Mays Business School’s inaugural Lifetime Achievement Award for Research and Scholarship was awarded to Michael A. Hitt, a University Distinguished and Joe B. Foster ’56 Chair in Business Leadership.
During the recognition program for Hitt, Mays Dean Jerry Strawser said, “We are starting a new tradition in a place that’s full of traditions. We wanted to bring in pioneers and thought leaders in the field.”
Hitt entered the management field 40 years ago, and he spoke on the day of his award about the numerous changes in the field over time. “A lot of the work we do is important on even a broader scale,” he said, adding that the study of management is now global.
Data for research is much more available now than it used to be, but he said basic scientific research is still the basis of all reputable research.
Hitt said the important questions of academia are: What is the impact of your work? And how do you measure it? Strawser said Hitt’s research findings “direct the work of other scholars and the course of future study in the academic profession.” In addition, he said, Hitt “studies relevant issues that affect the business world and impact economic development.”
When Hitt’s impact on audiences – both within his field and outside of academia – is measured by any scale, it always ranks highly. An article in the Academy of Management Perspectives named him as one of the 10 most-cited authors in management over a 25-year period. The Times Higher Education in 2010 listed him among the top scholars in economics, finance and management, and he was first among management scholars (tied), with the largest number of highly cited articles.
Hitt targeted the younger audience members when he spoke to a group of colleagues and students at the award program, offering this checklist of advice:
Whatever you do, do it well.
Think long-term.
Do work for which you have a passion.
You’re going to have pressure to do it all well.
There are no short cuts.
About Mays Business School
Texas A&M University’s Mays Business School educates more than 5,000 undergraduate, master’s and doctoral students in accounting, finance, management, management information systems, marketing and supply chain management. Mays consistently ranks among the top public business schools in the country for its undergraduate and MBA programs, and for faculty research. The mission of Mays Business School is creating knowledge and developing ethical leaders for a global society.
Jeff Smith ’85 counts Jerry S. Cox ’72 as one of his mentors, and he urged business honors students he spoke with at Mays Business School to seek out business leaders who are often willing to mentor individuals before and during their careers.
Anyone who is familiar with the Wehner building knows about Jerry and Kay Cox Hall, which added classroom and office space, the trading center and the Cocanougher Special Events Center in 2003. Cox also founded and serves as chairman of the board and president of Cox & Perkins Exploration, and he has leadership roles at Mays and with the 12th Man Foundation.
“I was watching his every move,” Smith said of the man he met when Smith was a junior in high school. “There was something about him I wanted to learn about and emulate. Mentors are important. Sometimes you find them, and sometimes they find you. Just be open to receiving advice and guidance from those you come in contact with.”
Smith is the first Aggie in his family. Â He obtained an accounting degree from Texas A&M while serving a leadership role in the Corps of Cadets. His career began with one of the top accounting firms and later moved into the oilfield services industry, serving various positions including director of financial planning, director of business development, treasurer and chief financial officers. He now works as a private investor and provides independent consulting to the oilfield services industry.
Ian Wood ’17 considers himself fortunate to be able to hear Smith talk about his career and how he has come about his success. “He taught us the importance of an accounting background and how it teaches us what is behind each number on a balance sheet,” Wood said. “He also stressed the importance of character and integrity in the business world, and pushed us to expand our knowledge of business and the world’s markets.”
Smith told the students that character and integrity matter, and that both will be challenged sometime during their careers. “My advice to you is don’t compromise your character, hold your ground and you will come out ahead. Define your values and stick to them.”
Joshua Caleb Scott ’14 said the talk prompted him to reflect upon an even deeper understanding of the importance of ethics. “A topic Mays Business School sews into every course, ethics will remain a common thread throughout our careers,” he said. “Mr. Smith cautioned us that other people will challenge our ethics, but a seamless dedication to the Aggie Honor Code will not lead us astray.”
Smith provided useful insight into the world of accounting and finance, Bridget Bauman ’17 said, and emphasized the two most important things in a finance or accounting career: (1) character and integrity, and (2) understanding the nuts and bolts of your business’s operations. “He really emphasized the importance of exercising sound business ethics no matter the consequences, and he also gave us many pointers about how to act in situations that create an ethical dilemma.”
About Mays Business School
Texas A&M University’s Mays Business School educates more than 5,000 undergraduate, master’s and doctoral students in accounting, finance, management, management information systems, marketing and supply chain management. Mays consistently ranks among the top public business schools in the country for its undergraduate and MBA programs, and for faculty research. The mission of Mays Business School is creating knowledge and developing ethical leaders for a global society.
As Texas Comptroller of Public Accounts, Susan Combs serves as the state’s treasurer, check writer, tax collector, state procurement officer and revenue estimator. In this role, Combs is committed to making state government work better for Texas through open, responsive and transparent government. In her presentation to Mays business honors students, she encouraged them to educate themselves about which agencies are taxing them and then hold those entities accountable for how they are spending taxpayers’ money.
Combs’ vigilance for government accountability was borne of her first close encounter with a government agency in 1987, when a power company proposed to install a new transformer and run power lines across her family’s ranch near Marathon, Texas. Rather than sitting passively by and letting the power company move forward with its plans, she educated herself on the facts and helped form a coalition of local ranchers to stand up for their rights as taxpayers and property owners. “We were able to control the scope creep of the power company’s project and reduce the proposed $12 million project to a $75,000 solution that delivered the necessary power without infringing on citizens’ rights or property,” she said.
Combs emphasized to the students the importance of recognizing that government in Texas is a big business, with more than 280,000 employees, $130 billion in revenues and $238 billion in assets. Given the size, scope and potential inefficiencies of running a business that’s larger than Chevron or ConocoPhillips, Combs suggested to students several ways the state can improve its ability to gauge and control true costs across all its lines of business. “We must employ advanced technology in pursuit of better forecasting and utilization of resources, and we need to achieve greater volume purchasing power and economies of scale.”
Since being elected Texas Comptroller of Public Accounts in 2006, Combs has driven sweeping reforms in state purchasing and contracting, saving nearly $12 million in her agency alone. Her office’s efforts have also saved the state more than $123 million through volume purchasing. Texas Transparency (texastransparency.org) is another of the reforms Combs has spearheaded since taking over the Comptroller’s Office. Through this innovative transparency initiative, her office has posted a series of online reports so citizens can educate themselves about the state of taxes in Texas. Reports cover a range of topics, including Your Money and the Taxing Facts, Your Money and Local Debt, Your Money and Education Debt, and Your Money and Pension Obligations.
“I had the distinct pleasure of meeting with Susan Combs, the Texas Comptroller of Public Accounts,” said Shelby Carter ’15. “Her desire for transparency with her constituents is admirable, especially when considering how much of an expense taxes are to the citizens. It is vital to know as much of the information as possible if we want to create and maintain an efficient and effective tax structure. As a possible future business owner, I want to be able to obtain any information that could affect my bottom line.”
Combs offered several additional bits of advice to students as they graduate from Mays and embark upon their professional careers:
Remember there’s no such thing as a free lunch when you hear about government providing incentives for business.
Don’t consider debt as intrinsically bad, but know the terms and risks associated with it.
Beware of activist investing strategies that some local government agencies are using for their public sector pensions, as many of them are ill-contrived or reckless.
Combs also delivered a parting call to action: Students can spur grassroots awareness and drive greater citizen engagement in government through the use of social media, and they should use these and other tools to demand higher levels of customer service from government.
“I walked into Wehner 440 with little to no knowledge on the duties of the Texas Comptroller,” said Matthew Baldree ’15. “Mrs. Combs excellently detailed how Texas behaves as a business. More importantly, she discussed how Texas raises revenue through taxation and how the taxpayers’ contributions are used by the state. To me, the most interesting detail of the discussion was the average taxpayer’s future. Local debt, underfunded pension plans, high education costs and drained water supplies are increasing the tax burdens of future generations. As a current and future taxpayer, it is in my best interest to address these issues now and have a proper understanding of how my tax money is being utilized by the state.”Â
About Mays Business School
Texas A&M University’s Mays Business School educates more than 5,000 undergraduate, master’s and doctoral students in accounting, finance, management, management information systems, marketing and supply chain management. Mays consistently ranks among the top public business schools in the country for its undergraduate and MBA programs, and for faculty research. The mission of Mays Business School is creating knowledge and developing ethical leaders for a global society.
QUESTION: Which PMBA courses, events, self-assessments or experiential activities (ChallengeWorks, Disaster City, International Experience, and Capstone) made the most significant impact on the development of your leadership understanding and ability?
The personal statement of leadership exercise had the most significant impact on the development of my leadership understanding and ability. The process began at the end of the first semester with reflection about effective characteristics of leaders and ended with a draft of my personal statement of leadership philosophy. After completing the leadership journey created through the effective design of the program’s courses, events and activities, I revisited my first draft during the last semester of the program. Equipped with my deeper awareness and understanding of leadership, I was able to significantly improve my personal statement. My leadership philosophy was now clear and concise, but most importantly, it was my own.
QUESTION: What is the most important insight you gained regarding leadership?
One must find his own leadership voice in order to be effective. Although leadership is a skill that can be learned, an authentic message delivered in a natural voice will produce the best results.
QUESTION: What is the most important leadership tool or technique you learned?
Given the collaborative nature of today’s work environment, the framework described in The Five Dysfunctions of a Team by Patrick Lencioni has been very useful. This model points out the common pitfalls that restrict teams from producing optimal results. Understanding these common limitations of teams has allowed me to quickly diagnose problem areas and make adjustments.
Increasing my awareness of the importance of emotional intelligence (EI) has contributed to my effectiveness as a leader. In my pursuit to increase my EI competencies, I have increased my patience and improved my listening skills. This has allowed me to focus on asking the right questions to uncover root issues, understand initial decisions and suggest appropriate alternatives.
QUESTION: Did any professors have a particularly strong influence on your leadership maturation?
Leadership and communication are closely linked and are both woven into the program from start to finish. Accordingly, Executive Professor John Krajicek was instrumental in my leadership development. His assignments put us in scenarios requiring leadership expertise and challenged our current communication skills to maneuver through the situation. He then asked that we create an individual communication development plan to address any gaps revealed during the previous exercise. This process accelerated the development of both my leadership and communication abilities.
QUESTION: How have you applied your leadership knowledge or tools to your career/job?
At the end of the first semester in the PMBA program, my company decided to close our Houston office and consolidate operations into its headquarters out of state. I was at a personal and professional crossroads, but I decided to continue my career with the company and relocated my young family to Oklahoma. Not wanting to abandon my commitment to the PMBA program, I also decided to continue pursuing my MBA. This choice proved very beneficial as I was able to apply the leadership training from the program to my role as a Revenue Accounting Supervisor leading a group of 11 direct reports. My new staff included external hires, internal transfers, and a couple of “relos,” like myself. The team was changing, but the deadlines to record and distribute approximately $70MM in oil and gas revenues each month were not. I knew we were responsible for producing accurate results on a timely basis, but I needed to influence the team if we were going to meet this goal.
For this, I turned to The Five Dysfunctions of a Team by Patrick Lencioni. After exploring this model during a class session, I decided to implement the concepts into my team meetings. We began with the foundational element of the framework, building and sustaining trust. I introduced the topic of trust during an early team meeting and built on the discussion during subsequent meetings by reviewing the constructs of trust, sharing personal experiences and finally having the team present examples of trusting each other. With this foundation, the next elements of the framework naturally fell into place. Through productive, open dialogue, a commitment was formed, and the group began holding each other accountable to produce the high-quality results I had envisioned.
QUESTION: Have you assumed greater leadership responsibility at your job as a result of your PMBA leadership training?
In March 2014, my company acquired the Eagle Ford Shale assets of a privately held exploration and production company for $6 billion. A month later, I presented my capstone project to the senior management and project sponsor at my company. The capstone allowed me to demonstrate an ability to apply an analytical framework to solve a real business problem facing our company. The leadership skills I developed were also displayed as I was tasked with forming a cross-functional team to solve a business problem outside of my expertise. At the end of April, I was assigned as the Business Lead for converting the systems from the recent acquisition to our ERP system, SAP. I was now tasked with creating the integration plan and leading a cross-functional team of approximately 50 people. I believe the skills demonstrated during the capstone presentation influenced management’s decision to assign this project to me.
These leadership skills developed during the program and displayed during the capstone presentation will also provide the foundation for the success of the SAP conversion project. Three weeks later, I graduated from the PMBA program, and at the end of May, I was promoted to a management position. In addition to my project role, I am now responsible for leading a group of supervisors and staff of approximately 50 people. I would not have realized this success or have been prepared for the responsibilities that accompany these roles if it were not for the leadership development I experienced during the PMBA program.
QUESTION: What advice would you give to prospective PMBAs who are considering pursuing the degree?
I would advise prospective students to be aware of the impact of leadership, and the shift in perspective that is required as one moves from pursuing individual achievement to influencing others. Given the professional experience level for most prospective PMBA candidates, individual contributions have highlighted the success they have realized to date. These accomplishments may put these talented individuals in a position to lead, but a different set of skills is required for success in a leadership role. These skills are being taught in the Mays PMBA program, and it is essential that candidates do not let these opportunities pass them by.
Before deciding to pursue an MBA, I had graduated from the U.S. Military Academy at West Point and served as a Commissioned Officer in the Army. I had a lot of peers that were also separating and realized they were getting a great deal of variety in job offers. I wanted to make the transition less of a shot in the dark and dedicate some time to learning as much as I could about what was out there and make the most informed decision possible when shaping the next stage of my life. Additionally, I believe it’s a great way to stand out.
The Texas A&M MBA.
The state of Texas offers top-notch veterans benefits and Texas A&M in particular truly understands and appreciates the culture of service members. From first speaking with an admissions officer to contacting old professors over my summer internship, the Texas A&M MBA program has been a small, close family.
Life as a Texas A&M Student.
Most MBA programs will be very demanding, and Texas A&M is no exception if not more so due to our compressed schedule. It’s been uncomfortable at times but a year later during my summer internship; I’ve realized how much I’ve learned. Class occupies much less time than it did in my undergraduate degree but the commitment to studies outside of class more than make up for the difference. Expect class to be a culminating event in which you get out of it what you put in. Finally, there’s a healthy injection of professional development outside of your studies to ensure you are as well prepared outside of the academic world.
Your future?
Through my internship search and what’s soon to be a full-time employment search, I’ve found the opportunities for function, industry, and locations are limitless. I’m excited to continue shaping my decision.
After getting my undergraduate degree in Agriculture Economics I worked for 4 years in Agribusiness, doing sales and account management for Elanco Animal Health (a division of Eli Lilly). In the account management role I was stewarding the business relationship with customers that were large, complex organizations and I found myself needing a better understanding of the different functional parts that make up a whole organization. My interest in entrepreneurship also drove me towards an MBA. The Texas A&M MBA
The Aggie Network is exceptional and I wanted to be a part of it. The culture of the university was a draw for me as well as the shortened program length. One of the key assets of Mays is the small program size, something I couldn’t fully appreciate until the program started. Life as a Texas A&M Student.
This is a high impact program for many reasons but most important is the people. Dr. Berry’s services marketing class changed the way I view how a company operates and interacts with its customers. Group projects transformed my view of teams and what it really takes to get great results – the real “aha” moments come from brainstorming and kicking around ideas with people as you push through to learn together. MBAA events and interactions across the Aggie Network continue to reinforce that the Aggie family is real and invaluable. Leadership discussions in John Krajicek’s class grounded us in the role of self-awareness and why it matters as a leader. The list goes on, but people are at the heart of what makes this program great.
Your future?
I plan to use what I’ve learned through the people and classes in the MBA program to pursue a career in entrepreneurship by creating organizations that impact lives. I have no doubt my lessons, experiences and people from my time at Mays will be the cornerstone of this pursuit.
M. Ann and Charles P. ’82 Manning have committed gifts to Mays Business School, two other Texas A&M University colleges and the 12th Man Foundation. The funds for the gifts will be generated through a retirement account and a revocable living trust.
“Because Ann and I have had successful careers, we wanted our estate to include support for organizations we feel contributed to that success. Texas A&M certainly fit that bill,” Charles Manning said.
Manning preferred not to disclose the total amount, but he did say the “lion’s share” will go to Mays to establish the M. Ann and Charles P. Manning ’82 Dean’s Excellence Endowment at Mays. Similar endowments will be created at Texas A&M’s College of Agriculture and Life Sciences, the College of Veterinary Medicine and the 12th Man Foundation.
“We wanted the funds to be discretionary because it is so far in advance — decades, we hope — that we couldn’t presuppose the needs,” Manning said. “We don’t know much about educating young students, but we were impressed when talking to the deans of the diversity of needs for financial support. We concluded the deans are in the best position to give wise allocation to the annual distributions, and believe it will accomplish very worthy goals.”
The Mannings live in Austin. Charles received a bachelor’s degree in finance and retired in 2008 from a career in banking technology. Ann received a bachelor’s degree in accounting and marketing from Marietta College and a Juris Doctor degree from Ohio Northern University.
“The Mannings’ most generous commitment to our School will impact our students in so many ways,” said Mays Dean Jerry Strawser. “With the flexibility they have provided to our School, it can support student scholarships, study abroad opportunities, student travel to competitions, and faculty teaching and research activities. As education and outside-of-class opportunities continue to evolve, the ability of their gift to support current and future needs makes the impact of this already generous commitment even more significant.”
About Mays Business School
Texas A&M University’s Mays Business School educates more than 5,000 undergraduate, master’s and doctoral students in accounting, finance, management, management information systems, marketing and supply chain management. Mays consistently ranks among the top public business schools in the country for its undergraduate and MBA programs, and for faculty research. The mission of Mays Business School is creating knowledge and developing ethical leaders for a global society.
Employees who fear their jobs are at risk are more likely to stay engaged with their work colleagues than those who feel more secure, according to research from a team led by Mays Business School Management Professor Wendy Boswell.
The fallout from working virtually around the clock varies, from stress to burnout to work interfering with the home life.
In a recent study, Boswell and her colleagues on the project, Julie Olson-Buchanan of California State University, Fresno, and Brad Harris of University of Illinois (a former PhD student at Mays), focused on the role of the context in shaping how employees manage their work and family boundaries. Boswell described the cycle in a simple illustration: Job insecurity leads to lower use of family support program and more willingness to integrate work into an employee’s personal life (i.e., blur boundaries). These behaviors in turn lead to higher burnout as well as more work-family conflict.
The study has been accepted for publication by the journal Personnel Psychology.
“Drawing on an adaptation perspective, we expect employees feeling greater job insecurity to engage in adaptive work behaviors, including less use of work-nonwork support programs and greater willingness to let work permeate into one’s personal life, which in turn will associate with greater work-nonwork conflict and emotional exhaustion,” Boswell explains.
Data were collected from employees within a large energy company at two points in time. Results support the model, offering important insight on employee behavioral responses to job insecurity and key mechanisms through which insecurity may foster diminished employee well-being. It also offers firms with important practical insight on how, when faced with job insecurity, employees may engage in behaviors that are ultimately detrimental to their well-being and long-term effectiveness. Boswell emphasizes: “It is during such unstable and stressful times when employees need to utilize organizational support resources the most and strike a balance among their multiple work and personal demands; yet our results suggest that employees may be hesitant to do so, likely out of fear of further risk to their job and a desire to be seen as a valuable – perhaps even indispensable – contributor.”
Boswell’s latest study is related to earlier research that focused directly on the role of communication technology in blurring the boundaries between work and family. Published in January 2012 in Journal of Vocational Behavior, “Communication technology: Pros and cons of constant connection to work” was one of the first studies to specifically examine the predictors and consequences of using communication technologies (e.g., email, cell phones) for work purposes “after hours.” The findings revealed how employees who strongly identified with the job and/or were ambitious were particularly likely to stay connected after hours and that doing so associated with greater work-nonwork conflict.
Boswell’s research targets managers and organizations by examining how to best manage and develop policies around the work-nonwork interface, although the topics of work-family boundaries, burnout and work-family balance are definitely interesting to individuals.
She says her interest in work-family issues began when she started a family a decade ago. “I know first-hand the challenges of balancing demands, but I also know there are tradeoffs and choices we all must make. Understanding how people make these choices, how they can be more effective in balancing demands, and the various outcomes (personally and for a firm) has real practical importance,” she explains.
“I’m fascinated with how people manage multiple demands (and we have many in our lives!), and how individuals vary in managing these demands (e.g., different needs, preferences, goals). Certainly, technology has changed how and when we work, and I always like to ground my research in fairly practical and timely issues. “The stress of job insecurity and balancing one’s life and work demands is a very practical, timely and important one for our society.”
She says she is interested in observing “somewhat counterintuitive things” and wanted to explore an area that the literature so far has not offered a clear answer for: Why would people who are stressed by their employment situation (e.g., feel insecure) work harder/more?
“Much of the literature suggests insecurity should make you ticked off at your company, yet anecdotally, we were seeing employees put their heads down and dive in to work in the face of a poor economy,” she explains. “And, then, what would be the longer-term outcomes of this – that is, isn’t it likely that this behavioral adaptation to insecurity could actually have long-term deleterious effects for the individual?”
Boswell teaches courses on human resource management at the undergraduate, graduate (master’s and doctoral) and executive levels. She is the holder of the Jerry and Kay Cox Endowed Chair in Business and she received the 2004 Center for Teaching Excellence Montague Scholar Award.
Her research focuses on employee attraction and retention, job search behavior, workplace conflict and the work-nonwork interface. Her work has appeared in such journals as Academy of Management Journal, Academy of Management Review, Journal of Applied Psychology, Personnel Psychology, Human Resource Management, Journal of Vocational Behavior, and Journal of Management. She serves on the editorial boards of the Academy of Management Review, Journal of Applied Psychology, International Journal of HRM, and Journal of Management, and is an incoming Associate Editor for Personnel Psychology. She served as the 2012-13 Chair of the HR Division, Academy of Management.
Many research studies have analyzed customer-based brand equity and how it relates to consumers’ willingness to pay for a branded product, but researchers have not yet questioned whether the same brand equity can impact executive pay. Alina Sorescu, associate professor of marketing at Mays Business School, saw a correlation between brand equity and top management of well-known brands’ willingness to work for less compensation.
Sorescu first saw patterns forming within academia when PhD candidates chose to study at more prestigious schools who offered them less scholarship money over lower-tier schools offering a much larger amount of scholarship money. She theorized the PhD candidates’ decisions were based on the opportunities created by attending a more prestigious school. In the long run, the benefits of taking the option that provided less funding would pay off because of the brand equity that accompanies a prestigious degree. As she repeatedly observed this pattern in academia, she began applying this theory to other scenarios.
Sorescu and her colleagues, Nader Tavassoli and Rajesh Chandy – both from the London Business School – began looking for connections between brand equity and the salary of top five executives across a large sample of firms. Sorescu wanted to know if top executives of companies with well-known brands received lower compensation.
She began her data collection with U.S. Young & Rubicam BAV metrics survey to obtain brand strength, executive level compensation data from ExecuComp, a Standard & Poor’s database and firm level data which yielded a sample of 10,107 observations for all top executives and 1,869 observations for CEOs, across 393 firms.
Her findings were in line with the proposed theory. Moving from a brand with average brand equity to one whose equity is in the 80th percentile yields a 12.13 percent decrease in CEO pay, or $1,268,130 in savings for the average CEO compensation, and a 2.42 percent decrease in pay, or $89,978 in savings for the average non-CEO executive
In an effort to explain why strong brands should attract executives at lower levels of pay, Sorescu explains the definition of employee-based brand equity as “the value that a brand provides to a firm through its effects on the attitudes and behaviors of its employees.” This concept offers a new look at the returns on branding, by highlighting a brand’s ability to cut costs instead of increasing revenue. “The payoff to brand investments largely exists in the revenue gains that they can yield. Our approach flips this notion by looking at the cost side of profits, an area rarely examined in marketing,” she explains. “We suggest that a significant part of the returns to marketing investments in brands may be in reducing payroll costs.”
Taking a look at the psychological effects strong brands have on executive pay Alina offers an identity-based framework. “The overarching theme underlying this effect is self-enhancement,” says Sorescu. “Strong brands offer greater possibilities for self-enhancement to the executives associated with them than do weak brands.” People choose to work for companies with strong brands because brands build reputation and those connections create future opportunities, “Self enhancement is seen as a substitute for pay.” Brands are seen as a signaling tool, being associated with a strong brand says something about you; the long-term benefits outweigh the immediate salary cut one may be willing to take.
“Our results imply that researchers should take a broader view of the contributions that brands make to firms and the effect they have on the balance sheet,” Sorescu says of employee-based brand equity. “Moreover, they should make use of strong brands in executive pay negotiations that are typically viewed as being outside the realm of marketing.”
– “Employee-Based Brand Equity: The Impact of Customer Perceptions on Executive Pay” by Sorescu, Nader Tavassoli and Rajesh Chandy (both of the London Business School) is forthcoming in the Journal of Marketing Research. Sorescu is holder of the Rebecca U. ’74 and William S. Nichols III ’74 Professorship at Mays.
The bottom line is that engaged employees improve a company’s bottom line, and an organization possessing an entire workforce that is collectively engaged will exhibit higher levels of motivation. That’s according to research by a team of professors and graduate students from Mays Business School’s Department of Management, who determined that higher levels of collective engagement in an organization lead to higher level of motivation.
In a study of 83 small to mid-sized U.S. credit unions, the researchers concluded that engagement—defined as investing one’s cognitive, emotional and physical self into work performances, i.e., putting one’s head, heart and hands into work—leads to improved return on assets, a common financial indicator of organizational success.
“The word ‘engagement’ is sometimes used as a pop term,” said Stephen Courtright, an assistant professor of management who participated as a researcher in the project. “There is a lot of discussion anecdotally that engagement impacts organizational effectiveness, but we set out to test in an objective, scientific way whether an organization full of employees who see themselves and other organizational members as engaged improves the bottom line,” he said. “We concluded that yes, employee engagement impacts an organization and helps drive its competitive advantage. That means collective engagement matters for organizational effectiveness in a real and measurable way.”
However, beyond just showing the bottom-line impact of collective employee engagement, the researchers also sought to answer a question naturally brought up by organizational leaders and stakeholders: “What can organizations do to get their workforce engaged?” While some research has analyzed what immediate bosses can do to help a small group of employees become more engaged, what organizations can do from a strategic standpoint to influence their workforce to be collectively engaged as a whole is a deeper question.
Management Professor Murray Barrick, Courtright and graduate students Gary Thurgood and Troy Smith tested this question on the same sample of credit unions. Using this sample of similarly-sized organizations from the same industry helped to produce purer results.
To get a collective workforce engaged, “it starts at the top,” Courtright said. Specifically, the researchers found that the strongest predictor of collective employee engagement was the CEO’s “transformational leadership,” a leadership style in which the CEO (1) articulates a compelling vision that challenges the status quo, (2) serves as an inspirational and charismatic role model and (3) shows care and concern for members of the organization.
Next, the team found that company leaders need to establish and implement performance management systems that serve to identify and track high performers, reward high performers and then make high performers feel secure in their job.
Finally, companies can better facilitate collective employee engagement by designing jobs within the organization to be more motivating for their employees. This includes giving employees greater autonomy and ownership over tasks, allowing them to use a variety of skills on the job and helping them to see how their jobs make a significant difference to the company’s overall success.
According to the researchers, these three organizational-level factors, in combination, maximize the three underlying psychological conditions for full engagement from employees—psychological availability, safety and meaningfulness. “CEO transformational leadership helps employees be more willing to be engaged at work; effective performance management helps employees feel that they are rewarded for being engaged; and motivating job design helps employees sense that impact of their engagement on the organization,” said Courtright.
—— “Collective Organizational Engagement: Linking Motivational Antecedents, Strategic Implementation, and Firm Level Performance” was accepted for publication in the Academy of Management Journal” February 2014. Researchers are Murray R. Barrick, Stephen H. Courtright, Gary R. Thurgood and Troy A. Smith.
Mays Business School’s inaugural Lifetime Achievement Award for Research and Scholarship was awarded to Michael A. Hitt, a University Distinguished and Joe B. Foster ’56 Chair in Business Leadership.
