Toward a management strategy for optimal recruiting: potential applicant concerns on goodness of fit in the corporate culture.

Buntzman, Gabe ; Parker, Richard D.

ABSTRACT

Over the years a large body of literature has developed regarding cultural difference using Hofstede's cultural dimensions. In the course of studies regarding this literature attention has been placed on the differences between management and employees from a management perspective, yet little attention has been focused in the opposite direction. This study uses an in-basket laboratory experiment to determine if US students would prefer to work for a boss who shared cultural traits. The literature, methods and findings are followed by a discussion of the results and implications for entrepreneurs.

INTRODUCTION

Buntzman and Parker (2004) recently applied the Hofstede value system to an analysis of MBA student perceptions of CEO effectiveness and found evidence in a pilot study that their perceptions of CEO effectiveness might in fact be related to their internationally diverse cultural backgrounds. This study is in some ways a follow-on study. It examines the preferences of undergraduate students to possibly work for individuals whose philosophies reflect various cultural backgrounds typical of the USA and certain European, Latin American and Asian regions.

Currently a wealth of literature exists on the impact of culture on business operations particularly in the area of employer/employee relations. Much of this literature is useful in examining the role that cultural differences plays in the understanding of how business works. Culture though extends farther than just an individual's background; one must also consider the culture of business to which a new graduate will be entering upon completion of a degree program or an experienced worker might enter upon changing jobs. "Corporate culture is comprised of philosophy and mission, manner of internal communications and hiring practices. From the outside such things as dress code, flexibility of work schedules and level of volunteerism often form a company's public profile" (Pfister 1999).

This perception of corporate culture is particularly true in America. As one U.S. CEO stated: "I think the most important thing you can have is pride in how you dress, in how you act ... when you have facilities that are clean and painted, people take pride in that, and you end up with a better safety record, a better environmental record" (Pfister 1999). The philosophy of the CEO was reflected in how the employees reacted to it. One employee indicated that as a result of the CEO's attitude the company had become "extremely image conscious" and failure to adhere to norms would result in co-workers quietly pointing out violations (Pfister 1999).

The American value system as pointed out in a number of studies is not universally accepted. In an application of the Hofstede values (collectivism vs. individualism, high vs. low uncertainty avoidance, high vs. low power distance, masculine vs. feminine and dynamic vs. Confucian) Gouttefarde (1996) observed the interaction between Americans and French working in French companies. The comparison was justified given the cultural differences between the two nations. The Gouttefarde study showed the French are high on the power distance scale whereas Americans rate low. The study also showed French and Americans are at odds on uncertainty avoidance. Not surprisingly many of the respondents in the Gouttefarde study expressed frustration at their cultural counterparts. The Americans were seen as brash and too individualistic. The French were seen as micromanagers who stifled the creativity of American employees and were mired in bureaucracy. French bosses were seen as aloof from subordinates whereas the feeling was among French subordinates that the American supervisors got too close.

In other international studies (e.g. MacMahon 1996 and Channon & Dakin 1995) the importance of cultural understanding and identity was seen as a key to business success. In terms of hiring practices by small business owners in Ireland one entrepreneur stated: "I think that in a small company you have to be careful in selecting your workforce anyway--you try to make sure that people will fit in with your way of thinking, your way of doing things and the other employees" (MacMahon 1996). One study conducted in the relatively calm years of the mid-1990s showed that in the emerging markets of Central and Eastern Europe after the fall of communism, over 70% of companies surveyed for a study in hiring practices were aiming for "99-100 per cent local staffing in the long term, as most felt local staff would have a better understanding of the local market" (Channon and Dakin 1995). Arguably Ireland and the individual countries of the former Warsaw Pact are for the most part internally homogenous. But the expressed preferences for hiring people who shared a common viewpoint may in fact reflect a widely held desire that new employees fit the mold of the corporation's culture.

The role of organizational culture within a corporation has been the focus of a number of studies during the last 30 years. Van Dick, Christ et al (2004) noted that social identification factors played a vital role in employee retention. Pearson and Porath (2005) examined the relationship and consequences between incivility and organizational loyalty. Additionally Macklem (2005) found that an unhealthy desire for profits created a cultural atmosphere that was detrimental to corporate long-term health. But how does the idea of corporate culture play into job acceptance decisions by prospective candidates?

In reviewing the literature relating to job acceptance factors, we discovered that researchers choose to look at a number of items that impact decisions to accept a job offer. In a study by Turban, Campion and Eyring (1995) it was noted that factors including "site visit, perceptions of the location, and host likableness were related to job acceptance decisions" but no mention was made of perceived cultural attributes. Other studies by Swinth (1976), Sheridan, Richards and Slocum (1975), Schmitt and Coyle (1976), Saks (1989), Saks and Cronshaw (1990), Saks, Wiesner and Summers (1994) have sought to predict the likelihood of job acceptance by potential employees using realistic job previews and instruments which attempted to measure the candidates' perceptions of employers based on factors such as likeability and adequate communications. These studies appear to discount, ignore or minimize the role corporate culture plays in job acceptance decisions.

Saks and Cronshaw (1990) point out that the channels of communication used to provide potential applicants with "realistic job information" comes in two forms: either through written materials such as brochures or in oral communication during a job interview. Such verbal communications fail to provide potential employees with vital non-verbal communications which might provide clues and insights into the nature of specific cultures within companies.

Additionally we wanted to know what companies are doing to foster the culture that will best suit their strategic objectives (particularly those objectives related to hiring qualified personnel). Herb Kelleher, former CEO of Southwest Airlines is credited with establishing a culture that carefully "protects and nurtures its employees" (Fryer 2004). Other firms offer employees access to top executives and perks such as African safaris and other exotic trips. Such actions are significant in that "employee morale and performance improvement are top management concerns" (McMaster 2003). Problems begin to arise when bosses begin to label subordinates as weak performers. According to Jean-Francois Manzoni, a management scholar at a leading French business school: "employee performance tends to adjust up or down according to such expectations" (Mount 2002). As a highlight to the importance of these issues Manzoni and Barsoux (2005) recently conducted a study to determine the relationships between management and employees and how employees disconnect from both management and their jobs. Such studies are important in determining and understanding the role culture plays within corporations.

Corporate culture also is impacted by popular media image. Given that most people rely on the popular media to formulate and reinforce viewpoints, the observations of this group cannot be discounted or ignored. As an example the emphasis on cultural understanding in corporations was succinctly framed in a recent editorial in the Dallas Morning News: "A company is only as good as its employees. That employer-employee relationship is being tested as never before, making it more difficult for companies to get workers to agree with their leaders on the same business goals. Successful businesses will understand the trends that are undermining workplace morale and will respond accordingly" (March 15, 2004).

Being aware of employer responsibilities in creating and managing corporate culture as seen above, what can be investigated about the expectations or desires of subordinates coming into a new work situation? Do workers desire to be employed by someone who has a similar cultural background and values to them? In the United States, is cultural similarity a factor in determining whether or not a junior candidate would base a decision on job acceptance based upon the perceived opinions and judgments of similarity with the boss?

Research Questions

In order to investigate the whether or not cultural similarities are desirable between employees and employers, we posed the following research questions based on the above:

R1: Do US undergraduate students prefer a boss whose values are consistent with the US "archetype" that was identified by Hofstede?

R2: Do US business students prefer an entrepreneurial-type boss or one who is more conservative?

R3: Is the type of business, its size and environment, a factor in determining whether an entrepreneurial or conservative boss would be preferred?

METHOD

The sample consisted of 100 undergraduate students enrolled in several sections of the authors' required business courses. Participation was voluntary and extra credit was provided.

We devised an in basket-like laboratory experiment for this study. Written instructions asked respondents to assume the role of a relatively new employee who has been appointed as a member of a 360/ style selection committee seeking a replacement for a "very senior management position" for either a large multinational corporation or a small local business in the service sector. After reading brief statements of philosophy attributed to each candidate in turn, subjects were asked to rate them as good for the organization, whether they would enjoy working for the person, whether the person would be a good role model for them, whether this person should receive priority in being given a personal interview, and the excellence of each candidate's philosophy. Each item was evaluated on a seven point Likert-type scale anchored by "Disagree" (1) and "Agree" (7).

Additionally, we collected data on how the candidates were perceived with respect to the Hofstede dimensions masculinity/femininity, low/high uncertainty avoidance, individualism/collectivism, and high/low power distance on seven point Likert-type scales. The scales asked subjects to rate candidate in terms of: hard driving or easygoing (to represent Hofstede's masculinity/achieving orientation); concern for subordinates, to represent collectivism, or out for himself, to represent individualism; entrepreneurial, representing low uncertainty avoidance, or cautious, representing high uncertainty avoidance; and elitist, representing high power distance, or democratic, representing low power distance.

Four candidates were presented for evaluation. Alex's statement of philosophy was designed to have him perceived as masculine, individualistic, with low power distance (LPD) and low uncertainty avoiding. According to Hofstede (1980) this is a typical value structure in the USA. Bobby was portrayed as masculine, LPD, collectivistic, and high uncertainty avoiding, typical of value systems in Japan and other parts of Asia and Latin America (Hofstede, 1980).

Charlie's philosophy was intended to present him as feminine, high power distance (HPD, individualistic, and high uncertainty avoiding. This value system is consistent with Western European countries such as France and some Asian states (Hofstede, 1980). Finally Del's philosophy was intended to portray his/her value system as masculine, individualistic, HPD, and high uncertainty avoiding, typical of countries such as Belgium and Italy (Hofstede, 1980).

Independent variables were subject gender, business type (MNC v. Small Business) and type of value system. We used analysis of variance and stepwise multiple regression to analyze our data.

RESULTS

As stated above, Masculinity/Femininity was measured with the anchors "hard driving" (M) and "easy going" (F); Individualism/Collectivism was measured with the anchors "out for himself" and "concerned for subordinates." Low/High UA was measured with the anchors "entrepreneurial" and "cautious" and High/Low Power distance used the anchors "elitist" and "democratic" (Please see Table 1 below.)

As is shown in Table 1 below, Alex (A) is perceived as Masculine (mean <4.0) and significantly more masculine than Bobby (B). Del (D) is most masculine. Alex is perceived as more individualistic (>4.0), and more so than the collectivist Bobby. He is perceived as a low uncertainty avoider (entrepreneurial) (<4.0) and low PD (democratic) (>4.00). With two exceptions, the "applicants" were perceived as expected. The exceptions were that Bobby was perceived as feminine and Charlie (C) was perceived as masculine. Overall, subjects perceived the candidates as would be expected based on their "statements of philosophies."

There were no gender differences in how men and women perceived the candidates. There were no business-type differences in how subjects perceive the candidates suitability for the position. Means for the dependent variables based on type of business tended to be close to the neutral midpoint value of 4 on the seven point Likert--type scales.

The candidates' value systems do appear to have influenced subjects' perceptions and recommendations. We expected that Alex would be rated more favorably because his/her value profile was intended to be similar to that for the USA, and the vast majority of the subjects were also from the US. In performing tests of differences in perceptions, we took the mean value of the rating for the dependent variable for Alex (representing the US value structure) as the test value against whether the others were compared. Results for these comparisons are discussed below.

Would this person be good for the organization? Using t-tests, Charlie (Feminine, High Power Distance, Individualistic, High Uncertainty Avoidance had a rating of 4.52 (s.d. 1.22) versus 5.09 (s.d. 1.09) for Alex, T=-4.65, p<.000. Thus Charlie was seen as somewhat neutral for the organization compared to Alex. (Please see Table 2 below).

Would the subject enjoy working for this person? Bobby received the highest rating, 5.12 (s.d. 1.23). This was significantly higher than the ratings for Alex. (Please see Table 3). Del had a significantly lower rating and Charlie's low rating approached significance.

Would this person be a good role model? None of the candidates stood out in this regard with mean ratings close to the midpoint of 4.00, but C was significantly lower than A (3.99, s.d. 1.31, vs. 4.28, s.d.. 1.48) and t=-2.22, p< .03.

Should preference be given to this person to be offered an interview? No candidate stood out here either. There were no significant differences between A and the other candidates. (Please see Tables 4 and 5 below).

Does this applicant have a good overall philosophy? B was rated marginally higher than A, T>1.81, p<.074. C was not significantly different and D was significantly lower (t=-2.29, p<.024). (Please see Table 6 below).

Finally, we wondered whether perceptions of an applicant's strengths (would he/she be good for the organization, would the respondent enjoy working with him/her, would be a good role model, has a good overall philosophy would be predictors of an offer for interviews. We used stepwise multiple regression to explore this issue. For candidates A, B, and C only "excellent philosophy" entered the equation, but for D "a good role model" added explanatory power. Adjusted R-squares ranged from about .26 to about .49. (Please see Table 7 below.)

DISCUSSION

We thought that US students would prefer a candidate, one for whom they might actually work according to our scenarios, who matched the value profile of U.S. culture as determined by Hofstede. This was not the case. In fact, using the mean for Alex as the reference point our subjects did not demonstrate a statistically significant preference that any of the candidates be offered an interview before the others.

The regression equations in which the candidates' philosophy was shown to be associated with making an offering all provide food for thought. These are no doubt many factors which bear on an individual's preferences in choosing to join an organization on the one hand, or whom to recruit to it on the other. Our results indicate that consideration of a candidate's philosophy (values) may be a major influence on those decisions. Often the emphasis in making such decisions is placed on using "hard" data such as income or profits or some other measure of achievement. In this experiment, however, we depicted the candidates as equally able and so there was not tangible data on which to base a decision. Another possibility would be to determine preference based on self-interest, but here self-interest concerns such as "would enjoy working with the person," or "would be a good role model," did not enter into the regression equations for three of the four candidates. In fact, for three of the four candidates nothing entered into the regression equation but philosophy.

Only is the case of D was "would be a good role model" a predictor with a beta of .37. Perhaps this association is related to the fact that on average our subjects did not think D would be as good a role model as the other candidates.

Recently Gabarro and Kotter (2005) showed that "effective managers take time and effort to manage not only their relationships with their subordinates but also with their bosses." Perhaps given the relative young age of the participants in the study reflects the observation by Gabarro and Kotter (2005) that "some people's instinctive reaction...is to resent the boss's authority and to rebel against the boss's decision." As Hood (2004) noted "businesses are now using mentorship to hone top talent, to broaden staff skills and especially integrate new people into the organization." These mentorship programs would give new employees insights into cultural norms and mores within the corporation they might not otherwise receive from managers or other top executives. One question to consider is whether or not students who participated in internships or co-operative education programs would have greater insight into the dynamics of corporate culture than undergraduates who did not participate in such programs.

An interesting point to note is that Meglino and Ravlin (1997) found that when subjects had perceptions regarding jobs based upon previously obtained information, they tended to respond more negatively in accepting job offers, yet the opposite was true when subjects had no prior exposure. Bretz and Judge (1994) point out that "organizations tend to differentiate themselves on the basis of what is rewarded and how rewards are distributed" and that "individuals prefer to work in environments in which their individual efforts and contributions are recognized." If the subjects in this study tend to follow individualistic traits as most Americans do, then one must ask if a perception bias arose among the participants regarding potential recognition of individual efforts?

In their study of recruitment effectiveness Vandenberg and Seo (1992) point out that individual needs and rankings of items of importance vary and are time and circumstance sensitive. Vandenberg and Seo (1992) also point out that the communication efforts needed to provide all information individuals require for making decisions regarding job acceptance will invariably fall short due to "the infinite variety and combination of needs characterizing a group of applicants." Clearly a challenge exists in business communication efforts to recruit and persuade undergraduates to join organizations.

DIRECTIONS FOR FUTURE RESEARCH

Edwards and Kuruvilla (2005) identified culture as an area needing greater study and clarification in understanding how international human resources management works. We agree with their assessment and contend that more work needs to be done, with a cross-cultural study and with other types of samples, to determine the impact of senior management characteristics on the preferences of subordinates. In-situ survey research may be most appropriate for such a follow-up study. More research into the impact of organizational philosophies, degree of entrepreneurial culture and the like is warranted.

IMPLICATIONS FOR PRACTICE

In the real world, it is the subordinate who is most often the one under consideration to be hired and so is the one to be offered an interview, contrary to the scenario in this study. But the hiring process is a two way street since the subordinate has an opportunity to accept or reject an offer. Organizations that hope to attract the best candidates cannot ignore this part of the process and should be aware of the things that make them attractive to potential employees. That is where this study makes a small contribution. "Soft" issues such as leader philosophy, organizational culture and so on should not be ignored if organizations wish to attract the best candidates.

LIMITATIONS OF THE STUDY

As this was a laboratory study with a student population from a limited geographic area it would be unwise to generalize at this time. Nevertheless, as this sample is drawn from a segment of the population to which the results would be generalized the nature of the sample is not per se problematic (Arnold, 2004). More research is needed to clarify relationships and to validate the generalizability of the results.

CONCLUSION

From this study it appears that a "similarity to me" syndrome does not apply to the sample population making these evaluations (assuming that the students sample does itself match the US value archetype). It is striking that a candidate's overall philosophy is important as a determinant of offers (as indicated by the regression equations). This is a positive sign inasmuch as business schools of late seek to emphasize the importance of values in the workplace. But business schools also have emphasized the importance of an entrepreneurial culture, networking and mentoring and these do not seem to have been influential since an entrepreneurial orientation, role modeling potential and enjoying working with an individual were, for the most part, inconsequential considerations.

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Gabe Buntzman, Degma Investing LLC

Richard D. Parker, High Point University

Table 1: Mean Perceptions of Candidates

Lower Values Alex Bobby Charlie Del

Masculine 3.67 4.80 * 3.66 3.27 *
Collectivism 4.27 3.03 * 4.70 * 5.08 *
Low UA 3.36 4.99 * 3.88 * 3.91 *
High PD 4.35 4.84 * 3.77 * 3.78 *

Note: Lower values imply more agreement.

* p<.05

Table 2: Mean values for "Would the candidate be good for the
organization?"

Dependent Variable Mean SD

a-good 5.09 1.09
b-good 5.07 1.24
c-good 4.52 *** 1.23
d-good 4.90 3.93

Note: *** p < .001.

Table 3: Mean values for "Would you enjoy working for this
candidate?"

Dependent Variable Mean SD

b-enjoy 5.12 *** 1.23
c-enjoy 4.29 * 1.45
a-enjoy 4.56 1.51
d-enjoy 4.08 ** 1.52

Note: * p < .05. ** p < .01. *** p < .001.

Table 4: Mean values for "Would this person be a good role model
for you?"

Dependent Variable Mean SD

a-model 4.28 1.48
b-model 4.49 1.38
c-model 3.99 1.31
d-model 4.06 1.41

Note: n = 100

Table 5: Means for "Should this person receive an offer of an
interview before the others?"

Dependent Variable Mean SD

a-offer 4.05 1.58
b-offer 4.02 1.51
c-offer 3.91 1.49
d-offer 4.11 1.42

Note: n = 99

Table 6: Means for "This person has an excellent philosophy."

Dependent Variable Mean SD

a-philos 4.43 1.29
b-philos 4.66 1.25
c-philos 4.20 1.49
d-philos 4.12 1.34

Note: n = 99 Note: n = 99 Note: n = 99

Table 7: Results of Regression Analysis for Offers

 Predictors DV

 R R Square

Step 1 Offer to A .27 ***
 Constant 1.28
 a-philos .60

Step 1 Offer to B .30 ***
 Constant .29
 b-philos .66

Step 1 Offer to C .49 ***
 Constant 1.20
 c-philos .65

Step 1 Offer to D .43 ***
 Constant 1.26
 d-philos .26

Step 2 Constant .93 .43 *** [DELTA]
 d-philos .40 [R.sup.2] 0.06
 d-model .38

Note: *** p < .001