Examining the Relationships Between Employee Development, Engagement, and Service Climate

Examining the Relationships Between Employee Development, Engagement, and Service Climate

Andrea D. Ellinger, Ph.D.

Professor of Human Resource Development

The University of Texas at Tyler

3900 University Boulevard

Tyler, TX 75799

903 566 7310

Email:

Carolyn (“Casey”) Findley Musgrove, Ph.D.

Assistant Professor of Marketing

Indiana University Southeast

4201 Grant Line Road

New Albany, IN 47150

812 941 2052

Email:

Alexander E. Ellinger, Ph.D.

Professor of Marketing and Supply Chain Management

The University of Alabama

Tuscaloosa, AL

205 348 8941

Email:

Stream 14: Vocational Education, Training and Workplace Learning

Submission Type: Working Paper

Abstract

The concept of employee engagement has garnered considerable attention in recent years as research has suggested that highly engaged employees are more customer focused, productive, less likely to turnover, and often generate higher levels of revenue (Shuck and Reio 2011). Within the service industry context, frontline service employees become critical to the success of their organizations because their interactions with customers influence perceptions of service quality. Yet, research exploring individual and organizational antecedents and consequences of employee engagement is limited but even more so within the service context (Menguc, Auh, Fisher and Haddad, 2012; Wollard and Shuck 2011). Some previous research has suggested that the roles of managers in providing clear expectations and promoting a supportive work climate are linked to engagement, however, developmental interventions such as managerial coaching and training have not been examined, although providing feedback and opportunities for learning have been identified as likely organizational antecedents.Therefore, to address various calls in the literature, this study sought to explore the relationships between managerial coaching, training, employee engagement and service climate. The findings are reported here along with implications for practice and future research recommendations.

Key Words: training, managerial coaching, employee engagement, job engagement, organizational engagement, service climate

Examining the Relationships Between Employee Development, Engagement, and Service Climate

1. Introduction

The concept of employee engagement has garnered considerable scholarly and pragmatic attention in recent years as research has suggested that highly engaged employees are more customer focused, productive, less likely to turnover, often display higher levels of discretionary effort, affective commitment and often generate higher levels of revenue (Shuck and Reio 2011). The meta-analysis reported by Harter, Schmidt and Hayes (2002) also reported that employee engagement was positively associated with customer satisfaction and customer loyalty. Within the service industry context, frontline service employees become critical to the success of their organizations because their interactions with customers influence perceptions of service quality. A compelling issue confronting service organizations is improving customers’ service experiences by identifying and maintaining positive service climates (Schneider, & Bowen, 2010). Service climate has been defined as the “meaning employees attach to the policies, practices, and procedures and the behavior that gets rewarded, supported, and expected in an organization” (Schneider, Macey, Lee, & Young, 2009, p. 3).

Frontline service employees, therefore, are critical to the success of service organizations because their attitudes and behaviors are manifested in their daily interactions with customers which influence customers’ perceptions of service quality, satisfaction, and value. Positive service climates have been found to produce beneficial results in terms of service quality and other performance outcomes (de Jong, de Ruyter & Lemmink, 2004). Yet,service employee engagement has received limited empirical investigation (Menguc, Auh, Fisher and Haddad 2012). Although managers and leaders within service organizations are increasingly recognizing the importance of developing and engaging their frontline service employees, research exploring individual and organizational antecedents and consequences of employee engagement is limited but even more so within the service context (Menguc, Auh, Fisher and Haddad 2012; Wollard and Shuck 2011).

Some previous research has suggested that the roles of managers in providing clear expectations and promoting a supportive work climate are linked to engagement (Wollard and Shuck, 2011). However, developmental interventions such as managerial coaching and training have not been examined, although providing feedback and opportunities for learning have been identified as likely organizational antecedents. Therefore, to address various calls in the literature, this study sought to explore the relationships between managerial coaching, training, employee engagement and service climate because scholars contend that a better understanding of how developmental interventions and management actions influence frontline service employee behaviors and their engagement is required (Ostrom et, al., 2010; Russ-Eft, 2004).

1. Abbreviated Review of the Literature and Theoretical Orientation

The concepts of employee engagement, managerial coaching, and formal training have garnered significant attention in the services literature as they relate to enhancing service climate (Hannah, 2004; Slatten, Svensson, & Svaeri, 2011; Wirtz, Heracleous, & Nitin, 2008) and will be briefly reviewed here. Various definitions of employee engagement have been offered, however, Shuck and Reio (2012) have acknowledged that “the construct consists of three separate facets: cognitive engagement, emotional engagement, and behavioral engagement. Employee engagement, as initially described by Kahn, refers to the “harnessing of an employee’s full self in terms of physical, cognitive, and emotional energies to work role performance” (Rich, Lepine, & Crawford, 2010, p. 617). Shuck and Wollard (2010), building upon Kahn and others’ seminal work, define employee engagement as “an individual employee’s cognitive, emotional and behavioral state directed toward desired organizational outcomes” (p. 103). Although the base of empirical research is growing, and recent findings suggest that engaged employees often outperform disengaged employees, how employee engagement can be influenced by management is relatively under-developed (Kular, Gatenby, Rees, Soane, & Truss, 2008).

Kahn (1990) proposed that psychological safety was an antecedent condition of employee engagement and “offers the most potential for leadership to influence engagement” (Xu & Thomas, 2011 p. 401). In particular, scholars suggest that “leadership that provides a supportive, trusting environment allows employees to fully invest their energies into their work roles” (p. 401). Previous research has suggested that supportive supervisor relationships contribute to an environment in which employees feel engaged (May, Gilson, & Harter 2004). While Wollard and Shuck (2011) acknowledge that the role of managers has been empirically explored in terms of organizational antecedents, for example, in providing clear expectations, promoting a supportive organizational culture, and perceptions of workplace safety, issues such as feedback, encouragement, and opportunities for learning have not received attention. More recently, Menguc et al. have reported that supervisory feedback and perceived autonomy promoted service employee engagement, but found, in contrast to the existing literature that supervisory support was not positively and significantly related to engagement.

Building upon the notions of feedback and expectations, the concept of managerial coaching represents a highly supportive, trusting, and developmental intervention that may influence employee engagement. Managerial coaching is often defined as “a manager or supervisor serving as a coach or facilitator of learning in the workplace setting, in which he or she enacts specific behaviors that enable his/her employee (coachee) to learn and develop” (Ellinger, Beattie and Hamlin 2010). While the literature base on managerial coaching is growing and empirical research has linked managerial coaching to job satisfaction, job performance, enhanced knowledge, improved communications and interpersonal relationships,linkages between managerial coaching, employee engagement and service climate are not well established.

While managerial coaching may afford informal opportunities for learning, formal opportunities for learning, like formal training, and its links to engagement have not been examined relative to other developmental interventions. Training refers to a “systematic approach to learning and development to improve individual, team, and organizational effectiveness” (Aguinis and Kraiger 2009) and more than $126 billion is spent annually in the United States on employee training and development. Formal training has been positively linked to job-related behaviors or performance and other indirect benefits at the organization level include reduced employee turnover, organizational reputation, and social capital.

Therefore, this research study responds to these various calls in the literature to explore the relationships between alternative developmental interventions, employee engagement, and service climate. Drawing upon social exchange theory, this study hypothesized that formal training and managerial coaching would be positively related to job and organizational engagement and service climate. Four research hypotheses guide this study as illustrated in Figure 1:

Figure 1. Conceptual Model

H1: Managerial coaching has a positive relationship with a) job engagement, b) organizational engagement, and c) service climate.

H2: Formal training has a positive relationship with a) job engagement, b) organizational engagement, and c) service climate.

H3: Job engagement is positively related to service climate.

H4: Organizational engagement is positively related to service climate.

1. Design of the Study

A cross sectional survey design was used for this study. To obtain a sample comprised of a wide range of full-time employees who work in multiple organizations within a broad range of service industries, undergraduate students in a marketing research course were trained as data collectors consistent with established methods (Gwinner, Gremler & Bitner, 1998). The students identified and contacted potential respondents in person, online, or by telephone to request participation in the research study. An online survey was developed based upon established and validated measures of managerial coaching, formal service-related training, job engagement, organizational engagement, and service climate. Participants were given the URL to an online survey. A total of 516 surveys were completed. Fourteen of the surveys contained insufficient data, leaving a total of 502 usable questionnaires. The data collection process continued for approximately three weeks. Random follow-up calls were made to 10% of the sample to confirm respondents’ demographic information and to verify actual participation. The fact that more than two-thirds of the trained student data collectors obtained a respondent suggests that non-response bias is not a problem in this study.The respondent pool consisted of a convenience sample of 502 full-time service employees who work in multiple organizations in a wide range of service industries. Just over half of the respondents are female (50.9%) and mean respondent age is 35.8 years (SD = 11.82). The mean organizational tenure is 8.26 years (SD = 8.09) and the mean industry tenure is 11.52 (SD = 9.97). The most frequently represented service industries include: retail (20.16%); restaurant and hospitality (17.64%); banking and financial services (12.21%); sales (6.98%); healthcare (6.40%); real estate (4.26%); and education (2.33%). The remaining 30.04% of the respondents come from a wide variety of other service industries.

3.1.Measures

Established, validated measures were used for the five constructs examined in the survey. The measures are shown in Table 1. All items are measured on a seven-point scale ranging from 1 (strongly disagree/very poor) to 7 (strongly agree/very excellent). Managerial coaching was measured with an eight-item scale developed by Ellinger, Ellinger, and Keller (2003), which indicates the degree to which employees’ perceive that their managers facilitate their learning and growth through informal coaching behaviors. Service-related formal training, which was measured using five items (Boshoff and Allen 2000), indicates the degree of formal instruction and education that the service organization provides for their service employees. Job engagement, or the extent of an individual’s psychological presence in their job, was measured with a five-item scale (Saks 2006), while organizational engagement, or the extent of an individual’s psychological presence in their organization, was measured with a six-item scale (Saks 2006). The endogenous variable, service climate was measured by Schneider, White, and Paul’s (1998) eight-item global service climate scale. This scale provides a summary measure of the service employees’ perceptions of their organization’s climate for service.

Table 1. Measures and Confirmatory Factor Analysis Results
Measure / Std. Coeff.
Informal Coaching
1. My supervisor uses analogies, scenarios, and examples to help me learn. / 0.79
2. My supervisor encourages me to broaden my perspectives by helping me to see the big picture. / 0.77
3. My supervisor provides me with constructive feedback. / 0.83
4. My supervisor solicits feedback from me to ensure that his/her interactions are helpful to me / 0.78
5. My supervisor provides me with resources so I can perform my job more effectively. / 0.76
6. To help me think through issues, my supervisor asks questions, rather than provide solutions. / 0.72
7. My supervisor sets expectations with me and communicates the importance of those expectations to the broader goals of the organization. / 0.57
8. To help me see different perspectives, my supervisor role-plays with me. / 0.71
Service-related Formal Training
1. At my company, customer service contact employees receive extensive formal training before they come into contact with customers. / 0.78
2. At my company, customer service contact employees receive ongoing formal training on how to serve customers better. / 0.84
3. At my company, customer service contact employees are formally trained to deal with customer complaints / 0.84
4. At my company, customer service contact employees receive ongoing formal training on resolving customer problems. / 0.87
5. At my company, customer service contact employees receive ongoing formal training on our company's services. / 0.82
Job Engagement
1. I really “throw” myself into my job. / 0.75
2. Sometimes I am so into my job that I lose track of time. / 0.65
3. This job is all consuming; I am totally into it. / 0.74
4. My mind often wanders and I think of other things when doing my job (R). / 0.57
5. I am highly engaged in this job. / 0.82
Organizational Engagement
1 Being a member of this organization is very captivating. / 0.79
2. One of the most exciting things for me is getting involved with things happening in this organization. / 0.79
3. I am really not into the “goings-on” in this organization (R). / 0.78
4. Being a member of this organization make me come “alive.” / 0.79
5. Being a member of this organization is exhilarating for me. / 0.83
6. I am highly engaged in this organization. / 0.84
Service Climate
1. How would you rate the job knowledge and skills of employees in your business to deliver superior quality work and service? / 0.66
2. How would you rate efforts to measure and track the quality of the work and service in your business? / 0.73
3. How would you rate the recognition and rewards employees receive for the delivery of superior work and service? / 0.70
4. How would you rate the overall quality of service provided by your business? / 0.65
5. How would you rate the leadership shown by management in your business in supporting the service quality effort? / 0.81
6. How would you rate the effectiveness of your firms' communications efforts to employees? / 0.77
7. How would you rate the effectiveness of your firms' communications efforts to customers? / 0.76
8. How would you rate the tools, technology, and other resources provided to employees to support the delivery of superior quality work and service? / 0.78
Note: N = 502, χ2 (451) = 1255.71 (p < .01), χ2 / df = 2.78, NNFI = .98, SRMR = .044, IFI = .98, RMSEA = .060

1. Results

4.1 Reliability and Validity

LISREL 8.8 (Jöreskog and Sorböm 2001) was used to test both the measurement and structural model. Results from the confirmatory factor analysis conducted to test the measurement model are presented in Table 1. Overall, this analysis yields adequate fit for the hypothesized five-factor model (χ2 (451) = 1255.71 p < .01). While chi-square values are typically significant for samples of this size, several other key fit indices demonstrate good fit (Kenny, Kashy, and Cook 2006). For example, the mean square error of approximation (RMSEA) is .060, the non-normed fit index (NNFI) is 0.98, the incremental fit index (IFI) is 0.98, and the standardized RMR is .044. The error covariances of one pair of items from managerial coaching, one pair of items from organizational engagement, and one pair of items from service climate are allowed to correlate within the same scales, as items within the same scale are expected to be correlated with one another. As seen in Table 1, each of the standardized factor loadings is significant (p < .01), at a moderately high level, with the lowest loading being .57. A Harman’s single factor test was used to determine whether common method variance is a problem in this data. Another measurement model is estimated with a measurement factor in place of the latent variables. This method factor model produces a worse fit than the hypothesized measurement model (χ2 (461) = 7365.80, p < .01, RMSEA = .173, NNFI = .89, IFI = .90, SRMR = .11). A χ2 difference test confirms that the difference in the fits is significant (χ2diff (10) = 6,110.09, p < .001). Thus, a common underlying factor is not the best representation of the data and common method variance is not a pervasive problem in this data.

Table 2 reports alpha reliabilities, average shared variance estimates, and inter-construct correlations. Construct reliability is evaluated using Cronbach’s alpha. All of the measures exhibit acceptable levels of reliability with the minimum coefficient alpha at .82. Fornell and Larcker’s (1981) index of the average variance in each latent factor accounted for by its indicators is above .50 for all constructs. Evidence for discriminant validity comes from the fact that the shared variance among any two constructs is less than the average variance explained in the items (ρυс(η)) by their intended construct. Collectively, these results provide evidence of adequate convergent and discriminant validity and indicate that it is appropriate to test the study hypotheses.

4.2 Hypothesis Tests

To test the four aforementioned hypotheses, a structural equation model was estimated, using the maximum likelihood method of parameter estimation. Figure 2 displays the final structural model. The overall fit of the model is acceptable (χ2 (451) = 1348.51, p < .01). Several key fit indices provide supporting evidence of good fit; the root mean square error of approximation (RMSEA) is .063, the non-normed fit index (NNFI) is .98, incremental fit index (IFI) is 0.98, and the standardized RMR is .045. The same correlated error covariances from the measurement model are present in the structural model. The structural error terms in the Psi matrix are allowed to correlate between job engagement and organizational engagement. This correlation is reasonable given that both variables are types of employee engagement. As shown in Table 2, the correlation between these two variables is significant at the p < .01 level.