BTI measures interpersonal trust between employees and managers, particularly ‘relying on’ and ‘disclosing to’ a manager. For the less immediate ‘organisational trust’, personal interactions do not play such a large role.

Ferres (2003) argued that rather than trust in one manager, the degree of trust within an organisation also depends on management as a group. The results support this distinction, implying that future research should seek a more nuanced understanding of trust. In particular, even within notions of trust, ‘relying on’ and ‘disclosing to’ appear to operate differently. Similarly, different components of trust in organisation also operated differently on organisational outcomes.

It is generally accepted that knowledge workers face an increased rate of change. This thesis adapted the Dunphy and Stace (1993) contingency model to establish measures of the varying degrees of change and the different approaches by managers to gain workers’ opinions about planned changes. Empirically, the data has indicated there are high levels of change, however for the knowledge-based workplaces surveyed in this study, the negative effect on trust in manager and organisation was small and ultimately insignificant. The results do however indicate that the objective information on change practices did assist in the sample design – the workplaces did have high rates of change.

Similarly, the theoretically informed selection of departments within organisations that

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used abstract knowledge under conditions of comparative autonomy did achieve the aim of capturing knowledge workers (84% of the sample).

Finally, the new measure of ‘perceived character of manager’ is a strong trust antecedent, which influences other generally accepted antecedents. It would be interesting to test this new measure in other trust studies, particularly in other industries.

Confirming the usefulness of all of the new measures created for this research may be fruitful areas for further research.

CONCLUSION ______

The findings presented in this and the previous chapter provide a means to develop our theoretical understanding of the role of trust in knowledge-based workplaces. They indicate that in part, trust works through the behaviour of managers. In addition, the conventional KWT of high trust is shown to be correct to some extent, but not in all circumstances.

Contextual factors are also considered and an attempt made to develop some preliminary insights into the specific circumstances in which trust delivers positive organisational outcomes. Although conclusions must remain speculative and provisional, the findings suggest that in knowledge-based workplaces trust does deliver benefits to workers and management. Moreover, in this specific context, the character of managers and senior management, communication and participation in decision making work partially via enhancing trust. The implication is that in other similar settings –

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perhaps for example, among professional staff in research institutes and universities – similar outcomes and apparent causal paths could also be found. The challenge for future research which seeks to go beyond general or perhaps universal claims of ‘high’ and ‘low’ trust is to test associations in a range of settings, explicitly considering ‘who trusts whom’, as a means to develop more detailed knowledge of when and how trust has positive or negative outcomes.

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CHAPTER 6

CONCLUSION

Chapter 6 |Conclusion

OVERVIEW ______

This thesis examines the broad claims about the emergence of a knowledge society.

These earlier claims were widely adapted into claims about knowledge-based workplaces. In particular that they were characterised by high levels of trust as a central feature of ‘soft focus’ management. One important aim of this thesis has been to interrogate this claim. One immediate difficulty was the need to identify what was meant by knowledge. Understandings in the literature varied wildly, even, or especially, where a definition was offered. Tensions were apparent between narrow definitions on the one hand, sometimes including only abstract theorists, and on the other hand sweeping generalisations that included movie ticket sellers. Ultimately, given that this thesis was going to be an examination of the theoretical links between trust and knowledge work, a conception of knowledge needed to be operationalised, so

‘theoretical knowledge that was applied to particular tasks’ was selected.

The next step was to define a knowledge worker. Given the lack of clarity and broad claims that generated the term knowledge worker, it should not have been surprising that there was a tension in definitions (when they were offered at all), similar to those surrounding knowledge itself. Beginning by examining the argument that a ‘new class’ of worker had emerged, the influence of this debate on understandings of knowledge work was traced, with particular consideration of who possesses knowledge. After examining various attempts to define knowledge and knowledge workers, this thesis has argued that the tensions between these themes are difficult to resolve. This thesis adopted the ‘conventional’ view of knowledge. Initially using the IT industry as a proxy for knowledge work, a number of questions were then developed to include various

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Chapter 6 |Conclusion formulations of what a knowledge worker was thought to be. In addition to emphasising that the data relies on workers’ perceptions, self-conception includes: the respondents understanding of the organisation’s conception of the worker, the manipulation of ideas, the use of symbols and the use of the highest qualification gained. The possibility of knowledge workers identifying as such through the use of knowledge that is not written down and/or can only be gained on the job was also considered, but rejected after initial testing. This in itself has been a useful contribution of the thesis – the development of preliminary evidence about ways of identifying knowledge workers, especially the utility of asking knowledge workers about their consciousness of being a knowledge worker.

As mentioned above, in much of the ‘conventional’ KWT literature, the assumptions about the knowledge-based workplace, and the relations between workers and managers, centred on trust. The assertions of a high trust environment for knowledge workers emerged from the early broad utopian views of the ‘new society’, adopting various ‘soft focus’ ideas along the way. These assertions were seldom examined with any of the rigour that was applied to trust research in other disciplines. In addition, the tension between the need for trust in eliciting knowledge and the undermining of trust when organisations capture workers’ knowledge was identified. Discovering and incorporating the work that has been done in social psychology and other areas opened an enormous amount of material that needed to be rendered in a way that could be sensibly applied to knowledge worker-management relations (Frenkel et al’s, 1999

‘vertical relations’). In managing that task, this thesis may be of assistance to others who may wish to examine these relationships.

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Chapter 6 |Conclusion

This dissertation has sought to carefully delineate the various components of the literature by shaping them into a theoretical model. The centrality of trust to the knowledge worker claims and assumptions, both implicit and explicit, has a number of consequences for the workplace. The antecedents, consequences and outcomes of trust were registered and shaped by the different circumstances present in workplaces.

Specifically, the decision was made to examine the impact of the immediate work area and the organisation on knowledge workers. It is clearly possible to trust an immediate manager, known more or less personally and not to trust senior management whom one may never have met. There is surprisingly little existing research that seeks to deploy such a nuanced understanding of the specific circumstances of trust within workplaces.

Another area of the knowledge worker thesis which had little theoretical development or empirical research is the characteristically high levels of change in such environments.

Against the thrust of many research findings1, this research has found that high levels of change per se do not have a significant impact on trust. It is suggested in Chapter five that IT workers may have become accustomed to these high levels of change, and perhaps even welcome it.

The high level of trust expected for knowledge workers had strong implications for the expectations of management, largely reflecting the cross pollination from the soft HRM literature. The knowledge worker thesis generates expectations of high levels of communication and participation in decision making that help to build trust and to elicit knowledge. Interestingly, the empirical research largely confirmed this aspect, common in the trust research, that communication and participation do build trust. An unexpected diversion from the theoretical model was uncovered in that communication

1 See Chapter two, Section five in particular. ______Page| 179

Chapter 6 |Conclusion operates directly on organisational outcomes for the immediate work area.

Organisational communication is mediated by trust as expected from the literature (e.g.

Creed and Miles, 1996; Whitener, Brodt, Korsgaard, & Werner, 1998; Gilbert and

Tang, 1998). This may indicate that the importance of communication to trust is worthy of emphasis, contrary to Musacco’s (2000) view.

The results also demonstrated that trust antecedents are an important component of any theory of trust in the knowledge-based workplace. A new finding of this thesis was the impact of the character of managers and senior management on trust (as perceived by the worker). Character of manager emerges as highly influential on trust and on communication (for the immediate work area). This new measure is a strong trust antecedent, which may influence other generally accepted antecedents. Character of senior management has been shown to be one of the strongest drivers of trust for the organisation. This thesis has clearly proposed ‘perceived character’ as a new theoretical development in understanding trust in the workplace.

If, as the conventional KWT suggests, knowledge workers hold the means of production in their heads, this knowledge can ‘walk away’, therefore requiring engagement through cultivating trust. Cultivating trust is said to generate desirable organisational outcomes such as OCB, job satisfaction, support for change direction and organisational commitment. Through this engagement, knowledge workers are ‘bound’ to the organisation and their knowledge is both retained and elicited for the use of the organisation. On the other hand, critical scholars observe that the pressures for codification and capture of knowledge from the organisation can in fact undermine the trust that is at the heart of this engagement, showing two very different views of the workplace. This research has untangled these differing conceptions. It is clear that trust ______Page| 180

Chapter 6 |Conclusion does indeed have a strong influence on organisational outcomes. However, a major contribution of this thesis is to show that while trust is central to the workplace, knowledge worker consciousness is not central to trust. It may be that knowledge worker ‘dynamics’ are somewhat separate from trust.

Another important contribution to knowledge was assessing the competing theories of the workplace, as discussed in Chapter two. Workers who identified themselves as knowledge workers were more likely to report greater affective commitment, job satisfaction, OCB, support for change direction and trust in the organisation. However, when more of the workplace circumstances were included, the results were more nuanced, showing that knowledge worker consciousness operates more strongly as a direct effect on some organisational outcomes, rather than through trust. Those who perceived themselves as knowledge workers did have higher trust in the organisation, but did not have higher levels of trust in their immediate manager. Workers’ identification of themselves as knowledge workers had direct effects on organisational outcomes, providing some support for a more critical view of ‘knowledge worker’ as a normalising discourse or system of persuasion (Blackler et al., 1993; Thite, 2004). This research has also shown that Warhurst and Thompson’s (2006) definition was useful for selecting a sample of knowledge-based workplaces and Chapter five proposed some additions to that definition.

Regarding trust in the knowledge-based workplace, this dissertation theorised that trust operates in knowledge-based workplaces in the same way that it operates in other workplaces (e.g. Dirks and Ferrin, 2002), rather than in a special or unique way.

Communication in the immediate work area had important direct effects on support for

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Chapter 6 |Conclusion change direction and job satisfaction but organisational communication was mediated through trust.

There were a number of research questions that this thesis answered. One that emerged in the course of the research was the need to identify knowledge workers. An important contribution to knowledge was the successful identification of knowledge workers in the IT industry based on questions about knowledge worker consciousness. The results also suggested that other possibilities for identification of knowledge workers, based on highest qualification, workplace experience or the use of symbols are less likely to be successful. This thesis has also added to knowledge by refining the existing definition of knowledge workers.

New knowledge was gained in finding that associations may vary depending on who the referent is. The results confirmed that the impact of the circumstances for the immediate work area and the organisation are different, in these knowledge-based workplaces. An important implication was that one can no longer theorise about trust and communication in knowledge based workplaces, rather one must specify ‘trust in whom’ and ‘communication with whom’. A possibility arising from these findings is that research examining organisations could miss important effects of the different levels of the management hierarchy within those organisations.

The effects on organisational outcomes differed depending on whether the immediate work area, the organisation or a combined model was being considered. This supports the contention that trust sub-components and the specific circumstances of knowledge- based workplaces should be considered to better understand their relationships.

Research that considers trust as a single variable may miss important connections

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Chapter 6 |Conclusion between the antecedents and outcomes of the sub-components of trust. The results did show that trust increases organisational citizenship behaviour, job satisfaction, support for change direction and affective commitment in knowledge based workplaces.

Communication and participation in decision making did increase trust within knowledge-based workplaces, however the mediation of immediate work area communication was unexpected. Disposition to trust was associated with only one sub- component of trust in organisation, possibly indicating that where trust is less interpersonal, a general propensity to trust is more important.

A further addition to knowledge is the differentiated nature of the results for the impact of character of managers and senior management. As with other trust antecedents, the theoretical model was correct in suggesting that immediate managers have a different impact on trust when compared to senior management. This has important implications for all workplace based theories of trust.

THESIS STRUCTURE ______

Structurally, this thesis has developed a theoretical model from the literature (Chapter two) and then undertaken a research strategy to test that theoretical model. Initially a focus group and small survey test (n=23) was conducted in Phase one. A larger group in

Phase two (n=96) was used to test the questions crafted by the researcher (for character of managers, communication, support for change direction and the adaptation of

Dunphy and Stace (1993). A component of the responses within Phase Two (n=53) provided an opportunity to test ‘knowledge worker’ questions and the use of an online survey. Finally, the main study in Phase three (n=255) provided survey responses for testing the theoretical model. ______Page| 183

Chapter 6 |Conclusion

Chapter four used the data (gathered in Phase three) to assess the impact of the specific immediate work area and the organisational circumstances. A combined model was then compared to the theoretical model and significant differences noted. A number of controls were included in the survey, to assist in a robust test of the model. Specifically age, gender, disposition to trust and whether the respondent was a supervisor were included. Disposition to trust had a small, significant effect. Chapter five then discussed the findings, drawing out important theoretical contributions and new knowledge.

FURTHER RESEARCH ______

Theoretical developments in understanding workplaces require a sound conceptual basis. There is too little attention to, and agreement on, what a knowledge worker is. If there is in fact no difference between ‘a worker’ and ‘a knowledge worker’, this should be established with a corresponding focus of theoretical development on the workplace.

It is hoped that the suggestions for defining knowledge worker (in Chapter five), which were prompted by the results, may assist in this development. Similarly, management theory could progress further by giving greater attention to important developments in related disciplines that take a different approach, or have a different perspective. Two major findings provide fruitful starting points for further research: identification of knowledge workers, and the importance of the character of managers to trust.

Two additional areas for future research are the high levels of change, and the impact of change on trust. Workers within the IT industry appear to have adjusted to high levels of change. Research could establish whether this is the case in other industries. Further research might also consider whether change is in fact detrimental to trust, or whether change is welcomed as a means of retaining and/or learning new skills.

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Chapter 6 |Conclusion

Further research should seek to engage in more sophisticated designs, in order to better reflect the nuances of the various levels of management within organisations.

Organisations, even small local ones appear to have a complexity in their hierarchy, which is more often expected in multinational corporations. These different circumstances within organisations may be fruitful ground for additional research into the impact of both trust referent and communication referent. All of the preliminary findings of this research would also benefit from longitudinal study.

Finally, a few points arise from the results reported here. Trust is probably important in all workplaces, but it may be more important in knowledge-based workplaces.

Knowledge workers may also have a form of professional pride where disclosure helps them to do their job, but they do not rely on their immediate manager. Similarly, if the organisation changes direction in a way that a worker agrees with, they may be more satisfied than when the organisation’s direction is not one they agree with. These are all questions that arise from this research and may be fruitful areas for additional inquiry.

CONCLUDING REMARKS ______

The theoretical model initially developed in this thesis represents a new way of considering the knowledge worker and trust literature. Through clearly identifying aspects of the ‘soft focus’ ideas of the working conditions for knowledge workers, the centrality of trust in knowledge-based workplaces has been demonstrated. This research has tested the theoretical model’s utility using the experience of individual knowledge workers in their workplaces, and has included the impact of immediate managers and the organisation. This understanding of trust in knowledge-based workplaces provides an opportunity for an increased focus on the nuances of both trust and other workplaces.

______Page| 185

Chapter 6 |Conclusion

______Page| 186

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APPENDICES

Appendices

Appendix A: Ethics Approvals University of Newcastle 2004-2007

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University of New South Wales Ethics Approval 2006-2007

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Appendix B: Survey

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