Academic journal article Indian Journal of Industrial Relations

Psychological Climate as an Antecedent of Job Satisfaction & Job Involvement

Academic journal article Indian Journal of Industrial Relations

Psychological Climate as an Antecedent of Job Satisfaction & Job Involvement

Article excerpt


The increasing global spread of business and the greater participation of multi-national corporations (MNCs) in developing markets calls for focusing attention towards management practices in different parts of the world (Budhwar 2003, Napier & Vu 1998). Among the rapidly expanding economies of the world, India holds a position of prominence (Biswas, Giri & Srivastava 2006, Budhwar & Boyne 2004). It is evident that global changes have had a significant impact on the Indian economy too. Chauhan, Dhar and Pathak (2005) observed that change per se is a routine affair in the contemporary business scenario; what is more important is a recognition of the fact that managerial efficacy needs to keep pace with such rapid transformations. Furthermore, it appears that in the era following the South East Asian financial crisis of 1997-98 (World Bank 2001) and in accordance with the report published by Goldman Sachs (2003), India along with Brazil, Russia, and China is poised to be a major player in the world business scenario.

It has been observed that India's national culture has a rich heritage which is helpful in clarifying different human actions. It is further understood that these cultural facets are deeply ingrained in the individual psyche and are relevant in positive cognition and affect of individuals at the workplace (Rao & Abraham 2003). At the same time, the indigenous culture of India has been quick to accept alien customs and mores while preserving its distinctive values and rules (Biswas et al. 2006). This has established the Indian social order as a classic example of the oriental world. In terms of crossvergent socio-cultural ethos therefore, India stands as a leader in establishing the norms and practices that dominate managerial practices in the contemporary borderless business environment (Ralston, Holt, Terpstra, & Kai-Cheng 1997). In a cross-cultural framework, the above discussion indicates that the stature of India is quite elevated in the global socio-economic map. So much so, that Varma, Budhwar, Biswas, and Toh (2005) noted that India's traditional cultural systems are acting as a fulcrum of the South East Asian business environment.

England and Lee (1974) noted that during periods of environmental turmoil, societies in emergent economies such as India tend to follow a path that leads to stability. This further implies that in a bid to maintain internal homogeneity and acclimatize to the external changes, society focuses on retaining certain behavioral aspects that are indigenous and at the same time give way to a certain level of novelty. Given that organizations operate within the domain of societal norms and values, it is evident that behavioral aspects of managing organizations call for further study. Based on this supposition, the objective of the current study was formulated wherein the inter-relationship between three behavioral constructs were examined namely, psychological climate, job satisfaction, and job involvement. More specifically, the present study investigates the causal impact of psychological climate on job involvement and job satisfaction. The following section reviews literature related to the key variables.

Theoretical Background

Before the introduction of the New Economic Policy (NEP) in 1991, the Indian business environment was discernible through the dominance of firms in the manufacturing sector. These firms, whether public or private, were usually large organizations and were marked by mechanistic processes and rigid practices (Biswas & Varma 2007). In fact, firms belonging to the service sector such as, educational institutions, healthcare organizations, and media and communications were basically owned by the state. This was a direct consequence of Nehruvian welfare philosophy that emphasized pluralistic utilitarianism. The fall out of such a socio-political arrangement was the lack of emphasis on individual behavioural aspirations (Varma et al. …

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