Proceeding of 1st International Conference on Human Capital and Knowledge Management
Human Capital Dynamics of Regional Growth in Nigeria: Dynamic Panel Data Approach
Ali Idrisa Gambo*1, Zalina Mohd Daud2, Maizah Hura Ahmad3 1,3Department of Mathematics, Faculty of Science, 2Razak School of Engineering, Univerisiti Teknologi Malaysia. Malaysia (*[email protected])1
Abstract - We used Nigerian regional cross sectional forms the critical mass, in any region allows that region to and time series data of physical and human capital speed up its rate of catching up with the other rich accumulation to run a growth accounting regression regions. It is the major asset that allows poorer regions to captured by an aggregate production function. The tap into the available opportunities that is availed in the results indicated that Human Capital proxied by economy. Public Primary and Secondary Schools enrollments Furthermore, the quantity and quality Human capital are not significant in explaining per capita income proxied by the number and quality of technically levels in certain regions. Equally, they carry the wrong proficient persons in any region or country, makes the signs (negative). The results showed that the initial absorption of the available and new technologies easy and human capital stock has an influence on the GDP per faster,which in turn allows the increase in the production capita growth rate. Regions (Southwest) with a head processes, which increases the regional productivity, thus start school attendance have higher thresholds or improving the regional per capita income, which has a higher technical frontier; higher levels of schooling direct bearing on the level and quality of economic (secondary school) have significant impact on their growth in a region and the country at large. GDP per capita growth rate. While the Northern In generall human capital can be termed as the regions have lower technical frontier; as only the totality of any stock of knowledge or the particular primary school have significant impact on the GDP attributes of the Individual worker or collection of per capita growth. However we find that the federal workers that is acquired through academic institutions financial allocation from the federation accounts to be and, or innately endowed, that enhances and contributes significant across all regions with the exception of the to the worker’s productivity [1]. This impliedly, is the SouthSouth regions, and positive investment in quality of the personnel involved in the economic physical assets of education i.e.number of schools. The productive processes of the general economy and the implication of this is that, physical investment in specialized industries, is one of the major construct that is education (human capital) has a positive effect, the required in modeling the growth processes. challenge is that of student retention in school. Although, a few studies have confirmed the relevance of the growth model to Nigeria using the exogenous growth technique, none has applied the new endogenous Keywords–Dynamic Panel Data, Human Capital, model at the regional level. Majority of these studies have Regional Growth, Nigeria relied on nationally aggregated data, without examining the local spread of economic growth amongst the I. INTRODUCTION components of the Nigerian nation. This study is, therefore, an attempt to contribute to this debate, by using Most macroeconomics treatises and researches aggregate production function approach to estimate an focused on the determinants of growth on cross country endogenous GDP per capita growth rate for the Nigerian studies or inter regional convergence process. This is regions in panel data framework. To achieve this, the paramount given that the regional economic growth is study presents a review of relevant literature on growth somewhat uneven, that is, it is not balanced in approach rate model including the essential elements of the model, or spread. One of the major thrusts upon which economic as well as a few other models used in estimating the growth is hinged is the Human Capital factor as an input determinants of growth rate. The third section explains the in to the growth process and a key determinant of the data used and the estimation procedure. The fourth section subsequent convergence processes. How could the growth discusses the empirical results and the final section processes be moved and converge if there are uneven concludes. patterns or disparities in the basic Human capital structure Broadly the objectives of this study are the in any particular country or any Geographical location. determination of education as an important factor in Within National boundaries, educational or human regional per capita income growth and regional growth capital disparities makes it extremely challenging or dynamics. To achieve these objectives, the study utilized rather difficult for poorer regions to catch up with the rich the educational panel data set of the 36 states in Nigeria regions.Secondly, according to the general literature on during the period 1999-2008. The aim is to shed light and growth empirics, a large mass of Human capital that contribute to the literature on the issues surrounding the
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impact of Human Capital on regional GDP per capita (Lucas 1988) a , where a production function is used to growth in a Sub Saharan African country.As described model the output of the domestic economy, with physical above, this study will examine the extent to which assets, and the stock of Human capital. In this model, the primary and secondary schools (as proxies for Human engine of growth is the Human Capital, as human capital Capital) drive local welfare positions of the citizenry the 6 accumulation raises the level of productivity in terms of Geopolitical Zones in Nigeria. The general economic labour and physical capital. This modeling approach theory postulates that, Human Capital has a positive and “endogenises” the Human capital. significant effect on GDP per capita growth. The endogenous economic growth model and many This paper considers the states grouped into 6 Geo other models of growth rate determination certainly political zones as homogenous regions and the states data helped in explaining the dynamic pattern of economic on public school enrollments as proxy for human capital, growth rate and undoubtedly contributed to the number of schools in the states as a form of physical understanding of the cross country economic growth capital investment in human capital. And the State’s rates. However, despite the wide acceptance of the model, Financial Allocation from the Federation Accounts, there is still divergence of opinions amongst academic because of the fact that most states are dependent upon researchers and policy analysts as to the applicability of the Federal Government Allocations from the Federation the model to emerging/developing economies. Accounts, to run the public services. Central to the In a developing economy, the determination of the development of economic growth, there is the question; nature of the economic growth potential, productivity why do growth rates across countries differ and what levels, and output is a very important task. Because the factors causes these differences. Throughout the modern economic growth and social welfare nexus is a evolution of mainstream growth economics, from Adam fundamental fulcrum of reducing poverty, inflation levels Smith to Schumpeter, policy makers and economists have and stabilizing the monetary exchange rates of the tried to underhand what make some countries rich and domestic economy and currency. The importance of the others poor. Understanding these processes and its Human Capital in the productivity of economic growth dynamics has been the central focus of researches on has been well established and recognized in the economic economic growth disparities. How countries tend to literature. Mincer’s(1974) b seminal work on the converge at a particular point in time on the growth curve determination of individual earnings in particular and the have been the focus on economic growth literature. The labour economics generally introduced human capital to major framework of understanding these processes have the mainstream economics literature. Major seminal been dependent on the construct of capital and works that emphasized the importance human capital in technological accumulation through trade, as necessary the determination of the economic growth and conditionalities for economies to grow fast enough to convergence in the economic literature, seminal works have spurned positive social changes, which have positive like that in [14], [10] [4,5 and 6]. All these studies showed externalities on the welfare conditions of the citizenry. that the accumulation of Human Capital can spurn and The first clear exposition was first expounded by sustain economic growth in the short term and sustain Solow and Swan (Solow-Swan 1965). Solow posited that economic growth in the short run as well as the long run countries economic growth moves up until it reaches growth process and have positive externalities on the steady state point. Implying that countries tend to grow economic growth. until they reach equilibrium position, where they experience declining rates of return on their investments II. METHODOLOGY on the factors of production and thus stagnate. While poor countries in the meantime will endeavour to catch up and A simple Cobb-Douglass aggregate production functions eventually catch up with rich countries by adopting the with Human capital as a factor of production, in which the same path taken by the rich ones. Thus in due course the dependent variable is specified. Reference [7] specified an poor countries will catch up. This position “exogenise” all aggregate production function as: factor of production and based the rate of growth on the assumption of decreasing returns to scale on the factors of (1) production. Thus, the need for a new theoretical underpinnings as Where = per capita income as the dependent variable well as empirical representations of the economic growth = physical capital process became necessary, not only on the basis of the = Labour force disparities between countries growth rate, but also to = Human Capital determine the future path of the growth movement and the = Technology speed of such movement. Hence, the birth of an unending intellectual debate immediately after the outset of the Solow-Swan Growth “exogenous” growth rate regime in aLucas R.E (1988): On the Mechanics of Economic the mid-1970s. During this early period, saw the Development. Journal of Monetary Economics 22 (3-42) emergence of the Lucas Model of Economic Growth b Mincer, Jacob (1974): Schooling, Experience and Earnings. New York. Columbia University Press.
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= Error term their impact on the GDP per capita, an autoregressive coefficient term of the dependent variable is introduced By taking the log differences of equation (1), the amongst the regressors. Thereby turning the static (fixed specification becomes; effect) regression model into a Dynamic panel model. The addition of the lagged dependent variable allows for = + feedback from current or past shocks to current values of + + + the dependent variable to be captured in the model as (2) outlined in equation (10).
III. RESULTS
[ ] [ ] [ ] [ ] [ ] (3) The regressors were converted into Logarithmic values before the analysis was run, and the data were Which is an expression for the long term growth per classified according to the 6 regions in the country. This capita income. A key challenge in estimating such an allows the data to be as homogenous as possible, given equation is the possibility that the physical and human the fact the Nigerian context is a diverse and c capital will be correlated with the error term ( . heterogeneous in nature. The results yields are different from the expected theoretical positions based on the By making assumptions and allowances for the estimation general results reported from other applications in the of equation (3), in OLS, the equation can be rendered into Literature. a dynamic panel data model, thus; Standard Panel data estimation techniques were used to estimate the GDP per capita income in Nigeria. The
∑ utilization of panel data (time series and cross sectional (4) data) gave allowance for higher degrees of freedom in the estimation process and has the advantage of including The GDP per Capita is used as the dependent variable specific state effects within the region thereby giving which will show the level of change in the regional more data information and reducing the multicollinearity welfare growth determinants. The effect of the regressors effects and this allows for a dynamic specification. ware estimated using OLS regression, Fixed Effect and Dynamic Panel analysis. Table 1. We start the analysis by specifying a Pooled OLS Pooled OLS Results for the 6 Regions in Nigeria regression equation; NE NW NC SE SW SS (5) Finance 0.023 0.1807 - 0.121 0.1453 953 999 0.028 910 This specification produces consistent and efficient 0.2136 912 (0.61) (4.34)* 76 (3.21) parameter estimates, if there is no individual effect 946 (4.49)* * (- * (3.53)* * 0.32) Uieither in the cross-sections or the temporal section. No_PriSC 0.567 - - - Thus the model becomes; H 1.3518 0.6192 948 0.0027 0.371 0.054 99 551 (4.49) 97 13 753 (6.63)* (4.58)* ** (-0.02) (- (- * * 1.41) 0.26) PubPriEn 0.066 0.1502 - - (6) rolM 0.5440 026 76 1.380 0.109 0.4176 396 (0.87) (1.78) 87 16 Secondly, a Fixed Effect Panel model (LSDV) with 952 (4.50)* (- (- dummies to capture the individual effect in the cross- (1.11) * 0.92) 1.07) PubPriEn 0.249 0.1520 2.033 - sectional dimension. The model is specified as; rolF - - 633 11 81 0.042 0.4383 0.2296 (2.55) (-1.62) (1.39) 64 83 10 * (- (-1.01) (-1.91) 0.54) No_SecSC 0.115 - 0.017 - H 729 0.0261 171 0.076 0.0679 0.0130 (2.05) 4 (0.11) 42 (7) 471 482 * (-0.44) (- (0.83) (0.40) 0.95) PubSECS 0.5516 0.0233 0.283 0.2727 0.486 - The dummies were added to reflect the number of states CHM 333 687 287 61 130 0.629 in every region under analysis. (2.03)* (0.32) (1.68) (-1.26) (- 01 To capture the dynamics that are inherent in the growth process, between the introduction of the regressors and c The Analysis was run using STATA version 12
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2.03)* (- Table 2. 2.35)* Fixed Effect (LSDV) Results - 0.3821 1.023 0.876 PubSECS NE NW NC SE SW SS CHF - - 0.077 26 196 1
0.4256 0.0112 1 (1.72) (4.23) (3.15) Finance 0.195 0.143 0.0262 0.1026 0.055 0.0129 32 81 (- ** * 756 556 93 717 09 747 (-1.73) (-0.290 0.49) (4.55) (4.72) (0.66) (2.05)* (0.84) (0.30) Cons - - 4.2261 - 6.497 ** ** 7.3257 - 2.410 5 1.574 393 No_PriSC 0.205 0.782 0.5387 - - 0.0151 4 2.7291 55 (2.86)* 00 (4.26) H 987 763 83 0.4830 0.166 493 (- 6 (- (- ** (2.60) (5.40) (3.95)* 9 96 (0.07) 3.67)* (- 1.71) 0.53) * ** * (- (- * 2.71)* 2.26)* 0.70)
PubPriEn - 0.402 0.0809 0.1084 - 0.0081 F 17.92 70.05 20.82 7.68 12.89 6.78 rolM 0.188 139 85 31 1.008 64 2 0.7069 0.8878 0.737 .05614 0.634 0.477 R 59 (2.54) (1.00) (1.62) 07 (0.10) 0 2 (- ** (- Adj R 0.6674 0.8751 0.701 0.4883 0.585 0.406 1.50) 0.73) 6 9 PubPriEn 0.118 - 0.2286 - 1.429 0.0300 RMSE 0.2788 0.1543 0.188 0.1771 0.376 0.271 rolF 116 0.179 98 0.0363 272 51 1 3 0 (1.34) 974 (2.18)* 8 (1.05) (0.32) (- (-0.43) Notes: The (*) signifies variable significant at 5%, (**) significance at 1.27) 1%. Values in brackets are t-ratios. NE=NorthEast, NW=NorthWest, No_SecSC 0.035 - 0.1087 0.2283 - 0.2081 NC=NorthCentral, SE=SouthEast, SW=SouthWest, SS=SouthSouth, H 467 0.007 676 83 0.019 76 regions. (0.66) 32 (1.88) (2.83)* 73 (2.26)* (- (- Equation (6) was estimated using the panel data Pooled 0.22) 0.16) PubSECS 0.147 - 0.3082 - - - OLS techniques and the results were reported in Table.1, CHM 713 0.020 91 0.1989 0.557 0.0193 for all the 6 regions. The results obtained from the OLS (1.19) 901 (1.76) 47 04 81 estimation showed a varying degree of differences (- (-1.06) (- (-0.06) between the models fit for the different regions. Four (4) 0.27) 3.49)* regions {NE, NW, NC and SW}, the OLS estimation fits * PubSECS - 0.032 - 0.2605 - - the data, quite well by explaining on average 60% of the CHF 0.071 061 0.0657 58 0.041 0.0940 variation the data. Two (2) regions {SE and SS} showed 80 (0.74) 51 (1.33) 28 56 an average variation below 50% by the pooled OLS (- (-0.41) (- (-0.25) estimation model. Federation account allocation from the 0.57) 0.19) Cons 2.864 - - 7.7941 9.722 8.2604 federal seemed to be significant with a level magnitude in 54 2.513 2.5515 97 494 55 terms of impact on the per capita income for almost all the (1.84) 67 02 (4.64)* (3.15) (5.06)* regions, with the exception of SW region. This may be (- (1.77) * ** * attributed to the level of internally generated revenue 2.25)* * accruing to the states in the region or the inadequacy of D1 0.272 - 0 0.2757 the federation allocation from the federal government. All 161 0.4987 234 the Northern regions, NE, NW, and NC, were positively (5.06) 0 (0.97) and significantly affected by the physical investment in ** (- 4.11)* human capital by the building of the public primary * schools. If this is tenable, it implies the low level of D2 0.818 - 2.842 technical frontier of the regions; as such even a simple 918 0.2284 97 ability of literacy and numeracy has a positive impact on (10.22 2 (7.76) )** (-1.84) ** the income of the persons. The initial per capita income D3 0 0.0528 1.691 0.0879 level of the regions is quite significant for all the regions, 34 71 208 even if all regressors are held at zero level, the per capita (0.59) (5.63) (0.37) income drops negatively and significantly, with the ** exception of 2 regions; SE and SS regions. All the D4 0.477 - 1.581 0.2943 273 0.0668 41 702 Northern regions are significantly poorer than the other (28.63 0 (6.06) (0.92) regions. This is quite challenge in-terms of bridging the )** (-0.51) ** income disparity and the level of growth. D5 - - 1.513 0.1388 0.271 0.2197 993 87 26 4 (5.36) (0.44) (- (-1.68) ** 4.63)* * D6 0 0.029 2.007 0.8767 987 62 618 (0.36) (5.06) (2.93)*
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** up the regions in terms of the baseline positions. All the D7 - - baseline positions of the states in the regions are 0.179 575 statistically significant and positive, this implies that they (- are better off compared to their Northern counter parts. 2.51)* SW also reports 4 states that are better off in terms of the R2 0.898 0.899 0.7388 0.7534 0.858 0.7097 welfare positions given that their intercepts are above the 9 9 4 regional baseline and they are statistically positively AdjR2 - 0.884 0.6979 0.6820 0.822 0.6356 9 significant, this impliedly means that amongst the RMSE 0.170 0.148 0.1892 0.1396 0.246 0.2124 southern states, the SW is at a better position in terms of 46 1 3 welfare positions relative to the other regions in the south. Notes: The (*) signifies variable significant at 5%, (**) significance at 1%. Values in brackets are t-ratios. NE=NorthEast, NW=NorthWest, NC=NorthCentral, SE=SouthEast, SW=SouthWest, SS=SouthSouth, Table 3. regions Dynamic Panel Data Results NE NW NC SE SW SS The results of the fixed effect (LSDV) showed GDP L1 0.8440 1.6158 0.6398 0.7408 0.7849 0.4916 somewhat similar results but with an improved model fit 56 39 09 59 04 43 for all the regions. Averagely all the regions were fitted (3.22) (4.56) (3.35) (4.48) (4.92) (2.37) quite well by the model, with 80% of the variation in the * ** ** ** ** * data being explained by the model. The Northern regions L2 0.2130 0.6562 0.5932 0.4737 0.2707 38 41 78 0.1963 92 still maintained their statuses of being positively and 55 (0.77) (3.39) (3.28) 47 (2.27) significant being affected by the Federation Allocation (1.30) ** ** (1.07) * from the federation Account and physical investment in Finance ------human capital which has a direct correlation with the 0.3920 0.5388 0.2485 0.2667 0.2630 0.1862 ability to create the necessary human capital stock to 5 8 5 3 9 9 (- (- (- (- (- (- favourable close the gap in terms of development between 4.01)* 4.25)* 3.01)* 3.90)* 5.48)* 4.96)* the regions in the south. Availability of schools is closely * * * * * * related to the number of school attendance and access to No_PriSC 1.0568 - - education. The same situation also applies to the south H 79 0.0963 0.5172 - - 0.2005 (2.66) 7 3 0.0157 0.1259 eastern part of the country going by the value of the 87 * (-0.33) (- 9 1 coefficient of the public primary school investment. (0.83) 2.78)* (-0.15) (-1.11) The fixed effect models posits that each state in the PubPriEnr - - - 0.1411 - regions have its own intercept while slopes are similar all olM 0.4314 0.3319 0.0514 89 0.0762 0.0127 5 5 5 (3.02) 6 71 the states in the same region. Some of the Dummy (-1.46) (-0.92) (-0.97) ** (-0.11) (0.27) variables are dropped by the analysis; either due to PubPriEnr - 0.3705 - - collinearity or were reported with zero values for being olF 0.4501 0.0008 98 0.0682 0.0301 0.0632 the same with the same baseline intercept. Three (3) states 96 1 (2.50) (-0.89) 7 81 (1.38) (0.00) * (-0.04) (1.42) in the NE region have intercepts above the baseline for No_SecSC - - 0.0363 the region and are significant as evidenced by the H 0.0501 0.1887 16 0.2404 coefficients of their dummies. And one is below the 0.0838 1 0 (0.51) 15 0.0453 baseline. Furthermore, only the Ne showed a positive 17 (-1.14) (- (2.30) 97 coefficient baseline but not significant, while the other (1.46) 2.62)* * (0.71) PubSECS - - - - two regions showed negative coefficients, but statistically CHM 0.0037 0.0542 0.2229 0.5309 significant. Thus amongst the Northern regions, the NE is - 2 3 6 4 the poorest amongst the three regions. 0.2672 (-0.05) (-0.24) (-1.92) 0.1071 (- In the Southern part of the country, 2 regions reported 9 53 3.15)* (-1.20) (1.40) * a positive and significant impact of Secondary school PubSECS 0.0002 0.1713 0.2552 0.5688 investments in terms of Human capital development. This CHF 0.2903 6 99 16 0.0567 59 position confirms the general positions of the state of 73 (0.01) (0.81) (2.13) 35 (3.29) human capital development in the Country. Since the (1.44) * (0.62) ** Cons 6.2582 1.3438 - 5.3135 4.4382 4.1866 Southern regions have had a head start in access to 65 69 0.2533 86 85 38 western education long before the same institutions were (3.04) (0.62) 4 (3.72) (3.04) (2.58) established in the Northern part of the Country. SW * (-0.14) ** ** * region in the South showed a significant, but negative impact of male student’s access to education on the Wald 164.35 126.55 147.05 202.50 863.30 256.75 chi2(9) growth of gdp per capita of the region. If a male child Prob>chi 2 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 attends or accesses education up to the Secondary school, it has a 50% chance of improving the per capita income of The dynamic panel data analysis allows for the partial the household. Equally, there is a varied variation of the adjustment of the dependent variable by allowing for a positions of the per capita income of the states that made
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feedback from current or past shocks to current values of LSDV and Dynamic panel) can be attributed to the the dependent variable. The coefficient of the lagged education levels being taken on by the initial level dependent variables measures the speed of the adjustment. of per capita income. Since the lag values are all Also, the lagged value of the dependent variable removes positive and significant across all regions. any autocorrelation in the data, while accounting for the 2. The past changes on the education process are individual effect. The model in equation (4) is estimated having a negative effect on the current educational using the estimation technique outlined in [3] and [8] data collected for the analysis and thus there is a GMM (General Method of Moments). The estimator uses poor quality of education data d. This is a major the lagged values of the endogenous as the instruments in challenge, particularly in the developing countries, the differenced equations, while the lagged differences of where the Statistical information system is not fully the same variables are used as instruments in the level developed and automated. equations [12].This approach is similar to a 2 stage least 3. The poor quality of the education data, can only square (2SLS), this helps to overcome the issue of the non stationarity of the time series, given that these estimation mean one thing for certain; that there is a large are restricted to a short time series. Informal sector which is not captured or recorded Table 3 Reports the results of the dynamic panel by the National Accounts data collection with analysis using the GMM technique, by assuming that the regards to the GDP data. errors in levels are uncorrelated and using the appropriate 4. There is the possibility of heterogeneity in the sets of instruments for both the differenced and the level effects of education across the regions, across time equations. The results are somewhat odd, given the fact and possibly there are nonlinearities relationships that none of the human capital proxies were reported as in the effects of education. Since the regional significant and with the correct expected sign. For all the starting positions are different over time and space. regions the Financial allocation from the Federation There is the need to reappraise the effect of the account negatively and statistical significant in explaining composition of the different levels of education up the per capita income. Impliedly the per capita income to Tertiary levels. dynamics is negatively impacted by the financial 5. Regions with higher baseline (higher income allocation. Meaning it does not help the regions to grow level) seemed to be positively affected by higher out of poverty in the short run; rather it makes them to be levels of education (human capital factor), dependent on the Federal Government, rather than implying that their initial human capital needs to be developing their regional economies to generate sufficiently high for the impact to be felt. employment. 6. While regions with lower levels of education Current positions of per capita income are dependent seemed to be having a reverse case relative to their upon the immediate past levels of the per capita income human capital levels. for all the regions and they are positively and statistically significant, suggesting a strong adjustment dynamics in the effect and behavior of previous per capita levels. The V. CONCLUSION baseline initial positions of all the regions showed a positive improvement except the NC region. This We are interested in the dynamics of the human suggests that the region even at the initial position is capital contribution to the growth and development in the somewhat below the other regions baseline. Surprisingly, apparent regional disparities within the Nigerian states only the NC showed a positive and significant impact of and regions. Because of the social, economic and political human capital stock of secondary school and Female implications of continuous disparities in a developing students having access to education as a factor of country like Nigeria. These issues have policy attendant improving the per capita of the region. Therefore it can be fallouts, for which we want to obtain superior estimate argued that, financial positions of the regions conform to trends. The results of the analyses showed there are no the literature on growth finance nexus, though in reverse simple relationships between the human capital factors order and previous positions of the per capita income of and implied growth in the regions. Increases in financial the regions informs on the dynamics of the growth allocations from the federation accounts and investment in process. schools have a positive impact and effect on regions with low education levels. Thus it implies that such regions IV. DISCUSSION have low technology frontier, and are further away from the National technology frontier. Data quality challenges In totality the results are somewhat odd and at exists, because large proportion of the domestic economy variance with expected connection between the factors of is engaged in the informal sector, and are not captures by human capital and the regional per capita income growth the system of national accounts, thereby making insightful dynamics. This can be adduced to several reasons; 1. The negative signs and non-significance of the d human capital factors in all the 3 analyses (OLS, See Krueger and Lindahl (2001) and De la Fuente and Domenech (2001)
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analysis difficult. For regions with higher income positions, higher levels of education seems to have a positive and significant impact on their level of per capita income, relative to other regions, thus confirming our expectation of having a high technology frontier, such regions are closer to the National technology frontier. In this context, the growth of per capita income in Nigeria seemed to indicate that there is a complementarity between the Federal Government Financial allocation, Physical Investment in education and the Technological frontier of the regions.
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variables estimation of error-component models”Journal of Econometrics,1995, 68, pp. 29–51. [4] R.J.Barro,“Human Capital and Growth”American Economic Review,2001,Vol. 9, No 2. pp12-17 [5] R.J.Barro, “Economic Growth in a Cross-section of countries”. The Quarterly Journal of Economic.1991 Vol 106, No 2. http:// links.jstor.org [6] R.J Barro, and X. Sala-i-Martin “Convergence”Journal of
Political Economy,1992, 100 (2),pp.223-251 [7] J.Benhabib and M. Spiegel “The Role of Human Capital in Economic Development: Evidence from Aggregate Cross Country Data,” Journal of Monetary Economics, 1994 34, pp.143-173 [8] R. Blundell and S. Bond. “Initial conditions and moment restrictions in dynamic panel-data models”Journal of Econometrics 1998, 87,pp.115–143.
[9] P. Howitt, and P.Aghion, “Capital Accumulation and
Innovation as Complementary Factors in Long-Run Growth," Journal of Economic Growth, Springer,1998, Vol. 3(2), pp. 111-30, [10] N.G. Mankiw, D.Romer, and D.N.Weil, “A Contribution to the Empirics of Economic Growth”. The Quarterly Journal of Economics,1992, Vol. 107, No.2, pp. 407-437 [11] G.Petrakos, and P. Arvanitidis, “Determinants of Economic Growth: A Comparative Analysis of Estonia and Georgia.”The Conference on Economic Transformation of Central and Eastern European Countries, September 19- 20. 2008 [12] E.Podrecca,and G. Carmeci.“Education and growth. A dynamic analysis with panel data”. 2004. Working paper Dises n. 100. [13] B.B.Rao, and A.Cooray, “How Useful is Growth Literature for Policies in the Developing Countries?” MPRA Paper 14573. University Library of Munich Germany. Http:// Ideas.repec.org, 2009 [14] P.M.Romer“Endogenous Technological Change”. The Journal of Political Economy,1990, Vol. 98. No 5
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Health Literacy, Self-Efficacy and Health Information Understanding among Young Adults: Impacts on Health Related Decision Making.
A. Mohamad1, N. Mahadi2 1Faculty of Entrepreneurship and Business, Universiti Malaysia Kelantan, Kota Bharu, Malaysia 2International Business School, Universiti Teknologi Malaysia, Kuala Lumpur , Malaysia ([email protected])
Abstract - Health literacy (HL), self-efficacy (SE), and health The health literacy is defines in various terms. information (HI) understanding are three significant Reference [2] defined health literacy as “the ability to domains associated with generating better health related read, understand, and use health information to make decision. An individual will be able to make an appropriate appropriate health care decisions and follow instructions decision pertaining to health if he or she has remarkable for treatment”.In general, the health literacy can be levels for those three domains. The purposes of this study understood as having an ability to competently use health were to evaluate the level of HL, SE and HI among young adults and to determine the capability of the respondent in related information to enhance health. According to making an informed decision pertaining to their health American Medical Association, health literacy refers to based on the stated domains. This study had recruited 205 the “constellation of skills, including the ability to respondents, specifically students at Universiti Malaysia perform basic reading and numerical tasks required for Kelantan (UMK). This study had adopted three different persons to function in the health care environment”. The survey items. In order to assess level of Health Literacy, a definition also incorporated individuals who are able to 36-items survey of Test of Functional Health Literacy for read and comprehend prescription bottles, appointment Adult (TOFHLA) was adopted which consisted of two slips, and other essential health related materials. Health assessment parts; namely reading and numeracy test. While literacy is imperative due to the fact that a lot of health survey items on Self-Efficacy and Health Information understanding were used respectively to assess the level for information is delivered in written format [3]. both domains. T-Test analysis was done to determine the While the other researchers define health literacy as significant difference between those domains. The findings basic literacy skills of individual that encompasses an showed a mixed result. The majority of the respondents were ability to read, comprehend a text as well as numeracy. If having high literacy level (72.2%) but of average level for the person is having a difficulty in accessing, self-efficacy (69.3%) and health information understanding understanding and using information, that individual will (73.2%). These mix results were further analyzed in SPSS unable to make a proper health-related decisions [4]. The version 20.0 using cross tabulation to calculate the number Institute of Medicine (IOM) has coming out with its own of respondents who has the capability to make an description in which the agency regards health literacy as appropriate health related decision. The result demonstrated that only eight out of 205 respondents (3.9%) were able to “the degree to which individuals have the capacity to make informed decisions related to health. obtain, process, and understand basic health information and services needed to make appropriate health decision Keywords - Health literacy, self-efficacy, health information, [5]. From those definitions given, they were purely young adults, health related decision making highlighted that health literacy is about the one’s ability to gain health information, give comprehension in detail to the meaning of every sentence and fully utilize the I. INTRODUCTION information appropriately to make an informed healthcare decision. Health literacy, self-efficacy and health information As can be seen nowadays in all healthcare settings, as domains are crucial for people in making wise health part of their practices, all patients are supplied with related decision as they will be affected by the outcomes. information about all health related facts and figures such Whether they health is getting better or worse, it is all as diagnoses, treatments, laboratory procedures, depends on the selection made. The limited resources in medication as well as post clinical treatment [6]. Health healthcare systems nowadays have make demand for care information is the essence in successful healthcare and treatment becomes more complex and unlimited than delivery system. Healthcare providers working very hard what we had in the previous decades [1]. These to ensure the knowledge in health, especially in the pre- circumstances had made all healthcare users to become a treatment operation and post treatment operation wise decision maker when it comes to decide on comprehensibly absorbed and digested well by their healthcare matters. There were also an increased demand patients [7]. The materials disbursed in an effort to permit for an individual to be actively involved in self-care patients to actively involved in the whole processes and management which is alarming and the individual need to appropriately participate in their own care. This is aligned have a sense of self ownership towards their healthcare with the intention of the healthcare sector itself which status. aimed to develop a patient centric system whereby the patients will become the ultimate owner of themselves. In
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realizing so, the health care system required the patient to the healthcare providers. It is believed that the findings fill the health related knowledge gaps with the sufficient will aid any related authorities and agencies in designing health information before engaging the patient to be more the best activities possible to improve the health literacy involved in their health care ownership. The patients need of the nations. to be health literate enough by gratifying themselves with all related basic health care skills, techniques and knowledge or else, this "patient-centric" will remain just a II. METHODOLOGY wonderful concept with no chance to emerge as a reality. Apart from that, patients must possess high self- The population targeted for this study were efficacy within themselves as this will boost their belief undergraduate students at the three selected faculties of that they have the capabilities to accomplish health related Universiti Malaysia Kelantan (UMK) with the initial plan tasks or making an informed decision that will affect their of sample size of 250 (n=250). However, this study only health. A research conducted by a researcher [8] specifies managed to receive feedbacks from 205 respondents. The that there were an increment in the good care management undergraduate students at the organization been selected of diabetes and heart disease among patients who were because they represent young adults of characteristics showing an improved self-efficacy. Self-efficacy is a such age are between 18 to 24 years old, have the ability concept which reflects social cognitive theory, which to read and understand English language, alert to the suggests that an individual’s confidence in their ability to healthcare environment changes which affects their daily perform health behaviours will influence which lives, possess critical thinking, and have times to behaviours they will engage in [9]. In other words, self- administer the survey entirely due to fewer study efficacy is an individual’s belief in which those workloads. The summary of respondents is presented in individuals have faith that they are able to follow all given the table below. orders successfully. According to one researcher [10], self-efficacy is regarded as a key factor in actual TABLE 1 DETAILS OF SAMPLE SIZES behaviour change and maintenance. The mix of those skills will help the healthcare users % of in understanding better the information obtained from sample size taken Total various sources such as medical brochures, medical Total FACULTY from sample students forms, legal documents concerning health, prescription overall size (n) drug, appointment slips, doctor's directions and others. size These competencies will also reward the healthcare users (n=250) with an ability to steer their own health care effectively 1. Faculty of 1059 50% 125 and efficiently by making an informed health related Entrepreneurship and decision. Reference [11] highlighted that when healthcare Business (FEB) users fully comprehend the available treatment options and actively participate in the treatment decisions, they 2. Faculty of Creative 540 30% 75 Technology and tend to decide on decent treatment plans which will avoid Heritage (FCTH) other unnecessary care they do not value and will be more committed to follow all the treatment plans which 3. Faculty of Veterinary 250 20% 50 associated with their preferences. It is important for the Medicine population, in general, to become adequately literate when making health decision. Health status of the population TOTAL 1849 100% 250 will determine the productivity level of a nation. Thus, every individual must know beforehand what would be There were 53-items questionnaire used in order to the consequences of any health related decision made collect the data. For this study purpose, a set of validated towards oneself, the community as well as the nation. survey instruments were used. The surveys were derived In brief, health literacy is a tool that could improve from the previous studies and were adopted into the study health outcomes of a population as in general [12]. due to the time factor. For assessing the health literacy Therefore, this study was carried out to evaluate the level level, the surveys used was Short Test of Functional of health literacy, self-efficacy and health information Health Literacy in Adult (S-TOFHLA), derived from the understanding among young adults and to determine the literature of one study [13], developed by Emory ability of the respondent in making an informed decision University in 1995. While a survey instrument by one pertaining to their health based on the domains. The researcher [14] is used to determine the level of difficulty findings will provide some insights for future researchers of health information disseminated to healthcare users. on how these three domains will contribute to individual Meanwhile, a set of instrument developed by one health decision making, how it will affect the health status researcher [15] was used for assessing self-efficacy of the population as well as give an insight on the among healthcare users. understanding ability of the health care users in processing any health related information received from
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III. RESULTS TABLE 4 FREQUENCY FOR HEALTH INFORMATION UNDERSTANDING
A. Reliability Analysis Level Frequency Percent The Cronbach’s Alpha for all three variables was Low 31 15.1 above the cut point of 0.7. This indicated that the Average 150 74.2 individual variables were having high internal consistency High 24 11.7 and was accepted for the study. Total 205 100.0
TABLE 2 CRONBACH’S ALPHA FOR THREE VARIABLES Based on the Table 4, there were 31 respondents (15.1%) whom having low level of health information Variable No. of Items Cronbach α understanding while 24 of them or (11.7%) were of high Health literacy 36 .931 level. This study also revealed that the majority of the Health Information 8 .811 respondents were having average level of understanding with the total of 150 respondents or 73.2%. Self-Efficacy 9 .752
D. Level of Self-Efficacy
B. Level of Health Literacy There were nine questionnaire items used in this section with the range score of 15 (minimum) to 45 In deterrmining the level of health literacy, the scores (maximum). The mean for self-efficacy was 31.18 obtained from 36-items questionnaires were recoded into (average level) and standard deviation was 5.02. Based on three prescribed levels namely; inadequate level (0-16 the Table 5 below, there were 34 respondents or 16.6% scores), marginal level (17-22 scores) and adequate level whom having low level of self-efficacy while 29 of them (23-36scores). The findings are shown in the Table 3 or 14.1% were of high level. The study indicated that the below. majority of the respondents were having average level of self-efficacy which made up to 142 from the entire TABLE 3 populations which equivalent to 69.3%. FREQUENCY FOR HEALTH LITERACY
TABLE 5 Level Frequency Percent FREQUENCY FOR SELF-EFFICACY Inadequate 26 12.7 Marginal 31 15.1 Level Frequency Percent Adequate 148 72.2 Low 34 16.6 Average 142 69.3 Total 205 100.0 High 29 14.1
Total 205 100.0 The Table 3 above displayed that the majority of the respondents were classified as having adequate level of health literacy. The total of them were 148 which E. Numbers of Respondents to Make an Informed comprises of 72.2 percent. This followed by 31 Decision Pertaining to Health Care respondents were having marginal level of health literacy and the remaining 26 respondents were having inadequate Table 6 exhibits a frequency count of cross tabulation level of health literacy. for three variables namely, Health literacy (HL), Self- efficacy (SE) and Health information (HI). There were C. Level of Health Information Understanding three levels of frequency used which represented diverse levels for all variables namely low, average and high Meanwhile, health information understanding was level. Based on the frequency in table 6, it can be assessed by using eight questionnaire items with the range concluded that out of 205 samples, only 8 of them to be score of 11 (minimum) to 40 (maximum). The mean for found to be able to make informed decision pertaining to health information was 28.24 (average level) and standard their health care. The figure displayed on the table in deviation (SD) was 4.82. which it satisfied all variables by having all high levels.
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TABLE 6 level of functional health literacy together into one FREQUENCY CROSS TABULATION FOR HEALTH LITERACY (HL), category of inadequate level. SELF-EFFICACY (SE) AND HEALTH INFORMATION (HI) Despite of the argument above, this study adopted Wallace proposition in classifying the results. Based on HL SE Total the survey findings, it can be stated that the results was 1.00 2.00 3.00 astonishing as it indicated that young adults were able to obtain, process and understand all health information very 1.00 4 1 0 5 well. They had the capability to understand each of single HI 2.00 0 13 3 16 items very well and managed to select a right answer for Low 3.00 0 3 2 5 each item. This study suggests that young adults in Malaysia Total 4 17 5 26 having no difficulty in obtaining health related 1.00 4 0 0 4 information as they have being granted an access to it from a broad array of sources such as websites, signage, HI 2.00 1 22 3 26 Average mass medias, or even social platforms like Facebook, 3.00 0 0 1 1 blogs, and others. Therefore, these platforms make them Total 5 22 4 31 aware of health related matters and it somehow inculcate a positive attitude in which in return it will impose good 1.00 15 6 1 22 impacts in social and economic based aspects in the HI 2.00 10 87 11 108 future. High 3.00 0 10 8 18 B. Level of Health Information Understanding Total 25 103 20 148 1.00 23 7 1 31 The finding revealed that the majority of the respondents were having average level of understanding HI 2.00 11 122 17 150 with the total of 150 respondents or 73.2%. There were 31 Total 3.00 0 13 11 24 respondents (15.1%) whom having low level of health information understanding while 24 of them or (11.7%) Total 34 142 29 205 were of high level.
This result suggested that the respondents were
hardly understand a portion – or overall - of health related IV. DISCUSSION information that seems unfamiliar to them, in other words,
they might be blurred to understand medical jargon which A. Level of Health Literacy sounds too scientific to them. Health information
typically was presented in a way that was difficult to be Based on the findings in Table 3, it showed that comprehended by the users thus inhibit them to process majority of the respondents were classified as having the input on a complete basis. This hinder factor will adequate level of health literacy. The total of them were place the users in a state of confusion when it comes to 148 which comprises of 72.2 percent. This followed by 31 generate appropriate health related decision. The respondents were having marginal level of health literacy healthcare users, regardless of their age groups, should (15.1 percent) and the remaining 26 respondents or 12.7 always understand well of any health information prior to percent were having inadequate level of health literacy. generate the health related decision so that they would The level basically demonstrated the ability of anticipate the outcomes of the decision made and willing respondents in digesting the health related information to to accept those upshots readily. generate a decision. The inadequate level is the lowest Improved health literacy among healthcare users, level which indicated that a person was not in a best along with adequate health information and knowledge condition to make a decision and that person need supplied by healthcare providers will enable the users to interventions, assistance or helps from others to make a make informed decisions before selecting any related decision. While the highest level, which is adequate level treatments or care which aligned with their goals, value indicated that an individual was a right ones to make an and preferences. This is in tandem with proposition made appropriate decision pertaining health. However, there by [11] whereby they highlighted that when healthcare was a dispute raised in terms of the making a cut off point users fully comprehend the available treatment options to assess an ability of an individual to successfully digest and actively participate in the treatment decisions, they health information received to make health related tend to decide on decent treatment plans which will avoid decision. Reference [16] stated that the original score of other unnecessary care they do not value and will be more health literacy was an ideal score in assessing the level of committed to follow all the treatment plans which health literacy. However one researcher [17] seems associated with their preferences. disagree with the proposition. Schaefer suggested that However, it was not the health information alone to many studies combined the marginal and the inadequate be reviewed. An individual approaches to the health
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information also should be taken into consideration. An the young adults such as they were too sluggish to learn individual is naturally complex in terms of attitude and about health based information, lack of confidence, poor this attribute reflects in that person’s level of acceptance health management, and they also were less likely to seek of new things, particularly a new knowledge. Martin for help when it comes to settle down health confusion. Bauer had suggested that a growth of specific and new All these imperfections will risk them somehow if they knowledge entails a simultaneous increase in ignorance could not fix them out very well on the earlier basis. within oneself which he called as knowledge-ignorance For someone to make an informed decision was not paradox [18]. Reference [18] also highlighted that people an easy task. There were several aspects need to be will ignore new technical terms and ideas which are concerned prior deciding it as a decision taken will put the overlaid with new facts and frequent revision. In this maker into many consequences, either positive or context, if respondents perceive that they were dealing negative ones. However, it is important to note that with a set of complex new knowledge, they will have an decision making is a complex, dynamic process that is inclination to reject it since they would think that new often emotionally charged and conflicting for many knowledge brings no or less value to them. They will involved in the process [11]. Improved health literacy reluctant to process the input subsequently just left it among healthcare users, high self-efficacy along with outside their mind. In brief, similarly, if the respondents adequate health information and knowledge supplied by treated health information which obtained from any healthcare providers will enable the users to make sources such as appointment slip, medical from, informed decisions before selecting any related treatments prescription details or others as unimportant, they will or care which aligned with their goals, value and reject it instantaneously. preferences It is hoped that there will be interventions considered Reference [19] mentioned that it was vital for an to be employed to alleviate this matter so that all individual to be able to use the health related information generation will be able to understand better every single accurately in making healthcare decisions. Having this piece of health information disseminated to them. Having ability is required for anyone as it was regarded as a this approach applied, it will assist our people to make a significant part of health literacy. With the ability to use wise decision for themselves in the future. information correctly, the users will be likely to generate a wise decision pertaining their health and the inputs C. Level of Self-Efficacy received will skyrocket their literacy level. Self-efficacy portrays a positive relationship with The finding has reported that 34 respondents or decision making. Reference [20] revealed that for an 16.6% were having low level of self-efficacy while 29 of individual to make an informed decision making them or 14.1% were of high level. The study indicated concerning health, that individual must have an adequate that the majority of the respondents were having average health related information, knowledge and skills to level of self-efficacy which made up to 142 from the incorporate those element into a remarkable output. In entire populations which was equivalent to 69.3%. addition to that, the researchers also highlighted that an Self-efficacy reflects one’s ability to carry out all individual must also have a high confidence level and instructions given by physician in a successful manner. ability to participate in decision making at a personally Based on the findings, it can be concluded that more than desired level (decision self-efficacy); and decision making 2/3 of the respondents were having less sense of self that reflects one’s values and preferences (decisional management as well as were lacking of confidence to consistency). carry out orders and instructions from healthcare Self-efficacy also grants the patients to make a better providers. decision regarding healthcare. This suggestion was Self-efficacy is crucial in self-care management as it supported by a study done by a researcher [21] who stated will determine how efficient an individual to follow any that there were theories of health behaviour and decision healthcare regimes prescribed by the physicians or nurses. making which suggest that patients who perceive With that capability cultivated within oneself, it helps themselves associated with high risk of getting a disease, reduce the dependency level on the physician and nurses who actively participate in decision making, should be in most events. more likely to make an explicit, informed decision pertaining their health. The higher the degree of self- D. Numbers of Respondents to Make an Informed efficacy, the more likely an individual will seek out Decision Pertaining to Health Care healthy behaviours and commit a good decision making [16]. The findings in Table 6 showed that only eight respondents from the total of 205 were able to make an informed decision pertaining health. The results were not V. CONCLUSION impressive at all as it indicated that young adults were not mature enough to involve in decision making and having Based on the findings, it can be concluded that no sense of responsibility in managing their health. There majority of the respondents particularly young adults, were some weaknesses suggested to be associated with who were participated in this study, were having less
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knowledge about health management and were not disease in primary care. Journal of the American prepared enough to engage in making an appropriate Medical Association, 288 (19), 2469–2475. health related decision neither for themselves nor their [8] Sarkar, U., Fisher, L., & Schillinger, D. (2006). Is relative families. This proposition was supported by the self-efficacy associated with diabetes self- result of data analysis which indicated that only eight (8) management across race/ethnicity and health out of 205 respondents, which equivalent to 4%, could literacy? Diabetes Care, 29, 823-829. possibly be able to make informed decision pertaining [9] Nath, C. (2007), Literacy and diabetes self health. management.American Journal of Nursing, 107(6 It was quite surprised to know that though more than Suppl),43-49. 2/3 of the respondents were having high level of literacy, [10] Bandura, A. (1994). Self-efficacy. In V. S. which were 148 respondents (72%), however they could Ramachandran (Ed.), Encyclopedia of human not possibly make informed decisions due to lacking of behaviour (Vol. 4, pp. 71-81). New York, NY: self-efficacy level and less understanding of health Academic Press. information disseminated by healthcare providers. Based [11] Kwak, J., Allen, J.Y. & Haley, W.E. (2011), on the result, majority of respondents were having "Advance Care Planning and End-of-Life Decision average level for both self-efficacy with the frequency of Making", Annual Review of Gerontology & 142 respondents or 62% and health information Geriatrics, vol. 31, pp. 143-XII. understanding with 150 respondents or 73.2%. [12] Paasche-Orlow, M. K., & Wolf, M. S. (2010). Promoting health literacy research to reduce health disparities. Journal of Health Communication, 15(Suppl. 2), 34-41. ACKNOWLEDGMENT [13] Institute of Medicine. (2004). Health literacy. A prescription to end confusion. Washington, DC: The authors would like to thank Universiti Malaysia National Academies Press. Kelantan (UMK) for granting permission to carry out this [14] Cormier, Catherine M,PhD., R.N. & Kotrlik, J.W. research in its vicinity. (2009),"Health Literacy Knowledge and Experiences of Senior Baccalaureate Nursing Students", Journal of Nursing Education, vol. 48, no. 5, pp. 237-48. REFERENCES [15] DeWalt, D.A., Boone, R.S. & Pignone, M.P. (2007), "Literacy and Its Relationship With Self-efficacy, [1] Ryan M, Scott DA, Reeves C, Bate A, van Teijlingen Trust,and Participation in Medical Decision ER, Russell EM, Napper M, Robb CM. (2001). Making", American Journal of Health Behavior, vol. Eliciting public preferences for healthcare: a 31, pp. S27-35. systematic review of techniques. Health Technology [16] Wallace L. (2006) .North American Primary Care Assessment (Winchester, England) [2001, 5(5):1- Research Group. Patients’ health literacy skills: the 186] missing demographic variable in primary care [2] Weiss, B.D., Mays, M.Z., Martz, W., Castro, K.M., research.Ann Fam Med.;4(1):85-86. DeWalt, D.A., Pignone, M.P., et al. (2005). Quick [17] Schaefer, C.T. 2008, "Integrated Review of Health assessment of literacy in primary care: The newest Literacy Interventions", Orthopaedic Nursing, vol. vitalsign. Annals of Family Medicine, 3, 514-522. 27, no. 5, pp. 302-17. [3] AMA. (1999). Health literacy: Ad Hoc Committee [18] Sheldon Ungar (2001). Knowledge, ignorance and on Health Literacy for the Council on Scientific the popular culture: climate change versus the ozone Affairs. Journal of the American Medical Association, hole. Public Understanding of Science 2000 9: 297 281, 552-557. [19] Egbert, N., Nanna, K., (2009) "Health Literacy: [4] Carmona, R. (2005). The future of nursing. Keynote Challenges and Strategies" OJIN: The Online address at the National Student Nurses Association. Journal of Issues in NursingVol. 14, No. 3, Salt Lake City, Utah. Retrieved February 27, 2013, Manuscript 1. fromhttp://www/surgeongeneral.gov/news/speeches/0 [20] Allen J., Megan K. D., Hart A., Anshu P., Mohllajee, 4062005.html Yi Li and Bowen D. (2010). Do Men Make [5] Nielsen-Bohlman, L., Panzer, A.M., & Kindig, D.A. Informed Decisions about Prostate Cancer (2004). Health literacy: A prescription to end Screening? Baseline Results from the ''Take the confusion. Washington, DC: National Academies Wheel'' Trial, Med Decis Making 2011 31: 108 Press. [21] Bowen D, Allen J, Hart A, Vu T. (2006). Theoretical [6]Vahabi, M. (2007), "The impact of health foundations for interventions designed to promote communication on health-related decision making", informed decision-making for cancer screening. Ann Health Education, vol. 107, no. 1, pp. 27-41. Behav Med.;32:201–10. [7] Bodenheimer, T., Lorig, K., Holman, H., & Grumbach, K. (2002). Patient self-management of chronic
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The Impact of Charismatic Communication Training on Persuasion and Influence
Lee. C.H. A., N. M. Mohd Shariff , N. H. Nik Mahmood, UTM Razak School of Engineering and Advanced Technology, UTM, Kuala Lumpur, Malaysia [email protected]
Abstract - The aim of this conceptual paper is to Earlier researchers have defined charisma as an provide a conceptual framework that describes the individual personality that is considered as extraordinary, impact of charismatic communication training on the and that this fine quality is deemed to be supernatural effectiveness of persuasion and influence. This paper granted by divine power not accessible to ordinary people discusses and reviews the concept of charisma, but great leaders (Weber, 1947; Downtown, 1973; Bass, strategies of charismatic communication training and 1999). However, researchers later found out that charisma its effects on organizational outcome. Past researchers is a set of behaviors attributed by the perceptions of have attempted to investigate whether charisma is a followers on the leader’s actions, moral conviction, set of skills that can be acquired via charismatic emotional appeal, use of symbolic power and it is a set of communication training. Various behavioral outcome personal abilities that are capable of having profound and perception of followers have been measured and effects on followers (Conger & Kanungo, 1998; House, proved to have positive effects. However, most of the 1999; Shamir, 1999; Keyes, 2002). studies are done within the context of leader-follower Antonakis and House (2002) further integrated relationship and prompted by a set of instructions. theories of charisma and noted that it is observable in Few has measure the actual behavioral outcome in organizations. It concerns leaders who use symbolic relation with the speaker’s effectiveness of persuasion influence to motivate followers and are viewed as strong due to charismatic communication training. and confident based on attributions followers make of Recognizing that charismatic communication is an them. This perspectives defy earlier definition of charisma effective skills set used by leaders in persuading and that is a trait and “gift”, therefore suggesting that influencing their followers, this paper seeks to charisma can be trained since it is a set of behaviors that construct and propose a conceptual framework to can be measured. Subsequently, a number of researchers examine whether the same effect can be achieved in a have attempted to define and measure the attributes of non-leader-follower relationship and measure the charismatic leaders (Boss, 1976; Conger & Kanungo, direct behavioral outcome in a non-authoritative 1988; Shamir, Arthur, & House, 1994; Shamir et al., environment. This conceptual framework serves to fill 1993) in the gap identified from previous studies as well as to establish this study in a new context that few has CHARISMATIC COMMUNICATION examined before. Impact of Charismatic Communication Keywords – Charismatic communication training, charisma, influence, persuasion, behavior Leaders with good communication skills has always been treated as an asset to the organization and is a BACKGROUND critical skill for effective job performance, directly Charisma improving organizational performance (Klauss & Bass, 1982). It helps organizations to achieve satisfactory “I just want to do God’s Will. And He’s allowed outcome such as profit, high return of investment, me to go up to the mountain. And I’ve looked over, and customer satisfaction, efficiency and productivity (Barge, I’ve seen the Promised Land” (King, 1968, para. 50). 1994). Martin Luther King Jr. shared this bold vision of gaining racial equality in America on April 3, 1968 at the Church The importance of communication is evident in its of God in Christ Headquarters in Memphis, Tennessee. effects towards organizational outcome. Observer These powerful words that has impacted millions of attributes the evident of charisma’s effects on the leader people though spoken more than 40 years ago, King’s drawing from the nonverbal and verbal influencing tactics voice is still echoing vividly in our collective conscious that concretize the leader’s vision (John Antonakis, 2011). mind. This same quality has been seen among great Leaders are being attributed to be charismatic because leaders and eminent figures such as Mother Theresa, they can communicate in powerful and emotional ways Gandhi, Bill Clinton, Elvis Presley, Steve job, Adolf that invoke actions pertaining to the vision conveyed (Den Hitler and others, whom deemed to have an aura of Harog & Vergub, 1997; Shamir et al., 1993). There is a personal magnetism and displayed powerful ability to common trend identified through many different concepts inspire and motivate others, so powerful as to be of charisma that charismatic leaders communicate a vision considered as mystical in nature. that inspires others (Conger & Kanungo, 1998), it has to
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be communicated so as to generate enthusiasm and to Visionary content Refer to verbal pictures, “inspire” subordinates, peers, or customers (Frese, 2003). descriptions, or shared mental images, and are characteristically Hence, Kirk Patrick and Locke (1996) argued that there brief, clear, future oriented, and are three core aspects of charismatic leadership: vision, desirable. A projection of future vision implementation, and charismatic communication that is skillfully crafted to inspire. style. Charismatic communication has been shown to Set high expectation Setting high expectations for the communicator themselves as well have positive impact on leadership effectiveness, as the audience and communicate employee performance and organizational outcome confidently that these goals can be (Frese, Beimel, & Schoenborn, 2003; Howell & Frost, met (House, 1977) 1989; Towler, 2001). Emotional appeal Persuading an audience by using or manipulating emotions with the goal of arousing passions with the Charismatic Communication Strategies audience to resonate and move Charismatic leaders incorporated both verbal (i.e. them to act. content) and nonverbal (i.e. delivery mode) techniques in Rhetoric devices Creative and imaginative use of charismatic influencing tactics to engage followers language that is designed to persuade the audience towards a (Awamleh & Gardner, 1999). Charismatic communication particular frame of view or course distinguish itself from the conventional public speaking of action. It can also be used to ability by the use of visionary content and enhanced encourage and provoke rational nonverbal skills (Conger, 1991). Antonakis, Fenley & argument from an emotional display. Liechti (2011) has identified nine core verbal and three core nonverbal strategies that is often referred by Raising self-efficacy Self-efficacy is the belief that one neocharismatic scholars (Awamleh & Gardner, 1999; Den has in regards to their degree of Hartog & Verburg, 1997; Shamir, Arthur, & House, capabilities to complete tasks and reach goals. It determines how 1994). These nine core verbal charismatic strategies much effort people will expend and mentioned has been used to measure the nomination how long they will persist during speeches of the democratic and republican contenders for phases of obstacles, challenges and the United States’ presidency between 1916 and 2008, it adversity. significantly predicted the outcomes of the United States’ presidential elections (Jacquart & Antonakis, 2010). Table TABLE 2 1 and table 2 describes the nine verbal and three NONVERBAL CHARISMATIC STRATEGIES nonverbal charismatic strategies mentioned. Strategy Description Facial expression A crucial element in expressing TABLE 1 emotions appropriately by VERBAL CHARISMATIC STRATEGIES matching it to the delivery of content as well as body gesture and Strategy Description voice tone. Metaphors It is a figure of speech that Body gesture Body gesture acts as a bridge describes a subject by asserting between the speaker and the familiar meaning from another audience. It is another clue for the context into it via effects of audience to gauge the speaker’s comparison, association and emotion. resemblance. Vocal variation Dramatic and animated voice tone Stories telling Stories always make the message not only captivates the audience’s understandable and easy to attention but it also helps to remember (Bower, 1976), and amplify and arouse the emotions induce identification with the intended to convey. Volume, pace, protagonists (Altenbernd & Lewis, pitch and other vocal qualities that 1980). match the emotion has also come Moral conviction Share sentiments of the collective into play. (Shamir et al., 1993, 1994) that aids in identification to the extent that the morals and sentiments EFFECTS OF CHARISMATIC COMMUNICATION overlap with those followers, and TRAINING the leader is seen as a representative of the group (Hogg, With all the mounting empirical evidence on 2001) how charismatic communication plays a critical role in Autobiography It’s a story of one’s life used to express, connect and the charismatic behavior, its numerous positive impact on communicating personal emotions the organization and the stakeholder, various scholars and thoughts with the goal of have attempted to examine and quantify the effects of influencing the audience. It is a charismatic communication through training. therapeutic rhetorical act that seeks to dip deeper into one’s mind and Towler (2001) demonstrated the effectiveness of letting go of their experiences. training charismatic communication style, concluding that
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these are acquirable skills. In this study, Towler the relationship. Most of the studies done has only gone investigated the effectiveness of training individuals to be till the extent of measuring the perception of followers charismatic in their communication style. Participants (Antonakis, 2011; Fabbi, 2013). Therefore a conceptual were 48 students who attended two training sessions of 2 framework (refer to figure 1.0) is proposed in this paper to ½ hours each. Towler’s findings demonstrated the address gaps identified from previous studies and serves efficacy of charismatic communication training for as the emphasis of this paper. leaders as well as providing evidence of favorable effects As Bass (1988) and Dumas and Sankowsky (1998) on follower performance and attitudes. observed, charismatic leaders exude a powerful ability to Similarly, Frese et al. (2003), in two studies (n = persuade and influence followers. This proposed 25 and n = 22), evaluated the effects of inspirational conceptual framework seeks to examine whether the same communication of a vision as part of a charismatic influence can be achieved in a non-leader-follower leadership training program. Frese et al. demonstrated that relationship. For example entrepreneurs pitching their an action training program, targeting emotional business ideas to the investors, sales representatives communication skills as part of a charismatic leadership making sales pitch to potential customers or a marketer training program, was successful in developing a set of making a promotional speech and subordinates presenting charismatic communication skills among program their ideas to their superior. This will benefits all level of participants. members in the organization in different context of Groves (2006) investigated the direct effects of relationship, making charismatic communication not only charismatic communication in terms of leader emotional a critical skill for leaders only, but for all members in the expressivity skills, allowing leaders to establish an organization. emotional connection with followers, which may overcome resistance to change and produce meaningful organizational changes. Grove overcame the limitations of prior research that utilized trained actors and surrogates to portray leaders and followers by examining a cross section of 108 leaders and 325 of their direct followers from 64 organizations across numerous industries. Moreover, Groves suggested that these emotional communication skills may be developed through training. More recently, Jones and Turkstra (2011) applied the Charismatic Leadership Communication Scale (CLCS; Levine et al., 2010) in a test of seven adult males with traumatic brain injury. Findings suggested that aspects of non-verbal performance, namely gesture use and speech rate influenced the perception of charisma and how likely someone is to engage in conversation with that person. Fig 1. A conceptual framework describing the impact of charismatic Antonakis (2011) has also conducted charismatic communication training on the effectiveness of persuasion and influence. communication training using the Charismatic Leadership Tactics (CLTs) with 34 mid-level managers and found that they scored significantly higher on ratings of On the other hand, while this conceptual attributed charisma than the control group. Ratings of framework is interested to measure the audience’s leader prototypicality and emergence are also affected by perception towards the speaker’s level of trust, the leader’s charisma. In his study, Antonakis competency, affection and authenticity, it takes a step demonstrated that leader’s charisma has positive impact further in attempts to measure the behavioral outcome of on the audience’s perception such as the affect for the the audiences. The audiences will be given the choice to leader, trust in the leader, and attributions of competence make decisions at freewill with no instructions given. Any and influence. behavioral outcome yielded from the audiences will be in direct association with the speaker’s effectiveness of RATIONALE OF CONCEPTUAL FRAMEWORK persuasion skills due to charismatic communication training. This will help to rule out any effects in relation The results of these studies discussed above to the figure of authority. In short, this framework suggested that organizations may benefit by including proposes the study to be conducted in a non-authoritative charismatic communication in their leadership environment, hence the use of words like speaker and development programs (Groves, 2006). However these audience instead of leader and follower. studies of charismatic communication training has been This framework will also serves as the primarily examined in the context of leader-follower foundation of the study to examine whether an increase of relationship (Towler, 2001; Frese, 2003; Groves, 2006; charismatic communication skills also increases speaker’s Antonakis, 2011), little or no study has been made outside persuasion skill. This will help to predict relevant
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Proceeding of 1st International Conference on Human Capital and Knowledge Management
behavioral outcome of the audiences such as their level of Hence, a conceptual framework that is built upon interest, decision making and commitment to the vision previous concepts, theories and findings is proposed in by measuring the speaker’s charismatic communication this paper to fill in the gaps of previous studies and skills. The nine core verbal strategies and three core non- examine the effects of charismatic communication verbal strategies that has been identified by Anatonakis training in a new context as discussed in the rationale of (2011) is included in the framework as the elements of conceptual framework above. This conceptual framework charismatic communication training. They also serves as has a few breakthrough as it will be the first study of its the basis to measure the effectiveness of the speaker’s kind to be established in a context of non-leader-follower charismatic communication skills. relationship under a non-authoritative environment. It also This conceptual framework proposed that the study seeks to examine whether the speaker’s effectiveness of being conducted in two phases. The first phase will persuasion can be increased with the increase of mainly involve charismatic communication training with charismatic communication skills via training by the respondents, also known as the speakers. An measuring the audience’s direct behavioral outcome. experimental group and a control group will be used in This study if successfully established will help to this research design. Respondents in the experimental generalize the effects of charismatic communication group will undergo treatment whereas the control group training across different context of organizational will not. relationship and expands its usability under different The speakers will mainly be students who have good circumstances, either in a business context or not. Hence, command of English. After the training, speakers will be it will benefit more people, not just leaders but various asked to present a pre-designed speech and it will be level of members in the organization which in turn videotaped. It will be a marketing or promotional speech contributes towards greater organizational outcomes. with the objective of inviting people to participate in a cause or event. During phase two, the videotaped speech REFERENCES will then be viewed by another group of students as audiences. The perception of audience towards the [1] L. Altenbernd, & L. L. Lewis, Introduction to speaker’s level of trust, competency, affection and literature, stories, 3rd ed. New York: Macmillan, authenticity will be measured. The audiences will then be 1980. given the choice to decide whether they would want to participate in the event. The number of people signing up, [2] J. Antonakis, M. Fenley, & S. Liechti, “Can charisma their level of interest and commitment to the event will be taught? Test of two interventions.” Academy of also be measured. It is hypothesized that the speakers in Management Learning & Education, vol. 10, no. 3, the experimental group will be more positively perceived pp 374–396, 2011. by the audiences than the control group. The number of audiences signing up, their level of interest and [3] J. Antonakis and R. J. House, “An analysis of the commitment to the event is also predicted to be full-range leadership theory: The way forward.” In significantly higher for the experimental group compared Transformational and Charismatic Leadership: The to the control group. road ahead, B. J. Avolio and F. J. Yammarino, Eds. Amsterdam: JAI Press, vol 3, pp 34, 2002. CONCLUSION [4] R. Awamleh & W. L. Gardner, “Perceptions of This paper is intended to construct and proposed leader charisma and effectiveness: The effects of a conceptual framework that serves to fill in the gaps vision content, delivery, and organizational identified from previous studies as well as to establish the performance.” The Leadership Quarterly, vol 10, pp study in a new context. Charisma has long been proven to 345–373, 1999. be an asset for a leader to be successful in the organization and its impact has been clearly seen [5] J. K. Barge, Leadership: Communication Skills for throughout various industries. Researchers has since Organizations and Groups. New York, NY: St. identified the elements of charisma and some has even Martin's Press, 1994. proven that an individual can be trained to be more charismatic. Kirk Patrick and Locke (1996) suggested that [6] B. M. Bass, Leadership and Performance Beyond vision, vision implementation and charismatic Expectations. New York: Free Press, 1998. communication style are the core of charismatic communication style. Many researchers agreed that [7] G. H. Bower, “Experiments on story understanding charismatic communication skills is effective in and recall.” Quarterly Journal of Experimental increasing job performance and improving organizational Psychology, vol 28, pp 511–534, 1976 outcome (Den Hartog & Verburg, 1997; Awamleh & Gardner, 1999; Towler, 2001; Frese, Beimel, & [8] J. A. Conger, “Inspiring others: the language of Schoenborn, 2003). leadership.” Academy of Management Executive, vol 5, pp 31-45, 1991.
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[19] C. A. Jones and L. S. Turkstra, “Selling the story: [9] J. A. Conger and R. N. Kanungo, “Charismatic Narratives and charisma in adults with TBI.” Brain leadership in organizations.” Thousand Oaks, CA: Injury, vol 25, no 9, pp 844-857, 2011. Sage Publications, 1998. [20] R. Klauss and B. M. Bass, Interpersonal [10] D. N. Den Hartog and R. M. Verburg, “Charisma Communication In Organizations. New York, NY: and rhetoric: Communicative techniques of Academic Press, 1982. international business leaders.” The Leadership Quarterly, vol 8, pp 355–391, 1997. [21] C. F. Keyes, “Weber and anthropology.” Annual Review of Anthropology, vol 31, pp 233 – 255, [11] J. V. Downton, Rebel Leadership: Commitment and 2002. Charisma In The Revolutionary Process. New York: Free Press, 1973. [22] K. J. Levine, R. A. Muenchen and A. M. Brooks, “Measuring transformation and charismatic [12] C. Dumas and D. Sankowsky, “Understanding the leadership: Why isn’t charisma measured?” charismatic leader-follower relationship: Promises Communication Monographs, vol 77, no 4, pp 576- and perils.” Journal of Leadership & Organizational 591, 2010. Studies, vol 5, pp 29-45, 1998. [23] B. Shamir, R. J. House and M. B. Arthur, “The [13] M. Frese, S. Beimel and S. Schoenborn, “Action motivational effects of charismatic leadership: A training for charismatic leadership: Two evaluations self-concept based theory.” Organization Science, of studies of a commercial training module on vol 4, pp 577–594, 1993. inspirational communication of a vision.” Personnel Psychology, vol 56, pp 671-697, 2003. [24] B. Shamir, M. B. Arthur and R. J. House, R. J, “The [15] K. S. Groves, “Leader emotional expressivity, rhetoric of charismatic leadership: A theoretical visionary leadership, and organizational change.” extension, a case study, and implications for Leadership & Organization Development Journal, research.” The Leadership Quarterly, vol 5, pp 25– vol 27, pp 565-583, 2006. 42, 1994.
[15] M. A. Hogg, “A social Identity theory of [25] A. J. Towler, “The language of charisma: The Leadership.” Personality and Social Psychology effects of training on attitudes, behavior, and Review, vol 5, pp 184–200, 2001. performance.” ProQuest Dissertations and Theses, Rice University, 2001. [16] R. J. House, “A 1976 Theory of charismatic leadership.” The cutting edge, in J. G. Hunt, & L. L. [26] M. Weber, The Theory of Social and Economic Larson (Eds.), Carbondale: Southern Illinois Organization, in T. Parsons (Trans.) New York: University Press, 1997. Free Press, 1947.
[17] J. M. Howell and P. J. Frost, “A laboratory study of charismatic leadership.” Organizational Behavior and Human Decision Processes, vol 43, pp 243– 269, 1989.
[18] P. Jacquart and J. Antonakis, “It’s the economy stupid,” but charisma matters too: A dual-process model of presidential election outcomes.” Academy of Management, Organizational Behavior Division: Montréal, Canada, 2010.
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Proceeding of 1st International Conference on Human Capital and Knowledge Management
Administrator’s Role in Performance Pay System as a Determinant of Job Satisfaction
1 2* 2 Azman Ismail , Aimi Anuar , Fatmawati Abdin 1Faculty of Economics & Management, National University of Malaysia, Bangi, Malaysia 2Institut Islam Hadhari, National University of Malaysia, Bangi, Malaysia (*[email protected])
Abstract - The purpose of this study is to examine the monetary and non-monetary payments based on relationship between administrator’s role in pay employees’ skills, knowledge, competencies and/or merit performance system and job satisfaction. A survey [1] [9] [10]. This new payment systems has two major method was employed to gather self-administered types: pay for group performance (gain-sharing and team questionnaires from employees who work in based pay) and pay for individual performance (e.g., merit Malaysian private institutions of higher learning in pay, lump sum bonus, promotion based incentives and Peninsular Malaysia. The outcomes of the stepwise variable pay) [11]. However, pay for performance has regression analysis showed two important findings: different types, they still use the similar criterion to first, pay participation positively and significantly allocate pays, which is when an employer rewards correlated with job satisfaction. Second, pay additional pays to the basic pay in order to achieve high allocation significantly correlated with job performers’ needs and expectations [8] [12] [13]. Under satisfaction. This result demonstrates that the this pay system, the rules for distributing rewards, the capability of administrators to appropriately plan and volatility of pay levels and structures are now contingent implement pay for performance system has been an upon the level of performances, skills, knowledge and/or essential determinant of job satisfaction in the studied competency exhibited by the employees and not the organizations. In addition, this study provides attribute of their job structure [13][14][15]. The main discussion, implications and conclusion. advantage of implementing pay for performance will attract, retain and motivate employees to reach the major Keywords–Pay participation, pay allocation, job satisfaction objectives of the organizational performance pay system: efficiency (i.e., improving performance, labor costs, and I. INTRODUCTION customers quality,), equity (i.e., fair pay treatment for employees through appreciation of employee In a human capital management perspective, contributions and employees’ needs) and compliance with compensation is regularly viewed as an employer designs laws and regulations [16][17]. Hence, it may lead to and administers pay for jobs and pay for performance sustained and increased organizational competitiveness in with the purpose of reward its employees who perform a dynamic marketplace [8][15][18]. service and/or job in organizations [1][2]. Pay for job is also known as a membership and seniority based rewards A review of recent organizational compensation where an employer gives the type, level and/or amount of program highlights that many administrators have played monetary and non-monetary payments depended on the two important roles in planning and implementing pay for merit of job (e.g., pay rates are allocated according to performance system, that is pay participation and pay employees’ skills, efforts, responsibilities, and job allocation [13][19][20][21]. According to a high conditions) [2][3][4]. For example, the types of payment commitment human resource management practice, pay for job that are usually implemented in organizations are participation is often seen as an employer encourages membership based pay, time based pay and tenure based employees in different hierarchical levels and categories pay. Implementation of such payment systems, even to discuss and contribute to decision-making, information- though may remains to be appropriate and applicable in processing and/or problem-solving activities related to established and highly predictable business conditions pay design (e.g., start-up stages of pay system) and pay [5][6][7] is gradually known as insufficient to attract, administration (e.g., operation stages of pay system) retain and motivate competent employees to increase [21][22][23][24]. Then, participation in the design of pay organizational performance [3]. system refers to employees who are given more opportunity to provide ideas in establishing pay systems In a global economy, many employers have shifted to reach the most important goals of its system, the perceptions of compensation program from a pay for a stakeholders need and/or organizational strategy job to pay for performance in order to achieve their [16][17][25]. In addition, participation in the organizational strategy and goals [7][8]. Pay for administration of performance pay system refers to performance is also viewed as a person based pay where employee participation in both input and output. an employer sets the type, level and/or amount of Participation in input means employees provides
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Proceeding of 1st International Conference on Human Capital and Knowledge Management
recommendation to resolve the enterprise’s goals, Many scholars argue that the effectiveness of methods and resources. Participation by output means performance pay system is given little attention in the employees are allowed to share the organization’s rewards previous studies because they have much discussed the in profitability and/or the achievement of productivity characteristics of the administration of performance pay objectives [23][24][26]. The ability of management to system, employed a simple association method to analyze involve employees in performance pay system may obtain the correlation between certain features of the productive recommendations in performance pay system administration of performance pay system and general (e.g., merit pay and gain-sharing plans) and this action individual attitudes and behavior, and ignored to measure will encourage them to be honest in making personal the effect size of the administration of performance pay contributions to their organizations [27][28]. system towards specific individual attitudes and behavior. Consequently, these studies have not adequately provided Most scholars often construe pay allocation from useful recommendations to be used by practitioners in organizational, individual and cultural perspectives. In understanding the complexity of the administration of pay terms of cultural perspective, an individualistic culture for performance system, and formulating strategic action perceives pay allocation based on employee performance plans that can be applied to improve the effectiveness of as equity (e.g., equitable or inequitable pay) whereas a the administration of performance pay system in high collective culture perceives pay allocation based on the competitive organizations [21][38]. job as equality, pay for the duration of service or seniority and pay for individual requirements [27] [29]. In Objective of the Study organizations, pay allocation is broadly interpreted as the type, level and/or amount of pay which is provided by an This study has two important objectives: first, is to employer to its employee who works in varies job groups measure the relationship between pay participation and depend on the organizational policy and procedures [11]. job satisfaction. Secondly, is to measure the relationship While, from an individual perspective, pay allocation is between pay allocation and job satisfaction. often described based on a social comparison theory, which posits that an individual perceives the adequacy of Literature Review the type, level and/or amount of pay according to a comparison between what he/she receives and what Relationship between Pay Participation and Job he/she expects. Then, an individual will perceive the type, Satisfaction level and/or amount of pay as adequate if he/she views that the pays are given equitable with his/her contribution Relationship between pay participation and job (e.g., ability to perform job, merit, skills and/or satisfaction is consistent with the notion of [52] performance) [30][31][32][33]. expectancy theory which explains that an individual will perform to behave in a certain way if he/she understands Surprisingly, present research in organizational pay the value of the outcomes.The idea of this theory gained system reveals that the capability of administrators to strong support from pay participation research literature. properly perform pay for performance system may have a For example, several recent studies using a direct effects significant effect on individual attitudes and behavior, model to investigate pay participation based on different primarily job satisfaction [19][34][35]. According to an samples, such as 115 sales people [36] faculty members in organizational behaviour perspective, job satisfaction is institutions of higher education [49] and public servants in often seen as a result of employees’ perception or US public agencies [50]. These studies found that the appraisal of their jobs [2]. If employees have experienced ability of administrators to actively involve employees in high satisfaction with their job, this may create a pay decisions had provided more opportunities for pleasurable or emotional state [46][47] and a positive employees to determine pay rates based on performance response in the organizations [48]. had increased job satisfaction in the organization[36][49][50]. Within an organizational pay model, many scholars view that pay participation, pay allocation and job Relationship between Pay Allocation and Job Satisfaction satisfaction are different, but highly interrelated concepts. For example, the ability of administrators to appropriately Relationship between pay allocation and job use pay participation systems and adequately allocated the satisfaction is consistent with the notion of [51] type, level and/or amount of pay based on employees’ discrepancy theory which posit that determination of pays performance may lead to an enhanced job satisfaction equally with employee's expectation (e.g., [21][35][36]. Even though the nature of this relationship contribution/effort). The meaning of this theory gained is significant, little is discussed about the role of strong support from pay allocation research literature. For administrators in planning and implementing pay for example, few imperative studies that used a direct effects performance system as an important predicting variable in model to examine pay allocation based on varies samples the workplace pay system research literature [21][30][37]. conducted in US organizational settings like 150 employees in mid-Atlantic insurance companies [53] and
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U.S. group (153 sales representatives and 146 sales adapted from pay administration literature [36][11][41]. managers) and Japanese group (175 of sales Second, pay allocation had 3 items have been adapted representatives and 93 sales managers)[38]. The outcomes from pay management literature [11][16][17][23][24]. of these studies showed that the ability of managers to Lastly, job satisfaction had 6 items that were adapted provide adequate the type, level and/or amount of pay from the job satisfaction literature [42][43]. The based on merit, skills and/or performance had increased measurement used was 7-item scale ranging from employees’ feelings of job satisfaction in the “strongly disagree/dissatisfied” (1) to “strongly organizations [21][38]. agree/satisfied” (7) for all items in the questionnaires. Demographic variables (i.e., gender, age, race, status, Conceptual Framework and Research Hypothesis length of service, salary and position) were used as control variables because this study emphasizes on The literature has been used as foundation to propose a employee attitudes. conceptual framework for this study as illustrated in Figure 1. Sample
Independent Variable Dependent Variable The researchers have acquired an official approval to carry out the study of the head of the target organization Pay for Performance: Job Satisfaction as well as received advice from the specific authority . Pay Participation . Pay Allocation about the procedures for conducting the survey in the studied organization. After taking into account the organizational rules, as well as duration of study and Figure 1: Conceptual Framework financial constraints. Then, the technique of convenient sampling was used to distribute 1800 survey Based on the framework, it can be hypothesized that: questionnaires to employees which are ready to participate in each department within the organizations. H1: There is a positive relationship between pay Since, the list of registered employees was not given to participation and job satisfaction the researchers, the sampling technique was selected and H2: There is a positive relationship between pay this situation did not allow the researchers to use random allocation and job satisfaction technique in choosing respondents for this study. From the number, 331 usable questionnaires were returned to II. METHODOLOGY the researchers, yielding 18.4% percent of the response
Research Design rate. The survey questionnaires were answered by participants based on their consents and on a voluntary This study employed a cross-sectional research basis. design which allowed the researchers to integrate the pay for performance literature, the pilot study and the real Data Analysis survey as a main procedure to collect data. Using such methods may help the researchers gather accurate data, The SmartPLS 2.0 was employed to assess the decrease bias and increase quality of data being collected validity and reliability of the instrument and thus test the [21][39][40]. This study was conducted in Malaysian research hypotheses [54][55]. The main advantage of private higher education institutions in Peninsular using this method may deliver latent variable scores, Malaysia. At the early stage of this study, a survey avoid small sample size problems, estimate every questionnaire was drafted based on the administration of complex model with many latent and manifest variables, performance pay system literature. Next, a pilot study hassle stringent assumptions about the distribution of carried out by discussing the questionnaire with twenty variables and error terms, and handle both reflective and experienced academicians and non-academicians who formative measurement models [54][55]. The SmartPLS have worked in higher education institutions in Malaysia. path model was employed to assess the path coefficients Their opinion was requested to verify the content and for the structural model using the standardized beta (β) format of the study questionnaire for a real study. Hence, and t statistics. [57] suggest that a mediating variable can a retranslation technique was employed to translate the be clearly shown in the path model when a previously survey questionnaires into English and Malay versions in significant effect of predictor variables is reduced to non- order to increase the validity and reliability of research significance or reduced in terms of effect size after the findings [39][40]. inclusion of mediator variables into the analysis. The value of R2 is used as an indicator of the overall Measures predictive strength of the model. The value of R2 is considered as follows; 0.19 (weak), 0.33 (moderate) and The survey questionnaires used in this study have 0.67 (substantial) [54][58]. Thus, a global fit measure is three parts. First, pay participation had 4 items that were conducted to validate the adequacy of PLS path model globally based on [56] global fit measure. If the results of
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testing hypothesized model exceed the cut-off value of off diagonal, signifying that all concepts met the 0.36 for large effect sizes of R², showing that it acceptable standard of discriminant validity [54][59]. adequately supports the PLS path model globally [56].
III. RESULTS Table 2: The Results of Convergent and Discriminant Validity Analyses Respondents’ Characteristics Pay Pay Job Table 1 shows that majority respondents were females Variable AVE Participation Allocation Satisfaction (57.2%), ages between 26 to 30 years old (47.8%), Participation in bachelor holders (47.8%), lecturers and assistant lecturers Pay Systems 0.679423 0.824271 Pay Allocation (54.2%), working in academic divisions (78.6%), working 0.735688 0.467231 0.857723 experiences from 3 to 5 years (42.1%), and monthly Job Satisfaction salary between RM1000 to 2000 (56.9%). 0.660901 0.534194 0.573075 0.812958
Table 1: Respondents’ Characteristics (N=299) Table 3 shows the factor loadings and cross loadings for Sample Profile Sub-Profile Percentage different constructs. The correlation between items and Gender Male 42.8 factors had higher loadings than other items in the Female 57.2 different concepts, as well as the loadings of variables Age Less than 25 years 20.4 26 to 30 years 47.8 were greater than 0.7 in their own constructs in the model 31 to 35 years 15.4 are considered adequate [54]. Overall, the validity of the 36 to 40 years 9.4 measurement model met the criteria. 41 to 45 years 1.0 More than 46 6.0 Education SRP/LCE 17 Table 3: The Results of Factor Loadings and Cross SPM/MCE 9.7 Loadings for Different Constructs STP/HSC 3.7 Diploma 22.1
Bachelor 47.8 Construct/ Item Pay Pay Allocation Job Satisfaction Master 15.1 Participation
PhD 1.0 Pay Participation Position Professional & Management Group 26.4 Supporting Group 18.7 Part 1 0.793923 Professor/Associate Professor 0.7 Part 2 0.810062 Lecturer/Assistant Lecturer 54.2 Part 3 0.860198 Part 4 0.923234 Division Academic 78.6 Pay Allocation
Non-Academic 21.4 All 1 0.873721 Length of Less than 2 years 38.8 All 2 0.912953 Service 3 to 5 years 42.1 All 3 0.857168 6 to 8 years 12.0 Job Satisfaction
9 to 11 years 5.4 JS 1 0.786154 12 to 14 years 0.3 JS 2 0.900467 More than 15 years 1.3 JS 3 0.862152 Salary < 1000 16.4 JS 4 0.867915 (Malaysian 1001 to 2000 56.9 JS 5 0.888768 JS 6 0.815344 Ringgit) 2001 to 3000 7.7 3001 to 4000 8.0 4001 to 5000 1.3 Table 4 shows the results of reliability analysis for the > 50001 to 6000 0.6 instrument. The values of composite reliability and Cronbach’s Alpha were greater than 0.8, indicating that Note: SRP/LCE: SijilRendahPelajaran Malaysia/Lower Certificate of Education SPM/MCE: Sijil Pelajaran Malaysia/Malaysia Certificate of Education the instrument used in this study had high internal STP/HSC: Sijil Tinggi Pelajaran/Higher School Certificate consistency [54][62].
Table 4. Composite Reliability and Cronbach’s Alpha Validity and Reliability of the Instrument Construct Composite Reliability Cronbach Alpha Table 2 shows the results of convergent and discriminant Pay Participation 0.910987 0.868810 validity analyses. All concepts had the values of AVE Pay Allocation 0.912723 0.856849 Job Satisfaction 0.941821 0.925777 larger than 0.5, indicating that they met the acceptable Note: Significant at **p<0.01 standard of convergent validity [54][60][61]. Besides that, all concepts had the values of √ AVE in diagonal were Analysis of the Constructs greater than the squared correlation with other concepts in
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Table 4 shows the results of Pearson correlation analysis and descriptive statistics. The means for all variables were IV. DISCUSSION from 4.0 to 4.3, signifying that the level of communication about performance based reward, The results of this study confirm that the participation in performance based reward, interactional administrator’s role in performance pay system does act justice, and job satisfaction are ranging from high (3.0) to as an important determinant of job satisfaction in the the highest level (7). The correlation coefficients for the studied organizations. In the context of this study, relationship between the independent variable (i.e., managers often use compensation policy and rules set up communication and participation) and the dependent by the stakeholder to plan and implement performance variable (i.e., job satisfaction) were less than 0.90, pay system in the organizations. Majority respondents indicating the data were not affected by serious view that the levels of pay participation, pay allocation collinearity problem [44]. Hence, the reliability values for and job satisfaction are high. This situation describes that the constructs were 1.0, showing that the constructs had the ability of administrators to actively involve employees met the standards of reliability analysis. Therefore, these in making pay decisions, and adequately provide the type, statistical results confirm that the constructs have met the level and/or amount of pay based on employee acceptable standards of validity and reliability analyses [44][45]. performance may lead to an enhanced job satisfaction in the organizations. Outcomes of Testing Hypotheses 1 and 2 The implications of this study can be divided into three Figure 3 presents the outcomes of testing a mediating categories: theoretical contribution, robustness of research model using SmartPLS. It shows that the inclusion of pay methodology, and practical contribution. In terms of participation and pay allocation in the analysis had theoretical contribution, the findings of this study explained 18.4% percent of the variance in the dependent highlight two major issues: firstly, pay participation has variable. Specifically, the result of SmartPLS path been an important determinant of job satisfaction. This analysis revealed two significant results: first, pay result is consistent with studies by [26]. Secondly, pay participation is positively and significantly correlated with allocation has been an important determinant of job job satisfaction (β=0.346;t=6.63), therefore H1 was satisfaction. This result is consistent with studies by [63]. supported. Second, pay allocation positively and In conclusion, this study has provided great potential for significantly correlated with job satisfaction understanding the influence of the administrator’s role in (β=0.641;t=8.45),therefore H2 was supported. In sum, the performance pay system in the compensation result confirms that the administration of performance management models of the studied organizations and this based reward as an important predictor of job satisfaction result has also supported and extended previous studies in the hypothesized model. mostly conducted in Western countries.
Independent Variable Dependent Variable In respect of the robustness of the methodology of the Pay Participation B=0.346;t=6.63 R² = 0.54 study, a questionnaire used in this study meet the requirements of validity and reliability analysis; this could Job Satisfaction guide to producing accurate and reliable research findings. Whereas the practical contributions, the findings Pay Allocation of this study can be implemented to improve the B=0.641;t=8.45 administration of pay for performance systems in Note: Significant at *t >1.96 organizations. The improvement efforts can be implemented in the following aspects: Figure 3: The Outcomes of SmartPLS Path Model Showing the Relationship between the Administrator’s Firstly, review the additional rewards for high Role in Performance Pay System and Job Satisfaction. performers in accordance with the current national cost of living standards and organizational changes. For example, In order to determine a global fit PLS path model, we the willingness of employers to give additional rewards carried out a global fit measure (GoF) based on [56] will increase the positive perception of employee because guideline as follows: GoF=SQRT{MEAN (Communality is considered able to meet their expectations, standards of of Endogenous) x MEAN (R²)}= 0.54 indicating that it living and statuses in society. Secondly, the type, level exceeds the cut-off value of 0.36 for large effect sizes of and/or amount of pay for performance merit should be R². This result confirms that the PLS path model has improved in order to attract, retain and motivate high better explaining power in comparison with the baseline performing employees continuously support their values (GoF small=0.1, GoF medium=0.25, GoF organizational goals and strategy. As a result, it could large=0.36). It also provides strong support to validate the PLS model globally [64]. motivate them to reach organizational goals. Finally, by
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enhancing the content and methods of management B., Compensation in Organizations: Current Research and development programs in accordance with the current Practice”, pp.195-240. San Francisco: Jossey-Bass, 2000. requirements of the organization. For example, the ability [8] E.E. Lawler. “Rewarding excellence: Pay strategies for the new economy”. California: Jossey-Bass., 2000. of employers to focus more on the creative skills (for [9] K.A. Bender. “Examining equality between public and example, stimulates the 'intellectual in doing the job, private sector wage distributions. Economic Enquiry”, respects employees' voices, encourage the employees to vol.41, No.1, pp.62-80, 2003. increase their potential to reach a better career, learn new [10] F.D. Blau and L.M. Kahn. “Understanding international problem-solving strategies and shared the organization differences in the gender pay group”. 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[64] C.M. Wetzel, R.L. Kneeboe, H. Woloshynowych, K. performance”. The American Journal of Surgery, 2006, Moorthy and A.D. Darsy.“The effects of stress on surgical vol.19(1), pp. 5-10.
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RELATIONSHIP BETWEEN ORGANIZATIONAL CAREER PROGRAM AND JOB SATISFACTION
Azman Ismailˡ, Wan Aishah Wan Mohd Nowalid*², Nurrul Hayati Adnan³ ˡFaculty of Economics & Management, National University of Malaysia, Bangi, Malaysia ²Institut Islam Hadhari, National University of Malaysia, Bangi, Malaysia ³Faculty of Economics & Management, National University of Malaysia, Bangi, Malaysia (*[email protected])
Abstract – The aim of this study is to investigate flexible work practice and multi skilling) and to the correlation between organizational career achieve higher career ladders in organizations program and job satisfaction using self-reported [5][6][12]. Further, career development is often questionnaires accumulated from employees at a related to as management implements training defence based higher learning institution in programs, succession planning, Malaysia. The results of multiple regression counseling and job rotation to continuously update analysis confirmed that career management employees’ necessarily skills and experience negatively and insignificantly correlated with needed (total group of psychological, sociological, job satisfaction while career development educational, physical, economic and chance positively and significantly correlated with job factors) in order to improve job performance, add satisfaction. This findings explains that career value for current and future job, meet feelings of management is an essential predictor of job fulfillment and improve life span well-being satisfaction, but career development is not an [13][5][14][15][19][3]. essential predictor of job satisfaction in the studied organization. In addition, this study Interestingly, extant studies in the organizational provides discussion, implications and career program reveal that the ability of conclusion. management to properly manage and develop employee careers may have a positive impact on Key words: career management, career employee outcomes especially job satisfaction development, job satisfaction [2][3][7]. In an organizational behavior perspective, job satisfaction is normally interpreted I. INTRODUCTION as a form of behaviour towards work of conditions, employees’ judgment and employees process of Career program is generally seen as a strategic thoughts regarding with their jobs, facets or aspects human resource development and management. [16][17][18], individuals’ positive emotional state, The program highlighted the employees’ job, pleasurable feelings and/or attitudes towards job process, attitude, behavior and also focused on the resulting from their appraisals about the extrinsic state of affairs related to the employees’ work life and intrinsic job characteristics [20][21][16] [22]. [1][2][3]. Under this perspective, an employer often designs and administers career programs to In a career program model, most researchers think enable employees to match their interests and that career management, career development and capabilities with organizational opportunities and job satisfaction are different, but highly easily adapt with current and future organizational interrelated. It is reflected in studies by [3][7][23] changes. Thus, it may lead to an improved the where the ability of management to appropriately progression of employees’ career in organizations manage and develop employee career paths may [4][5][6][7]. enhance their job satisfaction. Although the nature of the relationship between career program and job A review of current human capital development satisfaction is interesting, but the role of and management highlights that organizational organizational career program as an important career program consists of two salient features: predicting variable has been given less attention in career management and career development the workplace career research literature [8][9][10][11]. Career management is usually seen [24][25][23]. Many scholars argue that the as a continuous activity whereby management predicting variable of organizational career implement and monitors the progression of program has been given less attention in the employees in order to enable them easily adapt previous studies because they have much described with organizational changes (e.g., turbulent the features of organizational career program, working environment, job stability and security, employed a simple correlation method to analyze
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the degree of association between respondent able to appropriately manage and develop career characteristics and organizational career program, programs to employees who have worked in the and ignored to quantify the effect size and nature of various kinds of job categories. As a result, it may the correlation between career program lead to greater job satisfaction in organizations [24] characteristics and job satisfaction in the [2][25][7][23]. workplace. Consequently, this study approach has not provided adequate findings to be used as useful The literature has been used as the basis of guidelines by practitioners in understanding the establishing a conceptual framework for this complexity of organizational career program, as research as exhibited in Figure 1. well as formulating and implementing strategic career programs for organizations that operate in a Figure 1: Conceptual Framework global economy [25][7][23]. Thus, it motivates the researchers to fill in the gap of literature by measuring the effect of organizational career Organizational Career program on job satisfaction. Program Features: Career Management Job Satisfaction Objective of the study Career Development Based on the conceptual framework in Figure 1, it This study has two important objectives: firstly, is canIndependent be assumed variable that effect of organizational Dependent career Variable to measure the correlation between career program on job satisfaction would influence the management and job satisfaction. Secondly, is to studied organization employees’ job satisfaction as measure the correlation between career the same practice does in Western countries. development and job satisfaction. Motivation theories like (Herzberg’s 1959, 1966) motivator-hygiene theory, Alderfer’s (2002) ERG II. LITERATURE REVIEW theory and McClelland‘s (1962) learned needs theory further suggest that the ability of Several extant studies using an indirect effects management to properly manage and develop model to measure organizational career program career programs may enhance employees’ job based on different samples, such as perceptions of satisfaction in organizations. Therefore, it was 5500 household taken from British Household hypothesized that: Panel Survey [7], perceptions of 330 Swiss eighth graders [24], perceptions of 620 students from H1: There is a positive correlation between Portuguese school system [2], perceptions of 13 in- career management and job satisfaction depth interviews with workers from knowledge H2: There is a positive correlation between career intensive working context [23], and perceptions of development and job satisfaction 140 employees in a Sabah local government in Borneo [25]. Findings from these studies reported III. METHODOLOGY two important outcomes: first, the ability of management to properly implement employee Research Design career programs (e.g., monitoring the progression of employees in career paths) had been an A cross-sectional research design was employed in important determinant of job satisfaction in the this study because it permits the researchers to organizations [25][7][23]. Second, the ability of integrate the organizational career literature, the management to properly develop employee career pilot study and the actual survey as a main paths (e,g., training, succession planning, procedure to gather data. As suggested by counseling and job rotation) had been an important prominent researchers [30][31], this methods able determinant of job satisfaction in the organizations to gather accurate and high quality data. This study [24][2][25]. was conducted at a defence based higher learning institution in Malaysia. At the initial stage of this The literature is consistent with the notion of study, survey questionnaire was drafted based on motivation theory, namely Herzberg’s (1959,1966) the organizational career program literature. After motivator-hygiene theory [26][27], Alderfer’s that, a pilot study was conducted by discussing the (2002) Existence, Relatedness and Growth theory survey questionnaire with two experienced HR [28] and McClelland’s (1962) learned needs theory managers and two experienced supporting staff in (need for achievement, need for affiliation and the human resource management department of the need for power) [29]. Application of these theories studied organization sample. Their views were used in the organizational career program reveals that to verify the content and format of the individual’s work characteristics [26][27], questionnaire for an actual study. Hence, a back individual’s job needs [28], and individual’s translation technique was employed to translate the learned needs [29] will enhance if management survey questionnaires into Malay and English
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versions in order to enhance the validity and determine the acceptable standards of validity and reliability of the findings [32][33]. reliability analyses for the measurement scales. For the second step, Pearson correlation (r) analysis Measures and descriptive statistics were further conducted to determine the validity and reliability of constructs The survey questionnaire consisted of two sections: [38][39]. Finally, an analysis of multiple regression first, career management had 4 items and career was conducted to assess the direct correlation development had 3 items that were modified from between variables, further show the causal career program literature relationship and the nature of relationship between [4][5][24][25][2][6][7][23]. Second, job variables. This analysis can accurately quantify the satisfaction had 7 items that were modified from magnitude and direction of many independent job satisfaction literature [13][34][35][16][9]. All variables and one dependent variable [43][44][40]. these items were measured using a 7-item scale In addition, the value of R2 is used as an indicator ranging from “strongly disagree/dissatisfied” (1) to of the overall predictive strength of the model. For “strongly agree/satisfied” (7). This study example, the value of R2 are considered as follows; emphasizes on employee attitudes, so demographic 0.19 (weak), 0.33 (moderate) and 0.67 (substantial) variables were used as controlling variables. [41].
IV. FINDINGS
The participant characteristics were shown in Table Population and Sampling 1. From the table, we can see that majority of the respondents were male (52.2 percent), aged The population of this study is employees who between 28 to 32 years old (47.8 percent), diploma have worked in the studied organization sample. holders (39.1), employees who served from 1 to 5 For the first step of data collection procedure, years (88 percent), and employees who has permission from HR manager to conduct this study monthly salary starting from RM1001 to RM2000 has been obtained, but the list of registered (41.3 percent). employees who have worked in the organization was not given to the researchers, so the survey Table 1: Participant Characteristics (N=92) questionnaires had to be distributed to employees Participant Sub-Profile Percentage through the HR office. Considering the Characteristics organizational rule, duration of study and financial Gender Male 52.2 constraints, a convenient sampling technique was Female 47.8 used to distribute 200 survey questionnaires to < 27 years old 25.0 employees in the organization. Out of the number, Age 28 to 32 years old 47.8 92 usable questionnaires were returned to the 33 to 37 years old 19.6 researchers, yielding a 46 percent response rate. 38 to 42 years old 3.3 The survey questionnaires were answered by > 43 years old 4.3 participants based on a voluntary basis. This figure Degree 30.4 exceeds the minimum sample of 30 participants as Education Diploma 39.1 required by probability sampling technique. STPM 12.0 Therefore, it can be analyzed using inferential statistics [31][36]. SPM 18.5 1 to 5 years 88.0 Data Analysis Length of 6 to 10 years 8.7 Service 11 to15 years 1.1 In order to analyze the data, researcher has used the 16 to 20 years 2.2 Statistical Package for Social Science (SPSS) Monthly Salary < RM800 4.3 version 20.0 for this study. In the first step, RM801 to 1000 8.7 exploratory factor analysis was used to assess the RM1001 to 2000 41.3 validity and reliability of measurement scales RM2001 to 3000 29.3 [37][42]. Relying on the guidelines set up by these RM3001 to 4000 9.8 statisticians, a factor analysis with direct oblimin RM4001 to 5000 5.4 rotation was first done for all items that represented > RM5000 1.1 each research variable, then it was followed by Note: other tests: Kaiser-Mayer-Olkin Test (KMO), SPM/MCE: Sijil Pelajaran Bartlett’s test of sphericity, eigenvalue, variance Malaysia/Malaysia Certificate of Education explained and Cronbach alpha. Before testing STPM/HSC: Sijil Tinggi Pelajaran research hypotheses, these statistics were useful to Malaysia/Higher School Certificate
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Results of validity and reliability analyses were Table 3: Pearson Correlation Analysis and shown in Table 2. The table demonstrates that the Descriptive Statistics survey questionnaire consisted of 14 items. It is Measure Item Factor KMO Bartlett’s Test Eigen Variance Cronbach related to three variables which is career Loading of Sphericity value Explained Alpha management (4 items), career development (3 Career 4 0.53 – 0.7 156.35 2.7 68.22 0.84 items) and job satisfaction (7 items). The factor Management 0.95 7 3 Career 3 0.73 – 0.7 144.37 2.4 2.41 0.88 analysis with direct oblimin rotation was done for Development 0.88 3 1 all variables. Further, Kaiser-Mayer-Olkin Test Job 7 0.74 – 0.9 557.54 5.1 73.78 0.94 (KMO) that has been used as measurement of Satisfaction 0.89 1 6 sampling adequacy was conducted for each variable and the results demonstrated that it was acceptable. Based on [37][42] guideline, these Note: Significant at **p<0.01 analyses showed that (1) the value of factor analysis for all items that represent each research The results of testing hypothesis using a multiple variable was 0.5 and more, indicating the items met regression analysis were shown in Table 4. The the acceptable standard of validity analysis, (2) all independent variable (i.e., organizational career research variables exceeded the acceptable standard program) was entered in Step 1 and then followed of Kaiser-Meyer-Olkin’s value of 0.6, were by entering job satisfaction as the dependent significant in Bartlett’s test of sphericity, (3) all variable. An examination of multicollinearity in the research variables had eigenvalues larger than 1, (4) coefficients table shows that the tolerance value for the items for each research variable exceeded factor the relationship between career management, loadings of 0.40 [37] , and (5) all research variables career development and job satisfaction were 0.81, exceeded the acceptable standard of reliability 0.64, and 0.69, respectively. These tolerance values analysis of 0.70 [42]. From these analyses, it were more than the established tolerance value of confirmed that measurement scales used in this .20 (as a rule of thumb), indicating the variables study met the requirements of validity and were not affected by multicollinearity problems reliability analyses. Thus, the findings of these [38]. Further, the result of hypothesis testing in analyses can be seen in Table 2. Step 1: firstly, career management negatively and insignificantly correlated with job satisfaction (ß=- .044 p<0.05). Secondly career development positively and significantly correlated with job Table 2: Results of Validity and Reliability satisfaction (ß=0.92, p<0.001). In terms of Analyses for the Measurement Scales exploratory power, the inclusion of organizational Variable Mean Standard Pearson Correlation (r) career program features had explained 81 percent deviation of the variance in dependent variable. Statistically, 1 2 3 4 this result sends a message that career management 1. Career 5.2 1.04 0.42** 1 Management was not important determinants of job satisfaction, 2. Career 5.1 1.26 0.33** 0.46** 1 but career development was an important Development 3. Job 5.3 1.18 0.25* 0.46** 0.59** 1 determinant of job satisfaction in the organizational Satisfaction sample.
The results of Pearson correlation analysis and Table 4: Results for Multiple Regression Analysis descriptive statistics were shown in Table 3. The Variable Dependent Variable mean values for the variables are between 5.1 and (Job Satisfaction) 5.3, signifying the levels of career management, Step 1 career development and job satisfactions ranging from high (4) to highest (7). The correlation Independent Variable coefficients for the relationship between the Career Management -.044 independent variable and the dependent variable Career Development .92*** were less than 0.90. It indicates that the data were R Square .81 not affected by serious collinearity problem [37] . Adjust R square .80 All constructs had value 1 as shown in a diagonal, F 184.710*** indicating that the constructs met the acceptable Note: Significant at ***p<0.001 standard of reliability analysis. Further, these V. DISCUSSION AND statistical results confirm that the constructs used in IMPLICATIONS this study met the acceptable standards of validity and reliability analyses as exhibited in Table 3. This study explains that career management do not
act as important determinants of job satisfaction,
while career development does act as important
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determinants of job satisfaction in the studied to increase knowledge sharing and transfer, as well organization. In the context of this study, most of as creativity and innovations in performing job. the respondents perceive that managers have Finally, the type, level and/or amount of pay for properly managed and developed their employees’ merit should be improved in order to attract, retain career ladders based on the stakeholder’s needs and and motivate high performing employees expectations. The levels of career management, continuously support their organizational goals and career development, and job satisfaction are high in strategy. If organizations pay attention on these the organization. This situation explains that suggestions this may increase motivate employees managers have put a greater effort to manage the support and accept the workplace career goals and progression of employees’ career ladders, but it strategy. may not enhance their employees’ satisfaction with job in the organization. Conversely, the role of VI. CONCLUSION managers in developing employees’ career ladders may help to enhance their employees’ satisfaction This study proposed a conceptual framework based with job in the organization. on the organizational career program literature. The instrument of this study met the acceptable This study provides three important implications: standards of validity and reliability analyses. The theoretical contribution, robustness of research findings of multiple regression analysis confirmed methodology, and practical contribution. In terms that career development did act as important of theoretical contribution, the results of this predictor of job satisfaction in the organization. research reveals two important findings: firstly, Conversely, career management did not act as an career development has been an important important predictor of job satisfaction in the predictor of job satisfaction in the studied organization. This result may be affected by organization. This finding has supported and external factors, that is respondents who have extended organizational career program studies by different backgrounds may have different beliefs [24][2][25]. Secondly, career management has not about the benefits of career management, and they been as an important predictor of job satisfaction in may have different recognitions and acceptance the studied organization. This finding may be about the style of managers in managing career affected by external factors, that is respondents programs for employees who work in different job who have different backgrounds may have different categories. These factors may reduce the influence beliefs about the benefits of career management, of career management on job satisfaction. Thus, and they may have different recognitions and present research and practice in the human capital acceptance about the style of managers in and management models need to consider career managing career programs for employees who management and career development as critical work in different job categories. These factors may driving forces of the organizational career program decrease the effect of career management on job domain. Further, this research proposes that the satisfaction in the organization. willingness of management to appropriately manage and develop career programs based on From the aspect of the robustness of research dynamic inside and outside organizational forces methodology, the survey questionnaires used in this will help to invoke subsequent positive individual study have met the acceptable requirements of attitudes and behavior (e.g., commitment, validity and reliability analyses; thus it may lead to engagement, performance, justice and ethics). produce accurate and reliable research findings. Therefore, these positive outcomes may lead to Further, in term of practical contributions, the maintained and enhanced organizational findings obtained from this study can be used as performance in an era of borderless world. guidelines by management to improve the design and administration of career programs in organizations. Some positive efforts that can be done are: first, career training content and methods References should be updated in order to enhance employees’ proactive personalities in managing and developing [1] J.A. Ferreira, E. Santos, A.C. Fonseca, and their future careers. Second, communication R.F. openness should be implemented in order to help Haase, “Early predictors of career employees understand clearly the benefits and development”: A 10-year follow-up consequences of organizational career program. study”, Journal of Vocational Behavior, Third, participative decision making should be 70 (1), 61-77, 2007. encouraged in order to strengthen organizational career program based on employees’ brilliant [2] I.N. Janeiro, “Motivational dynamics in opinions. Fourth, coaching and mentoring the programs should be formally implemented in order
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development of career attitudes among an achievement-based career adolescents”, Journal of Vocational advancement program”, ADA FNCE Behavior, 76 (2), 170-177, 2010. 2007 Food & Nutrition Conference & Expo, A88, 2007. [3] A. Puah, and S. Ananthram, “Exploring the [12] K. Whymark, and S. Ellis, “Whose career antecedents and outcomes of career is it anyway? Option for career development management in flatter organization initiatives: Empirical evidence from structures”, Career development Singaporean international, 4(2), 117-120, 1999. employees”, Research and practice in human [13] T.Y. Chen, P.L Chang, and C.W. Yeh, “A resource management, 14(1), 112-142, study of career needs, career development 2006. programs, job satisfaction and the turnover intentions of R&D personnel”. Career [4] Y. Baruch, “Transforming careers: From development international, 9(4), 424-437, linear to 2004. multidirectional career paths- Organizational and [14] E.L. Herr, “Career development and its individual perspectives”, Career practice: A historical perspective”. The development career development quarterly. 49(3), 196- international, 2004, 9(1), pp. 58-73. 211, 2001.
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[33] B.D. Wright, “Comparing Rasch [23] U. Wilkens, and D. Nermerich, “Love it, measurement and factor analysis”, change it, or leave it – understanding Structural Equation Modeling, 3(1), 3-24, highly-skilled flexible workers’ job 1996. satisfaction from a psychological contract perspective” Management Revue, 22 (1), [34] R. Knoop, “Work values and job 65-84, 2011. satisfaction”, The Journal of psychology, 128(6), 683-690, 1993. [24] A. Hirschi, “Career adaptability development in adolescence: Multiple [35] J.R. Hackman, and G.R. Oldham, “Work predictors and effect on sense of power design”, Reading, MA: Addison-Wesley, and life satisfaction”, Journal of 1975. Vocational Behavior, 74 (2), 145-155, 2009. [36] P.D. Leedy, and J.E. Ormrod, “Practical research: Planning and design” (8th Ed.), [25] A. Ismail, H. Madrah, N. Aminudin, and Upper Saddle River, NJ: Prentice Hall, Y. Ismail, “Mediating role of career 2005. development in the relationship between career program and personal outcomes”, [37] J.F. Hair, R.E. Anderson, R.L. Tatham, Makara Seri Sosial Humaniora, 17(1), 43- and W.C. Black, “Multivariate data 54, 2013. analysis” (5th Ed.), New Jersey: Prentice Hall International, Inc, 1998. [26] F. Herzberg, B. Mausner, and B. Snyderman, “The Motivation to Work”, [38] B.G. Tabachnick, and L.S. Fidell, 2nd ed. New York: Wiley, 1959. “Computer-Assisted Research Design and Analysis”, Boston: Allyn and Bacon, [27] F. Herzberg, “Work and the Nature of 2001. Man”, Cleveland, World Publishing Company, 1966. [39] M.R. Yaacob, “SPSS for business and social science students”, Pustaka Aman [28] Alderfer and P. Clayton, “Existence, Press Sdn. Bhd. Malaysia, 2008. Relatedness, and Growth; Human Needs in Organizational Settings, New York”: [40] D.P. Foster, B. Stine, and R. Waterman, Free Press. 2002. Business Analysis Using Regression: A Casebook. Springer-Verlag, 1998. [29] McClelland, C. David, “Business Drive and National Achievement”, Harvard [41] W.W. Chin, “The Partial Least Squares Business Review, July-August 1962, 99– approach to Structural Equation 112, 1962. Modelling”, In Hoyle, R.H. (eds.) Statistical Strategies for Small Sample [30] J.W. Cresswell, “Qualitative inquiry and Research (pp. 307-341). California: Sage research design: Choosing among five Publication, Inc., 1998 traditions”. London: SAGE publications, 1998. [42] J.C. Nunally, and I.H. Bernstein, “Psychometric Theory”, New York: [31] U. Sekaran, “Research methods for McGraw-Hill, 1994. business: A skill building approach”, New York: John Wiley & Sins, Inc, 2000. [43] L.S. Aiken, S.G. West, and R.R Reno, Multiple regression: Testing and [32] J. Hulland, “Use of Partial Least Square interpreting interactions, Newsbury Park, (PLS) in Strategic Management Research: California: SAGE Publications, Inc, 1991. A Review of Four Recent Studies”, Strategic Management Journal, 20 (2), [44] L.M. Berenson, D.M. Levine, Basic 195-204, 1999. business statistics: Concepts and applications, New Jersey: Prentice Hall Englewood Cliffs, 1992.
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Understanding the Declining of Trade Union Density: Literature Review And Conceptual Framework S. R. Ong 1, R. Jamil2, M.F. YUsof1 1Fakulti of Razak School of UTM in Engineering and Advanced Technology, University of Teknologi Malaysia, Kuala Lumpur 2International Business School (UTM IBS), Universiti Teknologi Malaysia, Kuala Lumpur ([email protected])
Abstract - Trade unions in various countries, 1980s whereby unions around the globe faced a including Malaysia are slowly declining its density great challenge in securing union memberships. and membership. Past research has been conducted Similar trends are recorded elsewhere for instance to examine this downward trend. The decline of union in Europe [7][31], the United Kingdom [36], [29] density can be attributed to its limitation to organize and [21]. Malaysia is not left out. The Vice new establishment [25]. Economic and social development factors are also important to explain the President of Malaysian Trade Union Congress, A. phenomenon [21]. This paper explores the possible Balasubramaniam, remarked that only 9% of reasons for the declining popularity of trade unions in workers in Malaysia was unionized and the number Malaysia based on a review of relevant literatures. of workers joining trade unions was on the decline The review concludes that structural, cyclical and despite rising workforce population [37]. institutional factors are important determinants in Malaysia’s Industrial Relation Acts (1967) Section explaining the declining density of unions. Based on 5 stipulates that: this the authors proposed a framework to guide future studies on the topic. ‘No employer or trade union of employers, and
Keyword – Union density, employee, decline, union no person acting on behalf of an employer or membership, trade union such trade union shall - (a) impose any condition in a contract of I. INTRODUCTION employment seeking to restrain the right of a person who is a party to the Trade unions provide protection at the most contract to join a trade union, or to personal level for individual workers. In Malaysia, continue his membership in a trade employers, employees, and trade unions are union;’ pg12 integral to or an essential element in the industrial relations system of the country. However, the On the surface, the above clause seems to grant decline in union density worldwide in recent times workers freedom to form and join trade unions. seems to signify a weakening of their influence However, in reality the presence of various labour [23]. Density of trade union is defined as the legislations hinders their movements. Reference percentage of union members of the total waged or [38] noted that Malaysia's industrial relations salaried workforce. It expressed union membership remain firmly within the 'control' rather than the as a proportion of the eligible workforce and can be 'commitment' framework. State interventions are used as an indicator of the degree to which workers pervasive and labour’s ability to bargain are organized and unionized. Trade union density collectively remains restricted. For example, the also measures the degree of penetration of either an state sanctions only ‘in-house’ unions for workers individual trade union or the trade union movement in the electronics industry, denies them access to in the workforce. Density is crucial since it minimum wage legislation and places restrictions determines the bargaining power of a trade union. on collective bargaining. Consequently, workplace This paper focuses on the reasons for the decline of industrial relations under the EOI (Export Oriented trade union density in recent times with specific Industrialization) phase was less committed to focus on Malaysia. collective forms of representation and led to a gradual decline in trade union density [20]. II. PROBLEM STATEMENT Furthermore, many unions are too small (referred as ‘peanut unions’)[23] to be truly effective. For The decline of trade union membership is a global instance, 62% of employee unions have less than trend and affects both industrialized and 500 members meaning that much effort may be industrializing countries. Reference[34] mentioned, spent more on rivalry among the unions and in 1947 there was a total of 195,113 union internal power struggles. These factors have memberships recorded in 298 trade unions in weakened the bargaining power and reduced various countries and since 1960s, the number of union’s productivity. The low memberships also employee trade unions has grown steadily. result unions to generate limited financial needed However this growth suffered in the beginning of to support their activities. Weak bargaining power
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will have a direct impact on the union’s success in parties over trade unions, a new provision was accomplishing its goals during negotiations with included in the Trade Unions Act which enabled employers. Given these consequences, the disqualification of officers or employees who are continuing decline in trade union density is a members of political parties from holding any matter of concern. Without a strong union, workers positions in the unions. Despite these restrictive are left without a significant voice at either amendments, the government under the then Prime national or local levels to negotiate and protect Minister Tun Abdul Razak was at the same also their interests and welfare. What causes this seen to adopt more accommodative or corporatist decline? What factors do employees consider when policies towards trade unions [19]. For example, deciding whether or not to join unions? These the government had declared May Day as public questions will be answered in the following review holidays and encouraged unions to venture into of literatures. various economics activities. In 1973, the government also amended the Trade Unions Act to III. LITERATURE REVIEW allow unions to invest their surplus fund in business activities. As a result of strong 1) Trade unionism in Malaysia government support, the MTUC had successfully established the workers bank, known as Bank Malaysia’s trade union movement is presently Buruh in 1975. being governed by three major legislations i.e: Employment Act (1955); the Trade Unions Act Further power to Registrar was given during (1959), and the Industrial Relations Act (1967), the administration of Dato’ Hussein Onn (1976 to which collectively control and regulate the 1981). He had warned trade unions not to use activities of trade unions in the country. In pressure to support their fight or to take any action retrospect, trade unions in Malaysia began since which might deter investors or threaten the country before the Independence. Industrial relation security. The Registrar was given the power to practices (including employment practices) in search trade unions’ offices and premises and Malaysia have changed and continuously evolved inspect any accounts and documents regarding since its early days in the 1920s. Amendments to unions’ investments. The Registrar also has the the employment and industrial-related legislations power to suspend any trade unions and direct the and Malaysia’s industrialization policies after the unions not to take any illegal proposed strike or Independence have had a marked effect upon the lockout. The definition of strike was also expanded activities of the employers and trade unions [30]. to include unauthorized reduction in work such as Trade union movement in Malaysia was revived in go-slow. Furthermore, unions in essential services 1950s. This was the period when the British were required to give three, instead of two week government was promoting a more compliant trade notice of their intention to strike and the definition union movement and a number of major national of essential services was also expanded to include labor unions were established. These included the banking. Malayan Trades Union Council (now known as the Malaysian Trades Union Congress, MTUC) and the The restrictive policies towards labor Labor Party of Malaya. However, the less hostile movements continued even after the subsequent political environment towards trade unions gave Prime Minister, Dr. Mahathir Mohammad, rise to the formation of several new militant unions assumed office in mid - 1981. To ensure the in the early 1960s. They upheld strike and took success of his Look East Policy and as a response other industrial actions to support their claims. to the 1985-1986 recession, Dr. Mahathir introduced new amendments to the Trade Unions However, the relative freedom enjoyed by Act which facilitated the formation of in-house unions did not last long as from the mid-1960s unions. The government argued that in-house onwards, the Malaysian government had taken a unions were good alternatives to national unions as drastic action by deregistering the radical unions their leaders would be more loyal, cooperative and and detaining the unions’ officials and activists sensitive to the companies’ needs[24]. The policy under the Internal Security Act (ISA). This was has resulted growth of in-house unions and blamed followed by several amendments made to the for further fragmenting the unions and eroding their Industrial Relations Act and the Trade Unions Act bargaining strength [19]. in 1971. Consequently, the unions were no longer allowed to bargain on issues designated as TABLE 1 ‘managerial prerogatives’ [Industrial Relations STATISTICS OF LABOUR FORCE AND Act, Section 13(3)] which includes matters TRADE UNIONS IN MALAYSIA (2000–2009) regarding the rights of employers to recruit, promote, transfer, retrench, dismiss or reinstate the worker and on the allocation of work duties [24]. With the aim of reducing the influence of political
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Year Labour Emplo Total Total Members Union knowledge-based industries, higher participation of force yment trade members hip density females, greater flexibility and empowerment given (‘000) (‘000) unions hip growth (%) rate (%) to employees, and individualistic work values are some examples considered as structural factors. Institutional factors refer to laws, rules and 2000 9 572 9 275 563 734 037 1.26 7.92 2001 9 724 9 379 592 785 441 7.00 8.37 regulations enforced by a country which limit the freedom of union movements. For instance, 2002 10 064 9 709 595 807 802 2.85 8.32 ‘closed shop’ agreement which allows unions to 2003 10 426 10 047 609 789 163 -2.31 7.85 recruit new members through forced, automatic 2004 10 846 10 464 611 783 108 -0.77 7.48 membership upon their employment in the 2005 11 291 10 893 621 761 160 -2.75 6.99 2006 11 545 11 159 631 801 585 5.31 7.18 companies, had already been abolished in many 2007 11 775 11 398 642 803 212 0.20 7.05 countries including the United Kingdom and 2008 11 968 11 577 659 805 565 0.29 6.96 United States. Similar legal restrictions are 2009 12 061 11 621 680 806 860 0.16 6.94 especially obvious closer to home in Malaysia. Sources: Department of Trade Union Affairs (2006, In Malaysia, the most significant barrier to trade 2010); Government of Malaysia (2010). unionism is unfavourable legal and institutional environments. Stricter rules and regulations Table 1 shows statistics of labour force and imposed on trade unions hampered the growth of trade unions in Malaysia from year 2000 to year trade unions in the Malaysia economy. The 2009. Trade union density declined from 8.37% in Employment Act provides minimum rights for all year 2001 to 6.99 % in year 2005 and increased workers in Malaysia and these rights can be easily again on year 2006 to 7.18%. The density however and ‘secretly’ denied by employers without prior decreased again from 7.05% in year 2007 to 6.94% notice or right to be heard given to workers. in year 2009. Despite variations in the trade union Similarly, by law workers in Malaysia are only memberships, growth rate and total employment, permitted to join a trade union which represents the average trade union density for the whole their respective occupation, trade, or industry. period was 7.5%. Membership growth took a Establishment of unions to represent workers of considerable dip from 1.26% in year 2000 to only different industries or sectors is not permitted. The 0.16% in year 2009. Interestingly also, the number legal restriction is further evident as workers in the of trade unions has steadily increased from 563 public sector are not allowed to collaborate with unions in year 2000 to 680 unions in year 2009, those in the private sectors although they perform which may be used to support the presence of similar nature of their work. Geography also plays peanut unions and their fragmented power. a role whereby workers in the states of Sabah and Possible reasons for the decline of trade union Sarawak can only join a trade union in their density will be explored in the following section. respective states. In other words, they cannot join 2) Reasons for its decline in a union whose members are working in any of the states of Peninsular Malaysia regardless if they The decline of union density has received much work for the same company. These facts point the research attention. One of the most notable existence of high proliferation and fragmentation of contributions came from [13] who studied the trade unions [24][25]. historical development and long-term changes in trade unions movements in Western Europe since 1945. Their work remain as the most useful and The restriction continues with regard to strike [24]. original reference and has served as an Malaysian laws have created multi-level and indispensable tool to understand labour relations in complicated procedures which proved to be Europe. Reference[13] attribute the changes in effective in hindering strikes. Strikes are trade union membership to three broad categories: considered legal only if they fulfill certain i.e., cyclical, structural and institutional factors. requirements. Only union members have the right to strike which they must decide in a secret Reference[11] explained cyclical factors refer to balloting process. A strike can only take place if changes in the economy which influence the two-thirds of the workers involved in a trade decisions of workers to join or not to join unions. dispute with their employer agree to the action. The Examples include inflation and unemployment. In results must be then submitted to the Department of the period of high inflation, workers are expected Trade Unions which is interested to determine if to join unions because they see the need to stand the ballot has been properly administered and together to ensure their survival to face increasing counted. The union must then wait for another standard of living. Similarly, increased rate of seven days after the submission before a decision is employment will force workers to protect their job communicated about permission to strike. In the security against potential layoffs by their interim, compulsory conciliation meetings will be companies. Structural factors concern with called by the Department of Industrial Relations in changes in the composition and demography of order to look for potential solutions to the dispute. workforce. Shift from manufacturing to If no resolution is reached between the two parties, HC-36
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the Minister of Human Resources is permitted to Kingdom whereby refer the dispute to the Industrial Court for the shift from arbitration. Once the dispute is referred to the heavy industry to Court, any strike on the matters is considered new-typed of illegal. The few strikes which do occur are mostly economies has illegal strikes, organized by workers who are not contributed to the members of trade unions. The repercussions for unpopularity of holding an illegal strike are serious which may trade unions. result job dismissal, lost of right to union membership and de-registration of trade unions. [10] Gender The rising Given these, leaders of unions often do not dare to participation of take their chances. women in the labour force may Various research have studied on the influence of also contribute to cyclical and structural factors in explaining the the downward union density decline. The following table trend in union summarizes some of these studies. Collectively density. Reference they highlight the influence of socio-economic [10] found that variables in understanding the phenomenon. women tend to References Variables Notes have weaker [32] & [33] Level of The increasing attachment to their skills number of white- job hence they see collar and highly- less benefits in skilled workers has joining unions. dampened labor movement. These [6] Education Employees with groups tend to be higher education more are not interested individualistic thus to join unions. were said are more Given their better difficult and costly education, these to be handled by employees often unions. have greater bargaining power [28], [8], [7] Economy Reference [28] as individuals and & [36] (Industry and [8] argue that see less need to Structure) the decrease of have collective union density is voice. Brady attributed to the further argues that shift from the higher the level manufacturing to of education, the service-based less likely the industries, employee is especially in interested to join advanced unions. economies. [7] observes that the [25]&[23] Age Argue that the new manufacturing to generation of service shift has workers have led to the greater interest on employment of a work benefits and larger number of less keen to join women, youth, and the labor part-time, contract, movement. These and temporary younger employees workers who tend do not care much not to join labor on job security and unions. Reference job-for-life [36] also recorded concept. They tend similar observation to job hop and will in the United be more likely to HC-37
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look elsewhere review of relevant literatures. The review has when there is job concluded that the decline may be attributed to the dissatisfaction. changes in the cyclical, structural and institutional factors taking place in the global workforce. On [31] Corporatism Development in one hand, results of the literature should be taken the way human positively as the union decline seems to signify for capital is treated instance maturing economies, more knowledgeable may also explain employees with individual bargaining power, and a the reason for balanced gender representation in the workforce. It union declines. may also suggest that organizations increasingly Corporatism is recognize and respect their employees as key defined as the stakeholders to their survival. However, on the national other hand, this downward trend should not be recognition and treated lightly. The literatures have shown how participation of employers and nations have deliberately made it labor unions in almost impossible for unions to function effectively policy-making and under various rules and regulations. The legal legislation in the restrictions are especially evident in Malaysia. The national decline in the membership of trade unions, as government. This explained earlier, results weak unions with limited approach together resources. In turn, the ability and success of these with other concepts unions are severely hindered. The unions may at like employee worse left as simply worker associations rather than participation and fighting for the benefits of their members. The involvement has conceptual framework provided in the article will significantly be useful to provide an overview and guide future reduced the need research on the topic. It is particularly fruitful to for strikes. guide research in Malaysia whereby there is still much to be understood if the structural and cyclical factors, for instance, would have significant IV. CONCEPTUAL FRAMEWORK influence on the decline of union density in the country. Built upon [13] tri-factor model and further reviews of relevant literatures, the following framework is developed. The framework argues REFERENCE that all three structural, cyclical and institutional factors may contribute to the decline of trade union [1]Alex Bryson and John Forth. Trade union density. membership and influence 1999-2009 ,NIESR Discussion Paper No. 362 September 2010. [2]Amparo Serrano Pascual and Jeremy Waddington. “Young people: The labour market and trade unions”, research prepared for the Youth Committee of the European Trade Union Confederation, May 2000. [3]Athukorala P and J Menon (1995) Developing with foreign investment: Malaysia. Australian Economic Review 109, 9–22. [4]Bhopal M and P Todd (2000) Multinational corporations and trade union development in Malaysia. In C Rowley and J Benson (eds) Globalisation and labour in the Asia Pacific Region, 193–213. Frank Cass, London. [5]Booth A., Burda M, Calmfors L, Checchi D, Naylor R, Visser J: What do union do in Europe? Prospects and challenges for union presence and union influence, A Report for the Fondazione RODOLFO DEBENEDETTI Figure 1.1(Adapted from Ebbinghaus and [6]Brady, D. (2007) ‘Institutional, Economic, or Visser,1999) Solidaristic? Assessing Explanations for Unionization Across Affluent Democracies’, Work and Occupations V. CONCLUSION 34(1): 67–101. [7]Bronfenbrenner, K., Friedman, S., Hurd, R.W., Oswald, R.A., & Seeber, R.L. (1998). Organizing to This article aims to explore the possible reasons for win: Introduction. In K. Bronfenbrenner, S. Friedman, the declining popularity of trade unions based on a HC-38
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The Changing Nature of Work in Malaysia
H.S.Tan*, Muhammad Fathi Yusof, Nik Hasnaa Nik Mahmood, P.L.Tin UTM Razak School of Engineering and Advanced Technology Universiti Teknologi Malaysia *[email protected]
Abstract - The nature of work is changing worldwide in order organization lies in the competitiveness of their human to cope with the pressure from technological advancement capital utilization. and economic liberalization in the globalized labor market Technological advancement has lead to many changes today. For recent workforce, work task is becoming more in working life and also business performance. With the cognitively complex, time pressured and more mobile if present of business flexibility from the creation of compare to traditional work task. Previously, work task in the workplace is more individual based and less technological multiple web services, many organizations has step into a dependent, where working hours are also fixed and new and different kinds of management [2]. According to workplace is immobility. By comparison, there is no doubt McKinsey Global Institute Report, 2010; many services that the world of work is changing, same as what is jobs are to be carried out remotely and flexibly. happening in Malaysia context, thus, a research is needed for a solid evidence for academic purpose and organizational Organizations today mainly consist of Generation X productivity enhancement. The main objective of this study is (1963 – 1978) and Generation Y (1979 – 1999) as their to gather the pros and cons about the changing nature of main workforce; where this kind of generation is different work in service sectors from the integration of existing from Baby Boomer. Generation X and Generation Y is articles and reports through library search and thus create a general idea for business improvement. This study adopts result oriented generations, where they would like to library search journals integration and semi-structured perform and continue performing if their performance is phone interviews with HR personnel from service industries. being recognized by top management. Besides, their working styles are also different from baby boomers, Keywords – Nature of Work, Flexible Work Arrangement, where they want flexible schedules, independence, Talent Workforce interesting and challenging job and seek for professional growth and development [3]. Thus, employers and I. INTRODUCTION employees today are more rather to focus on continuous training, competency development and work-life balance. Service industries such as banking, transportation, This also means that the ways of organization work have hotel and tourism play an important role as one of the to be changed in order to suit to the working lifestyle of earning generator sources of Malaysia. Almost every year, present generation. this industry accounted for the largest share of Malaysia’s Gross Domestic Product (GDP). According to the Presently, some of the multinational companies proposed Budget 2014, services sector is expected to grow (oversea companies) like IBM, Symphony and Ernst & at 5.7%. Since service industry is the largest industries Young have been known as flexi organization in affected by the modern nature of work which is changing, Malaysia. This is because they mainly following the work therefore, it is very crucial for a research to be conduct in culture that have been practiced a long time ago in this industry to determine the performance and headquarter in oversea. Also, this is proven that with such contribution from the entire industry and hence a a working culture, they are able to sustain their business conclusion to made to improve service organizations performance and always be in the of Bursa Saham performance and productivity. Malaysia. Therefore, this study tends to gather the pros and cons about the changing nature of work in Malaysia’s Organizations today are more tuned to dynamic service sectors. This study is also tends to determine competitive and less hierarchical in structure as compared whether flexible work arrangement is a new working to traditional organization. The past two decades have seen pattern for service sectors in Malaysia based of the new a trend toward less hierarchical employment relationship working pattern from Generation Y. Furthermore, this along with the vanished of long term relations and towards study is also to identify a significant impacts created by a more demanding work [1]. Furthermore, the workforce talent workforce which had been discussed worldwide today need helps to keep its sustainability due to the recently. With the comparison between the pros and cons changes in the way of working. In other word, employer of new working culture, it will be sufficient to contribute and employee relationship have to be manage effectively a newly form working pattern which is proved to be in order to sustain the competition of the entire efficiently increase the overall performance of the organization with the globalized labor market. There is companies. little dispute showing that the success or failure of an
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Workplace flexibility is expected to be on a rise in the II. LITERATURE REVIEW future and thus most of the interaction between HR personnel and line managers or workers will be very near A. Definition and Concept of Nature of Work to without face-to-face meetings [8]. In addition, it also had been proven that FWA is totally suited with the Generally, work nature is known as the characteristic working lifestyle for high demanding Gen Y workforce. of the work itself. It may include task variety, task accomplishment and it also consists of a few definitions. By understanding and examining FWA and its But from its original definition, Nature of work as the impacts from exploring career experiences in today features of a person as well as the characteristics of work workforce is important for understanding the ways that task itself [4]. From academic perspective, work nature as organization can maximize their human resources. This is how skill variety applied to the job, the completion of one of the ways for top management to utilize different work task by managing employees and the impacts of job approaches to attract and retain their organization talents to others contributed by the employees [5]. from different groups of employees.
As identified previously, nature of work today C. Talent Workforce becomes more and more complex and more dependent to cognitive and social skills instead of experienced. An Talent workforce in an organization in general is obvious example of the change of work nature is where in known as those skills workers who able to possess today workplace, a highly specialized employee (talent) leadership competencies, adapted quickly to the doing their work without much more guidance from their organizational culture and accomplished their task within manager, which is also not well defined the manager the dateline given and is able to achieve outstanding know more about the job than the employee. Indeed, performance than others. They are types of employees under this notion of job, each employee may have his or used as a meant to adapt quickly to the changes in labor her own preference way (flexibility) to complete the work market and allow for needed flexibility [9]. These kinds and they may resist autocratic management attempts to of workforce are increasingly seen as a crucial factor in control what is being done traditionally [6]. bringing a successful organization.
According to McKinsey Global Institute Report, Employers of choice in today modern era looking to 2010; only 13 – 19 percent of 33 million universities win talent by offer improved career development graduates in developing countries, such as China, India opportunities, provide challenge, inspiring, enjoyable and and Malaysia are suitable to work in multinational flexible work, improving participation and encouraging company mainly due to their lack of languages skills to open communication [10]. This is in line with the new socialize and lack of cultural fit. In other words, work task working style demanded by Gen X and Gen Y who is the required not only cognitive and knowledgeable main workforce in today labor market. In Malaysia, a employees, but also employees who know to socialize. good and clear example is shown in IBM as an employer This is explaining why organizations today tend to of choice in 2012 where they tends to create management develop their own talent pool employees. Talent trainee positions more than executive position for workforce is basically known as the employees who had graduates. those skills and are able to compete and cope with the pressure from globalization. They played an important Employers have to be clear which employees have the role in determining the organization performance neither potential to be developed as a leader for future and all of in productivity nor profitability. this development has to be depends to the needs of the organization and the nature of the work itself. In addition, B. Flexible Work Arrangement employers also have to know the attitude of recent workforce especially high demanding Generation Y, Flexible Work Arrangement (FWA) is known as where they only select high and good reputation once they organization flexibility where it is about employee’s graduated in order to fulfill their needs such as flexible freedom from their office work arrangements to their working condition and greater salary credited. The best personal life such as professional development and family practice organization believe the most important life. FWA includes flexible working hour, working place developmental exercise is by providing flexible job and also working conditions. Organization have to description to allow for rotating assignment that will help support flexible working hours such as part time work and enrich the growth and potential for employees [11]. recognize that it is not about the length of time spent at a desk but about the output of the task and its There is no doubt that talent workforce is attracted by accomplishment time [7]. flexibility where more freedom is provided. The current working trend is adapted to increasingly virtualized, where employees are allowed to work from their home
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with flexi working hour and it is proven that both V. CONCLUSION employer and employees look more satisfied with the current practice since the performance and profitability of From the reviewed of literature and available journal the organization is improving. In order to attract and papers study, and the information from the HR Personnel retain talent businesses needs, it is require a renewed in Symphony through phone interview, it is to be energy and focus on employee value proposition with concluded that flexible work arrangement (FWA) and greater flexibility to attract increasingly diverse talent in talent workforce are keen and helpful in improving current and also for future workforce [12]. business productivity and enhancing business goals. And there is no doubt that talent workforce is strategically tally III. METHODOLOGY with flexible work arrangement among Generation Y
workforce. Hence, this had psychologically and This study mainly adopts library search articles and physically putting the top management to the edge of journals with the integration of information collected hiring high performance talent workforce in the sense of through semi-structured phone interviews with HR Personnel from the selected service industry improving business creativity and productivity. Therefore, organizations. Available literature from several publishers it is to be concluded that demanding working adult such as Scopus, Emerald is reviewed which can be easily Generation Y looking for a save time and enjoying accessible through the UTM library channel. Important lifestyle. This can also be known as work-life integration information and previous study was extracted using or work-life balance. Last but not least, it will be good if exploratory method and hence analyzed critically with the future research is able to cover on what types of explanatory method. organizational culture is stimulating flexibility and talent . workforce in terms of improving business performance IV. DISCUSSION and productivity.
From the information gathered through the library ACKNOWLEDGMENT search and integration of literature reviewed, it is to be said that the flexible work arrangement and talent I would like to express my gratitude to Poshini and workforce is going to be rise in the current and future Aaron who as a HR Executive in Symphony that willing workforce. These two elements are interrelated with to answer my questions through social media and phone Generation Y. For instance, today working adult calls. Besides, the ideas contributed from co-authors are demanding for flexibility and at the same time they are also appreciated. In addition, I would like to thank to my also looking for good income paid with the only condition family and friends for supports they had given to me is that they must be a talent. This is supported throughout along the way of completing this paper. Last but not least, the phone conversation with one of the HR personnel who I like to thanks to Malaysia Government especially responsible for recruiting and training activities in Ministry of Higher Education (MOHE) for the scholarship Symphony. He mentioned that in order for him to recruit a sponsor that gave me chances for further exploration in talented graduate, he has to be alert on the psychological this study. part of the inner talent skill such as ability to cope with the work pressure that the individual perform during the interview session. Certain test is to be carried out for REFERENCES recruitment in order to make sure the candidate fit well to the organizational culture and get engaged. [1] Suzanne, M. and John, W. (2009). Generation Y: Unchartered Territory, Journal of Business and Economics Research, Vol. 7, No. 4. Besides, he did mention also Symphony do to have [2] Sunilkumar, P. (2009). Mashups and the Enterprise. graduates program for their IT Department. This program [3] Tulgan, B. and Martin, C. (2001). Managing Generation Y Global is in the collaboration with the Ministry of Higher Citizens Born in the Late 70s and Early 80s, HRD Press, Amherst, Education of Malaysia where Symphony will offer with MA. [4] Arvey, R.D., Bouchard, T.J., Segal, N.L., & Abrahim, L.M. (1989). the adaption of diploma graduates as a trainee for a period Job satisfaction: Environmental and genetic components, Journal of of time. At the end of this program, recruiter will select a Applied Psychology, 74(2), 187- 192. few high performance trainees and adopt them into the [5] Hackman, J.R., & Oldham, G.R (1980). Work redesign. Reading, company as the junior executive staff. The pros of this MA: Addison-Wesley. [6] Adar, A.D. (2002), Managing Knowledge Workers, Quorum Books, program is it given an employment opportunity for Westport, CT. nowadays graduates but the cons for this program is the [7] Anita Weyland. (2011). Engagement and Talent Management of Gen graduate have to be work with the same company for at Y. Industrial and Commercial Training, Vol. 43, No. 7, pp. 439 – least 3 years and above with the same credit salary paid. 445. [8] Bhushan.K & Joseph.S. (2012), Global Human Resource (HR) Besides, this is also related to the retention process in the Information Systems, Kybernetes, Vol. 41, No. ½, pp. 229 –238, company. Emerald Group Publishing.
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[9] Kathy, P. (2010). The Role of Flexible Job Description in Succession Management, Library Management, Vol. 31, No. 4/5, pp. 279 – 290. [10] Lowe, G. (2001), Employer of Choice, Workplace Innovation in Government, a Synthesis Report, Canadian Policy Research Network Inc. [11] Fulmer, R. (2005), Key to Best Practice Succession Management, Human Resource Magazine.
[12] Peter Cheese (2010). Talent Management for a New Era: What we have learned from the recession and what we need to focus on next. Human Resource Management International Digest, Vol. 18, No. 3, pp. 3 – 5.
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Significant Human Risk Factors in Aviation Maintenance
M. N. Said*1, A. Z. Mokhtar2 1Department of Mechanical, University Kuala Lumpur, Sepang Selangor, Malaysia 2University Kuala Lumpur, City Campus, Kuala Lumpur, Malaysia (*[email protected])
Abstract - We are approaches to invistigate the significant include risk factors in their conclusions. For example, on human risk factors in aviation maintenance industry. May 25, 2002, a B747-200 China Airlines passenger Questionnaire through the modified human factors SHELL aircraft departing Taiwan for Hong Kong broke up in- model was developed to categories the human factors flight; all 225 people on board were killed. The accident variables that were derived from the literature review and the opinions of aviation personnel who involved in report by the Aviation Safety Council (ASC) in Taiwan maintenance. The data were obtained from 18 aviation found that the incident involve many items related to maintenance in Malaysia which has been listed in Malaysia maintenance risks that had the potential to degrade Aviation Industry Report (MAIR). The total of 315 aviation safety [9]. respondents was received during the period of the survey. The most important step in aviation management is Several analysis techniques were used to analyze the survey risk identification. If the risk cannot be accurately data through exploratory factor analysis, reliability analysis and confirmatory factor analysis. The result showed that identified, it cannot be analyzed or evaluated. Once actual there are significant human risk factors in aviation and potential hazards are identified, an assessment should maintenance and the result also provided approaches of be made of the cause and contributing factors and a Structural Equation Modeling (SEM) to verify the decision should be made as to whether action is required hypotheses in the path analysis model. The study contributes [10]. We aimed at evaluating the significant human risk to the knowledge on human factors management and act as factors in aviation maintenance industries. The objective guidelines to aviation maintenance practitioners and aviation authority in order to improve human factors to help aviation industries better understanding their management in Malaysia aviation industry. major operational and managerial weaknesses in order to improve management and aviation maintenance Keywords – Significant, Human Risk Factor, Aviation operation. The study of questionnaire in Malaysia was maintenance. conducted to determine these significant human risk factors and to illustrate how empirical evaluation I. INTRODUCTION approach integrate expert opinion about the relative
importance of these factors Aircraft maintenance is an essential component of the global aviation industry. It involve a complex organization in which each aircraft maintenance personnel A. The human factors model performs varied task with limited time, minimal feedback, and sometimes difficult ambient conditions [1]. Human factor practitioners typically concentrate on the interface among people and the other system elements. Maintenance in this context is essentially about keeping The important point of the system view is that humans aircraft operational within a strict time schedule. The cannot be isolated from other system components. The main role of aviation maintenance personnel is to view is similar to that of ecologist, i.e. that all element in categorize and judge the important of problem that could nature interacts. We can't change one aspect of the system threaten the airworthiness of aircraft [2]. Aircraft contain without being concerned about its effects on other system many rapidly developing advanced technologies, such as [11]. composite material structures, glass cockpits, highly All aviation accidents are composed of four factors automated systems, and build-in diagnostic and test [12], this is known as the SHEL model: software (e.g. equipment; therefore, the need to simultaneously maintain maintenance procedure, maintenance manual, checklist ), new and old fleets requires aviation maintenance hardware (e.g. tools, test equipment, physical structure of personnel to be knowledgeable and adept in their work aircraft, and instruments ), environment (physical than in previous years [3]. However, the complexity of environment such as condition in the hangar, work such operations naturally presents new possibilities for environment such as work patterns, and management human error and subsequent break-downs in the system’s structures), and liveware ( the person or people at the safety net [4] center of the model, including maintenance engineers, In recent years, the aviation industry has gradually supervisors, managers, etc,) [13]. The model which begun to make use of risk management and risk incident identifies three kinds of interactive resources, its indicated analysis [5],[6],[7],[8]. Many accident reports now that the sources of all aviation accidents can be categorized as one (Liveware) or combination of three
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major relationships (Liveware-Software, Liveware- Hardware, and Liveware-Environment.) In aviation accident analysis, organizational errors Hawkins [14] modified Edwards’ model to include in relation to resource management, organizational the interactive nature of the person to person relationship climate, and operational processes have been highlighted (Liveware-Liveware) and called it SHELL. Hawkins used in order to better understand and manage human error. the relationship between liveware and software, liveware These latent organizational failures can directly impact and hardware, liveware and environment and liveware affect supervisory practices, as well as the conditions and and liveware to describe situations that the people actions of operators [24]. In aviation maintenance, the encountered or what happened to them in the working efficiency and reliability of human performance are environment. The model does not cover the interfaces that influenced by working conditions which stem from the the outside human factors (Hardware-Hardware, overall organizational process [25]. Organization and Hardware-Environment and Software-Hardware) and is management decisions made in the technical support, intended only a basic aid to understanding human factors policies, workforce, finance and safety have significant [15]. impacts on the type of human error that can appear. These human performance deficiencies can be reduced if the organization properly addresses such issues as training, B. The modified model for categorizing the human time pressure, task design and working environment [25]. risk factors in aviation. As such, an effective (Liveware) aviation We are in the era of organizational accidents [16]. In maintenance personal interface with less organizational recent years, there has been a shift in emphasis within the deficiencies would better help reduce human errors safety literature away from the individual-level that might created by other human performance interfaces of the be responsible for accident and incidents, and towards system. In addition, an effective (Liveware) aviation organizational and organization-related factors [17], [18], maintenance personal interface derived from positive and [10],[8],[19]. When people are at the center of aviation innovative organizational climate will help the safety, the quality, capacity, attitude, perception, and organization operating in a high-risk environment such as training of personnel are important and therefore an aviation maintenance system to better manage and highlighted. The organizational culture, organizational more easily adapt to ongoing changes [21]. climate, managerial model, decision making pattern and Mismatches at the above human performance aviation safety culture will also affect an individual [20], interfaces have been regarded as sources of human error [10], [21].Accidents are usually organizational or in which the aviation maintenance personal (liveware) managerial issues composed of series of errors that are play a vital role. To examine how this ideal situation has sometimes difficult for aviation personal to recognize and been achieved, it is thus hypothesized that: control. In practice, the International Civil Aviation H1 There is a positive & direct relationship human factors Organization’s (ICAO) Human Factor Training Manual and human error in aviation maintenance. [22] emphasizes the organizational issues of airline H2 There is a positive & direct relationship human factors maintenance operations. Furthermore, the International and organization in aviation maintenance. Air Transport Association [23] has five categories for the H3 There is a positive & direct relationship organization accident classification system: human, technical, and human error in aviation maintenance environmental, organizational, and insufficient data.
C. The extended SHELL model and research II. METHODOLOGY hypotheses A. Data collection To examine the importance of the organizational A survey questionnaire containing the measurement aspect of the aviation maintenance system, we extended items was distributed to aviation maintenance personal of the SHELL model to explicitly include organization as a all levels in 18 aviation maintenance industries, including mediator factor. This extension enables the role played by supervisor, instructor, license aircraft engineer and the organizational aspect of the aviation maintenance technician. A total of 315 effective responses were system to be examined, through its interaction with the received. aviation maintenance personal. With the extended SHELL III. RESULTS model, an aviation maintenance system is described as human factors interfaces in which the aviation A. Reliability analysis maintenance personal (liveware) as a human factor A reliability analysis was first carried out on survey interact with other human factors including others data to ensure the internal consistency of the constructs. (liveware), physical resources (hardware), non physical For exploratory research, Cronbach’s alpha should be at resources (software), physical settings (environment), and least 0.70 or highest for a set of item to be considered and non physical settings (organization). adequate scale [28]. An exploratory and confirmatory
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factor analysis was than conducted on a single and multiple constructs to extract the factors from the items retained after reliability analysis. The items retained are .57 good indicators of their underlying factors extracted, e01 Software .76 .61 which are used as the observed variables or indicators in .76 Installation e01 e02 Hardware .87 the measurement model for measuring their .78 .32 .51 .71 HF HE corresponding constructs. e03 Environment .85 .82 .72 Serv. Rep. e02 .67 .25 .41 e04 Liveware(I) Unstandardized Standardized .77 ORG p-value .59 Estimate Estimate e05 Liveware(O) HE <----- HF 0.569 0.001 0.324 79 .84 .81 .88 .74
ORG <----- HF 0.501 0.008 0.252 Quality Policies Work. F Finance Safety HE<----- ORG 0.632 0.001 0.405
.64 .70 .67 .78 .55
Table 1: Regression weight for the constructs e01 e02 e03 e04 e05
B. Structural Equation Modeling Analysis Chi-Square = 126.530 df = 50, p-value = 0.000 The structural model with a path diagram shown in Chi-Square/df = 2.531 GFI = 0.939 AGFI = 0.905 RMSEA = 0.070 Fig.1 with the measurement model in Tables 1 and 2 was PCFI = 0.709 AIC = 182.530 constructed. Ovals represent the constructs (Latent variables), and rectangles represent the factors (observed variables or indicators). Single headed arrows represent Figure 1: The research model showing input and output causal relationships between variables. Goodness of fit variables with regression weight. test was conducted with the survey data to examine the efficiency of the structural model. The chi-square of the C. Hypotheses testing structural model was significant ( = 126.530, df = 50, p In SEM analysis, the relationships among = 0.000) with the value of ( /df = 2.531) smaller than 3, independent and dependent variables (constructs) are indicating ideal fit [29].the large chi-square value was not assessed simultaneously via covariance analysis. surprising, since the chi-square statistic has proven to be Maximum Likelihood (ML) estimation was used to directly related to sample size. estimate model parameters with the covariance matrix as To assess the overall model fit without affected by data input. The ML estimation method has been described sample size, alternative standalone fit indices less as being well suited to theory testing and development sensitive to sample size were used. These indices included [27],[30]. Two sets of independent variables and the goodness of fit index (GFI) the adjusted goodness of dependent variables are used for testing research fit index (AGFI), the comparative fit index (CFI), and the hypotheses H1-H3 respectively [31] root mean square error (RMSEA) [5]. To have a good Fig. 1 shows the result of the structural model. The model fit, GFI should be close to 0.90, AGFI more than values associated with each path (hypothesized 0.80, CFI more than 0.90, and RMSEA less than 0.10 relationship) are standardized path coefficients. These [30]. An assessment of the structural model suggested and values represent the amount of change in the dependent acceptable model fit (GFI = 0.939 ; AGFI = 0.905; CFI = variables for every single unit of change in the 0.936; RMSEA = 0.070). independent variable. For example, an increase of one unit in the human factors construct will cause an increase of one unit in the human error construct. Solid lines indicate supported relationship respectively. The standardized regression weight and p-values for structural relationships as shown in Table 1.The result shows that, the standardized regression weight for H1was found to be 0.324 (p-value < 0.001). This result was support to H1 that the HF has direct and positive impact on HE . Table 1 also presents the relationship between HF and ORG efforts. The standardized regression weights for the hypothesized relationship between HF and ORG was found positive (0.252) and insignificant (p-value > 0.001), the result does not provide support to H2 have a direct and positive impact on ORG effort. The standardized regression weight for the direct relationship between ORG
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effort as found to be positive (0.405) and significant (p- Furthermore, when we took quality support as value < 0.001) confirming H3 that ORG had direct and reference factor, we found that quality support, company positive impact on HE. policy, workforce, finance strategy and safety culture were significant in 95% confidence level (p-value < D. The Significant Human Risk Factors in Aviation 0.001). Finance strategy (0.883) is the most significant Maintenance Industry. risk factors influence organization. It continues the The purpose of this research is to determine if there significant with other independent variables company are significant human risk factors in aviation policy (0.836), workforce (0.818), quality of support maintenance. The findings of this research reveal that (0.803) and safety culture (0.7.41). there are significant human risk factors in Malaysia aviation maintenance industry. The research supports [3] and findings that the human factors have a positive impact IV. CONCLUSION to the aircraft maintenance. The results of the study also The empirical findings of a questionnaire survey of agree with [31] indicated that human errors were caused 315 aviation maintenance personnel in Malaysia shows by one or several components failures among Software, that the model and approach are both strategically Hardware, Environment and Liveware in a system. From effective and practically acceptable for categorizing the the path analysis, we can observe that human factors and significant human risk factors. organization were significant towards dependent variable The result reveal that the aviation maintenance human error. The significant level was referring 95% companies may want to propose management strategies confidence level with p-value < 0.001. With reference to related to the significant human risk factors to minimize the significant importance, independent organization the human error. Our findings also suggest that the Civil factors (0.405) were more significant compared to Aviation Authority may consider asking management independent human factors (0.324) which referring to the level groups in aviation companies such as human estimate value stated in the Table 1. recourses and maintenance departments, to focus on significant human risk factors to improve aircraft maintenance performance and reducing error. Table 2: Regression weight of the items. Specifically, these significant human risk factors are related to the hardware, liveware (I), environment, and Unstandardized Standardized liveware (O). Aviation maintenance companies also have p-value to focus other significant human risk factors under Estimate Estimate organizational such as financial strategy, policies, SW <------HF 1.000 0.001 0.754 manpower and safety culture. When employee HW<------HF 1.214 0.001 0.871 professionalism is protected and the individual staff ENV <------HF 1.069 0.001 0.714 members have the company attention, safety and human error costs should be reduced. LW(I)<------HF 1.110 0.001 0.818
LW(O) <------HF 1.120 0.001 0.768 QS <------ORG 1.000 0.001 0.803 REFERENCES CP <------ORG 0.920 0.001 0.836 [1] Latorella, K.A., Prabhu, P.V., 2000. A review of WF <------ORG 0.908 0.001 0.818 human error in aviation maintenance and inspection. FS <------ORG 0.878 0.001 0.883 International Journal of Industrial Ergonomics 26 (2), SC <------ORG 0.867 0.001 0.741 133–161. INST<------HE 1.000 0.001 0.781 [2] Pettersen, K.A., Aase, K., 2008. Explaining safe work practices in aviation line maintenance. Safety SR <------HE 0.910 0.001 0.848 Science 46, 510–519. [3] Y.-H. Chang, Y.-C. Wang 2010.Significant human Based on weight and ranking, the order of factors in aircraft maintenance technician, Safety significance of the five dimensions when we studied the Science 48, 54-62 result as presented in Table 2, with human factors as [4] CAA, 2002a. CAP 715: An Introduction to Aircraft dependent variable and software, hardware, environment, Maintenance Engineering Human Factors for JAR liveware (I) and liveware (O) as independent variables, it 66. UK Civil Aviation Authority. indicated that software, hardware, environment, liveware
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[6] Lee, W.K., 2006. Risk assessment modeling in governed organization. Applied Ergonomics 37, 119– aviation safety management. Journal of Air Transport 129. Management 12 (5), 267–273. [22] ICAO, 1998. Human Factors Training Manual, first [7] Wong, D.K.Y., Pitfield, D.E., Caves, R.E., Appleyard, ed. International Civil Aviation A.J., 2006. Quantifying and characterizing aviation Organization, Doc. 9683-AN/950. accident risk factors. Journal of Air Transport [23] IATA, 2006. Safety Report. International Air Management 12, 352–357. Transport Association. Geneva, [8] CAA, 2007. Aircraft Maintenance Incident Analysis. Switzerland/Montreal, Canada. UKCivilAviationAuthority. 2.hf.faa.gov/ops. [16] Reason, J., 1990. Human Error. Cambridge University Press, Cambridge, England [17] Westrum, R., 1996. Human factors experts beginning to focus on organizational factors in safety. ICAO Journal (October). [18] Neal, A., Griffin, M.A., Hart, P.M., 2000. The impact of organizational climate on safety climate and individual behavior. Safety Science 34, 99–109. [19] Parker, D., Lawrie, M., Hudson, P., 2006. A framework for understanding the development of organizational safety culture. Safety Science 44, 551– 562 [20] McDonald, N., Corrigan, S., Daly, C., Cromie, S., 2000. Safety management systems and safety culture in aircraft maintenance organizations. Safety Science 34 (1–3), 151–176. [21] Arvidsson, M., Johansson, C.R., Ek, A., Akselsson, R., 2006. Organizational climate in air traffic control: innovative preparedness for implementation of new technology and organizational development in a rule HC-48 Proceeding of 1st International Conference on Human Capital and Knowledge Management A Review of Human Resource Management Practice Models Applied in Banking Industry Nur Syhuhada Ab Ghani & Maslin Masrom UTM Razak School of Engineering and Advanced Technology Universiti Teknologi Malaysia [email protected], [email protected] Abstract - Human resource is important asset for any of risk. How you manage the people and how you manage organization whether manufacturing, service or the risk determines the success in the banking industry. production. Likewise, it’s also becomes the source of There is little dispute recently that the success or achieving competitive advantage. Managing human failure of most organizations lies in the competitiveness resource is very challenging as compared to managing of their human resource [5]. Several scholars have noted technology or capital and for being an effective that managing people is more difficult than managing management; organization requires effective human technology or capital and the weaknesses of an resource management (HRM). HRM practices may organization are much related to the weaknesses of back up the organizational function in order to managing human resource [6]. However, those achieve the goals. HRM practices refer to organizations that have learnt how to manage their human organizational activities directed at managing the pool resources well would have an edge over others for a long of human resource and ensuring that the resources are time to come because acquiring and deploying human employed towards the fulfillment of organizational resources effectively is cumbersome and takes much goals. The objective of this study is to review the longer [7]. As such, nowadays’ HRM has made a models that have been applied in banking industry in transition from a state of insignificance to one of strategic order to develop an understanding of HRM practices importance academically and business wise. In fact, in an and to examine the similarity or different HRM organization, human resources are the source of achieving practices implemented by banking industry in competitive advantage because of its capability to covert Malaysia. This study adopts a qualitative approach by the resources such as money, machine, methods and using the desk-based and library-oriented methods. It material into output like product or service. The presents the understanding of the concept of competitor can imitate other resources for instance framework on the basis human resource management technology and capital but human resources are unique. practices in banking industry and its’ implications. According to [8], people are one of the most important factors providing flexibility, stability and adaptability to Keywords –Human resource management practice, organizations. banking industry, HRM model, HRM framework, Malaysia The objective of this study is to review the models that have been applied in banking industry and the I. INTRODUCTION purpose of this study is to develop an understanding of HRM practices and to examine the similarity or different Financial service is one of the fastest growing HRM practices implemented by banking industry in industries in Malaysia today and has now been accepted Malaysia. as viable and competitive mode of financial intermediaries [1]. Islamic and conventional banking have II. LITERATURE REVIEW undertaken a long journey in this path of financial industry which the current global banking assets and Definition of Human Resource Management assets under management have reached USD750 billion and is expected to hit USD1 trillion [2]. However, this Human resource management (HRM) define as the banking industry undeniably faces numerous challenges act of designing management system in ensure the human that need to be addressed in order to provide a sound base talent is use effectively and efficiently to accomplish the for future course [3]. Therefore, this development become organizational goals [9]. The performing activities must one of the most important and critical aspect in way to be includes planning, organizing, developing and leading boost up the organization performance and factors and it is the management that is specialized to persuade contributing to financial institutions towards positive employees to reach the highest level of productivity with attitude. Nevertheless, its start from how the HRM efficiency and matching with the organizational and the practices that was used in the banking industry. According employees towards the direction and the contribution in to [4] HRM is important for any banking industry because realizing the goals of each. Other than that, each banking is a service industry. It faces with two key employee must be selected, recruited, trained, and challenges which management of people and management managed effectively. HC-49 Proceeding of 1st International Conference on Human Capital and Knowledge Management Whereas, Verata (2010) [10] defined it as methodological analysis for the institution's needs for insure that the correct number of employees with Stakeholder Interest necessary skills is available when needed. From these Shareholders definitions, it is clear that the human resources is a special Management Employee Group HRM HR outcomes Long-term operation to attract individuals and develop them, Policy Commitment Consequences preserve them in the frame of realizing the organization’s Choices Compliance Individual well- Employee Congruence being aims and employee’s aims. HR flow Cost Organizational Situational Reward effectiveness effectiveness Factors System Societal well-being Types of Human Resource Management Practices Workforce Characteristic Business Strategy There is no agreement on what constitutes HRM Management practices let alone a prescribed set of them [11]. Philosophy Researchers have over the years proposed countless varied lists of practices however; there is no agreement on what or which practice qualifies as an aspect of HRM Figure 1. Harvard Analytical Framework for Human [12]. It is interesting to note that there are still some Resource Management practices that form the core of the various practices proposed. These include recruitment and selection, training and development, performance management, and ii. Michigan Model reward scheme. However, others such as job design and also employee involvement are more sporadic and are yet Based on figure 3, the Michigan model focuses to gain grounds in the HRM literature. However, Guest on hard HRM. It holds that people should be managed [12] puts forward seven practices namely, selection, like any other resources and so obtained cheaply, used training, appraisal, rewards, job design, involvement and sparingly, developed and exploited fully. It also security. emphasized the interrelatedness of HRM activities. According this model, selection, appraisal, development and rewards were geared towards organizational Conceptual Models of Human Resource management performance. There are various models of HRM have been developed by different teams of the researchers. All these Rewards models have helped the human resource practitioner to effectively manage the human resources in organization whether these models are International or Islamic practices. Some of the important models have been discussed as follow: Selection Performance Appraisal i. Harvard Model Figure 2 shows that the Harvard model by [13] works as a strategic map to guide all managers in their relations with employees and concentrate on human or Development soft aspect of HRM. It strives at employee commitment not control them. Figure 2. Human Resource Management cycle for Michigan Model iii. Guest Model Figure 4 shows the Guest model and it more too comparative model which it works on the promise that a set of integrated HRM practices will result to superior individual and organizational performance. It advocates a significant difference of HRM from performance management. It holds that HRM strategies like differentiation, innovation, the focus on Quality and cost reduction will lead to practices like better training, HC-50 Proceeding of 1st International Conference on Human Capital and Knowledge Management appraisal, selection, rewards, job designs, involvement, and security leading to more quality outcomes such as commitment and flexibility. It will then affect v. Islamic HRM Model performance in that productivity will increase; innovation will be achieved as well as limited absences, labor Figure 6 shows the Islamic HRM model by Junaidah, [15] turnover, and conflict or customer complaint. was emphasize on the fairness and justice. It indicated a positive and significant influence of the empowerment, organizational communication and good procedure as determinants of employees trust toward organization. Principles of HRM Islamic Practices Recruitment & Selection Training & Development Organizational Performance Career Development Performance Appraisal Figure 3. Guest Human Resource Management Model. Rewards iv. Warwick Model Figure 5 demonstrate the Warwick model was developed Figure 5. The Islamic Human Resource Management by Hendry and Pettigrew [14] at centre for strategy and Model change of Warwick University in early 1990s. It emphasize on analytical approach to HRM. It also recognize the impact of the role of the personnel functions III. METHODOLOGY on the human resource strategy content. The researcher focused their research on mapping the context, identifying This study adopts a qualitative approach the inner (organization) and external (environment) whereby the desk-based and library-oriented has using in context. ways to find out the results. In order to review the models of HRM practices uses by banking industry in Malaysia, available literatures from several of book publications, journal and article that were related in this field are referred. This study are conducted by search the online database like Emerald and Scopus which can be accessible via UTM library with the keywords “framework human resource management”, to narrow the search to banking setting. This study interest not only limited only the human resource management practices in Malaysia banking industry only but also tries to looking at others countries. Possible related articles are the retrieved and read. The journal that referred in this study from The International Journal Human Resource Management and content analysis is the key tools which this study intends to use to extract necessary information materials. Any necessary information for this study was extracted using exploratory method, and then critically analyzed and interpreted using explanatory method. The study has been structured in the light of the research objectives. Figure 4. The Warwick Strategic Change and HRM Model. HC-51 Proceeding of 1st International Conference on Human Capital and Knowledge Management IV. RESULTS Management. It thus is a contingent model that extends the Harvard framework, explores the interrelatedness of inner and outer contexts On the basis of the review of the several studies and Warwick model without minimizing the thrust various models of HRM which have been developed from towards quality, employee participation and high time to time, this study can be decided that HRM commitment management. practices in banking industry are uses the framework indicates how external and internal factors affect HRM c) It represents strategic human resource practices and how these HRM practices generate into management for the long run. Employees are certain benefit for the organization and ultimately lead viewed not as a cost but as an investment. In way overall corporate performance. The choice framework is to fulfillment the organizational goal all stages of an integrated or the holistic model for HRM. It work and people in organization are the main actors. drivers for formulating HRM policies with the three sources namely; d) The integrated framework are considers the inner and outer context of HRM it can be good model 1) Organization in analyzing intervention environments. The outer considerations in formulation of HRM policies in the ‘Choice model’, lends credibility The organizational source includes mission statement and of using HRM as international function. the strategy, policies and procedure, management culture and task technology of organization. e) It is effective for it has “the ability of an organization to meet the demands and expectations of its various stakeholder, albeit 2) Personal/ individual some more than others.” The personal source constitutes individual frames or references, perception, awareness, and ideology. V. CONCLUSION & DISCUSSION Based on the study above, the review literature on 3) External HRM practices have shown that to effectively manage the human resources, organization have to implement The external sources are environmental, hence innovative HRM practices. The organizations which socioeconomic, political, and cultural and include a wide implements such practices with dedication, remains ahead range of stakeholders, associations, unions and other of their competitors because such practices affects other organizations. variables such as competitive advantage, job satisfaction, These sources (organization, personal and external) financial performance, employee turnover, service constitute the input to HRM formulation leading to a quality, employee commitment and so on in positive process of formulation of HRM policies and frameworks manner and leads to overall corporate performance. While at the Senior/Executive level. These policies are then designing and implementing such practices, should be transported to functional and line management level and analyzed from time to time and it should be updated are subject to direct and indirect influences during the accordingly. Whereby, in certain HRM practices differ implementation which end at an output level that affects from one organization to another and from one country to the individual, organization and society. It affects them by another but the outcome remains the same. HRM bringing, improved performance and effectiveness and practices also leads to increase in the productivity and quality to work and life [16]. The benefits of choice performance of employees as well as of the organization. model that include the following: In addition, the traditional HRM practices according to their needs. Strategies must be developed with a relevant a) It is holistic and integrated model that involves purpose to sustain the organization goals. Indeed, the best understanding of personal, organizational and approach of emphasize the relations between HR policies environmental factors in the formulation of and the way to reach organization’s goals by considering HRM policies. that the external environment also play the role in drive the banking industry. However, those models, mixed with b) In the fact that it involves careful planning and other models that can improve the flexibility of the forecasting at the input stage and takes into approach. However, every approach that was been used consideration issues like organizational culture, has to aims toward the same goals, business effectiveness individual perception and stakeholder analysis and profitability. Even though, each model has its own makes it proactive not reactive as with Personnel limits. HC-52 Proceeding of 1st International Conference on Human Capital and Knowledge Management Managing Human Assets. Free Press, New York Chap.2 ACKNOWLEDGMENT [14] Hendry, C. and Pettigrew, A. (1990) ‘Human resource management: an agenda for the 1990s’, I like to thanks to Malaysia Government especially International Journal of Human Resource Ministry of Higher Education (MOHE) for sponsorship Management, Vol.1, No. 1, pp. 17-43 that will give me chance for further in this study. [15] Junaidah, H. (2009). Islamic revival in human resource management practices among selected REFERENCES Islamic organizations in Malaysia. International Journal of Islamic and Middle Eastern Finance and [1] Izah M. Tahir and N.Mazlina A. Bakar (2007), Management. Vol. 2 No. 3, pp. 251-267 “Service Quality Gap and Customers’ Satisfactions of [16] Dessler, G. (2003), Human Resource Commercial Banks in Malaysia,” international Management. 9th Edition, Prentice Hall Review of Business Research Papers, Vol. 3, No. 5, pp. 327-336. [2] BNM. (2011), Islamic and Takaful. Retrieved July 10, 2011, from Bank Negara Malaysia: http://www.bnm.gov.my/microsites/financial/0204_ib _takaful.htm [3] Khan, T. (2007), “The Islamic Financial Services Industry: Ten-Year Framework and Strategies”, Islamic Research & Training Institute Islamic Development Bank, Islamic Financial Services Board and Islamic Research and Training Institute [4] K. C. Chakrabarty, Deputy Govemor of the Reserve Bank of India at the HR Conference of Public Sector Banks, Mumbai, 1 June 2012 [5] R.Claudia A.H-Thomson, (2007), “Human Resource Management Practices In the Ghanaian Banking Sector, Thesis for Master Science in International Business, University of Nottingham [6] Sabah A., (2012), “Human resource management from an Islamic Perspective,” Journal of Islamic and Human Advanced Research,, Vol. 2, pp. 86-92. [7] Wright, P. M., McMahan, G. C., & McWilliams, A. (1994), Human resources and sustained competitive advantage: A resource-based perspective. International Journal of Human Resource Management, 5: 301–326. [8] Khatri N., (1999), “Emerging issues in Strategic HRM in Singapore,” International Journal of Manpower, Vol. 20, No. 8, pp. 516-529. [9] Lim, G. S., Robert L. Mathis, and John H. Jackson (2012). Human Resource Management: an Asia edition. Singapore: Cengage Learning Asia Pte Ltd. [10] Vareta Nyamupa Chari (2010). "Importance of Resource Planning Organizations, " Brazza Villa, Gongo [11] Boxall, P. (2007), ‘The Strategic HRM Debate and the Resource-Based View of the Firm’, HRM Journal, Vol. 6, No. 3, pp. 59-75. [12] Guest, D. (1997) ‘Human resource management and performance: a review and research agenda’ International Journal of Human Resource Management, Vol. 8, No. 3, pp.263-276 [13] Beer, M., Spector, B., Lawrence, P. R., Mills, D.Q., Walton, R. E. (1984), A Conceptual View of HRM. in HC-53 Proceeding of 1st International Conference on Human Capital and Knowledge Management INDIVIDUAL WELL-BEING AMONG ENGINEERS IN MALAYSIA: THE EFFECT OF PROTEAN CAREER ORIENTATION N. B. Rahim*1, S. R. M. Zainal2 1School of Management, Universiti Sains Malaysia, Penang, Malaysia 2School of Management, UniversitiSains Malaysia, Penang, Malaysia (*[email protected]) Abstract - This present study aims to highlight the effect of orientation effect the individual well-being of the engineers? protean career orientation on individual well-being among The answer may lie in understanding the protean career engineers in Malaysia. The approach taken is a literature orientation and individual well-being. review. The paper contributes to the literature by focusing on how the characteristics of protean career orientation II. PROTEAN CAREER OREINTATION practices might influence the individual well-being. As this paper focus on individual well-being of the engineers, Employees with protean career orientation could make therefore the characteristics of their protean career is given themselves employable though a series of self-management less attention. At a general level, there is ample evidence of activities so that they can realize their full potential and the impact of protean career orientation on psychological accordingly set goals so as to achieve career success. [9] well-being outcomes. mentioned that protean career person uses his own values rather than organization’s to guide career [9]. He added, protean career Keywords - Protean Career Orientation, Individual Well- orientation is a two-dimensional framework that refers to one’s Being preference to take a self-directedapproach to career management I. INTRODUCTION in which the individual takes personal control over career development and the initiative to explore career options and Recently, the world of work has started to change make career decisions; and be values-drivenin the sense that drastically, which also holds true for the engineering profession. personally meaningful values and goals provide the motivation Engineers are fast track individuals who have great expectation behind career decisions and create the standards for and ambition for their careers because of their specialist experiencing career success. knowledge and expertise. As the essence of career has changed, they bear most of the responsibility for planning and managing An individual is considered to have a full protean career their own careers. The successful navigation of the current orientation when he is displaying two main attitudes: first, by scenario requires the development of a distinct mind set, called having a values-driven attitude which refers to a person’s protean career orientation [1,3,2]. Rather than their employing internal values that provide the guidance and measurement of organizations, they become the architects of their own careers, success for the individual’s career These values serve as an development and vocational destiny. This orientation represents internal compass which the individual follows rather than acting an internally driven and self-directed perspective in managing upon extrinsic factors such as money, promotion, or outside job one’s career that reflects values such as freedom and adaptability offers [10,2]. The second main attitude is having a self- [2]. It has been argued that taking responsibility for managing directedness attitude in his career management. Meaning that, one’s career development can deliver positive psychological the person is adaptive in terms of performance and learning outcomes, including career and life satisfaction, enhanced self- demands. According to the scholar [11] described that the main efficacy and well-being, as well as extrinsic career progression if goal of the protean career is subjective, psychological success, desired career outcomes are achieved [5,6,7]. the feeling of pride and personal accomplishment that comes However, as the engineer’s key performance areas are from achieving one’s most important goals in life, be they structured by the organization according to the business needs, achievement, family happiness, inner peace, or something else. the increasing in productivity and change in the workplace has He pointed out that (in theory) there are infinite ways to achieve become an integral part of engineer’s working life. The job subjective success in a career, whereas the traditional, objective demand facing by the engineers has lead to adverse engineers view of career success only allows for one path, namely the way psychological outcomes. As a result, engineers are facing an towards the top of the organization [12]. Referring to [13] extremely high job demads. Companies that operate in a higly metaphor [14] put it this way: “The path to the top has been competitive market with relatively low profit levels are replaced by the path with a heart”. In order to successfully with completing construction projects within tight deadlines and protean career, people need to acquire with two budget constrain. Given the threat of significant penalties for metacompetencies, which are adaptability and self-awareness time overruns, working hours are often long and sometimes [15] as shown in Figure 1.1. irregular [8]. Consequently, this scenario has increased their health problems resulting from their working lives. The most comment ailments among the engineers are related to excessive workloads such as constant tiredness and stress. The failure in meeting the task performance caused the engineers performance to drop significantly and eventually the deficiencies in the final product. Other consequences are delayed project completion and unable to meet customer deadlines and requirement [29]. Therefore, how does the characteristic of protean career HC-54 Proceeding of 1st International Conference on Human Capital and Knowledge Management values) rather than internal values. On the other hand, if a person Metacompetencies is driven by his personal principles, but does not have a self- directed attitude, the person is considered to have a rigid career orientation, as they are not able to fully shape their own career [10]. Identity/ Adaptability Self-awareness III. INDIVIDUAL WELL-BEING The well-being of employees is the best interest of Adaptive Adaptive competence motivation communities and organizations. The workplace is a significant part of an individual’s life that affects his or her life and well- being of the community. The average adult spends much of his Figure 1.1: Protean career metacompetencies or her life working, as much as a quarter or perhaps a third of his waking life in work. As much as a fifth quarter of the variation in adult life satisfaction can be accounted for by satisfaction [3] defined a competency as the global quality of a with work [17]. The nature of work such as its routinization, person that enables him or her to be effective in a larger area of supervision, and complexity, has been linked casually to an functioning, such as a job role and metacompetency as a individual’s sense of control and depression. It is now competency that is so powerful that it affects the person’s ability recognized that depression is second only to ischemic heart to acquire other competencies. According to the protean career disease in contributing to reductions in productive and healthy concept, an individual needs adaptability to thrive in an years of life [18]. The ability of the workplace to prevent mental environment where autonomy, self-direction, and proactive illness and to promote well-being is compatible with the mission behaviour are thought to become increasingly important, be it at of the public’s health. However, the well-being of the employees work or in private [3,11]. However, a person must both be able is also the best interest of employers who spend substantial and wiling to adapt to new situations [3]. Therefore, the ability resources hiring and trying to generate products, profits, and to learn (adaptive competence) and the motivation to learn maintain loyal customers. To succeed hiring, employers must (adaptive motivation) are seen as the two major components of provide tangible benefits. However, employees want more than adaptability. Yet, adaptability alone is not enough. The a stable job with pension and benefits. Survey of recent and successful pursuit of a protean career requires a second upcoming generations of employees clearly show a majority of metacompetency, identity or self-awareness. Being clear about employees desire greater meaning and personal development one’s own values, motivation, abilities or interests is crucial to from their work and suggest many workers see their work as a define where individual wants to head in life, to keep a sense of calling – enjoyable, fulfilling, and social useful [19]. direction and successfully to adapt to new work enviroments [3,11]. [30] stressed the importance of identity exploration for Although from a subjective perspective it is relatively easy individuals in the context of protean careers. to identify one’e own degree of well-being or happiness, reaching more general findings from more rigorous approach It has repeatedly been highlited that both metacompetecies has proved to be a more complex task [20]. Over the last few are required simuntaneously for protean career individual [3,4]. years, academic debates, from scientific perspective, has Table 1.1 illustrates the consequences of the lack of one or both returned to two old philosophical orientations. The first of these metacompetencies as assumed by [1]. perspective has generally been called hedonic [21] which defines well-being as the presence of positive affect and the absence of negative affect. The second perspective, both as Table 1.1: Interactive effects of two metacompetencies ancient and modern as the hedonic perspective, suggests that well-being does not consist in maximizing positive experience Adaptability and refers to living fully or to allow for the richers human potential possible [22]. This second perspective is widely known High Low Metacompetencies as eudaimonic. Table 1.2 shows some differentiating High Proactive Paralysis characteristics of both perspective. Smart performace Blocking Identity/Self- Avoidance Table 1.2 Characteristics of Hedonic and Eudaimonic Awareness Low Reactivity Rigidity Well-being Chemeleon Performance to orders Hedonic Well-being Eudaimonic Well-being behaviour Basic Pleasure Virtues Concepts Positive/Negative Self-fulfillment affect Psychological growth Therefore, individuals who follow a protean career are Affective balance Aims and need proposed to learn on a continuous basis and look for work Positive emotions Psychological strengths challenges [14,16]. The combination of self-directed and values- Net affect driven has resulting in four main career orientations which are Life satisfaction dependent; reactive; rigid; and protean. Individuals who are low on both components are considered as dependent, as they do not follow their own principles, nor do they manage their career Studies now clearly suggest that the well-being of themselves. Individuals with reactive profiles do manage their employees may be in the best interest of the employers. In career, but do not use their internal values as guidance. They particular, researchers have studied the relationship of will guide their career by external values (e.g. organizational individual-level job satisfaction to individual-level performance. HC-55 Proceeding of 1st International Conference on Human Capital and Knowledge Management Meta-analysis reveals positive relationship between job [6] King, Z. (2004). Career self-management: Its nature, causes satisfactions and individual performance, particularly facets and consequences. Journal of Vocational Behaviour, 65, such as satisfaction with one’s supervisor and satisfaction with 112–133. one’s work. Still questions of the direction and causality of these [7] Seibert, S. E., Kraimer, M. L., & Crant, J. M. (2001). What relationships have not been resolved completely. [23] review do proactive people do? A longitudinal model linking suggested that more satisfied employees are more cooperative, proactive personality and career success. Personnel more helpful to their colleague, more punctual and time- Psychology, 54, 45-874. efficient, show up for more days of work, and stay with the [8] Lingard, H., (2003). The impact of individual and job company longer that dissatisfied employees. Investigation of the characteristics on 'burnout' among civil engineers in happy productive worker clearly links emotional well-being Australia and the implications for employee turnover. with work performance. Employees who report experiencing a Construction Management and Economics, 21, greater balance of positive emotional symptoms over negative 69-80. emotional symptoms higher performance ratings from [9] Briscoe, J. P., Hall, D. T., & DeMuth, R. L. F. (2006). supervisor than employee who report feeling more negative than Protean and boundaryless careers: An Empirical positive symptoms of emotion [24]. In sum, work is persuasive exploration. Journal of Vocational Behavior, 69, 30-47. and influential part of the individual’s life and his or her mental, [10] Briscoe, J. P., & Hall, D. T. (2002). The protean and thereby can affect productivity of the entire communities. orientation: Creating the adaptable workforce necessary for The ability to promote rather than create strains and mental flexibility and speed. Paper presented at the Academy illness is of considerable benefit not only to employees in the of Management Meeting, Denver, Colorado. community but also to the employer’s bottom line. The [11] Hall, D.T. & Mirvis, P.H. (1996). The new protean career: emotional well-being of employees and their satisfaction with Psychological success and the path with a heart. In D.T. their work and workplace affect citizenship at work, turnover Hall (Ed.), The Career is Dead - Long Live the rates, and performance ratings. Career, 15-45. [12] Hall, D.T., & J. Richter. (1990). Career gridlock: Baby boomers hit the wall. Academy of Management Executive, IV. CONCLUSION 4, 7–22. [13] Shepard, H. (1984). On the realization of human potential: Psychological well-being is predicted by meaningful work A path with a heart. In M. B. Arthur, L. Bailyn, D. [26]. Employment serves not only the manifest function of Levenson, & H. Shepard (Eds.), Working with careers providing income, but also provides individuals with valuable (pp. 25–46). NewYork: Columbia University School of experiences, social interactions and opportunities for personal Business. development and skill use [25]. As recommended by [27], [14] Hall, D. T. (1996). Protean careers of the 21st century. potential loss of such psychologically important factors would Academy of Management Executive, 10(4), 8-16. imply reduce individual well-being. Job resources such as [15] Hall, D. T. (2004). The protean career: a quarter-century autonomy, skill utilization, professional development and social journey. 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Hopefully, it will provide [18] Murray CJL, Lopez AD: Global and regional descriptive a systematic assessment of the actual strength of this epidemiology of disability: incidence, prevalence, health relationship. Second, hopefully it will investigate the link with expectancies and years lived with disability. In The Global different dimensions of well-being not examined together Burden of Disease. Edited by Murray CJL, Lopez AD. previously: personal, environmental/community, financial, Cambridge MA: Harvard University Press on behalf of the interpersonal, and performance. Finally, it assesses factors that World Health Organization and the World Bank; increase, diminish, or help explain the strength of the 1996::201-246. psychological well-being link. [19] Avolio,B.J.,& Sosik, J.J. (1999). A life-span framework for assessing the impact of work on white-collar workers. In S.L. Willis & J.D. Reid (Eds.) Life in the Middle, (pp. 249- REFERENCES 274). San Diego, CA.: Academic Press. 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In A. B. Bakker and M. P. Leiter (Eds.), Work engagement: A handbook of essential theory and practice (pp. 102-117). London and New York: Psychology Press. [29] Mat Desa, N. (2009). Human Resource Practices and Job Performance: The Mediation of Perceived Organizational Support among Malaysia Engineers. Proceeding of the 10th International Conference on Human Resource. [30] Hall, D. T., Zhu, G. & Yan, A. (2002). Career creativity as protean identity transformation. In: Peiperl, M.; Arthur, M.; Goffee, R.; Anand, N. (ed.) Career Creativity: Explorations in the Remaking of Work, pp. 159-179. Oxford, UK: Oxford University Press. HC-57 Proceeding of 1st International Conference on Human Capital and Knowledge Management The Implementation of Minimum Wages in Malaysia P.L.Tin*, Muhammad Fathi Yusof, Nik Hasnaa Nik Mahmood, H.S.Tan UTM Razak School of Engineering and Advanced Technology, UTM, Kuala Lumpur, Malaysia *[email protected] Abstract - Minimum wage is gazette by government in II. LITERATURE REVIEW order to protect low skilled employees in order to increase their quality of life and reduce poverty. A. Minimum Wages Legislation Likewise, it’s also as an opportunity to increase the value chain by investing in new technology and The Minimum Wages Order is applied to all the boosting technology. Implementing minimum wages is employers with 6 employees and above in Malaysia, much more challenging which is eligible for all including foreign worker with effective date started from workers. Organization having different minimum 1st January 2013. For the micro enterprises are allowed to wage practices in order to achieve win-win solutions. defer for further 6 months from the commencement date. With the implementation of new minimum wage According to National Wage Consultative Council (2012), policy, it creates a strong debate between it pros and the government has set a minimum wages of RM900 per cons especially for those small and medium month will be pay to the employee in Peninsula and organizations. Thus, small and medium enterprises RM800 for those employees in Sabah, Sarawak and (SMEs) were allowed to defer payment of minimum Federal Territory of Labuan. National Wages Consultative wage to foreign workers until December 2013. The Council (NWCC) announced that a grace period is given objective of this study is to review the practices that to SMEs’ employers to apply a deferment implementation have been applied recently thus, to study the effect of of this policy for foreign workers until 31st December minimum wages and to recommend its solution. This 2013. Furthermore, for those employers applied for study applies a qualitative approach by using deferment were not allow to deduct the cost of levy, interview and library oriented methods. It presents the accommodation or other costs from foreign workers’ understanding of the implementation of minimum salary. wages in Malaysia. CIMB researcher stated the RM900 minimum wage is Keywords – Minimum Wages, Small and Medium 49.9% of the national mean wage of RM1,804.43 in 2010. Enterprise (SME), Foreign Workers, Formal and Informal In setting the minimum wage, the government took into Employment account social and economic considerations: cost of living, productivity, competitiveness and employment. In Malaysia, almost 33.8% of about 1.3m private sector I. INTRODUCTION workers still earned less than RM700/month in 2009, well below the RM800/month that is considered the poverty Malaysia is one of the developing countries in Asia line. Wages have been lagging behind productivity Pacific that has introduced minimum wages legislation. growth, rising 2.6% p.a. versus productivity growth of The purpose of minimum wages legislation is to protect 6.7% p.a. over the past decade. The new wage rate will low wage workers to be able to afford better living and have a bigger impact in Sabah (RM800 vs. the current higher education. Therefore, this enforcement also can average salary of RM577), followed by Sarawak (RM800 bring up value chain for employers by investing in vs. an average of RM758). For Peninsular Malaysia, the technology innovation. This can be known as a best way new rate of RM900 is 20.4% below the current average of both worlds which are reduce poverty and increase the salary of RM1,131 [2]. technology innovation towards developed country. According to the National Wage Consultative Council There is a little debate recently that the (2012), the minimum wage will then benefit 3.2m private implementation of minimum wages will impact to all sector workers other than those in domestic service party. For other developing countries, there is having workers. However, there are lots of things about the labor different findings about the impact of minimum wages in market that don’t really fit well with the competitive the same developing country such as Brazil and model of the labor market [1]. The main objective of this Indonesia. Economist finds a negative employment effect study is to review the practice of minimum wage in in the formal labour market and a positive effect on the Malaysia for the betterment of country development in the informal labour market. In the context of formal labour future and hence to bring out a better suggestion for market, it means those legal workers are protected by policy developer to improve the implementation. contract agreement and social security protection scheme [3]. On the other side, informal employment means those HC-58 Proceeding of 1st International Conference on Human Capital and Knowledge Management illegal workers have no protected by employment security, work security and social security [4]. However, if a sector is not considered vulnerable, the minimum wage is hence not applicable and it is regardless In Malaysia, economic analyst concluded that there is of the fact that some employees in that particular sector strong empirical evidence that countries which implement may be paid very low wages. On the other hand, for those a minimum wage tend to see a positive wage effect and a vulnerable workers and work in the sectors stated above, small negative employment effect among workers if their employer is found guilty by which paying below covered by the minimum wage legislation if the wage is the minimum wage, the individual can lodge complaint to set above the market equilibrium level [5]. In fact, the Department of Labour or to Trade Union implementation of minimum wages will bring up representative, the employer can be fined. Minimum competitive advantage in order to help redress the wages in South Africa is adjusted annually and usually imbalances and imperfections of the free market fixed in one year. economy. However, the new minimum wages policy in Malaysia is still in the beginning of process Moreover, in China perspective, minimum wage had implementation; therefore, research is needed in order to been introduced around ten years ago, which is on March provide strong empirical evidence to support. 2004 by the Ministry of Labor and Social Security and is updated every two years. The meaning of minimum wage B. Minimum Wages Legislation Practices in Other as according to “Minimum Wage” Article III, it is about the legal working hours of workers in labour contract law Developing Countries to provide normal working hours under the premise of labour, the employer shall pay the minimum legally Generally, minimum wage has been known as the labour compensation. China’s minimum wage is lowest pay rates to employees who accomplished their determined at regional level as compared to South Africa, work task in the required time frame. In developing they have minimum wage to be determined at national, countries such as Malaysia, China and South Africa, the regional, sectoral and different skills level. main purpose of introduced minimum wage is to protect unskilled workers and young workers from being China’s minimum wage is between RMB 500 – RMB discriminated and pay equally. At the same time, it also 1120 (approximately RM 265 – RM 594) where the helps to improve the lower pay worker’s living condition. poverty line is somewhere around RMB 1196 (RM 634) per capita annual income. Two different kinds of From Malaysia’s context, minimum wages (MW) minimum wages been introduced in China which are defines as the lowest hourly, daily or monthly monthly and hourly rate minimum wages. Both monthly remuneration that employers legally pay to workers and it and hourly minimum wage component include fixed and is the lowest wage at which workers may sell their labor st variables elements. Several factors need to be considering [5]. This legislation had been implemented since 1 when determine minimum wage such as cost of living of January 2013 and the purpose is to protect lower pay resident per capita, individual worker’s insurance slavery in market economy. This policy providing the premium, housing fund, the average wage, unemployment protection for lower skill level or unskilled employee and and the economic developmental level. maintains the employment opportunities of entry level for all industries and sectors registered in Malaysia. In addition to the above statement, China’s monthly minimum wage is refer to local employment and their Meanwhile, for South Africa, the purpose of dependents of the cost of living, the urban consumer price introduced minimum wage is to improve the country index, individual workers to pay social insurance and economy and thus keep away from poverty line. The housing fund, the average wage, the level of economic poverty line of the country is around R515 (approximately development, and employment status. For the hourly RM 165). The amount of minimum wage in South Africa minimum wage, it is to be paid according to basic pension is R1500 (approximately RM 480) per month. Therefore, and medical insurance, job stability, working conditions the percentage of minimum wage from poverty line in and labour intensity. Therefore, China’s minimum wages South Africa is around 200%. are varied as according to their economic developmental and change. In contrast, the minimum wages level in Unlike Malaysia, South Africa’s minimum wage is Malaysia is unified for all workers with contract of determined at national, regional, sectoral and occupation/ service which are including local and foreigner labour in skill level and are only applicable to certain sector where all sectors. labour has been deemed vulnerable. In detail, there are nine sectors involved and these are: domestic work sector, contract cleaning, private security sector, wholesale and III. METHODOLOGY retail, farm worker sector, forestry sector, taxi sector, learner-ships and children in the performance of This study adopted a round desk meeting and advertising, artistic and cultural activities. discussion was conducted and library search for available HC-59 Proceeding of 1st International Conference on Human Capital and Knowledge Management journals and articles that were related to the study were standard of living and local economic to setting minimum also been utilize in the ways to find out the results. This wages level. In this case, these new adjustments will study are conducted by search the online database like adherently increasing cost of employment and burden of Emerald and Scopus which can be accessible via UTM employers. Small and medium enterprises employers will library with the keywords “minimum wage”, to narrow suffer from this increment. As we know, Malaysia totally the search. Possible local and international related articles consist of 13 states, only a few states is urban area and are retrieved and read and paraphrased. Any necessary others still consider as rural area. So, it is unfair for information for this study was extracted using exploratory minimum wages level cover the same rate for all the method, and then critically analyzed and interpreted using states. For example, Federal Territory Kuala Lumpur is explanatory method. The study has been structured in the reasonable for new wages rates RM900 because of high light of the research objectives. cost of living in the city. This study interest not only limited to the minimum V. CONCLUSION wages in Malaysia’s industry only but also looking at others countries such as South Africa, China. Besides the In this study, we compared the compliance of above mentioned method, this study was also compared and contrasts the employment and the minimum wage minimum wages between 3 countries which are Malaysia, implemented in South Africa, China by review published China and South Africa. As we know, China and South scholarly papers and newspaper. Africa can consider as most populous countries which can considered as good examples for us to study their IV. DISCUSSION implementation on minimum wages compliance. It will be much better if further research for new minimum wages Based on the above study, the review literature on policy on small and medium enterprises to be carried out minimum wages practices in other developing countries in order to strengthen the evidence found through this had shown that the different ways to implement minimum study. wages legislation. China and South Africa are known as the largest population in the world, labour intensive is ACKNOWLEDGMENT manpower in their production line. As we know, most of the big companies had invested their main production I would like to express my gratitude to my friend industry in China due to larger population and cheap Xiang Hui which is Master student from China for the labour such as Apple Inc. useful comments, remarks and engagement through the learning process of my first paper writing. On the other side, I would like to thank to my family and friends for There are lots of arguments and almost all the support me to the topic as well for the support on the way. entrepreneurs disagree and causing strong debates to the implemented minimum wage in Malaysia. They debating REFERENCES about the increase of labour cost and foreigner worker’s levy cost and refuse to followed the implemented [1] Mike Konczal (2013). Minimum Wage 101, The American minimum wage policy. Prospect. [2] Lee Heng Huie (2012). Minimum wage policy – Curse or cure? CIMB Economic Update, 2012 Thus, there is no doubt that Malaysia’s minimum [3] Carneiro, F. G. (2000). Time-series Evidence on The Employment wage policy makers should review how and what had to Effects of Minimum Wages in Brazil. Texto Para Discussao No. be done in order to create a fair and reasonable wage 18, Catholic University Brasilia. policy. A brief suggestion is that the policy makers should [4] Report on conditions of work and promotion of livelihoods in the unorganised sector. New Delhi: National Commission for review minimum wages in South Africa and China been Enterprises in the Unorganised Sector. 2007 implemented where in both of these countries, their [5] Kaviyarasu Elangkovan. (2012). Minimum Wage Laws in Malaysia: minimum wage are been categorized into few sectoral and An Answer to the Increasing Rate of Unemployment. International Journal of Academic Research in Economics and Management are reviewed based on the cost of living of the urban and Sciences, September 2012, Vol.1, No.5. ISSN: 2226-3624. economic developmental of the country. Hence, Malaysia’s minimum wage policy makers should review cost of living of every states and implement the minimum wage policy accordingly to the sectoral and also the skills level of every single different industry instead of “one covered all” policy. As per findings, the minimum wages rate in Sabah has a bigger impact from current average salary which is RM577 to RM800. Policy maker should be based on the HC-60 Proceeding of 1st International Conference on Human Capital and Knowledge Management Shortage phenomenon among educated and skilled labor in Malaysia S. Mohd Amin *1 1PhD Student, Department of Economics, Faculty of Economics and Administration, University Malaya (*[email protected]) Abstract - Labor is one of the very vital factors in the education broadly refers to all post-secondary education, process of production. To produce an output, a including but not limited to universities [2], and in sufficient number of domestic labor may lead to Malaysia, tertiary refers to those whose highest level of dependence on foreign workers. In order to be high- education is above Form 5 [3]. Therefore, educated income developed countries, which Malaysia's worker refer to those who completed any academic or economic goal was to ensure the achievement of a professional qualification at tertiary level. competitive economy, the importance of educated and skilled labors become very crucial. Recognizing that II. Phenomenon 1: Increasing number of need, the investment in human capital in Malaysia has graduates from higher education institution in increased since independence. Brief statistics will be Malaysia discuss to highlight the increasing number of graduate, possibly could be the backbone for economic Government has done various efforts to provide empowerment. Parallel with the increase in student educational opportunities to its people, and these efforts enrollment at the tertiary level, a number of higher were still continuing. By increasing the number of higher education institutions are also increases in Malaysia. education institutions in both public and private sector, In addition, this study will discussed the direction of school leavers have more opportunities to improve their employment in Malaysia by educational attainment, academic or skill level. Presently, both the Public of with focusing on tertiary level. However, the number Higher Education Institutions and Private of Higher of educated and skilled labor is still at an alarming Education Institutions have rapidly expanded with the level. The shortage of them in Malaysia’s economy is increase in the number of students and various programs probably due to mis-matched occurs when vacancies of study [4]. do not fit existing job seekers. The issue of Parallel to this, the total number of students entering unemployment among graduates continues to be the higher education institutions in Malaysia also increased. focus and effort to call people who work outside However, analyzing the total enrollment was less Malaysia is still further intensified. Although there are precisely because they are not hundred percent graduation no issues in male labor force participation, women's compared to the entrance. Therefore, to see an increase in participation is still around 40 per cent in 40 years. supply of educated labor force, it is more appropriate that More concerning, the participation of women in the we look at the size of their graduation. labor force in Malaysia is the lowest among ASEAN countries. Figure 1: Number of graduate students from Higher Education Institution, Malaysia Keywords : shortage, educated, skilled, labor (2002 - 2010) Year Output of graduates % change I. Introduction 2002 196,585 - Education and training received by an employee in a 2003 212,860 8.3 country is a key factor in determining the level of the national economy. This difference often creates a 2004 206,911 (2.8) distinguish achievement of production factors between 2005 137,887 (33.4) developed, developing and less developed countries. A country's economy becomes more productive because the 2006 164,281 19.1 educated workers work more efficiently to carry out the 2007 168,879 2.8 tasks that require literacy and critical thinking. Therefore, each country will try to maximize the utilization of local 2008 173,183 2.5 labor, especially the educated and highly skilled. 2009 202,203 16.8 General definition for educated person is one who has undergone a process of learning that results in enhanced 2010 239,303 18 mental capability to function effectively [1]. Tertiary Source : Ministry of Higher Education, Malaysia (2011) HC-61 Proceeding of 1st International Conference on Human Capital and Knowledge Management Figure 1 shows the increasing number of total output iv. number of labor with tertiary educational of graduates in Malaysia from 2002 to 2010. (However, background increased with increasing rate but then in 2004 and 2005 there was a negative change in the increased with decreasing rate (there are more than number of graduates). From this increase, it was a hundred per cent increase from 1982 to 2002, but suggested that Malaysia has added an educated labor the increase was only 72 percent in 2012) supply, which continued every year, although it may still The important facts to note about the trend of the labor not enough. force in Malaysia in 40 years is the labor market in Malaysia is still dominated by those with a secondary III. Phenomenon 2: The Trend of employed in educational background [3]. Labor among those with Malaysia by educational attainment tertiary educational background in Malaysia showed a significant improvement but still does not exceed 25 Formal education in Malaysia consists of three levels percent of the total labor force in Malaysia in 2012. of schooling which are, primary, secondary and tertiary. Whereas, in most developed countries, their labor market Persons who never attended school in any of the dominated by the educated and highly skilled labor. What educational institutions that provide formal education, important is, when the labor from informal educational they are categorized as no formal education. The primary background decreases, primary education only changed level includes standard 1 to standard 6 and the secondary slightly, and secondary education increased with a level includes form 1 to form 5, whereas the tertiary level declining rate, why the number of workers from tertiary covers all academic education after form 5 [3]. education are not much improved? Figure 2 : Number of employed by educational attainment, Malaysia IV. How the phenomenon relates to the investment (1982, 1992, 2002 and 2012) in human capital and labor force participation rate? Theory of investment in human capital had been 8,000 developed in the sixties due to the realization that the 7,000 growth of physical capital has only small part of growth 6,000 in the growth of income [5]. Relatively, the emergence of 5,000 education and skills training in military technology has 4,000 also played an important part in the discovery of this theory. In the discussion, the theory clarified that rate of 3,000 return to education will be higher as education level 2,000 increased. Accordingly, he suggests that education or 1,000 training raises the productivity of workers by imparting valuable knowledge and skills, thus raising workers’ Numberofemployed('000) 0 1982 1992 2002 2012 future income by increasing their lifetime earnings [6]. There is a statement highlight “as enrollment of Years student in an educational system increase, the participation rate in the labor market is expected to be No formal education Primary high”. A lot of research proved that level of education Secondary Tertiary turns out to be important in determining in the labor force participation decisions [5–19]. Source : Department of Statistics, Malaysia (2013) However a little research also explained that there is a weak relationship between higher education with labor force participation rate [9]. They established that even Figure 2 shows the number of the labor force by with greater education there are other aspect turns out to educational attainment in Malaysia for year 1982, 1992, be important in determining in the labor force 2002 and 2012. Conclusions that can be made are: participation decisions [8], [13], [20–23]. Therefore, we i. decrease the number of labor with no formal can state that the rate of participation in the labor market education (exceed 20 percent every 10 years) depends not only on the level of education. Other factors ii. number of labor from primary educational could also affect the decision not to work will lead to low background almost stagnant (change only about 5 labor force participation rate. percent every 10 years) iii. number of labor with secondary educational In Malaysia, the issue of low labor force participation background increased with diminishing rate (rose rate is very crucial to women [24–27]. Malaysia is among 87 percent in 1992 compared to 1982, but the countries in the Asia-Pacific region with the lowest increased only 25 percent between 2002 and 2012) number of female workers and were still under- represented in the job market. Female participation rate in HC-62 Proceeding of 1st International Conference on Human Capital and Knowledge Management Malaysia’s labor force was 47.9 percent in 2011 [28]. VII. ACKNOWLEDGMENT This was below the global average of 53 per cent [29] and East Asia and Pacific rate of 66 percent [30]. Focus of PhD research by the researcher is about educated women participation in the labor force. However, she is also aware about other related issues to labor economic V. Reasons For Shortage since she is also a Labor Economic Lecturer in MARA Malaysia’s statistics show a higher unemployment rate University of Technology. But at this moment, she is on among graduate in Malaysia [31], [32]. This situation will the length of study leave in University of Malaya, under affect the number of employed person in the labor market the supervision of Associate Prof. Dr. Yap Su Fei and Dr. [33], [34]. However, there is a finding stated that Nurulhuda Mohd Satar. For the paper, the researcher tries shortage of educated and skilled worker in Malaysia’s to be independent but also like to thank you the supervisor economy was due to mismatched occurs when vacancies for coach the writing skill. do not fit existing job seekers [35]. 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Nik Mahmood UTM Razak School of Engineering and Advanced Technology *[email protected] achieved through a distinctive set of integrated Abstract - Recruitment is a set of activities and employment policies, programs and practices [2]. processes that are used to obtain sufficient number of Recruitment, as a human resource management function, people who are eligible and legal to work in an is one of the activities that impact most critically on the organization in a well-timed manner and enable the performance of an organization [3]. applicants as well as the organization to identify and However, it has become obtainable for organizations to select each other on the basis of their mutual best rely on many strategies to attract human resources that interests. The e-recruitment takes a place alongside they need, some of these ways are based on the use of with the traditional recruitment and even exceeds it in common methods which are called Traditional some countries.The current paper investigates the Recruitment and some are based on the use of the Internet factors that affect the top managers to engage the and information technology in its process which called E- human resources management polices and strategies recruitment. Online recruitment, e-recruitment, or web- towards e-recruitment in attracting human capital in based recruitment is the use of online technology to attract order to compete and survive in the market. and source candidates and aid the recruitment process [4]. Exploring, identifying and classifying the factors that influence the manager’s attitudes towards e- Lee (2005) mentioned that since the mid-1990s, a number recruitment were the aims of this study. Conceptual of e-recruiting methods such as job boards, corporate framework of seven factors; Faster recruitment career Web sites and e-recruiting consortia have been process, Easier administration, Cost reduction, larger introduced into the labor market [5]. Recruiting through candidate pool, Gives update impression, Pre- the corporate career Web site has been touted as the most screening assessment and Competition; was projected efficient and cost-effective recruiting method. While most as a finding of this paper. Empirical studies of this large and medium-sized organizations have deployed model for Malaysian institutions’ top management corporate career Web sites, many of them have failed to were recommended for future studies. achieve the maximum benefits because they do not have the appropriate e-recruiting practice in place. Keywords: E-recruitment, Recruitment Process, Candidate Pool and Pre-screening assessment. Although companies might work to take advantage of using E-recruitment, especially in attracting and hiring experts, knowledge workers and talent; but they are still facing some problems. Tong (2009) stated that organizations are concerned about website privacy, as I. INTRODUCTION online sharing of personal data may be used to other employers that further can cause harm to the organization [6]. It has become obvious that the essential idea of economic growth, in the light of the great economic competitions in In global organizations, recruitment is often conducted via the world, depends on the brains that create and manage the Internet with job seekers being attracted using an the development rather than the ineffectuality of spending online jobs board, an organization’s corporate website, or a large capital in projects lacked creative and innovative more recently, through the use of social networking sites recourses. Furthermore, many HR (Human Resource) [7]. The growth of online recruitment statistics in 2005 leaders, today, are dealing with more complex challenging showed that the majority of 500 companies in the world in questions than the ones that their predecessors faced [1]. 2003-2005 use online recruitment. About 43.9 percent of Although the strategies and policies are of the most respondents to KeyNote (2012) research across UK had important functions in top management, the department of used the internet to search for a job, whereas in 2006, Human Resource Management contributes significantly to Chartered Institute of Personnel and Development (CIPD) the implementation of recruitment strategies which are found 64 percent of the UK organizations used e- followed by an organization. Bratton and Gold (2007) recruitment [8, 9]. defined Human Resources Management from a strategic approach as managing employment relations which Poorangi, et al. (2011) found in their study that Malaysian emphasize on leveraging peoples’ capabilities which is SMEs recruitment policies are made mainly by top critical to achieving competitive advantages, this is being management (entrepreneur, CEO or owner), and the HC-66 Proceeding of 1st International Conference on Human Capital and Knowledge Management executives of Malaysian SMEs believe that E-recruitment Recruitment was changed in the means of doing can lead them to a new competitive position mainly in recruitment started during mid-90’s that Edgley (1995) Malaysia labor market, moreover, in the same time they said the recruitment industry’s future is on the net [15]. It found that E-recruitment in Malaysia is still in-progress is the process of using the Internet to attract and exchange work and even the big recruiting firms have not fully the required information with new potential employees to implemented this technology [10]. work in an organization. E-recruitment or online recruitment is among the most advanced systems and The problem of this study is addressed as investigating the widespread in its usage in all the foremost organizations factors that affect the top managers to engage the human all over the world [16]. Electronic recruitment has resources management polices and strategies towards E- changed the way jobs are applied for and has become so recruitment in attracting human capital in order to simple that anyone can do it. [17]. compete and survive in the market. This study therefore E-recruitment is something that cannot be ignored but the aims to explore, identify the concept and procedures of process should fillful all the criteria of more traditional the e-recruitment and to determine and classify the approaches and should be regularly monitored to ensure aspects which motivate managers to use e-recruitment. that delivering the required results. It should be fully Finally, this study also aims to find a conceptual integrated with other recruitment methods. It is also framework of the concepts that were discussed by the important to ensure that websites are kept up-to-date and researcher. that there is a contact number for those having technical difficulties [16]. Thus, clarifies the importance of the top management and human resource management to attract and provide the required competencies of organization. Moreover it shows the significance of this research is investigating the E-recruitment can be applied in various formats such as a top management’s preferences to use the traditional or e- corporate web site for recruitment and commercial job recruitment which is effecting their decisions towards boards [4], online recruitment [18], virtual recruitment pool resource to achieve 2020 vision effectively. There is [19] and internet recruitment [20, 21, 22]. lack of this kind of research in general and in Malaysia. II. LITERATURE REVIEW Thw Figure below show one of the examples of web technologies developed for the e-recruitment while the A. Recruitment system is developed based on usual recruitment process, i.e. analysing requirements related to the vacancy, job Recruitment can be argued to be a natural fall-out from publishment, receive and preselect qualified application the way that we socialize and do things, which is now and final decision [23] increasingly and happening online [11]. Recruitment at the same time is the process of searching potential candidates and employs them for vacancies exist in an organization [12]. Maimunah Aminuddin (2011) defined recruitment as the process of attracting suitable people to apply for job vacancies [13]. Schuler (1987) described recruitment as the set of activities and processes used to legally obtain a sufficient number of qualified people at the right place and time so that the people and the organization can select each other in their own best short and long term interests [14]. B. Conventional Recruitment Which called also conventional recruitment is the process of using offline ways such as TV and newspaper to attract and exchange information with new potential employees to work in an organization. Recruitment has typically Figure 1 Overview of recruitment process developed been conducted via methods such as advertisements in {23} local and national newspapers and professional using Semantic web technologies magazines, word of mouth, recruitment agencies and headhunter [8]. D. Factors Supporting E- Recruitment Strategy C. Electronic-Recruitment In spite of of the fact that every organization has to first study and understand the dynamics that would affect the HC-67 Proceeding of 1st International Conference on Human Capital and Knowledge Management management’s decision to adopt in recruitment [7]. Larger Candidate Pool Recently, recruiters are moving towards electronic recruitment or E-recruitment for employment as it Although the conventional process of recruitment use weighing more to advantages instead of traditional high cost, time and worker energy, It is possible that the method of recruitment. The changes might be because of recruiting company is unable to find the right applicant several factors as follows: within time. implementation of e-recruitment, may Faster Recruitment Process involve both active and passive jobseeker since dropping resume is easier through online system compared to the The benefits of online recruitment to employers include conventional method where they have to send them by speed [24] and faster recruiting cycle [25]. Companies postage which might receive a week later [12]. It could recently relayed on online recruitment to turn out a even, in time, ensure greater diversity of job applicants multistage process as a single recruitment process which among talent pool for selection [28] with no geographical also lead to ease in administration [26]. E-recruitment limits [24]. Moreover, E-recruitment allows employers to system is also is one of the technologies that is able to achieve greater efficiency by quickly reaching a diverse automatically screening and sorting out suitable pool of job applicants [34], higher caliper recruits and application. After the quota of application has being increase candidates reach [25]. reached, the system closes and automatically removed the advertisement from the system. All of that allow the Gives update impression management to get involves in the recruitment process but limits decision making. Faliagka, et al. (2012) proposed a Emerald (2013) believes that lack of feedback from system to limit background investigation during interview companies after jobseeker sending out applications is one [27]. of the causes of reduced of applicants for another job posted since they might think that the company has a high Easier Administration expectation of requirements, later reducing number of applicants, causing them cannot find the ‘right fit’ person E-recruitment use online management system for [35]. Other than that, using the online recruitment system employment which automates vacancy and resumes is to ease in navigation other than allows applicant to dropping [27]. The system will filterize and sort out track their application status. In addition, online vacancies applicants according t standers requirements and criteria advert can be tailored to the specific vacancy and adjusted fixed. Sorting applicants is one of the administrative job quickly if not effective. E-recruitment system also can for human resource staff. Existence of E-recruitment include pre-screening assessment system by programmed would save cost, energy and time. Some of the system the computer to ‘weed out’ applicants who are not developed is straight fowards and easily access by the qualified or the computer can invite all applicants to sit a jobseeker [23]. In addition, businesses nowadays provide test before the application is accepted [36]. free services for jobseeker dropping their resumes and allowing companies to advertise at a low cost [6]. Also, e- Pre-screening assessment recruitment can improve the short-listing recruitment process and boost candidate confidentially [28], effective Based on the traditional method, the objective of in terms of performing talent management process [29], recruitment is to find ‘right fit’ employee who has reduce administrative burden and employ better tools for consistent personal qualities while reducing the possibility the recruitment team [30] and streamlines the process of of employing a person with undesired behavior. reviewing thousands of resumes and conducting hundreds Therefore, there are companies organizing multistage of interviews [31]. recruitment process which creates a stressful and high pressure situation and candidates should be able to cope Cost Reduction with it [37]. Using online recruitment system, the filter Study shows that main recruitment strategies were held process might goes on with lack of discrimination during massive event such as tours and recruiting event, i.e. job searching of contributions and skills [35]. Faliagka. et. al. fair and career fair consumes a huge amount of money (2012) also proposed a system that sorting applicants in a [32]. Development of E-recruitment had succeeded in ranking according to a set of criteria [27]. decreasing company dependency with the external agencies such as newspaper and recruitment agencies [33], it is also cost-effective. [25]. Barber (2006) and Competition Wire (2000) found that one of the benefit of internet recruitment include lower recruiting costs and reduced Online recruitment is effective in terms of giving administrative burden and costs [24]. competitive edge to the firms, enhanced company reputation and increase quality of candidates [38]. Also, E-recruitment helps to improve corporate image and profile [30], gives impression that the company is up to date [36]. HC-68 Proceeding of 1st International Conference on Human Capital and Knowledge Management as evidences that support top managers in choosing the E- recruitment to select and appoint the new employees in III. METHODOLOGY: the organization. REFERENCES Qualitative research method was employed in conducting this research whereby data was gathered though literature [1] B. Adachi, M. Gretczkwo, and B. Pelster. Human survey. Secondary data retrieved from literature via online Capital Trends 2013: Leading Indicators Deloitte databases such as the ones that can be accessed through Development LLC, 2013 Universiti Teknologi Malaysia (UTM). This approach has aided us in providing in depth understanding of the [2] J. Bratton, and J.Gold. Human. Resource factors which influence managers to use Electronic Management: Theory and Practice, 4th Edition, Recruitment Strategy. 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Tyson. “An analysis of the use and Figure 2 A Conceptual Research Model success of online recruitment methods in the UK,” Human IV. Conclusion Resource Management Journal, vol. 18, no. 3, pp. 257– 274, 2008 In conclusion, in these days although the traditional recruitment is still used for internal and external [10] M. M. Poorangi, S. Razavi, and N. Rahmani. “An candidates attraction, but the revolution of information Evaluation of the Effectiveness of E-recruitment Practices and communication technology and the Internet have led for SMEs in Malaysia”, 2011 International Conference on to extensive changes in all the activities of the Innovation, Management and Service IPEDR.14, 74-78, organization, including human resource management 2011 functions in general and recruitment in particular. Since the trend in the future is E-recruitment, the top managers [11] N. Ollington, J. Gibb, M. Harcourt.”Online social need more evidences in this direction. Therefore, this network: An emergent recruiter tool for attracting and research came to investigate top management’s screening,” Personal Review, Vol. 42, No. 3, pp. 248 – preferences to use the traditional or e-recruitment, and it 265, 2013 clarified the importance of the top management and human resource management to attract and provide the [12] P. Dhamija. “E-Recruitment: A roadmap towards E- required competencies of organization. Seven factors Human Resource management”, Journal of Arts, Science were extracted from the scholars’ literature and provided & Commerce, Vol III, Issue 3, no. 2, pp. 33-39, 2012 HC-69 Proceeding of 1st International Conference on Human Capital and Knowledge Management [26] B.H.J. Schreurs and F. Syed. “Battling the war for [13].M. Aminuddin Human Resource talent: An application in a military context,” Career Management: Principles and Practices, Oxford Development International, vol. 16, no. 1, pp. 36-59, 2011 University Press.2011 [27] E. Faliagka, A. Tsakalidis and G. Tzimas. “An [14] R. Schuler. Personnel and Human Resource integrated E-Recruitment system for automated Management, 3rd Ed. 1987 personality mining and applicant ranking”, Internet Research, vol. 22, no. 5, pp. 551-568, 2012 [28] S. Pandre. (2011) “ E-recruitment creates order out of [15] K. Edgley. “The best job in the world may be one chaos at SAT Telecom,” Human Resource Management click away,” The Times, October 11, 1995 International Digest, vol. 19, no. 3, pp. 21–23, 2011 [16] B. Cushway. The Employer's Handbook. Kogan Page Ltd. 2002 [29] R. Burbach and T. Royle. “Talent on demand: Talent management in the German and Irish subsidiaries of a US multinational corporation”, Personnel Review, vol. 39, no. [17] A J du Plessis and H. Frederick “Effectiveness of e- 4, pp. 414 – 431, 2010 recruiting: empirical evidence from the Rosebank business cluster in Auckland, New Zealand” Science [30] L. Barber. “E-Recruitment Developments”. Inst. for Journal of Business Management, Article ID sjbm-126, 21 Employment Studies, Univ. of Sussex , 2006 Pages, doi: 10.7237/sjsa/126, 2012 [31] W. Business. “In tight labor market employers require new recruitment and workforce solutions to [18] E. Parry and H. Wilson. Factors influencing the combat 30 year unemployment rate low,” March 3, 2000. adoption of online recruitment, Personnel Review, Vol. 38, No. 6, pp. 655 – 673, 2009 [32] M.A. Hubbard & A.T. Loos. Academic library participation in recruitment and retention initiatives”, [19] S.D. Maurer and Y. Lui. “Developing E-Recruiting Reference Services Review, vol. 41, no. 2, pp. 7-7, 2013 websites: Insights for managers from marketers,” [33] Emerald. “Recruitment reforms put talent on stream Business Horizons, vol. 50, no.4, pp. 305 – 14, 2007 at River Island”, Human Resource Management International Digest, vol. 19, no. 7, pp. 24-26, 2011 [20] P.A. Hausdorf and D. Duncan. “Firm size and Internet recruiting in Canada: A preliminary [34] W. White. “E-Recruitment”, Journal of investigation”, Journal of Small Business Management, Organizational Leadership & Business. Texas A&M vol. 42, no. 3, pp. 325 – 334, 2004 University, 2008 [21] P.K. Kuhn. (2003) “The internet and matching in [35] Emerald. “Recruitment goes virtual: Use Web-based labor markets,” retrieved from http:// technology intelligently for best results in recruitment”, www.econ.ucsb.edu/~pjkuhn/Research%20Papers/Handb Human Resource Management International Digest, vol. ook.pdf 21, no. 3, pp. 19-21, 2013 [22] F. Lievens, & M. M. Harris. (2003). Research on [36] J. Beardwell and T. Claydon. Human Resource Internet Recruiting and Testing: Current Status and Future Management: A Contemporary Approach. Prentice Hall. Directions. In C.L. Cooper & I.T. Robertson (Eds.) 2010 International Review of Industrial and Organizational Psychology, vol. 16. (pp. 131-165). Chicester: John Wiley [37] K. Townsend. Recruitment, Training and Turnover: & Sons, Ltd. Another Call Centre Paradox. Personnel Review. 36(3): pp. 476-490, 2007 [23] Bizer, R. Heese, M. Mochol, R. Oldakowski, R. [38] G. Gravili. “Electronic recruiting: Trends in the Tolksdorf, R. Eckstein. “The Impact of Semantic Web Italian market”, EBS Review, pp. 132 – 142, 2003 Technologies on Job Recruitment Processes”, Wirtschaftsinformatik, pp. 1367-1381, 2005 [24] G. Rees and R. French. Leading, Managing and Developing People, 3rd Ed., CIPD, 2013 [25] T. H. Carl, R. W. Glover, L. R. Tucker and R.K. Terrien“ Impact of the internet on the recruitment of skilled labor,” Univ. of Texas, 2001 HC-70 Proceeding of 1st International Conference on Human Capital and Knowledge Management GTM Challenges: IHRM Roles in Managing Generation Y to Sustain Competitive Advantage in Malaysian Multinational Companies (MNCs) S. A. Othman, N. H. N. Mahmood, N. H. Fauzi Universiti Teknologi Malaysia, Kuala Lumpur, Malaysia Department of Human Resource Development, Universiti Teknologi Malaysia, Kuala Lumpur, Malaysia ([email protected]) Abstract - In today’s world, the terms ‘war of talent’ is organizations there is a need to efficiently manage global no longer localized in respective individual countries talent, by “working smarter” to ensure a return on the but it is becoming a global issue. The growth of new investment in key people. industries or business lead to the creation of new jobs and most of employers tend to seek someone who can Organization worldwide must able to manage work under challenging, changing and complex global their talent effectively in order to win the war of talent. environment. Presence of Generation Y in today Regardless of size or industry, the high performers are workplace with different kind of expectation creates likely to leave companies when they feel underdeveloped, challenges especially to talent management underpaid or undervalued. Losing the highly skilled department. Gen Y had becoming part of workers can create shortage of skills and represent a loss demographic challenges to Global Talent Management of investment made in these skills. In perspective of (GTM) in order to sustain competitive advantage. global economic condition, some organization downsizing Different business strategies and ways need to execute their operation due to financial condition and this in order to manage this generation of employees situation creates talent surplus with unemployment rates because the traditional business models are no longer increase across countries. able to cope with the challenge. In developing countries, multinational companies need to find the Labour Force Statistic of Malaysia states that, in right leader to help them meet the organization target January 2013 there was an increase number of and to do this, it is not easy. Regardless size of unemployment population bringing it to a total of 444, companies they need to face the global challenges in 500 people with 3.3 percent. When too many qualified term of attracting the new talent since today’s world people chasing for too few jobs, this will creates a big the competition in getting talent is very high. The challenge for organization to identify only the best scope of this research is focus on the executive and talented individual to be hired. According to McKinsey managerial level of employees in selected Malaysian (2001), 72 percent of all manager surveyed say that the multinational companies (MNCs). While this paper critical success to their companies is winning the war for aims to see on how the international human resource talent but only 9 percent confident they able to strengthen management (IHRM) play a vital role in managing their talent pool in next three years. Most companies in Gen Y to sustain their competitive advantage. today’s business world believe in their talent as the main source of sustainable competitive advantage. The hiring process is more than merely to fill up vacancy available, Keywords – Generation Y (Gen Y), Global talent but to develop organization capability for short and long management (GTM), International human resource term. Companies that able to apply integrated workforce management (IHRM) and talent management strategy will demonstrate significantly better financial performance compare to other companies within same industry. However, most of I. INTRODUCTION organization lack of ability to get the right people, with the right skills in the right place and at the right time. The Talent becomes the potentially powerful source outcome of integrated approach of talent management of competitive advantage in today’s global business should be the revenue, efficiency, profitability and environment. Talent management is the fundamental customer satisfaction. building block to create an organization that is capable of changing, innovating and learning as well as to execute This paper objective is to see the role of IHRM the new processes. In today’s competitive knowledge- in managing Gen Y to sustain competitive advantage in based world having a great managerial talent is become Malaysia multinational companies (MNCs). Lockwood critical because it determine the organization success in (2006) states that, the determinant of global talent market place. The fact that many organizations are now management (GTM) success, is the degree of CEO developing complex structures that cross national involvement, the board director and the GTM leader in boundaries makes the management of global talent a talent management activities. In this definition it is clearly challenging task. Given the economic constraints faced by that they neglect the role of international human resource HC-71 Proceeding of 1st International Conference on Human Capital and Knowledge Management activities (IHRM) in dealing with global talent for flexibility and work-life balance. If the organization management challenges. According to Koh (2003), even unable to meet the expectation from the Generation Y, most of research investigates about the specific aspect on they will pursue other companies for employment. In managing talent but most of the time they neglect and did today’s world, since the Baby Boomer will reach the year not focus on human resource management issues. While of retirement it is better for employers to understand about according to Stahl (2007) only a small number of the Generation Y that allow them to provider great qualitative methodologies are used in global talent opportunities and meet their expectation. Martin (2005) management research, some research conducted studies come out with a term or Yers, describes eight main surveyed managers of an organization, some of GTM characteristic of Generation Y towards their career: research analyzed case studies and other used scenarios to describe issues related to talent management. Thus a qualitative research will come out with a strong data and Table 1: Adapted from Martin (2005) contribute to the global talent management literature in future. Characteristic Description Job Street CEO Mark Chang, in an interview said Self-reliant and Yers were more likely to be brought that employer have to learn to work with the younger independent up in a single parent family or a generation than ask them to learn work with us. family where both parents worked Companies have to learn how to blend the workplace to than previous generations. This stay connected to borderless Gen Y group by offering meant that many Yers were forced to flexible work schedules, option of telecommuting and “fend for themselves” from an early exchanges with other offices around the world. Ashbridge age. Business School’s Global Survey (2012) states that 66% Techno-savvy This is the first generation to grow of Malaysia managers claim its becoming their overriding up with computers as an every day concern on managing graduate. Gen Y graduates have part of their lives. They want to use high expectation of responsibility and interest on work this technology to complete their that need them to make changes. Gen Y also look out work more effectively and speedy promotion to management and if it’s not meet efficiently. their expectation, they will leave. The challenge for talent Have an urgent Generation Y has a sense of urgency management and succession planning is when the Gen Y sense whereby they don’t care about next does not want their managers job especially the lifestyle. of immediacy month or next year, they only care The Gen Y has different priorities from previous about today. generation, sooner the growing workforce will challenge Entrepreneurial Today’s young adults are starting the traditional models within companies. their own businesses in record numbers from youth employment Recently Dr Raymond Madden the Asian services to Web shows for teens Institute of Finance (AIF) speaking at AIF International while they’re still in school. Symposium 2013 about “Changing Face of Talent”. He Want increasing Generation Y sees increasing said the Gen Y as the new kids on the block. Organization responsibility responsibility not as a burden to be need to use different business strategies and workplace avoided but as a proving ground for culture to remain competitive. While at the same their skills and talents. Generation Y symposium, Takumi Shibata (Nikko Asset Management request even demand more Co Ltd Chairman), Faiz Azmi (PwC Malaysia Executive responsibility Chairman) and Datuk Noripah Kamso (CIMB Islamic Have a ‘‘get off Every generation will dislike Bank Bhd Advisor) spokes on today business which my micromanagement, so it’s no changing rapidly had becoming unpredictable, high back’’ attitude surprise that this is one of Gen Yers’ competitive and more globalised. This is because the rise pet peeves. They haven’t been of Asia as key player in the market had change the way taught to manage time for business is done and in order to excel, companies need to themselves align their talent strategies with business challenges to create a different mindset. Seek flexibility Generation Y seeks new experiences. They are looking for According to Morton (2002), the Generation Y careers that offer them the shows a tendency towards looking at the equality in the opportunity to move from project to workplace and position that offer good opportunities for project, move between positions and training with a reasonable wages. Instead, they also departments frequently and they are respect manager who able to empower employees, open looking for the opportunity to work and honest with employees. Oliver (2006) states in different locations. Generation Y is uninterested in a job for life but they seek HC-72 Proceeding of 1st International Conference on Human Capital and Knowledge Management Have adopted the Generation Y is not looking for According to Garavan, (2012) the term global talent free lifetime rather they will change management (GTM) exploded in the past 10 years agency attitude careers several times during their because GTM is consider as the important business working life. practices especially in multinational companies (MNCs). Some firms compete for top talented workers because they believe they will enhance their competitiveness and deplete the advantage of competitors. Tarique and Schuler, (2012) argued that global talent management Sheahan (2005) states that the motivators of focuses on two important aspects. First, the individuals Generation Y have been identified, it is including the with critical level of talent such as knowledge, skills and team, culture, management style, flexibility, condition and ability that give an add value to company for sustaining salary. Even recently, the world has been dominated by competitive advantage. Second, in order to manage Baby Boomer Generation but we must realize on the employees they need to implement international human dramatic generational shift and maximizing Generation Y resource policies and practices (IHRM) and this can be talent for the organizational success. Many organizations refer to global talent management system. feel unprepared for Gen Y when it comes to particular aspect of talent management program. Talent management can no longer exist in silo, a holistic of global talent management system should be address and implement in order to sustain in competitive advantage. International human resource management (IHRM) activities domain will be the global talent management system in response the GTM challenges. IHRM can be defines both formal and informal policies of the actual daily practices of an organization, (Schuler et al 1993). Multinational companies can use different set of tool to diagnose the current problem or situation. For this research the components in the system include attracting, developing and retaining talent, these are three major IHRM activities in the GTM system. In attracting talent IHRM activities focus on developing HR reputation, attracting individual with interest in international work and recruiting vis-a-vis position. According to Chapman, Figure 2: Integrative Framework of Global Talent Uggerslev, Carroll, Pasentin and Jones (2005) building Management (GTM) in MNEs and Suggestion for Further the HR reputation is similar to the concept of Research. organizational attractiveness and this is become vital with respect to attract talent. Meanwhile, MNCs should While in order to response with global talent identify those individual that interested in international management challenges for the past recent years, a work or permanent international career by IHRM policy, framework has been proposed by Tarique and Schuler (Tarique and Schuler, 2007). The talent pool strategy also (2010) as above. Global talent management term has been will need MNCs to select position for the best people use broadly by many researchers and this is useful to any rather than select to only specific position for specific companies’ especially multinational firm as it can address people. Meanwhile for developing talent, organization the global talent management challenges and how the should identify talent with necessary characteristic such as IHRM activities domain will encounter in order to personality, and offer them developmental experiences for achieve GTM effectiveness. The demographic, will shows their career growth, (Caliguri, 2000). Seigel, (2008) how the MNCs tackle with this challenges since most of argued that companies that excellent in their talent the top management is the Baby Boomer Generation. management will integrate their leadership development They will reach the years of retirement and the as part of their culture. For retaining this research focus replacement from Generation X and Y are needed. on reducing repatriate turnover and increase the employee engagement. According to Lazarova and Cerdin (2007) the issues of repatriate turnover become the important II. METHODOLOGY issues in many MNCs. For the employee engagement, Lockwood (2007) argued it can promote the retention of talent, build up their loyalty, and improve companies’ The qualitative method use in this study is in- performance and stakeholder value. depth interview with talent management manager and focus group discussion. Meanwhile the quantitative method is done by survey. For qualitative data, the in- HC-73 Proceeding of 1st International Conference on Human Capital and Knowledge Management depth interview and focus group discussion are use to see the retirement periods, neglecting the Gen Y expectation on how the selected MNCs impact due to the global talent will only affect organization performance because they management challenges and how they encounter the don’t have any right talent to execute the business problem. While focus group discussion will help process. researcher to come out with GTM system that are sensitive to cultural and region which might be implement Gen Y or Millenials seems to have lot of bad to any MNCs worldwide. criticism from all around the world because of their high expectation. Importantly not to comparing one generation Meanwhile the quantitative method is useful for to other generation because there were born on different the researcher to collect data concerning many variables eras. People who were from baby boomer generation start through the questionnaire. This quantitative method also their work with less pay but they are very satisfied and tends to focus on measurement and proof. The strengths loyal to employers. In 1950s employees who received of the quantitative paradigm are that its methods produce RM300 per month as their salary might survive and yet quantifiable, reliable data that are usually generalize to still have pocket money until end of month. With rental some larger population. The information from the house only as low as RM17, the economic condition at qualitative data will be used as a guideline to develop that eras were balance with their income salary. But those survey questionnaire for the quantitative data collection. who born in Gen Y group was born during the economic Population and sampling is the process of taking subsets condition were uncertain, unpredictable and keep of subjects that is representative of the entire population. changing from time to time. In 2013, most of baby Sampling is done usually because it is impossible to test boomer generation already achieve their personal every single individual in the population. Thus, this help economic stability and have their own asset such as house the researcher in conducting research more effective and or car. The situation is different for generation y that was efficiently. live in unbalancing economic condition, rising of house and car price. Gen Y expects more and not merely about The target population is the executive and their self satisfaction but they need to keep pace with managerial level of employees in multinational companies what is happening around them. If particular organization (MNCs), while for the interview session the researchers cannot fulfill their expectation, they will leave and that is select twenty talent management managers’ to share their why most of Gen Y start involving in doing business thought regarding global talent management challenges where they can control the business, earn more money regards to Gen Y and how IHRM can play roles to and enjoying their flexible work time. encounter the problem. In this study, population’s estimates are around 100 totals of employees. While the Getting Gen Y to work will bring many changes to MNCs selected will be based on Federation Malaysia respective organization and leading to sustain their Manufacturing that practice talent management and have competitive advantage in future. Gen Y fully equipped their own specialize department more than 5 years. The with techno-savvy, ambitious, risk taker, decision maker data will be analyzed by using SPSS version 20.0 in order and many more. By utilizing all the positive sides of Gen to produce a valid and reliable research finding Y, the leader of tomorrow will be created to face more challenging condition by next decades. The best approach is, when you stop complaining or blaming and start on III. CONCLUSION diagnosing the root of problem to find the solution. Globalized world nowadays creates different business opportunities and the global economic keep rapidly ACKNOWLEDGMENT changes. For example like hand phone in 1990s which the primary function is to message or calling another person. The authors express highly appreciate to global talent But the same product in 2013 had undergone tremendous management scholars who contribute to the body of changes on the function due to the innovation. This is knowledge. The thoroughly discussion regarding GTM same situation on regards to manpower or talent, even one has help the authors on gaining new information and particular MNC had hired someone 10-15 years ago, they understanding about the research topic. need to upgrading their skills in order to keep on pace. 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[9] Sheahan P.(2005) Generation Y: Thriving And Surviving With Generation Y At Work. Hardie Grant Books, South Yarra, Australia [10] Schuler, R., Dowling, P. And De Cieri, H. (1993) ‘An Integrative Framework Of Strategic International Human Resource Management’, Journal Of Management, 19: 419–58 [11] Chapman, D., Uggerslev, K., Carroll, S., Piasentin, K., & Jones, D. (2005). Applicant Attraction To Organizations And Job Choice: A Meta-Analytic Review Of The Correlates Of Recruiting Outcomes. Journal Of Applied Psychology, 90: 928–944. [12] Caligiuri, P. (2000). The Big Five Personality Characteristics As Predictors Of Expatriate Success. Personnel Psychology, 53: 67–88. [13] Seigel, J. (2008). Global Talent Management At Novartis. Harvard Business School, Case #9- 708-486. [14] Thomas N. Garavan (2012): Global Talent Management In Science-Based Firms: An Exploratory Investigation Of The Pharmaceutical Industry During The Global Downturn, The International Journal Of Human Resource Management, 23:12, 2428-2449 [15] Ibraiz Tariques and Randall Schuler (2012): Global Talent Management Literature Review, SHRM Foundation [16] Tarique, I. and Schuler, R.S. (2010). Framework and Review of Global Talent Management and Suggestions for Future Research, Journal of World Business, H. Scullion and D. Collings (special guest editors), 46, #2. [17] Department of Statistics Malaysia, (2013). Labour Force Statistics, Malaysia (Bureau of Labor Statistics) HC-75 Proceeding of 1st International Conference on Human Capital and Knowledge Management UNEMPLOYMENT PROBLEM AMONG GRADUATES OF TECHNICAL FIELD: COMPETENCIES OF THE GRADUATES AND QUALITY OF THE EDUCATION Z. Hanapi1, M. S. Nordin2,R. Che Rus3 1Fakulti Pendidikan Teknikal dan Vokasional Universiti Pendidikan Sultan Idris, Perak, MALAYSIA 2Fakulti Pendidikan, Universiti Teknologi Malaysia,Skudai, Johor, MALAYSIA 3Fakulti Pendidikan Teknikal dan Vokasional, Universiti Pendidikan Sultan Idris, Perak, MALAYSIA ([email protected]) why it happens when the country has allocated a large Abstract - The unemployment problem among graduates is amount of investment in the educational system especially an issue not only in Malaysia but it is an issue throughout the world. Even though the unemployment rate in Malaysia in the field of Technical and Vocational Education (Abd is considered low as compared to countries like the United Hair et al, 2007). States and other countries in Europe, it is not an issue to be neglected. This is because graduates are human workforce Even though the unemployment rate in Malaysia is that is vital and become the core for innovative and considered low as compared to countries like the United productive high-income economy. Therefore, this study aims States and other countries in Europe, this issue should not to investigate the factors that contribute to the be ignored. This is because graduates are human unemployment problem among Malaysian graduates from workforce that is vital and become the core for innovative two aspects, which are graduates’ competency and the and productive high-income economy. Through the Tenth quality of education, which are related to the learning and Malaysian Plan (2010-2015), the government has aimed curriculums of the programmers offered in educational 33% of the human workforce is categorized under high- institutions. This study focuses on the factors of skilled workers by 2015 and by 2020, 40% of high-skilled unemployment problems among graduates of technical fields. This study was conducted qualitatively through workers are needed. This shows that the country really interview among eight experts, who have experiences in needs skilled and semi-skilled workers, especially from teaching and working in the industries. The majority of the the graduates with technical qualifications. Therefore, it respondents agreed that the graduates’ competency and the shows that TVET plays an important role in producing quality of education are among the factors that contribute to high-skilled workers in Malaysia by providing excellence the unemployment problem among graduates of technical education to students with the interest and potential fields nowadays. Therefore, appropriate efforts and actions towards the technical and vocational fields. The source for should be taken in curbing this problem since graduates are human capital, that is highly potential and competitive, is important resources of human capital for an organization or highly needed in this globalization era. However, a country. Human capital with the knowledge and qualified skills contribute to the enhancement of the country’s producing human capital resources that are comprehensive and at a world class level is not an easy economic productivity. task and it is a challenge to Malaysia. Therefore, this Keywords: Unemployment, technical field, paper aims to identify primary factors that lead to the competency,quality of education,curriculum unemployment issue among the Malaysian graduates in technical fields and hence it can hopefully become guidelines in curbing this problem. I. INTRODUCTION II. LITERITURE RIVIEW Currently, the unemployment among graduates has become an issue not only in Malaysia but also all around A. Unemployment Issue among the Graduates of the world. The unemployment problem is occurring not Technical or Engineering Fields only in Malaysia but throughout the world. Based on the report by the Department of Statistics Malaysia (2011), it Abd Rahim and Ivan (2007), states that the Technical is found that the unemployment rate in Malaysia had Education and Vocational Training (TVET) system is increased from 3.2 % in 2007 to 3.7% in 2009. Besides, a designed to produce skilled human resources in order to report on graduates tracer study in 2010 found that almost meet the needs of the industry. However, it is found that 25% of the graduates of the Higher Educational nearly 80,000 technical graduates are still unemployed Institutions were unemployed (Graduates Tracer Study and they are depending mostly on the academic System by Ministry of Higher Education, 2010). The qualifications and not on the employability skills in order Tracer Study Report by Ministry of Higher Education to get jobs (Ahmad, 2005). (MOHE) also found that the unemployment problem Based on a statistic by World Bank Education, it is mostly occurs among the graduates of the field; i) Science revealed that Malaysia had only 28% of skilled human (28.6%); ii) Information Technology and Communication capital, whereas other countries (Singapore:51%, (27.7 %) and; iii) Technical (27.6 %) (Graduates Tracer Finland:43.8%, Australia:42.9%, United Kingdom:42.5% Study System by MOHE, 2010). This raises a question, and Republic of Korea:29.3%) had a higher percentage of HC-76 Proceeding of 1st International Conference on Human Capital and Knowledge Management skilled human capital (10MP, 2010). This shows that the technical skills and employability skills. Rosa (2000), majority of the human capital in Malaysia has a low level defines technical skills as the skills associated with the of academic achievement and this also shows that there is procedures, methods or techniques. While according to a big gap for Malaysia to achieve a world-class level of Mohd Yusof and Seri Bunian (2009), employability skills human capital development. Based on a report by the can be called with other names such as non-technical Ministry of Human Resources (2011) related to job skills, generic skills, soft skills, key skills and core skills. vacancies and job placements of graduates and non- Technical skills need to be mastered by the graduates graduates according to the types of industry in Peninsular since it is the base that allows the graduates to be Malaysia in 2012, it is found that; i) industries based on employed in the industry. Dacre Poll dan Sewell (2007), technical skills or engineering such as manufacturing, stated that employability skills are referred to a set of construction and repair of motor vehicles show the skills, knowledge, understanding and personality of an highest job vacancies compared to the other industries; individual that qualifies the individual to choose and be and ii) the number of the job vacancies increased from successful in a work. January until March 2012. However, the vacancies were Mahyuddin and Norrafidah (2010), in their study filled only by a small number of employees. This raises a related to the selection of engineers based from the question of where about the other job registrants in the employers’ perspective found that most of the employers situation where the number of job seekers are increasing are concerned with employability skills such as creativity, and there are still job vacancies in most of the industries innovative, problem solving, cooperation, information (Ministry of Human Resources, 2012) management and entrepreneurship, in the process of Nasrudin (2004), stated the eleven factors that lead to selecting engineers. Based on a report by Final Report the unemployment problem among the graduates are the Engineering and Technology Labour Market Study relationship between capital intensive economy, a rapid among Engineers Canada and Canadian Council of increase of graduated workforce, lack of the relationship Technicians and Technologists (2009), it is found most of between educational institutions and the industry, lack of the engineering graduates have no problem in terms of training for work preparation, rapid increase of the technical skills and employers are satisfied with the level population rate and rapid decrease of the mortality rate, of technical skills of the graduates. However, these educational development, economic recession, quality of graduates have problems in terms of non-technical or education, capability of graduates, and the graduates’ employability skills such as communication skill, project skills and personalities. Based on the Economic Planning management skill, team working and entrepreneurial skill. Unit of the Prime Minister’s Department (2011), it is This is also depicted in a study by Syed Hussain (2008), revealed that there are a few issues that make TVET a not in which he revealed that almost 62.3 % of the technical popular choice among Malaysian students. The issues graduates are unemployed due to the lack of include; i) the technical and vocational areas do not employability skills compared to the technical skills. provide a clear working path to the student; ii) A study conducted by Akmarya Syukhairilnisah unattractive range of salaries; iii) too many skills training (2005), found that graduates of Public Skills Training centers with different standards and; iv) training centers Institutes are less competent in using new technologies that operated not at a maximum state. while performing a given task. Mastering technology skill Besides, from the aspect of the training centers and is one the important technical skills and it is an asset for the industry relationships, it is revealed that the skills graduates, which would enable them to work in the needed by the industries are not parallel with the industries. Azami (2008), mentioned that most of the curriculum provided in skills training centers. The employers agreed that elements such as ability to apply industries also do not give full support and recognitions to knowledge related to engineering field into real situation, skills training centers. In addition, there is no specific highly competent in applying practical skills that are platform available for the industry and the skills training engineering oriented, and able to solve problems that are institute to discuss on the suitable skills needed by both of related to engineering field are the important elements to the parties. There is also lack of apparent initiative, which technical skills and need to be mastered by engineering is done in order for the industry to get in touch with the graduates. Employability and technical skills are indeed skills training centers. Consequently, these problems lead important criteria among graduates, which would enable to the production of graduates from the skill training them to get a job. Besides, Yahya (2004) mentioned that a centers, whom do not fit the standard of an occupation. qualified worker is a worker, who do not only has This also leads to the unemployment problem among the technical skills but also has employability skills. graduates, especially among the technical graduates. C. Quality of Education in Technical Field B. Competencies of Technical Graduates According to Ashraf and Ibrahim (2009), the quality According to Palan (2003), competency consists of of education is difficult to measure and it is defined as the five characteristics which are knowledge, skills, self- students’ learning outcomes from educators and esteem, attitudes and motivation in doing a task. This institutional environment itself. Quality in education is study focuses on two types of comtency, which are necessary to achieve customers’ satisfaction. Students as HC-77 Proceeding of 1st International Conference on Human Capital and Knowledge Management customers are entitled to a good quality of education and produce the necessary improvement in the quality of they have the right to assess to an educational institution teaching and learning in engineering. Moreover, the (Roselena, 2007). Hoy and Miskel (2005), pointed out quality of the lecturers is an important factor in that the factors that influence effective education determining the quality of the students who graduated institutions are leadership, quality of curriculum, from a certain place of training or learning institutions. classroom climate, achievement-oriented, effective Lecturers are not only responsible for the daily tasks in learning time, structured teaching and the recognition of educating but also need to portray good behavior as they success. There are five standards in quality of education will be an example and role model to the students (Hani in Malaysia set by the Ministry of Education (2010), Nur Zakiah Masnora, 2011). namely; the leadership and direction, organizational management, curriculum, co-curricular and sports, student III. METHODOLOGY affairs, teaching and learning process and student excellence. This study is a qualitative study involving semi- According to Harvey (1993), a study conducted by structure interview. This study involved eight the project of Quality in Higher Education found that the respondents. The respondents are lecturers who are quality of teaching, the content of the program, the teaching at the universities, lecturers who are teaching at evaluation by the trainers are key factors affecting the the Public Skills Training Institutes in Malaysia as well as educational quality. This research is focused on the employers in the industry area. Researchers have selected educational quality in terms of curriculum studies and respondents through purposive sampling, where teaching and learning. According to Tang (2002), the researchers identified individuals who have access to evaluation of teaching effectiveness is the main approach information in accordance with the phenomenon of the in measuring the quality of teaching and learning. Marsh study (Merriam, 2009). (1987) also stated that measuring the effectiveness of teaching involves various dimensions of constructs for IV. RESULTS instance the lecturers’ willpower, course content, organization, scope of interaction, coverage of course The results showed that majority of the respondents content and assessment. agreed that the graduates’ competency and quality of Deputy Human Resources Minister Datuk Abdul education (including curriculum studies and teaching and Rahman Bakar at that time also said that the major learning) are the main factors affecting the problem of contributor to the unemployment among graduates is the unemployment among graduates of technical. failure to match educational syllabus or curriculum with the requirements in job market (Utusan Malaysia, May A. Competencies of Technical Graduates 18, 2005). The component of curriculum and subject in university is not in line with workplace literacy required Results showed that majority of the respondents by the industry. This problem affects the graduates’ agreed that a lack of technical skills and poor employment as they are unable to obtain a job that suits employability skills is one of the factors that contribute to their skills and abilities as well as hinder them from being the problem of unemployment among graduates in competence workers. A graduate tracer study (2004) technical fields. This is reflected in the statements below: revealed that the curriculum for teaching and learning in the Polytechnic did not aid the students in mastering “Technical skills are considered an asset to the language and technology skills. The students also argued graduates. If they could not master the skill, how they that the contents of the program taught in classroom was are going to work? Most of the students understand less relevant with the skills required in the workplace. what have been taught to them but they would forget A study conducted by Soo Wee Leng and Jumayah about it the day after.”(Aminah) (2001) found that the curriculum offered by Vocational Institutions is not in accordance with the demands of “Technical skills, which are important, include industry resulting in lack of skills from post-vocational aspects related to wiring, choosing equipment, students in meeting the needs of the industry. This maintaining equipment, identifying damage and contributes to the arising problems among graduates as fixing damage.” (Suhaimi) they are unable to apply what they have learned in their job and cannot adapt to the new working environment. In “Employability (skills), which are important,are self- addition, a study conducted by Zalina, Zainol & Norkisme discipline, has the knowledge on many things, (2011) on students' perceptions related to quality of leadership, entrepreneurship, students’ attitudes that tertiary education in engineering found that most students do not care about fines and ineffective time showed moderate satisfaction with the learning aspect of management." ( Nora ) the institutions. They also stated that aspects like infrastructure need to be maintained, a complete series of “Employability skills, which are important, are computer’s information, laboratory equipment and communication, teamwork, ethics and workshop should also be upgraded regularly in order to HC-78 Proceeding of 1st International Conference on Human Capital and Knowledge Management entrepreneurship. The employers are not looking at the graduates. There are employers in the industry, who skills certificates." ( Suhaimi ) gave negative comments on the graduates and mentioned that the graduates do not have the suitable skills and “Employability skills are essential to retain the jobs. qualifications, which meet the needs of the industry. (This includes) communication, body language and Ahmad Rizal et al (2008) also noted that most of the commitment.” ( Syiris ) graduates of various skills training centers fail to put themselves in the workplace due to their employability B.Quality of Education in Technical Field skills that do not match or do not meet the job requirements. This matter is a regret because the inability The results showed that majority of the interviewed for the Malaysian graduates to fulfill job vacancies in respondents agreed that the curriculum of teaching and Malaysia resulting in the hiring of foreign workers. learning is an aspect of educational quality and it gives a Technical and employability skills become the main great impact on the problem of unemployment among factors for a graduate to get employed. Therefore, it is graduates of technical fields. This can be seen in the list important to include elements of technical and of statements below: employability skills across the curriculum for each of the technical or engineering field of study offered at Public "Curriculum gives less exposure to the real working Skills Training Institutes and Institutions of Higher environment and not in accordance with current Learning. developments." (Suhaimi) Meanwhile on the aspect of the quality of education, the results show that curriculum employed by the "Every curriculum developed should meet the technical studies and teaching and learning that focuses requirements and in line with industry needs." (Nora) on the lecturers’ teaching is also a contributing factor to the unemployment problem among graduates of technical "The curriculum needs to be improved by creating fields. Ismail (2012), argued that the quality of education links with the industry". (Ramlan) depends on exemplary teachers, the use of reference materials and a conducive environment (infrastructure, "The present lecturers have inadequate experience, social, location, etc.) that contribute towards the less exposure to the industry, lack of competence and construction of admirable character and excellent some are not interested in the field of work. Have academic achievement. A research by the National problems in teaching’s techniques." (Suhaimi.) University of Malaysia (2007), reported that employers and curriculum on industry in Institutions of Higher "Most of the new lecturers have lack of skills in terms Learning should be redesigned because they found that of teaching methods, classroom control, lecturers most graduates do not have a satisfactory level of job have to change and need exposure to the industry to competency. be able to command higher skills, lecturers need to In addition, the findings also show that each lecturer become pioneer and find new ideas." (Ramlan) in higher education institutions should be given intensive training and continuous education courses in order to V. DISCUSSIONS AND CONCLUSIONS increase their level of skills or competence in line with the changing technology and the addition of new information. Education and training is a learning process that is A field of study offered by the education and training designed to change attitudes, improve knowledge and must meet the requirements of the employer or the job skills of the individuals in order to produce high personal market to ensure that the program gain recognition by all or career performance. On the aspect of competency, the parties. Bracey (2006), stated that it is difficult to know findings of this study focus on two competency skills that what the appropriate skills required by employers in the are technical skills and employability skills, which industry. Therefore, the employer should work together contributed to the problem of unemployment among and cooperate with the learning institutions in providing technical graduates. The findings showed that majority of any information related to the world of education. respondents agreed that most of the graduates of technical Overall, effective skills training will produce graduates have series of problems. Among the problems faced by with high level of education and skills before they enter a the graduates are having difficulty in applying what they working field. have learned in Public Skills Training Institutes and Institutes of Higher Education with a real job situation REFERENCES and having a weak mastery of employability skills such as time management skills, poor self-discipline, lack of [1] Abd Hair Awang et al. (2007). Potential Demand for communication skills especially in English and do not Skilled Labor in Manufacturing,Construction and Services have leadership qualities. in Malaysia. Project Report.Universiti Kebangsaan Rahmah and Lai Wei Siang (2011), mentioned that Malaysia. [2] Advant ,S.B. & Makhirja,S.J. (2003). 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Rosli Unit Penyelidikan Etnografi dan Pembangunan Sekolah Sains Sosial, Universiti Malaysia Sabah [email protected] Abstract Women play an important role not only in the family National Key Economic Areas (National Key Economic institution to ensure family members are in a comfortable Area) (NKEA) under the Economic Transformation but in the same time a source of employment that can Programme (Economic Transformation Programme) or contribute to an increase in family income and the short ETP. The objective of this study is servay at the country. Accordingly, it is not surprising that women are extent of the involvement of women in seaweed now the first time active in various fields to improve cultivation industry in Semporna . The study area is on the themselves and thus take on the responsibility of helping Selakan island that involving of 20 respondents. Data her husband in the head of the family that is income were collected through questionnaires, in-depth generating. Various projects and programs undertaken by interviews and field observations. The study reveals the the government to ensure that rural communities are techniques and technologies that try digarapkan in equally enjoy development and one of the project is seaweed cultivation industry through Mini Estate through seaweed cultivation project uses the concept of indirectly provides a new perspective to the community to Mini Estate . Mini estate seaweed is one of the 16 Entry provide space and opportunities for women not to be Point Projects ( Entry Point Projects ) ( EPPs ) under the marginalized from the mainstream of development taken agricultural sector has been identified as one of the by the government. HC-81