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Idiosyncratic Deals from an Organizational-Level
Perspective
Consequences, Mechanisms and Boundary Conditions
D I S S E R T A T I O N of the University of St.Gallen,
School of Management, Economics, Law, Social Sciences and
International Affairs to obtain the title of
Doctor of Philosophy in Management
Submitted by
Anna Franziska Schuler
from
Germany
Approved on the application of
Prof. Dr. Heike Bruch
and
Prof. Dr. Stephan Alexander Böhm
Dissertation no. 4801
Difo-Druck GmbH, Bamberg 2018
The University of St.Gallen, School of Management, Economics, Law, Social Sciences and International Affairs hereby consents to the printing of the present dissertation, without hereby expressing any opinion on the views herein expressed.
St. Gallen, May 22, 2018
The President:
Prof. Dr. Thomas Bieger
Acknowledgments
Many people have played an important role in the development of this
dissertation.
First and foremost, I thank my doctoral advisor Professor Dr. Heike Bruch, for
supporting me over the last three and a half years. Her critical feedback and her
creative ideas have always motivated and inspired me. Our discussions have
always been a source of inspiration for new ideas, solutions and challenges and
the energy to address them. I am grateful for our mutual and exciting
experiences over the past years, which allowed me to develop professionally
and personally. I am also very grateful to Professor Dr. Stephan Böhm for
constructively supporting this dissertation as co-supervisor. I appreciated his
critical questions and his valuable and encouraging feedback.
Moreover, I owe special thanks to the Porsche AG for supporting this
dissertation. In particular, I am thankful to Elke Lücke, Markus Dreckmann and
Dr. Frank-Steffen Walliser, our project partners at Porsche.
I also want to express my gratitude to Stefan Berger, my fellow in this research
project, who was always willing to listen and to offer advice. He always kept a
critical eye on my work and encouraged me with his motivation and energy.
Furthermore, I wish to thank Dr. Hendrik Hüttermann for taking the time to
provide constant feedback and help with his expertise. He was always available
for all questions and has always had workable solution.
Additionally, many friends, colleagues and peers accompanied, inspired, and
enriched the journey of this dissertation in various ways. They always
supported me with an open ear, encouraging words and creative suggestions
for solutions. I want to thank all my friends and colleagues with special thanks
to Jessica Färber, Anna-Patricia München, Christina Block, Manuel Fleschhut,
Anna Brzykcy, Dr. Petra Kipfelsberger, Dr. Markus Rittich, Dr. Ulrich Leicht-
Deobald, Sabrina Heinl, Tristan Ricken, Aylin Ispaylar, Sandra Berenbold,
Andrea Schmid, Nicole Stambach, Karin Kupka, Dr. Josef Fischer, Geraldine
Mildner, Lukas Hölzl and Drew Wilson.
Last but not least, I wholeheartedly thank Lars Kreissner, who supported me
emotionally every day with his infinite patience and has been through all the
downs and ups with me in the last three years.
Most importantly, I also thank my parents Felizitas Schuler and Peter Maier-
Schuler, my brother Stephan Schuler and my aunt Elisabeth Schuler for their
unconditional support, which has meant so much to me.
St. Gallen, February 2018 Anna Franziska Schuler
I
Overview of Contents
List of Tables .............................................................................................................. VII
List of Figures .......................................................................................................... VIII
List of Abbreviations ................................................................................................. IX
Executive Summary ................................................................................................... XI
Zusammenfassung .................................................................................................... XII
1 Introduction ............................................................................................................ 1
1.1 Idiosyncratic Work Arrangements in the New World of Work.......................... 1
1.2 Practical Relevance of Idiosyncratic Work Arrangements .................................. 3
1.3 Positioning the Concept of I-Deals .......................................................................... 6
1.4 Theoretical Relevance of Idiosyncratic Work Arrangements ............................ 12
1.5 Literature Review on I-Deals Research ................................................................. 14
1.6 Research Gaps and Intended Contributions ........................................................ 28
1.7 Methodological Approach ...................................................................................... 36
1.8 Outline of the Dissertation ...................................................................................... 37
2 How Do I-Deals Relate to Organizational Performance? The Role of
Collective Attitude, Coworker Relations and Leadership Climate .................... 41
2.1 Introduction .............................................................................................................. 41
2.2 Theoretical Background .......................................................................................... 44
2.3 Method ....................................................................................................................... 57
2.4 Results ........................................................................................................................ 64
2.5 Discussion ................................................................................................................. 71
3 I-Deals Differentiation and Organizational Performance: Does Idiosyncrasy
Make I-Deals Non-Ideal? .......................................................................................... 78
3.1 Introduction .............................................................................................................. 78
3.2 Theoretical Background .......................................................................................... 81
3.3 Method ....................................................................................................................... 91
3.4 Results ........................................................................................................................ 96
3.5 Discussion ............................................................................................................... 103
4 Combining I-Deals and Human Resource Practices: Enhancing
Organizational Performance through Consistency ............................................ 110
II
4.1 Introduction ............................................................................................................ 110
4.2 Theoretical Background ........................................................................................ 112
4.3 Method ..................................................................................................................... 124
4.4 Results ...................................................................................................................... 129
4.5 Discussion ............................................................................................................... 136
4.6 Conclusion .............................................................................................................. 140
5 Overall Discussion and Conclusion ................................................................ 142
5.1 Summary and Integration of Research Findings ............................................... 142
5.2 Theoretical Contributions ..................................................................................... 147
5.3 Practical Implications and Recommendation .................................................... 156
5.4 Limitations and Directions for Future Research ............................................... 165
5.5 Conclusion and Outlook ....................................................................................... 173
6 References ........................................................................................................... 174
Curriculum Vitae ..................................................................................................... 209
III
Table of Content
List of Tables .............................................................................................................. VII
List of Figures .......................................................................................................... VIII
List of Abbreviations ................................................................................................. IX
Executive Summary ................................................................................................... XI
Zusammenfassung .................................................................................................... XII
1 Introduction ............................................................................................................ 1
1.1 Idiosyncratic Work Arrangements in the New World of Work.......................... 1
1.2 Practical Relevance of Idiosyncratic Work Arrangements .................................. 3
1.3 Positioning the Concept of I-Deals .......................................................................... 6
1.4 Theoretical Relevance of Idiosyncratic Work Arrangements ............................ 12
1.5 Literature Review on I-Deals Research ................................................................. 14
1.5.1 Underlying Theory and Mechanisms ........................................................................ 15 1.5.2 Consequences of I-Deals .............................................................................................. 20 1.5.3 Antecedents of I-Deals ................................................................................................. 22 1.5.4 Moderators and Relevant Context Factors ................................................................ 23 1.5.5 Mediators and Explanatory Mechanisms.................................................................. 25 1.5.6 Multilevel Research on I-Deals ................................................................................... 26
1.6 Research Gaps and Intended Contributions ........................................................ 28
1.6.1 I-Deals and Organizational Performance .................................................................. 29 1.6.2 Intermediate Processes at the Organizational Level................................................ 30 1.6.3 The Role of Leadership ................................................................................................ 31 1.6.4 The Role of Organizational Justice ............................................................................. 32 1.6.5 The Interplay between I-Deals and HRM ................................................................. 33
1.7 Methodological Approach ...................................................................................... 36
1.8 Outline of the Dissertation ...................................................................................... 37
1.8.1 Chapter 1: Introduction ............................................................................................... 37 1.8.2 Chapter 2: Study 1 - How Do I-Deals Relate to Organizational Performance? The Role of Collective Attitude, Coworker Relations and Leadership Climate ........................ 37 1.8.3 Chapter 3: Study 2 - I-Deals Differentiation and Organizational Performance: Does Idiosyncrasy Make I-Deals Non-Ideal? .......................................................................... 38 1.8.4 Chapter 4: Study 3 - Combining I-Deals and Human Resource Practices: Enhancing Organizational Performance through Consistency ............................................ 40 1.8.5 Chapter 5: Overall Discussion and Conclusion ........................................................ 40
IV
2 How Do I-Deals Relate to Organizational Performance? The Role of
Collective Attitude, Coworker Relations and Leadership Climate .................... 41
2.1 Introduction .............................................................................................................. 41
2.2 Theoretical Background .......................................................................................... 44
2.2.1 I-Deals ............................................................................................................................ 44 2.2.2 Effects of Organizational Median I-Deals on Employee Job Attitudes ................. 45 2.2.3 Effects of Organizational Median I-Deals on Coworker Relations........................ 47 2.2.4 The Role of Leadership Climate ................................................................................. 50 2.2.5 The Link to Organizational Performance .................................................................. 54
2.3 Method ....................................................................................................................... 57
2.3.1 Data and Sample ........................................................................................................... 57 2.3.2 Measures ........................................................................................................................ 59
2.4 Results ........................................................................................................................ 64
2.4.1 Descriptive Statistics .................................................................................................... 64 2.4.2 Data Analysis and Hypothesis Testing ..................................................................... 66 2.4.3 Alternative Model Testing........................................................................................... 70
2.5 Discussion ................................................................................................................. 71
2.5.1 Theoretical Implications .............................................................................................. 72 2.5.2 Strengths, Limitations and Future Research ............................................................. 74 2.5.3 Practical Implications ................................................................................................... 76 2.5.4 Conclusion ..................................................................................................................... 77
3 I-Deals Differentiation and Organizational Performance: Does Idiosyncrasy
Make I-Deals Non-Ideal? .......................................................................................... 78
3.1 Introduction .............................................................................................................. 78
3.2 Theoretical Background .......................................................................................... 81
3.2.1 I-Deals ............................................................................................................................ 81 3.2.2 Organizational Justice Climate ................................................................................... 82 3.2.3 I-Deals Differentiation and Distributive Justice Climate ........................................ 83 3.2.4 Organizational Median I-Deals and Procedural Justice Climate as Moderators of the Relation between I-Deals Differentiation and Distributive Justice Climate ................. 85 3.2.5 Mediation Effect of Distributive Justice Climate ...................................................... 89
3.3 Method ....................................................................................................................... 91
3.3.1 Data and Sample ........................................................................................................... 91 3.3.2 Measures ........................................................................................................................ 92
3.4 Results ........................................................................................................................ 96
V
3.4.1 Descriptive Statistics .................................................................................................... 96 3.4.2 Data Analysis and Hypothesis Testing ..................................................................... 96 3.4.3 Robustness Analysis ................................................................................................... 103
3.5 Discussion ............................................................................................................... 103
3.5.1 Theoretical Implications ............................................................................................ 104 3.5.2 Limitations and Future Research ............................................................................. 106 3.5.3 Practical Implications ................................................................................................. 108 3.5.4 Conclusion ................................................................................................................... 108
4 Combining I-Deals and Human Resource Practices: Enhancing
Organizational Performance through Consistency ............................................ 110
4.1 Introduction ............................................................................................................ 110
4.2 Theoretical Background ........................................................................................ 112
4.2.1 Flexible Working Arrangements .............................................................................. 112 4.2.2 I-Deals .......................................................................................................................... 113 4.2.3 Flexible Working Arrangements and Organizational Performance ................... 114 4.2.4 The Intermediate Effect of Organizational Productive Energy ............................ 115 4.2.5 The Moderating Effect of I-Deals ............................................................................. 119
4.3 Method ..................................................................................................................... 124
4.3.1 Data and Sample ......................................................................................................... 124 4.3.2 Measures ...................................................................................................................... 125
4.4 Results ...................................................................................................................... 129
4.4.1 Descriptive Statistics .................................................................................................. 129 4.4.2 Data Analysis and Hypothesis Testing ................................................................... 129 4.4.3 Robustness Analysis ................................................................................................... 134
4.5 Discussion ............................................................................................................... 136
4.5.1 Theoretical Implications ............................................................................................ 136 4.5.2 Limitations and Future Research ............................................................................. 137 4.5.3 Practical Implications ................................................................................................. 139
4.6 Conclusion .............................................................................................................. 140
5 Overall Discussion and Conclusion ................................................................ 142
5.1 Summary and Integration of Research Findings ............................................... 142
5.1.1 I-Deals and Organizational Performance ................................................................ 143 5.1.2 Intermediate Processes............................................................................................... 144 5.1.3 Context Factors ........................................................................................................... 144
5.2 Theoretical Contributions ..................................................................................... 147
VI
5.2.1 I-Deals Theory ............................................................................................................. 147 5.2.2 I-Deals and TFL Theory ............................................................................................. 151 5.2.3 I-Deals and Justice Theory ......................................................................................... 153 5.2.4 I-Deals and HRM Literature ..................................................................................... 154
5.3 Practical Implications and Recommendation .................................................... 156
5.3.1 Employer ...................................................................................................................... 157 5.3.2 HR Managers ............................................................................................................... 158 5.3.3 Line Managers ............................................................................................................. 161 5.3.4 Employees .................................................................................................................... 164
5.4 Limitations and Directions for Future Research ............................................... 165
5.4.1 Measurement of I-Deals ............................................................................................. 166 5.4.2 Level of Analysis......................................................................................................... 168 5.4.3 Study Design ............................................................................................................... 169 5.4.4 Additional Directions for Future Research ............................................................. 170
5.5 Conclusion and Outlook ....................................................................................... 173
6 References ........................................................................................................... 174
Curriculum Vitae ..................................................................................................... 209
VII
List of Tables
Table 1-1. Comparison of work design concepts (based on Hornung et al.,
2010b). .................................................................................................. 8
Table 1-2. The research questions of this dissertation. ................................. 35
Table 2-1. Means, standard deviations and intercorrelations among study
variables. ........................................................................................... 65
Table 3-1. Means, standard deviations and interecorrelations among study
veriables. ........................................................................................... 98
Table 3-2. Results of moderated regression analysis predicting distributive
justice climate. .................................................................................. 99
Table 3-3. Results of the moderated regression analysis predicting
organizational performance. ........................................................ 101
Table 3-4. Bootstrapping results for the test of conditional indirect effects at
specific values of the modertaor: mean and +/- standard
deviation. ......................................................................................... 102
Table 4-1. Means, standard deviations and intercorrelations among study
varibles. ........................................................................................... 130
Table 4-2. Regression results for the estimated coefficients of the mediation
model. .............................................................................................. 131
Table 4-3. Regression results for the estimated coefficients of the moderated
mediation model. ........................................................................... 133
Table 4-4. Bootstrapping results for the test of conditional indirect effects at
specific values of the moderator: mean and +/- standard
deviation. ......................................................................................... 135
VIII
List of Figures
Figure 1-1. Integrative research perspective. ................................................... 35
Figure 1-2. Overview of chapter structure. ...................................................... 39
Figure 2-1. Overview conceptual model. ......................................................... 57
Figure 2-2. Structural model results. ................................................................. 68
Figure 2-3. Moderation effect of the individual-focused leadership climate
on the relationship between organizational median i-deals and
collective job satisfaction. ............................................................... 69
Figure 2-4. Moderation effect of the collective-focused leadership climate on
the relationship between organizational median i-deals and
collective OCBI. ................................................................................ 69
Figure 3-1. Moderated mediation model of the relationship between i-deals
differentiation and organizational performance. ........................ 91
Figure 3-2. Three-way interaction on distributive justice climate. ............. 100
Figure 4-1. Moderated mediation model of the relationship between FWAs
and organizational performance. ................................................ 123
Figure 4-2. Moderation effect of organizational median i-deals on the
relationship between FWAs and organizational productive
energy. ............................................................................................. 134
IX
List of Abbreviations
α Cronbach’s alpha
ADM(J) average deviation index
AIC Akaike information criterion
AMOS analysis of moment structures
b / B b-value / unstandardized regression coefficient
β beta-coefficient / standardized regression coefficient
χ2 chi square value
CFA confirmatory factor analysis
CFI comparative fit index
CI confidence interval
Δ delta
df degrees of freedom
Ed. / Eds. editor / editors
ed. edition
EFA exploratory factor analysis
e.g. example gratia / for example
et al. et alii
F F-test value
FWAs flexible working arrangements
HR human resource
HRM human resource management
ICC intraclass correlation coefficient
I-deal idiosyncratic deal
I-dealer employee with an i-deal
i.e. id est / that is
IFI incremental fit index
LMX leader-member exchange
M mean
X
N/n number of observations
NWW new ways of working
ns not significant
OCB organizational citizensghip behavior
OCBI OCB directed towards coworkers
OCBO OCB directed towards the organization
p p-value
p. page
PLS partial least square
r Pearson product-moment correlation coefficient
R2 squared multiple correlation coefficient
RMSEA root mean square error of approximation
rwg index of interrater agreement
s.d. standard deviation
SDT self-determination theory
SE standard error
SEM structural equation modeling
SPSS statistical package for the social sciences
SRMR standardized root mean square residual
t t-test value
TFL transformational leadership
USA/ U.S. United States of America
VIF variance inflation factor
Vol. volume
XI
Executive Summary
In the modern world of work, standardized working agreements are often not
sufficient. Organizations are increasingly offering employees idiosyncratic
working conditions (so-called i-deals) in order to meet a variety of needs and to
recruit and retain high-performing employees. So far, research has largely been
limited to the positive effects of i-deals on individual employees. However, by
definition, i-deals are also beneficial to the employer. This dissertation therefore
addresses the question of whether, how, and under what conditions i-deals
have positive or negative effects on companies.
Study 1, with data from 87 companies, shows that i-deals can have negative and
positive effects on companies, depending on the type of leadership climate in
the organization. In addition, collective job satisfaction and coworker relations
mediate the effect of the median level of i-deals on organizational performance.
Study 2 is based on data from 96 companies and concerns i-deals differentiation,
which describes the differences between employees that arise through i-deals.
I-deals differentiation has a positive effect on perceived distributive justice and
organizational performance when there is a procedural justice climate and not
too many i-deals are awarded. Study 3 found that, based on 83 companies,
flexible HR practices only impact organizational productive energy and
organizational performance when employees, through individually negotiated
i-deals, can actually leverage the flexibility.
The three studies show that whether or not organizations benefit from the use
of i-deals depends on a variety of contextual conditions. This dissertation is a
starting point for i-deals research at the organizational level and aims to inspire
future i-deals research and the successful use of i-deals in practice.
XII
Zusammenfassung
In der modernen Arbeitswelt reichen standardisierte Arbeitsvereinbarungen oft
nicht aus. Unternehmen bieten Mitarbeitern zunehmend individualisierte
Arbeitsbedingungen (sogenannte I-Deals), um einer Vielzahl an Bedürfnissen
entgegenzukommen und leistungsstarke Mitarbeiter anzuwerben und zu
binden. Die Forschung hat sich bisher grösstenteils auf positive Auswirkungen
von I-Deals auf einzelne Mitarbeiter beschränkt. Laut Definition sind I-Deals
jedoch auch für den Arbeitgeber von Vorteil. Diese Dissertation geht daher mit
drei Studien auf die Frage ein, ob, wie und unter welchen Bedingungen I-Deals
positive und negative Auswirkungen auf Unternehmen haben.
Studie 1 zeigt mit Daten von 87 Unternehmen, dass I-Deals negative und
positive Effekte auf Unternehmen haben können, abhängig von der Art des
Führungsklimas im Unternehmen. Ausserdem zeigt sich, dass der Effekt von I-
Deals auf die Unternehmensleistung von kollektiver Arbeitszufriedenheit und
der Mitarbeiterbeziehung mediiert wird. Studie 2 beruht auf Daten von 96
Unternehmen und beschäftigt sich mit I-Deals Differenzierung, welche die
Unterschiede beschreibt, die durch I-Deals zwischen Mitarbeitenden entstehen.
Die I-Deals Differenzierung hat hierbei einen positiven Effekt auf die
empfundene Verteilungsgerechtigkeit und die Unternehmensleistung, wenn
ein prozedurales Gerechtigkeitsklima herrscht und nicht zu viele I-Deals
vergeben werden. Studie 3 erforscht anhand von 83 Unternehmen, dass flexible
HR Instrumente sich nur auf Organisationale Produktive Energie und
Unternehmensleistung auswirken, wenn die Flexibilität von den Mitarbeitern
auch tatsächlich durch individuell verhandelte I-Deals genutzt werden kann.
In den drei Studien zeigt sich, dass es von einer Vielzahl an
Kontextbedingungen abhängt, ob ein Unternehmen von der Nutzung von I-
Deals profitiert. Diese Dissertation stellt einen Startpunkt für die I-Deals-
Forschung auf Unternehmensebene dar. Sie soll zukünftige I-Deals-Forschung
und eine erfolgreiche Nutzung von I-Deals in der Praxis inspirieren.
Introduction 1
1 Introduction
“Workplaces are full of idiosyncrasies.”
Rousseau (2005, p. 27)
The Daily Muse (or just The Muse) is an American career and employment
website founded in September 2011. The firm’s client list includes Facebook,
Zappos, McKinsey, and Pinterest. On its website, The Muse offers career advice
as well as extensive information on employers including behind-the-scene
videos and interviews with current employees (The Muse, 2016a). Further, a list
of “10 companies that let you create your own job” is provided. Amongst other
companies, Zappos and The Wall Street Journal give applicants the opportunity
for general applications by proposing new job positions matching their own
needs and ideas (The Muse, 2016b).
1.1 Idiosyncratic Work Arrangements in the New World of Work
In the future, customized or so-called “idiosyncratic working arrangements”
will be no exception (Rousseau, 2005). In the 21st century, a new working era
has emerged. Environmental changes have altered the entire work context,
including the traditional organizational structures and the employer-employee
relationship (Sullivan & Baruch, 2009). Increased globalization, workforce
diversity and rapid technological advancements are creating changes in how
companies approach work (Demerouti, Derks, Ten Brummelhuis & Bakker,
2014) and how individuals enact and create their careers (Sullivan & Baruch,
2009; Sullivan & Mainiero, 2007). Today’s work is no longer limited by a specific
time and a fixed location or the traditional boundaries of organizations (De Kok,
2016). The focus of this new approach to work is flexibility in how employees
approach and organize their work (Demerouti et al., 2014). Employees have the
possibility of deciding for themselves when they work (i.e., schedule flexibility),
where they work (i.e., location flexibility), and which communication tools (e.g.,
2 Introduction
smartphone, email, videoconference) they use (Ten Brummelhuis, Bakker,
Hetland, & Keulemans, 2012). This new and flexible approach to work has often
been referred to as “new ways of working” (NWW; Demerouti et al., 2014). The
NWW concept comprises a myriad of different forms of modern work
arrangements and tools, such as working from home, mobile working, flexible
working hours, use of video conferencing, internet and collaborative tools (Blok,
Groenesteijn, Van den Berg, & Vink, 2011). The key principles of NWW are time
and location flexibility, and result orientation rather than a culture of
attendance, unlimited access to information and connectivity, and flexible work
relations (Baane, Houtkamp, & Knotter, 2010, as cited in De Kok, 2016). These
work principles aim at giving employees maximal autonomy in carrying out
their work (De Kok, 2016; Demerouti et al., 2014). Thus, NWW go hand in hand
with, and foster idiosyncratic work arrangements (Hornung, Rousseau, &
Glaser, 2008). When organizations have human resource (HR) practices which
allow employees to work from home or have flexible working hours, employees
are more likely to negotiate idiosyncratic work arrangements with their
supervisor, which enable them to use those offers according their own needs
(Bayazit & Bayazit, 2017; Hornung et al., 2008). Hornung et al. (2008) found that
formal organizational programs offering employees part-time work and home
office foster negotiation for customization beyond the scope of these officially
offered programs.
Merz Pharma, a German pharmaceutical company, is one of the few companies
today that already respond very individually to their employees’ needs. The
company has found that employees want to use human resource management
(HRM) offerings very differently. When caring for relatives, for example, the
range extends from a temporary complete withdrawal to a reduction in working
hours to full-time employment with the simultaneous use of care services. Even
with parental leave, employees use this resource in different ways. Some
parents return after half a year and then use the company day nursery for their
children while others take time off for several years. To meet the manifold
needs, Merz Pharma offers versatile options through a strong flexibilization of
Introduction 3
working forms offered by the HRM, for example through a basic range of
working time models. On the other hand, Merz Pharma has created a culture in
which employees can openly talk to their direct managers and HR managers
about their concerns and make individual arrangements that fit their personal
needs (berufundfamilie, 2015).
1.2 Practical Relevance of Idiosyncratic Work Arrangements
Idiosyncratic work arrangements are aimed at the needs of employees and
employers, which arise from a multitude of global mega-trends (Nauta & Van
de Ven, 2016). The hasty development of globalization and demographic change
implicates a more and more diverse workforce (Stangel-Meseke, Hahn, &
Steuer, 2015). On the one hand, organizations are increasingly making use of
international personnel recruitment as people become more mobile and able to
move internatinally between jobs (Stangel-Meseke et al., 2015). On the other
hand, more and more women are entering the workforce while the retirement
age is increasing and the workforce is aging (Nauta & Van de Ven, 2016; Stangel-
Meseke et al., 2015). The increase of the retirement age is a crucial challenge.
While a few years ago, many workers retired at the age of 60, today many
European countries demand that workers retire at the age of 65 or even 67
(Nauta & Van de Ven, 2016). Still, the retirement age will undoubtedly continue
to increase in the future. Older people often experience a loss of abilities and
thus fit less into standardized jobs (Nauta & Van de Ven, 2016). Idiosyncratic
work arrangements are an option to help older employees compensate for their
decreasing abilities and to stay motivated to continue working. Indeed, Bal, De
Jong, Jansen and Bakker (2012) show that especially idiosyncratic work
arrangements are important for older workers and their motivation to continue
working. Furthermore, the increasing participation of women in the labor
market observed in recent years leads to an increase in the number of dual-
career couples (Arnold, 2003). The so-called feminization of the workplace
challenges norms, values and traditional career paths of our society (Fondas,
1996). Idiosyncratic working arrangements can assist members of dual career
4 Introduction
couples in handling and balancing their various commitments at home and at
work and to be effective in their job (Arnold, 2003). Arrangements as for
example leave entitlements, career breaks, flexible working hours or home
office might be useful for dual career couples (Arnold, 2003, Bayazit & Bayazit,
2017). Furthermore, Generation Y, which has grown up in a digital world with
changing values and needs of the workforce contribute to the calls for
individualization at work (Bruch & Schuler, 2016; De Kok, 2010). For
organizations, idiosyncratic work arrangements will increasingly be an option
to attract skilled and diverse employees and to respond to the need for flexibility
and individualization (Bal & Rousseau, 2016). An HRM aligned towards the
various life phases of employees is becoming more important. In the future,
working arrangements must be matched precisely to each employee’s phase of
life and career (Bruch & Schuler, 2016). Finally, the rapid advancement of
technology is driving idiosyncrasy at work (Nauta and Van de Ven, 2016). Due
to these technological developments, job contents and work processes change
constantly and demand permanent adaptability from employees (Nauta and
Van de Ven, 2016). Successful career development is increasingly dependent on
employees’ flexibility, creativity and knowledge. All these aspects can be
promoted by employees through the negotiation of idiosyncratic work
arrangements, which might range from work-hour flexibility, taking on new
and challenging work assignments, or development and special training
arrangements (Nauta & Van de Ven, 2016). On the other hand, contemporary
organizations increasingly depend on employees’ skills and knowledge (e.g.,
Bal & Rousseau, 2016; Nauta & Van de Ven, 2016; Rousseau, 2005). Having
special, highly-developed and uncommon abilities makes employees difficult
to replace and strengthens their bargaining position (Rousseau, 2005). Thus,
those employees are able to negotiate effectively for special and customized
deals which fit their personal needs (Rousseau, 2005). Consequently, to design
successful careers and working conditions for both employees and employers
in the new organizational context, organizations and workers must
continuously negotiate and renegotiate what both parties expect to invest and
Introduction 5
receive in the employment relationship, leading to an increased use of
idiosyncratic work arrangements (Herriot & Pemberton, 1995; Rousseau, 2005).
Idiosyncratic work arrangements are already more common in organizations
than one might assume. Despite the widely known prime example of Silicon
Valley, European organization are also capable of what Google, Tesla and
Facebook do and are often even more innovative than expected (Esser &
Schelenz, 2013). Consequently, and contrary to the impression given by the
initial example of companies listed on The Muse, not just U.S. firms, provide
pioneering examples for the individualization of the workplace. In October
2012, The Brains recruitement agency published an innovative job
advertisement. While being a small company only founded in 2011, this Zurich-
based firm has had a successful start and was thus looking for a new employee.
The special feature of the job advertisement: the applicant could design his or
her own job. According to the motto “Design your own Job”, applicants had to
show, how they could contribute with their unique skills to the organization’s
performance. Amongst others, applicants could even define which tasks they
wished to take on and what percentage of working time they would suggest for
their future position (The Brains, 2012). The German machinery builder Trumpf
follows a similar path and offers a great deal of flexibility and individual options
for employees to meet each worker’s special needs. Each of the 4500 employees
decides for him or herself when he or she wants to work, with a minimum of 15
and a maximum of 40 hours per week. Furthermore, employees can save up a
maximum of 1000 working hours and use them for vacation or family
responsibilities, for example caring for relatives (Esser & Schelenz, 2013).
There can be a too much of a good thing effect, however, as employee relations
and organizational commitment might suffer when employees have the option
to work from wherever and whenever they wish to, especially when the
organizational culture does not fit to flexibility and individualization. Some
companies have failed introducing flexibility to their employees. Yahoo, for
example, had to refrain from allowing theirs to work from wherever they
wanted, since the collaboration and organizational culture suffered (Kossek,
6 Introduction
Thomspson, & Lautsch, 2015). No matter how many days employees chose to
work from home, they were ordered back into the office (The Guardian, 2013).
A similar fate befell IBM: they had already introduced the possibility of remote
working in the 1980s. By 2009, when flexible working locations were still a
novelty for most other companies, 40% of IBM’s 386,000 employees worldwide
were already working at home (Quartz, 2016). However, nowadays, IMB does
not only need increased productivity but also more innovation and creativity.
IBM believes that physical proximity between employees fosters new ideas,
communication, better understanding, and collaboration between coworkers
and thus abolished home office in 2017 (Quartz, 2016). Similarly, when Patrick
Pichette, Google’s CFO, was asked how many employees at Google can chose
where they want to work, he said: “As few as possible.” (Quartz, 2016).
These examples show big differences in whether and how companies allow and
use customized flexibility. Nevertheless, individualization can not be avoided
in today's world of work and will be increasingly important for organizations
(e.g., Nauta & Van de Ven, 2016). While Yahoo officially forbid home office,
some employees still do occasionally work from home (Huffington Post, 2015).
Thus, this ambivalence in organizational practices regarding flexible and
idiosyncratic working practices, which seems to reflect a certain degree of
uncertainty, is combined with the increasing relevance of individualized
working arrangements in the new world of work. This dissertation therefore
has the goal of clarifying what effects individualization at work has on
organizations and under which conditions organizations can use idiosyncratic
work arrangements while not harming but rather benefitting collaboration
between employees, organizational climate and organizational performance.
1.3 Positioning the Concept of I-Deals
Referring to Ebbinghaus’ prominent statement about psychology (Ebbinghaus,
1908, p. 7), Rousseau (2005) notes that, i-deals too, have a short history but a
long past. While i-deals research is still in its infancy, it is built upon a broad
Introduction 7
array of prior research on how individuals can proactively shape their jobs and
their employment relationships (Rousseau, 2005). Ostensibly unrelated research
areas such as work family balance, idiosyncratic jobs, job crafting, leader-
member-exchange (LMX), boundaryless careers and psychological contracts
constitute a rich foundation for the emerging research field of i-deals (Liao et
al., 2016; Rousseau, 2005). Research has for instance demonstrated that
employees with a high-quality relationship with their supervisor have more
access to resources such as information or support (Dansereau, Graen, & Haga,
1975; Liden & Graen, 1980), responsibility and decision-making autonomy
(Kozlowski & Doherty, 1989) as well as flexibility and development
opportunities (Rousseau, 2005). Other research streams demonstrate that
boundaryless career success depends on employee-employer negotiation
(Arthur, Khapova, & Wilderom, 2005) and that idiosyncratic jobs arise more
likely in less formal organizational settings (Granovetter, 1995).
Broadly spoken, i-deals can be classified as one approach to work redesign
(Hornung, Rousseau, Glaser, Angerer, & Weigl, 2010b). Job or work (re-) design
typically refers to setting up or changing tasks, jobs, contents, work settings and
employment conditions in ways that benefit both employees and employers
(Hackman & Oldham, 1975, 1980). Work redesign is beneficial for employees by
leading to more intrinsically satisfying work and greater well-being, while
employers benefit from increased employee attendance, retention,
performance, and proactivity (e.g., Fried & Ferris, 1987; Parker, Turner, &
Griffin, 2003). Two established approaches to work redesign are formal
management-led, top-down interventions and proactive bottom-up job crafting
(Hornung et al., 2010b). These two approaches differ to a great extent from each
other. Top-down approaches are management-led interventions to make job
classes more intrinsically motivating for employees to enhance their
performance (Hackman & Oldham, 1975, 1980). Job crafting refers to all
“physical and cognitive changes individuals make in the task or relational
boundaries of their work” (Wrzesniewski & Dutton, 2001, p. 179). Both top-
down intervetions and informal job crafting have limitations. On the one hand,
8 Introduction
top-down approaches to work redesign are restricted in their ability to establish
individually optimized work arrangements by meeting employees’ personal
needs (Hackman & Oldham, 1976, 1980; Walton, 1972), while on the other hand
bottom-up processes are constrained by the extend workers can substantially
alter their work setting and tasks without authorization from the leader
(Hornung et al., 2010b). I-deals therefore represent “a middle path between top-
down work redesign and a single worker’s private efforts to craft a job”
(Hornung et al., 2010b, p. 190). I-deals, which are customized working
conditions negotiated between employee and employer, are one possibility for
individual employees to receive idiosyncratic working conditions they cannot
create without formal approval of their employer (Rousseau, 2005). A detailed
comparison of all three concepts of work design - top down job redesign, job
crafting and i-deals - is shown in Table 1-1 (Hornung et al., 2010b, p. 188)0F
1.
Table 1-1. Comparison of work design concepts (based on Hornung et al., 2010b).
Dimensions Job redesign Job crafting I-deals
Initiation Top-down by management
Bottom-up by worker Bottom-up typically by worker
Implementation Planned intervention Employee discretion Employee-management negotiation
Authorization Formal Unauthorized or within zone of acceptance
Authorized by agents or human resources approval
Employee`s role Typically recipient Actor Both actor and recipient Focus Job classes or
idiosyncratic jobs Individual job or position
Individual job or position
Primary goal Intrinsic motivation/ performance
Personal needs Broad mutual benefit
Design content Work characteristics Tasks and interactions Any or all employment features
Results Objective changes Objective changes and/or cognitive redefinition
Objective changes
Process Discrete event Ongoing Intermittent events
1 This table was taken from Hornung et al. (2010b, p. 188)
Introduction 9
I-deals emerge due to a variety of personal goals and motives, ranging from the
need to balance work and family responsibilities to the need to know that one
is highly appreciated by the employer (Rousseau, 2005). Formally defined, i-
deals are a form of customizing job tasks, responsibilities, work conditions and
employment relationships (e.g., Rousseau, 2001, 2005). I-deals grant employees
special employment conditions which differ significantly from the standard
employment arrangements of their coworkers (Rousseau, 2005). This is done in
order to satisfy their personal needs (Rousseau, Ho, & Greenberg, 2006;
Hornung et al., 2008). The i-deals negotiated between an employee and his
employer reflect the employee’s market value ascribed by the employer (Bartol
& Martin, 1989). Representatives of the employer who negotiate i-deals with
employees are in most cases direct supervisors or HR managers (Liao et al.,
2016; Rousseau, 2005). These special arrangements are intended to benefit both
the employee through special consideration (e.g., through receiving special
training opportunities or schedule flexibility) and specifically the employer
through special contributions (e.g., through enhanced employee performance,
commitment and motivation; Rousseau, 2005). The customization of work
through i-deals is not limited to specific groups of workers, as for example high
performers (Rosen, 1981; Rousseau, 2005). Employees receiving i-deals are most
often called i-dealers in the i-deals literature (e.g., Rousseau, Tomprou, &
Simosi, 2016).
I-deals may be negotiated at different times of the employment relationship
(Rousseau, 2005) and those negotiated at the time of hire, for example during
the recruitment process, are called ex ante i-deals. When i-deals are negotiated
later in an ongoing employment relationship, they are called ex post i-deals
(Rousseau et al., 2009). Ex post i-deals are further distinguished in two forms:
Those in which an employee intends to quit and those in which the employee’s
past and assumed future contribution to the organization are the reason for
negotiations, as the company intends to keep the employee (Rousseau, 2005).
Customized deals vary considerably in content and scope, that is to say they
include minor adjustments in hours and work schedules, workplaces,
10 Introduction
responsibilities or tasks, but also highly individualized jobs (Miner, 1987). This
means that i-deals might consist of only one single idiosyncratic element in an
otherwise fully standardized employment contract or an entirely individualized
work arrangement (Rousseau, 2005). While i-deals can involve any resource
exchanged by employee and employer ranging from tangible elelements (e.g.,
money) to intangible (e.g., interpersonal support; Rousseau, 2005). However,
key features of i-deals regarding their content have been identified. Hornung et
al. (2010b) introduced four common types of i-deals: flexibility, developmental,
workload-reduction, and task i-deals. Flexibility i-deals allow employees to
schedule their work as they need it, developmental i-deals provide employees
special opportunities to use and expand their skills and to pursue career
advancement, workload-reduction i-deals refer to reduced work demands, and
task i-deals are arrangements to change the content of a job (Hornung et al.,
2010b). In contrast to Hornung et al. (2010b), Rosen et al. (2013) created an i-
deals scale according to established scale development methods. Their research
shows that employees negotiate i-deals across four content domains: schedule
flexibility, location flexibility, work responsibilities, and financial incentives
(Rosen et al., 2013). The two newly identified constructs, location flexibility and
financial incentives, describe special work arrangements that allow employees
to work outside of the office and to customize compensation arrangements,
respectively (Rosen et al., 2013). Nauta and Van de Ven (2016) go further by
distinguishing between “comfort i-deals”, which are about making work less
demanding for employees, and “challenge i-deals”, which aim at developing
employees’ skills and knowledge and therefore contribute to career
development.
Based on the fundamental theoretical postulate of mutual benefits for both
employee and employer, i-deals have been differentiated from dysfunctional
individual arrangements, such as favoritism or cronyism, which are based on
personal and political ties and, most likely, have a detrimental impact on the
team, the unit and the organization (Greenberg et al., 2004; Rousseau, 2005;
Rousseau et al., 2006). Although easily confused with one another, i-deals are
Introduction 11
also distinct from psychological contracts. I-deals are individually negotiated
agreements regarding the customization of certain employment features,
whereas the psychological contract is defined as an individual employee’s
beliefs regarding the terms and conditions of the reciprocal exchange to the
employer which represents the employment relationship (Rousseau, 2001).
More specifically, the psychological contract is a cognitive representation of the
working relationship, while i-deals refer to actually customized working
conditions (Rousseau, 2001, 2005). Thus, these two constructs are highly linked
with each other, but nevertheless distinct (Hornung, Glaser, Rousseau, 2010a).
In fact, the perceived nature of the employment relationship (i.e., the
psychological contract) may determine if and what kinds of i-deals are asked
for and how they are interpreted by employees (Hornung, Rousseau, & Glaser,
2009).
It becomes apparent that by negotiating i-deals, individual employees can shape
their employment relationships according to their personal needs and
requirements of their tasks and jobs as well as their intended contributions to
the organization (Rousseau, 2005). Nowadays, idiosyncrasy is more widespread
in organizations than one might think. Between 25% and 40% of employees
already have idiosyncratic work arrangements (Rousseau, 2005). To cite Denise
Rousseau, who first introduced the concept of i-deals: “On a given day in
virtually any organization, one individual or another is taking the initiative to
individualize some aspect of his or her employment relationship” (Rousseau,
2005, p. 22).
12 Introduction
1.4 Theoretical Relevance of Idiosyncratic Work Arrangements
In response to an increasing use of individualized work arrangements in
practice due to an increasingly diverse workforce and workplace (Broschak &
Davis-Blake, 2006), research on customization of work arrangements has
flourished over the previous years (Hornung et al., 2008; Rosen, Slater, Chang,
& Johnson, 2013; Rousseau, 2005; Rousseau, Hornung, & Kim, 2009). Growing
research interest has discussed and studied the role of employees in the new
working environment (Hornung et al., 2008) and suggests that workers will
increasingly have to design their jobs and to create their career opportunities
(Savickas et al., 2009). Extant literature shows that employees play a more
proactive role in shaping their own jobs (e.g., Sullivan & Baruch). Specifically,
employees strive to customize their tasks, responsibilities, work conditions and
employment relationships in response to their own needs (Wrzesniewski &
Dutton, 2001; Lawler & Finegold, 2000). Among other approaches, this
customization can be achieved through idiosyncratic deals (so-called “i-deals”),
where individual employees negotiate with their employer in order to adapt
their work conditions to better meet their personal needs (Hornung et al., 2008).
I-deals is probably the construct depicting individualization at work which has
received the most increasing research interest over the last few years (Hornung
et al., 2008; Rosen et al., 2013; Rousseau, 2005; Rousseau et al., 2009).
I-deals are assumed to have several beneficial effects for individual employees
and are related to a variety of positive employee attitudes and behavior, such
as engagement, affective commitment and proactiveness (for reviews see
Conway & Coyle-Shapiro, 2016; Liao, Wayne, &, Rousseau, 2016). Going
beyond the benefits for individuals, the definition of i-deals also promises
positive effects for organizations (e.g., Rousseau, 2005). However, little research
exists on the effects of i-deals for organizations (Conway & Coayle-Shapiro,
2016). Although scientific research is scarce, researchers surmise positive effects
for companies that offer their employees i-deals. Potential positive effects
include employee attraction, retention, development, motivation and
Introduction 13
employability as well as organizational performance (Kroon, Freese, & Schalk,
2016). Specifically, Kroon et al. (2016) suggest that i-deals could be applied as a
competitive advantage for organizations. In a first multilevel study, Bal and
Boehm (2017) found a positive relationship between i-deals and client
satisfaction at the unit-level. However, to my knowledge, no further research
exists to clarify the role of i-deals for organizations and their performance.
There seems to be a dark side of i-deals, however, especially at the collective
level, which has been neglected in i-deals research (Bal & Boehm, 2017; Garg &
Fulmer, 2017; Nauta & Van de Ven, 2016). Potential drawbacks of i-deals might
involve perceived unfairness and damaged relationships between employees
(Greenberg, Roberge, Ho, & Rousseau, 2004; Kroon et al., 2016). A main concern
voiced by researchers is the so-called “Mathew-effect” (Bal & Lub, 2016). Strong
negotiators might more often receive i-deals from their employer, which
enhances their career chances, making it easier to repeatedly negotiate for i-
deals in the future. In contrast, people who are not very skilled at negotiating
will probably not receive i-deals resulting in lower career chances (Bal & Lub,
2016). Consequently, coworkers without i-deals will likely feel treated unfairly,
which causes dysfunctional behavior, impeding the performance of the i-dealer
(an employee who receives an i-deal), the team, and the organization
(Greenberg et al., 2004). Furthermore, both employees with comparably high
and low career chances might try to leave the company, resulting in higher
turnover rates and decreased organizational performance (e.g., Kroon et al.,
2016; Ng & Feldman, 2010). Further potential costs for companies result from
long and complicated negotiation processes involving huge efforts from all
parties involved (Kroon et al., 2016). In addition, due to managers having little
experience negotiating and maintaining individualized working arrangements,
the chance for creating successful i-deals, which are perceived as fair by
everyone, is low (Greenberg et al., 2004).
These feared negative effects threaten to overshadow potential benefits of i-
deals for organizations and might be the reasons why many organizations shy
away from granting i-deals to their staff. As research is not yet far enough to
14 Introduction
either recommend or dissuade companies from i-deals (Conway & Coyle-
Shapiro, 2016), it is time to take a step further and examine effects of i-deals on
organizations. As Liao et al. (2016, p. 23) state in their review of i-deals studies
to date: “Greater attention on the theoretical implications of i-deals at the
organizational level is […] warranted”. Based on the defining feature that i-
deals are mutually beneficial for employee and employer (Rousseau, 2005), not
only the practical but also theoretical legitimacy of i-deals depends on whether
i-deals also contribute to collective performance. One as yet unanswered but
prominent question in i-deals research is therefore: “Do organizations that
encourage and allow i-deals perform better than ones without i-deals?” (Liao et
al., 2016, p. 23). This dissertation aims to answer this question and introduces
the organizational level of analysis to i-deals literature to this end.
1.5 Literature Review on I-Deals Research
Meeting current changes in society and the economy, a growing interest in i-
deals research and literature has emerged (Bal & Boehm, 2017). Lacking a single
standard definition however, existing studies slightly differ in terms of the
actual definition of i-deals (Conway & Coyle-Shapiro, 2016). Specifically, while
some i-deals articles focus on the benefits of i-deals for both employees and
employer (e.g., Bal & Boehm, 2017; Lai, Rousseau, & Chang, 2009), other i-deals
studies highlight the personal need satisfaction of the employee and thereby
emphasize the benefit of the individual worker (e.g., Hornung et al., 2010a; Ng
& Lucianetti, 2016). Furthermore, studies published to date on i-deals differ in
terms of how many dimensions of i-deals (e.g., location and schedule flexibility,
developmental and financial i-deals) are covered (Convay & Coyle-Shapiro,
2015). Most studies on i-deals are cross sectional and link self-reported i-deals
with self-reported outcomes, while longitudinal studies are rather rare in this
field of research (Conway & Coyle-Shapiro, 2016).
Introduction 15
1.5.1 Underlying Theory and Mechanisms
The theoretical foundations of i-deals can be retraced to social exchange theory
(Rosen et al., 2013). Social exchange is built on the basic principle that one
person does another a favor with a general expectation of unspecified
reciprocation in the future (Blau, 1964). Social exchange relationships are
characterized by the fact that individuals tend to reciprocate favors, even if not
required to do so (Blau, 1964). The nature of social exchange relationships is
dependent on what each party has to offer (Cropanzano & Mitchell, 2005). In
the employment relationship, employees may for example contribute with
effort, motivation and commitment to an organization, while employers may
offer higher compensation, recognition or career advancement and
development opportunities (Tsui, Pearce, Porter, & Tripoli, 1997). Social
exchange theory is used to explain the existence, nature and functioning of i-
deals throughout the relevant literature (Greenberg et al., 2004). First, social
exchange theory postulates that employees make voluntary contributions to the
organization because they are motivated by expected but unspecified
reciprocation in the future, surmising a long-term relationship with the
employer (Blau, 1964). Consistent with this aspect of investments in a long-term
relationship, i-deals are generally not negotiated and granted until the
employees have proven their value to the employer by for example high
performance (Rousseau, 2005). Therefore, i-deals may be a way for the employer
to reciprocate an employee’s efforts and contributions (Liao et al., 2016). Second,
social exchange relationships develop because two parties - such as employee
and employer - help each other to reach goals (Cropanzano & Mitchell, 2005).
Similarly, i-deals are negotiated because they are beneficial for both parties - the
employee and the organization (Rousseau, 2005). Finally, building on social
exchange theory, Rousseau et al. (2006) propose that i-deals influence employee
attitudes and behavior because they indicate that the organization is interested
in a high-quality and long-term exchange relationship. Thus i-dealers feel
obliged to reciprocate through beneficial work attitudes (e.g., commitment) and
behaviors (e.g., task performance; Liao et al., 2016). In sum, social exchange
16 Introduction
theory represents a well-established framework to explain why employers give
i-deals to selected employees and why i-dealers react as they do (Liao et al.,
2016). In line with predictions based on social exchange theory, Ng and Feldman
(2010) for example found in their study that the relationship between i-deals
and voice behavior is mediated by employees’ organizational trust.
However, some researchers have found evidence that receiving i-deals does not
always cause employees to reciprocate with enhanced performance,
commitment or motivation (e.g., Hornung et al., 2009; Rousseau et al., 2009).
Therefore, other explanatory mechanisms were suggested to account for the
seemingly more complex relationship between i-deals and outcomes. An
alternative explanatory mechanism suggested by Liao et al. (2016) refers to the
role of employees’ goals in pursuing and asking for i-deals (Latham & Locke,
1991, 2007). Goals are defined as internal states which help individuals to
regulate and align their behavior to achieve valuable targets (Latham & Locke,
1991, 2007). Liao et al. (2016) propose that employees seeking enhanced
flexibility or less workload may not necessarily be motivated to work harder on
their employers’ benefit. More likely, those employees are seeking personal
benefits such as increased work-life balance or less strain at work (Liao et al.,
2016). Furthermore, researchers suggest job characteristics theory as relevant for
i-deals research (Hornung et al., 2010a; Hornung et al., 2010b; Liao et al., 2016).
For instance, i-deals that provide individual employees the opportunity to work
on their preferred tasks change the perceived characteristics of the job,
specifically job complexity and autonomy (Hornung et al., 2010a; Hornung et
al., 2010b). Similarly, Ho and Kong (2015) draw on self-determination theory,
by stating that i-deals translate into beneficial attitudinal and behavioral
responses by need satisfaction, focusing on enhanced competence need
satisfaction. Self-determination theory implies that employees seek i-deals with
the aim to better fit their jobs to their individual needs (Rousseau et al, 2006).
Relevant for the work context are needs regarding job content and
responsibility, work hours and schedule flexibility as well as personal and
career development (Nauta & Van de Ven, 2016). In line with those theories, Bal
Introduction 17
and Boehm (2017) argue based on work adjustment theory that i-deals have
positive effects on individuals because they enhance the fit between personal
needs, skills and the job.
Although social exchange and need based processes are the most commonly
used theoretical mechanism in i-deals literature, they have been criticized for
being too general, offering ambiguous predictions and neglecting potential
damaging effects at the individual and the collective level (Conway & Coyle-
Shapiro, 2016). Conway and Coyle-Shapiro (2016, p. 59) demand “better
theorizing on the multilevel effects of i-deals”, including individual- and
collective-level effects. Indeed, scholars have suggested additional explanatory
mechanisms linking i-deals and outcomes, of which the most common are
presented in the following.
Akin to social exchange theory is the explanatory mechanism suggested by Liu,
Lee, Hui, Kwan and Wu (2013). The authors use self-enhancement theory to
explain the effects of granting i-deals to employees by proposing that i-deals
lead to improved outcomes (e.g., employee performance) by enhancing the self
(Liu et al., 2013). Employees pursue self-enhancement because they wish to see
themselves in the most positive light, regarding their behavior, attitudes,
characteristics and skills (Pfeffer & Fong, 2005). Korman (2001) suggests that
receiving information that facilitates personal development and performance
enhances employees’ self. According to Liu et al. (2013), granting i-deals to an
employee conveys the message that they are valuable to the employer, because
the employer is willing to make special concessions for their efforts. This is in
line with the arguments of Ho and Kong (2015), who assume that i-deals
function as signaling devices based on signaling theory. They suggest that i-
deals can be used as signals by the employer to convey his or her positive
evaluation and regard for valued employees in order to elicit desirable
attitudinal and behavioral responses that in turn benefit the organization.
Furthermore, justice theories play a major role in i-deals research, as i-deals
cause differences between employees (Rousseau, 2005). Equity theory, focusing
18 Introduction
on distributive justice, was introduced into i-deals literature by suggesting that
the effects of employees’ i-deals are dependent on their coworkers’ reactions
(Ng & Lucianetti, 2016). Adams’ (1965) equity theory proposes that equity arises
when employees compare themselves with others and perceive that the ratio of
their outcomes to their inputs is equal to their coworkers’ outcome/input ratio,
while inequity occurs when the ratio of own outcomes to inputs is unequal to
the ratio of others (Pritchard, 1969). Distributive inequity can occur when, for
example, two people work for the same person and compare their working
arrangement to each other (Ng & Lucianetti, 2016). Adams suggests four
strategies to avoid inequity: first, by cognitively changing one’s own, or others’
input/outcome ratio, second, by influencing others to change theirs, third, by
changing own inputs or outcomes and fourth, by changing the comparison
person or ending the employment relationship (Pritchard, 1969). Applied to i-
deals literature, researchers suggest that employees compare their work
arrangements with their colleagues’ (e.g., Rousseau, 2005). Individuals who
perceive that they are receiving less rewards and resources than their coworkers
are trying to change the unfair situation for example by negotiating their own i-
deals which grant them more resources (Ng & Lucianetti, 2016). If perceived
inequalities cannot be solved or are not addressed by i-dealers or supervisors, a
variety of problems might arise due to perceived injustice (Greenberg et al.,
2004). As such, employees’ justice perceptions are the core dilemma regarding
individual work arrangements (Nauta & Van de Ven, 2016). While not being
focused on as much as distributive justice, increasing attention is also being
payed to procedural justice theory. Procedural justice includes perceived
fairness of decision-making procedures and allocation processes (Li &
Cropanzano, 2009). Liao, Wayne, Liden and Meuser (2017) integrate i-deals and
procedural justice theory by suggesting that employees experience control and
voice in the process of modifying their work arrangements – both aspects of
procedural justice - through successful i-deal negotiations (Folger &
Cropanzano, 1998; Greenberg et al., 2004; Liao et al., 2017; Thibaut & Walker,
Introduction 19
1975). Supporting their reasoning, i-deals were related to enhanced procedural
fairness perceptions (Liao et al., 2017).
Vidyarthi et al. (2016) explore the effects of i-deals trough the lens of social
comparison and social identity theory. Akin to justice theories, these theories
assume that employees compare their work arrangements with those of their
coworkers. Because employees are embedded in a social context at work,
customized work arrangements different from those of others, such as i-deals,
invoke social comparison with coworkers (Anand & Vidyarthi, 2016). Social
comparison theory claims that individuals evaluate their own social status in
comparison to a reference group in order to construct self-awareness and social
reality (Festinger, 1954; Hyman, 1942; Mettee & Smith, 1977; Sheriff, 1936).
Social identity theory in turn postulates that an individual’s social identity in an
intergroup context shapes his or her self-concept in a group and thereby affects
attitudes and behaviors (Hogg & Terry, 2000; Tajfel & Tuner, 1985). Integrating
social comparison and social identity theory, Vidyarthi et al. (2016) show that
employees react to their relative status with respect to i-deals within their team
(measured by own i-deals compared to the groups mean i-deal) and that the
group context impacts the relationship between i-deals and work behaviors.
While research based on justice, social comparison and social identity theories
assumes that i-deals function in a social context and thus have examined
employees’ reactions to i-deals in group contexts, Bal and Boehm (2017) draw
on contagion theory to argue that benefits caused by i-deals at the individual
level are transferred across organizational members and ultimately to clients.
Contagion theory (Hatfield, Cacioppo, & Rapson, 1992) explains how
employees influence each other’s emotions and attitudes in teams, units and
departments, and organizations.
In summary, i-deals research is increasingly based on a rich theoretical basis.
However, what is clearly lacking are theoretical frameworks to explain the
relationship between i-deals and performance at the organizational level (e.g.,
Conway & Coyle-Shapiro, 2016; Liao et al., 2016). In the following, I summarize
20 Introduction
key findings of i-deals literature, without claim to completeness, regarding
consequences and antecedents of i-deals, moderators, and context factors as
well as mediating mechanisms between i-deals and outcomes. I conclude with
the results from initial studies examining i-deals from a multilevel perspective.
1.5.2 Consequences of I-Deals
I-deals have been linked to a variety of outcomes at the individual level such as
employee work-related perceptions, attitudes, and behavior. As such, research
has focused mainly on development and flexibility i-deals, while some studies
include task and work responsibility as well as workload reduction and
financial incentive i-deals.
Developmental i-deals were found to be related to several positive outcomes,
for example OCB towards coworkers and supervisors as well as towards the
organization as whole (Anand, Vidyarthi, Liden, & Rousseau, 2010), affective
commitment (Hornung et al., 2008), work engagement (Hornung, Rousseau,
Glaser, Angerer, & Weigl, 2011), increased performance, and motivation
(Hornung et al., 2009). However, developmental i-deals also show positive
relations to work-family conflict and unpaid overtime (Hornung et al., 2008). In
contrast, flexibility i-deals are negatively related to work-family conflict and
working unpaid overtime (Hornung et al., 2008; Hornung et al., 2009; Hornung
et al., 2011) as well as positively related to job satisfaction and organizational
commitment (Rosen et al., 2013). Ng and Lucianetti (2016) furthermore showed
that flexibility and development i-deals are related to in-role job performance.
Vidyarthi, Chaudhry, Anand, and Liden (2014) introduced the idea of possible
U-shaped relations of i-deals to outcomes on the individual level and found
evidence for a U-shaped relationship between flexibility i-deals and perceived
organizational support and career satisfaction. Specifically, high-perceived
organizational support and career satisfaction were found at low and high
levels of flexibility i-deals.
Introduction 21
In addition, i-deals are related to the nature of the employment relationship.
Developmental i-deals cause employees to perceive their employment as a
social exchange rather than an economic one, whereas flexible work hour i-deals
are positively related to perceiving employment as an economic exchange
(Rousseau et al., 2009). Similarly, Lee and Hui (2011) found that i-deals are
related to perceived psychological contracts. While personal development i-
deals are more positively related to relational and balanced (i.e., combining
relational and transactional features) psychological contracts, flexibility and
workload reduction i-deals are related more positively to transactional
psychological contracts.
Few studies have included other forms of i-deals than development and
flexibility i-deals, as for example task and work responsibility i-deals and
financial incentive i-deals. Considering those different types of i-deals in
addition to flexibility and developmental i-deals, Rosen et al. (2013) showed that
task and work responsibility i-deals positively relate to job satisfaction and
organizational commitment, while financial incentive i-deals are linked to
organizational commitment.
Some i-deals studies examine a composite measure including different forms of
i-deals. Ng and Feldman (2010) used an i-deals measure covering a broad array
of elements such as pay, advancement opportunities, training, career
development, job security and support with personal problems. They showed
that i-deals, including all these facets, were related to organizational affective
commitment. Using a general operationalization of i-deals as well, Hornung et
al. (2010a) showed that i-deals are positively related to job satisfaction. Bal and
Boehm (2017) found a negative relationship between an overall i-deals measure
and emotional exhaustion.
Finally, Rofcanin, Berber, Koch, and Sevinc (2016) compared the effects of i-
deals with those of job crafting on key employee outcomes. As I discussed
earlier, i-deals and job crafting represent possibilities for employees to better fit
their jobs to their needs with the difference that i-deals require the formal
22 Introduction
approval of the supervisor (e.g., Rousseau, 2005). Rofcanin et al. (2016) found
that i-deals are more strongly related to in-role work performance, citizenship
behaviors directed at organization and co-workers, affective commitment and
intentions to stay than job crafting.
1.5.3 Antecedents of I-Deals
As a second focus, i-deals research has examined several antecedents of i-deals.
Because i-deals research has focused on i-deals initiated by employees and
negotiated together with the direct supervisor, characteristics of employees and
line managers as well as their relationship play an important role for the
emergence of i-deals. First, the employee-supervisor relationship and
leadership behavior have been identified as one significant factor influencing
successful negotiations of i-deals. LMX and leader consideration were both
found to be positively related to employees’ i-deals in several studies (e.g.,
Hornung et al., 2010b; Hornung et al., 2011). While LMX describes the quality
of the relationship between employee and line manager, leader consideration
refers to an employee-centered leadership style focusing on social relationships
at work including concern and support for employees (e.g., Fleishman, 1973;
Graen & Uhl-Bien, 1985). Second, Las Heras, Van der Heijden, De Jong and
Rofcanin (2017b) showed that characteristics of the leader are important. Their
study showed that employees received more schedule i-deals when their
supervisors had caregiving responsibilities for their parents or in-laws.
However, whether or not supervisors had children was not related to their
subordinates’ schedule i-deals. Furthermore, individual characteristics seem to
play an important role in employees successfully negotiating and handling i-
deals. Lee and Hui (2011) showed that individualism is positively related to ex
ante i-deals, perceived insider status to ex post i-deals, and social skills are
associated with both forms of i-deals. Further studies have indicated that
personal initiative predicts i-deals (Hornung et al., 2008; Hornung et al., 2009).
Finally, Ng and Lucianetti (2016) showed that employees’ motivational goals
are important antecedents of i-deals. Comparing different motivational goals in
Introduction 23
their study, they found that achievement striving and status striving have
positive effects on i-deals negotiations, while communion striving has no effect.
In addition, characteristics of the working environment influence the
negotiation of i-deals. As already mentioned in Chapter 1.1, working
arrangements such as part-time work and home office, are positively related to
the negotiation of i-deals (Hornung et al., 2008). In line with these findings,
Bayazit and Bayazit (2017) showed that the perceived availability of flexible
work arrangements is positively related to the successful negotiation of
flexibility i-deals between employees and their leaders. In addition, structural
conditions such as unit size, group size and job constraints negatively influence
the negotiation of flexibility i-deals (Hornung et al., 2009).
1.5.4 Moderators and Relevant Context Factors
Research has also focused on moderators and context factors influencing the
effect of i-deals on employees and their coworkers. First, research has shown
that the relationship between the i-dealer and their team is an important factor.
Employees are more likely to accept the i-deal of a coworker if he or she is a
close friend and if they have a social, as opposed to an economic, exchange
relationship with their employer (Lai et al., 2009). Furthermore, the belief, that
an i-deal is also achievable for them in the future, is important for the acceptance
of a coworker’s i-deal (Lai et al., 2009). In addition, Ng and Lucianetti (2016)
found evidence that coworkers receiving i-deals motivates other employees to
ask and negotiate for i-deals themselves.
In addition to the relationship with coworkers, research has demonstrated that
the connection to the supervisor and the organization is critical. Anand et al.
(2010) showed that i-deals have no effect on OCB in settings with high quality
relationships (measuring the relationship quality between i-dealers, their
coworkers and supervisors) but are effective in settings with low-quality
relationships. Furthermore, supervisors more likely grant workload reduction
i-deals in the context of unfulfilled organizational obligations towards
24 Introduction
employees, characterized by a reward imbalance in the employee-employer
relationship (Hornung et al., 2009). Moreover, Ho and Tekleab (2016) showed
that i-deals requests were more positively related to actual i-deals receptions for
high than for low LMX. Finally, Las Heras, Rofcanin, Bal and Stollberger (2017a)
found that the effect of flexibility i-deals on family and work performance was
moderated by perceived organizational support, such that the relationship was
positive for high support but non-existent for low support.
The timing of i-deals negotiation is also important for their successful
negotiation and their effect on the employment relationship. Research shows
that employees are more successful in negotiating i-deals at the time of hire (ex
ante) than in later stages of the employment (ex post; Rousseau, 2005). Rousseau
et al. (2009) further showed that ex-post i-deals have greater impact on the
employment relationship compared to those i-deals negotiated ex ante
(Rousseau et al., 2009). Their study revealed in addition that i-deals negotiated
ex post are positively related with a social exchange relationship between
employee and employer and negatively with an economic exchange
relationship. On the contrary i-deals negotiated ex ante have no relation to
employees’ perceptions of the nature of the employment relationship (Rousseau
et al., 2009). Lee and Hui (2011) found similar results in a study showing that i-
deals made ex ante are more positively related to transactional psychological
contracts, while i-deals negotiated ex post are more positively linked to
relational and balanced psychological contracts. Furthermore, while ex ante
negotiation of i-deals leads more often to flexible work hour i-deals than to
developmental i-deals, ex post negotiation processes are related equally positive
to both forms of i-deals (Rousseau et al., 2009).
Moreover, initial results speak for the importance of the unit climate for the
functioning of i-deals: while flexibility i-deals contribute to a greater motivation
to continue working after retirement irrespective of the unit work climate, this
is not the case for developmental i-deals as they only contribute to a greater
motivation to continue working if the unit climate does not push older workers
Introduction 25
to withdraw from work and retire early but does encourage them to develop
themselves and use their knowledge and experience (Bal et al., 2012).
Finally, employees’ individual characteristics play a role as moderating
variables for the relationship between i-deals and outcomes. For example,
research reports that the positive relationship between i-deals and affective
organizational commitment is stronger for employees who have low self-
evaluations. In addition to employees’ self-worth, their age also plays a role.
Specifically, i-deals were most positively related to organizational commitment
for the group of older workers who had low self-evaluations (Ng & Feldman,
2010).
1.5.5 Mediators and Explanatory Mechanisms
A variety of theories were proposed in order to explain the functioning of i-
deals (see Chapter 1.5.1), which go hand in hand with several mediating
mechanisms that have already been explored in i-deals research. As I have
earlier discussed extensively the variety of theories and related explanatory
mechanisms, I now provide a brief summary of those not yet mentioned as well
as the most important mediators in the i-deals literature.
A majority of mediators for the relationship between i-deals and outcomes is
derived from theories based on social exchanges and need satisfaction.
However, other studies have also examined mediators based on less frequently
used theories in i-deals research such as self-enhancement or justice theory.
Basing their argument on social exchange theory, Ng and Feldman (2015) report
that i-deals are positively related to employee voice behavior, mediated by
flexible work role orientation, social networking behavior, and perceived
organizational trust. The mediating effects of all three intermediate variables
were generally stronger for development i-deals than for flexibility i-deals. Ho
and Kong (2015) showed in line with both social exchange and need satisfaction
perspectives that task and financial i-deals are related to coworker related OCB
via LMX and via competence need satisfaction. Infomed by person-job fit and
26 Introduction
subsequent need satisfaction, a study by Hornung et al. (2010b) examined task
i-deals and showed an association with a more positive evaluation of work
characteristics, specifically, higher perceived complexity, control, and lower
stressors. Perceived work characteristics further mediated positive indirect
effects of task i-deals on employee initiative and work engagement. Referring
to employees needs but also to equity theory, Hornung et al. (2010a) showed
that the positive effect of i-deals on job satisfaction is mediated by enhanced job
autonomy and perceived distributive justice. Liu et al. (2013) examined the
mediating roles of social exchange and self-enhancement and discovered that
the positive relationships between i-deals and proactive behavior as well as
between i-deals and affective commitment is mediated by different
mechanisms, depending on the cultural dimension individualism. Specifically,
perceived organizational support mediates the relationship between i-deals and
outcomes for low levels of employees’ individualism, while organization-based
self-esteem mediates this relationship for high individualism. Similarly,
Oostrom, Pennings and Bal (2016) used self-enhancement theory to show that
the positive relationship between task and work responsibility i-deals and
employability is mediated by employees’ perceived self-efficacy.
In addition, less common explanatory mechamisnsm were applied in i-deals
literature. Las Heras et al. (2017a) conducted an initial i-deals study based on
conservation of resource theory which states that possessing a resource leads to
the generation of other resources in the same but also in other domains.
Accordingly, they found that the effect of flexibility i-deals on work
performance was mediated by performance in the family domain. Finally, but
essential to i-deals literature and theory, Ho and Tekleab (2016) showed that the
relationship between i-deals request and job satisfaction, organizational
commitment and turnover intention is mediated by actual i-deal reception.
1.5.6 Multilevel Research on I-Deals
Calls have been raised for i-deals research to examine effects at the team and
organizational level (e.g., Liao et al., 2016) and some studies examining i-deals
Introduction 27
in team and unit contexts already exist. Relative i-deals (Vidyathi et al., 2016)
are a newly introduced construct in i-deals research, which aims at studying i-
deals in a team context. Vidyarthi et al. (2016) showed that the relationship
between relative i-deals (defined as an employee’s i-deal relative to the group’s
average level of i-deals) and employee performance is moderated by team
orientation and task interdependence and mediated by LMX social comparison.
LMX social comparison in their study represented an employees’ relative
standing with the leader compared to other group members. Liao et al. (2017)
showed in a multilevel model that the positive relationship between i-deals and
individual job satisfaction, in-role performance, and helping behavior is
mediated by employees’ perceptions of their leaders' procedural justice and
LMX quality in sequence. LMX differentiation moderates the mediated
relationship between i-deals and outcomes, such that the relationship between
i-deals and outcomes becomes stronger for greater LMX differentiation within
the team. Finally, Bal and Boehm (2017) combined the individual and the unit
level in a multilevel study and found that individual i-deals were negatively
related to individual emotional exhaustion and subsequently positively related
to collective commitment and client satisfaction within units. Furthermore, the
relationship between i-deals and emotional exhaustion was moderated by age
diversity in units such that the relationship was more negative in units with
high age diversity.
In sum, this literature review indeed reveals that theorizing and research is
scarce at the team and the unit level, while i-deals research seems to be
completely non-existent at the organizational level. This finding of the current
literature review is in line with scholars’ calls for future research to study the i-
deals – performance relationship from an organizational perspective (e.g., Liao
et al., 2016). As dicussed in Chapter 1.3, this dissertation aims at addressing this
gap in i-deals literature. In the following, I derive specific research gaps from
the existing literature regarding the relationship between i-deals and
organizational performance.
28 Introduction
1.6 Research Gaps and Intended Contributions
To explore the central question of how organizations can exploit the full
potential of individually negotiated deals with their employees, it is necessary
to break the question down into central issues that have not been investigated
by previous research which has neglected at least five major aspects.
First, research on i-deals has focused on individuals, while outcomes on
organizations have been neglected, although by definition, i-deals are beneficial
for both employees and organizations (e.g., Conway & Coyle-Shapiro, 2016).
However, the link between i-deals and performance has not been investigated
throughly especially not at the organizational level (e.g., Liao et al., 2016).
Second, introducing the concept of i-deals at the organizational level requires
examining intermediating processes between i-deals and organizational
performance such as collective attitudes, behavior, and organizational climate
(e.g., Liao et al., 2016).
Studying i-deals at the organizational level of analysis already implies that i-
deals operate in a social context, including manifold boundary conditions (e.g.,
Bal & Lub, 2016). Thus, the last three gaps relate to boundary conditions of i-
deals in the organizational context, which become especially relevant when i-
deals are studied at the organizational level. As third gap in i-deals research, I
identified the missing research on the role of the direct leader (e.g., Liao et al.,
2016). Despite the assumption that supervisors play an important role in the
negotiation and implementation of i-deals, research on the impact of different
leadership styles is scarce. Fourth, organizational justice is considered as
essential in i-deals theory, as i-deals cause differences between employees (e.g.,
Greenberg et al., 2004). Some authors have proposed that organizational justice
could mitigate negative effects when employees feel treated unfairly due to i-
deals (e.g., Liao et al., 2016). However, this potential positive effect of
organizational justice climate has not been studied yet. Fifth, the interplay
between i-deals and HRM has so far not been examined (e.g., Kroon et al., 2016).
While i-deals refer to individualized deals, they will probably relate to higher-
Introduction 29
level employment conditions rooted in an organization’s HRM (i.e., HR
practices for groups of employees; Kroon et al., 2016). Those five gaps in i-deals
research are discussed in detail in the following.
1.6.1 I-Deals and Organizational Performance
Research on i-deals has mainly focused on the positive effects of i-deals on
individual workers. Impacts on organizations have been neglected although i-
deals are defined as beneficial for both employees and organizations and
research has not yet explored the link between i-deals and organizational
performance (Anand & Vidyarthi, 2016; Conway & Coyle-Shapiro, 2016; Kroon
et al., 2016). However, i-deals are embedded in social and organizational
contexts and therefore influence not only outcomes at the individual but also at
the collective level (Rousseau, 2005). This is especially important as an
increasing number of firms is adopting flexible working arrangements to meet
a variety of societal trends and a corresponding diversification of employee
needs (e.g., Rousseau, 2005, Nauta & Van de Ven, 2016). The aim is to retain
valuable employees and motivate them to perform better (Bal & Rousseau,
2016). To date, research has not yet shown if these desired outcomes for
organizations occur (Conway & Coyle-Shapiro, 2016; Kroon et al., 2016). As a
first step, Bal and Boehm (2017) found a positive effect of i-deals on unit client
satisfaction. However, as Conway and Coyle-Shapiro (2016) claim, research has
not yet progressed enough in order to recommend i-deals to companies. Anand
and Vidyarthi (2016) suggest that introducing several levels of analysis to i-
deals literature, such as the individual, work group and organizational level,
will enrich i-deals research and further our understanding of individualized
work arrangements. To meet this challenge, researchers suggest two promising
options: first, effects at collective levels could be examined by focusing on
median i-deals, reflecting the average level of i-deals in a collective (Anand,
2012; Liao et al., 2016). Second, heterogeneity between employees regarding i-
deals, or so-called i-deals differentiation, seems to be a promising avenue for
future research at the collective level (Anand, 2012; Liao et al., 2016). Although
30 Introduction
today many employees have customized work arrangements, the degree to
which this idiosyncrasy is beneficial to organizations is still an unanswered
empirical question (Liao et al., 2017). Based on this reasoning, a key aim of this
dissertation is to examine the effect of both conceptualizations of i-deals (i.e.,
organizational median i-deals and i-deals differentiation) on organizations.
Research Question 1: How do organizational median i-deals and i-deals
differentiation influence organizational performance?
1.6.2 Intermediate Processes at the Organizational Level
When the concept of i-deals is examined at the organizational level, it is
important to consider potential intermediate processes by which i-deals
influence companies as i-deals are most likely not directly linked with
organizational performance (Liao et al., 2016). The question is how
organizational median i-deals and i-deals differentiation affect collective
processes, such as collective climates, attitudes and behavior, and ultimately
organizational performance (Bal & Rousseau, 2016; Liao et al., 2016). Identifying
intermediate processes in the relationship between i-deals and organizational
performance has been recognized as a crucial task for future i-deals research
(Conway & Coyle-Shapiro, 2016; Liao et al., 2016). The initial findings of Anand
(2012) and Bal and Boehm (2017) on group and unit level reveal that collective
processes and attitudes, such as team potency and collective commitment, are
positively affected by i-deals. However, many open questions remain,
especially at the organizational level, where i-deals may also have a dark side
(Conway & Coyle-Shapiro, 2016). A variety of potential mediating mechanisms
at the collective level, including potential negative effects of i-deals have been
suggested by researchers (e.g., Liao et al., 2016).
When i-deals are examined from the perspective of collectives, potential
negative reactions of coworkers have to be considered (Garg & Fulmer, 2017;
Greenberg et al., 2004). Serious concerns have been voiced that coworker
relations such as helping behavior between coworkers and collective climates
Introduction 31
might be impaired by i-deals in organizations (Conway & Coyle-Shapiro, 2016).
Furthermore, employees might perceive others’ i-deals as unfair (e.g.,
Greenberg et al., 2004; Marescaux & De Winne, 2016). One of the challenges in
managing i-deals is that differential distribution of i-deals within organizations
can erode the organizational justice climate (Liao et al., 2016). Attributions
coworkers make regarding others’ i-deals have implications for the
organizational justice climate, which can in turn increase costs for the
organization (Liao et al., 2016). Thus, the potential negative effects of i-deals on
coworker relations and the organizational justice climate likely affect
organizational performance (Conway & Coyle-Shapiro, 2016). This dissertation
aims to contribute to i-deals literature by examining potential mediation
mechanisms (i.e., collective attitudes, behavior, and climate), in the i-deals -
performance relationship at the organizational level. In this regard, both
potential positive and negative effects of i-deals on intermediate processes and
thereby on organizational performance are considered.
Research Question 2: Which processes, such as collective attitudes, behavior and
climate, mediate the relationship between i-deals and organizational performance?
1.6.3 The Role of Leadership
In most cases, i-deals are negotiated between employees and their direct
managers (Liao et al., 2016). Although supervisors play a key role in i-deals
literature, leadership has only thus far been treated mostly as an independent
variable and cause for i-deals. An exception is a study of Liao et al. (2017) who
focus on LMX differentiation as moderator for the relationship between i-deals
and outcomes. Furthermore, researchers have exclusively focused on
individual-focused leadership styles, which consider the relationship between
leaders and individual employees (LMX and leader consideration; Hornung, et
al., 2010b; Hornung et al., 2011; Hornung et al., 2014; Rosen et al., 2013). Despite
scarce research, there is a strong assumption that leaders not only influence the
negotiation (e.g., Ho & Tekleab, 2016; Hornung, Rousseau, Weigl, Müller, &
Glaser, 2014), but also the successful implementation of i-deals (Anand &
32 Introduction
Vidyarthi, 2016). This dissertation seeks to reinforce and expand the focus on
leadership in i-deals literature. Calls have been made for more research to
scrutinize how leadership styles beyond leader–member relationships shape
the effects of i-deals on organizations (Liao et al., 2016). Specifially, Liao et al.
(2016) have suggested that transformational leaders may create an environment
that encourages successful i-deals in organizations. In contrast to previous
studies, which include leadership styles focusing on the relationship between
the leader and individual employees, transformational leadership (TFL)
includes behaviors directed toward all members of the group and its individual
members simultaneously (Kark & Shamir, 2002). At the organizational level
when collective processes, such as collective attitudes, behavior, and climate
and ultimately organizational performance come into play, leadership behavior
directed towards all members of the group might become relevant. This is in
line with Greenberg et al. (2004) who suggest that supervisors should take the
needs of all stakeholders and not only of the i-dealer into account, when i-deals
are negotiated and implemented. Furthermore, a leadership climate is emerging
at the organizational level, which captures the average leadership behaviors in
organizations (e.g., Li & Cropanzano, 2009; Zohar & Luria, 2005). The current
dissertation therefore inspects the effects of organizational leadership climate,
including both individual- and collective focused leadership, on the successful
implementation of i-deals in organizations.
Research Question 3: How does the organizational leadership climate influence the
relationship between i-deals and organizational performance?
1.6.4 The Role of Organizational Justice
Liao et al. (2016) suggest the need for extensive future research on the role of the
organizational context in i-deals research. To date, only one study exists to my
knowledge which has investigated organizational climate as an important
context factor for i-deals to reveal their beneficial effects, including
organizational, supervisor, and work team support for older workers (Bal et al.,
2012). While organizational contexts include a broad variety of factors which
Introduction 33
potentially affect i-deals effectiveness, one key issue stands out from theoretical
discussions: while discussed in many papers, few studies have actually
combined i-deals and justice perceptions (e.g., Marescaux & De Winne, 2016).
Although all facets of organizational justice are often suggested as crucial
factors for effective i-deal implementation (Greenberg et al., 2004; Leventhal,
1980; Liao et al., 2016; Marescaux & De Winne, 2016; Rousseau, 2005), research
has focused solely on distributive and procedural justice perceptions at the
individual level (Liao et al., 2017; Marescaux & De Winne, 2016). Reactions and
fairness perceptions of coworkers are nonetheless becoming especially relevant,
when collective-level outcomes are examined. Particularly from a collective
perspective, social comparison processes are important as i-deals vary in
content and level for each employee (Liao et al., 2016). As a result, i-deals violate
the rule of consistency and negatively influence perceived justice (Liao et al.,
2016). However, scholars have argued that procedural justice in particular
might mitigate negative effects. Voice, transparency and consistency in
opportunity to negotiate i-deals – all key characteristics of procedural justice –
are suggested to mitigate negative effects of i-deals (Greenberg et al., 2004; Liao
et al., 2016; Rousseau et al., 2006). Most notably, consistency in opportunities to
negotiate i-deals is supposed to prevent aversion to i-deals differentiation (Liao
et al., 2016; Rousseau et al., 2006). Therefore, organizational justice climate with
a focus on procedural justice is also of interest for this dissertation.
Research Question 4: How does the organizational justice climate influence the
relationship between i-deals and organizational performance?
1.6.5 The Interplay between I-Deals and HRM
Research has claimed that, in addition to supervisors, the HRM plays a major
role in i-deals negotiations, however their influence on designing and
implementing effective i-deals has not yet been examined (Bal & Rousseau,
2016; Kroon et al., 2016; Liao et al., 2016). While HRM lays the foundation by
designing HR instruments, supervisors are in effect the organizational agents
who implement HR practices, grant requests for differentiation, and balance the
34 Introduction
interests of the employee and the employer (Greenberg et al., 2004; Hornung et
al., 2009). The increasing appearance of individualized work arrangements
shows that HR at present is not only a top-down process imposing HRM on
employees anymore, but also a bottom-up process by which employees try to
balance their own needs and those of their employer (Kroon et al., 2016).
Nonetheless, i-deals are not meant as a substitute for a HR instruments: they
can rather complement standard HR practices to make organizations more
flexible and attractive by offering additional flexibility and versatile options for
individualization to account for differences between employees and changes in
employees over time (Hornung et al., 2014). I-deals can also be used as a
management practice in order to repair imperfect fits between the standard
employment conditions and individual needs, such that the resulting working
arrangement satisfies both the requirements and needs of the employee and the
employer (Ostroff & Schulte, 2007). As suggested by researchers (e.g., Bal &
Rousseau, 2016; Kroon et al., 2016, Rousseau, 2005) one aim of this dissertation
is therefore to examine the interplay between HR standard practices and
flexibility through i-deals negotiated with the employee’s direct supervisor.
Research Question 5: How does the interplay between i-deals and HR practices
influence organizational performance?
This dissertation follows the five research questions derived above. Having
derived them based on extant i-deals literature and stated them, I briefly
summarize the overall research purpose of this dissertation. First and foremost,
this dissertation aims at investigation one of the most prominent but yet
unanswered questions in i-deals research: Are organizations that grant their
employees i-deals more successful than organizations that do not use i-deals
(Liao et al., 2016)? As discussed before in Chapter 1.2 and 1.3, this question is
relevant from a theoretical but also from a practical point of view. To delve more
deeply into this question, potential intermediating processes at the
organizational level are studied to clarify how i-deals affect organizational
performance. Those processes include collective attitudes, behavior and
climate. Beyond that, the organizational context becomes highly relevant for i-
Introduction 35
deals research on the organizational level and three prominent context
conditions are examined: leadership climate, organizationa justice climate, and
formal HR practices. The overarching model based on the five research
questions (see Table 1-2) for this dissertation is presented in Figure 1-1.
Table 1-2. The research questions of this dissertation.
Research Question 1: How do organizational median i-deals and i-deals differentiation influence organizational performance?
Research Question 2: Which processes, such as collective attitudes, behavior and climate, mediate the relationship between i-deals and organizational performance?
Research Question 3: How does the organizational leadership climate influence the relationship between i-deals and organizational performance?
Research Question 4: How does the organizational justice climate influence the relationship between i-deals and organizational performance?
Research Question 5: How does the interplay between i-deals and HR practices influence organizational performance?
Figure 1-1. Integrative research perspective.
Organizational Context
HR Practices Organizational Justice Climate
Organizational Leadership Climate
I-Deals
Organizational Median I-Deals
Indermediate Processes
Collective Climate
Organizational Performance
I-Deals Differentiation
Organizational Performance
Collective Attitudes and
Behavior
Operational Performance
36 Introduction
1.7 Methodological Approach
The afore-derived research questions are explored based on empirical research.
Specifically, quantitative, cross-sectional studies based on a positivist research
paradigm are conducted in this dissertation (Mackenzie & Knipe, 2006). In a
positivist worldview “causes probably determine effects or outcomes"
(Creswell, 2003, p. 7). This approach was chosen to explain and predict
relationships between constructs by general theories. The approach was
deductive in nature meaning hypotheses were theoretically derived and tested
(Mackenzie & Knipe, 2006). Because hypotheses cannot be confirmed, classical
testing methods aim to negate the null hypotheses (Popper, 1959). This
procedure was chosen over a qualitative or mixed methods approach as the
research began by deriving research questions and hypotheses from a literature
review (Mackenzie & Knipe, 2006).
As all derived research questions focus on the effects of i-deals from an
organizational perspective, my research was conducted with participants from
real settings, in this case organizations. To maintain the participation rate of the
requested companies and the generalization of the results as high as possible,
the participating employees and organizations should be disturbed as little as
possible in their daily work. Thus, an unobtrusive research method, namely a
cross-sectional survey study design, was used for all three studies (McGrath,
1981). To be able to gather survey data from a large sample of organization, the
data for all three studies was gathered in cooperation with a German benchmark
agency. Participating companies were small to medium sized. Specifically, data
was gathered with an online survey. This online survey was send to all potential
participants by the organizations themselves. To prevent same source bias,
several rater groups were asked for their participation in each organization,
namely employees, HR managers and members of the top-management team.
In line with research ethics and privacy policies, participation in the studies was
voluntary and full anonymity of all results was guaranteed to the participating
employees and organizations.
Introduction 37
1.8 Outline of the Dissertation
This dissertation is structured in five main parts (see Figure 1 – 2). The following
paragraph gives a short overview of the sections. As elaborated in the first
chapter, this dissertation examines i-deals within social contexts of
organizations. Thus, all three studies take on an organizational perspective with
the aim of examining the effect of i-deals on organizational performance.
Different intermediate processes and moderating aspects of the organizational
context are examined.
1.8.1 Chapter 1: Introduction
The first chapter introduced the concept of i-deals, gave an overview of existing
research, and identified research gaps. Specifically, the theoretical and practical
relevance of i-deals, especially from an organizational perspective, was
discussed. Five major research gaps and questions were derived from the
review of i-deals literature.
1.8.2 Chapter 2: Study 1 - How Do I-Deals Relate to Organizational Performance?
The Role of Collective Attitude, Coworker Relations and Leadership Climate
Study 1 focuses on the question of whether and how i-deals affect
organizational performance, inspired by Research Questions 1 and 2. This study
addresses these questions by introducing the organizational level of analysis in
i-deals research. Relying on social exchange and contagion theory, I propose
that organizational median i-deals affect employees’ collective job attitude
differently than coworker relations. I tested my propositions based on a sample
of 87 organizations. Results show that organizational median i-deals have a
positive, linear effect on collective job satisfaction, while having an inversed U-
shaped relationship to collective organizational citizenship behavior between
coworkers (OCBI). Both, collective job satisfaction and collective OCBI mediate
the relationship between organizational median i-deals and organizational
performance. Furthermore, inspired by Research Question 3, the organizational
38 Introduction
leadership climate was examined as a boundary condition for the functioning
of i-deals. While the effect of organizational median i-deals on collective job
satisfaction is moderated by the individual-focused leadership climate, the
effect on collective OCBI is moderated by the collective-focused leadership
climate. Support for moderated mediations are provided by the results.
1.8.3 Chapter 3: Study 2 - I-Deals Differentiation and Organizational Performance:
Does Idiosyncrasy Make I-Deals Non-Ideal?
Adding to Study 1 which examines the effect of organizational median i-deals
on organizational performance, Study 2 focuses on the relationship between i-
deals differentiation and organizational performance. In extant i-deals literature
concerns have been raised regarding the idiosyncratic nature of i-deals causing
inequality between employees, related negative justice perceptions, and
subsequent detrimental effects for organizational performance. The goal of this
study is to fill in this research gap by addressing the role of i-deals from an
organizational perspective, addressing again Research Questions 1 and 2. This
study is the first to examine the effect of i-deals differentiation on organizational
performance. Results imply that the extent to which i-deals differentiation is
beneficial to organizations is contingent upon context factors. Specifically,
Research Question 4 is addressed by examining the moderating effect of
procedural justice climate on the relationship between i-deals differentiation
and organizational performance. Study results based on a multi-source data set
containing 15,060 respondents from 96 companies reveal a three-way
interaction effect between i-deals differentiation, organizational median i-deals,
and procedural justice climate on perceived distributive justice of employees.
Further, distributive justice climate mediates the effect of i-deals differentiation
on organizational performance. Taken together, the results of the study provide
support for a moderated mediation model.
Introduction 39
Chapter 1: Introduction
Practical Relevance
Chapter 1: Introduction
Idiosyncratic Work Arrangements in the New World of Work Practical Relevance of Idiosyncratic Work Arrangements
Theoretical Relevance of Idiosyncratic Work Arrangements Positioning the Concepts of I-Deals
Literature Review on I-Deals Research Research Gaps and Indented Contributions
Methodological Approach Outline of the Dissertation
Chapter 2: Study 1
How Do I-Deals Relate to Organizational Performance? The Role of Collective Attitude, Coworker Relations and Leadership
Climate
Chapter 1: Introduction
Practical Relevance
Chapter 3: Study 2
I-Deals Differentiation and Organizational Performance: Does Idiosyncrasy Make I-Deals Non-Ideal?
Chapter 1: Introduction
Practical Relevance
Chapter 4: Study 3
Combining I-Deals and Human Resource Practices: Enhancing Organizational Performance through Consistency
Figure 1-2. Overview of chapter structure.
Chapter 5: Overall Discussion and Conclusion
Summary and Integration of Research Findings Theoretical Contributions
Practical Implications and Recommendations Limitations and Directions for Future Research
Conclusion and Outlook
40 Introduction
1.8.4 Chapter 4: Study 3 - Combining I-Deals and Human Resource Practices:
Enhancing Organizational Performance through Consistency
Study 3 focuses on Research Question 5 and addresses the interplay between
HR practices, specifically flexible working arrangements (FWAs) and i-deals,
representing informal arrangements between employees and their supervisors.
Nowadays, an increasing number of companies are implementing FWAs as HR
practices to meet differential needs of their workforce. The aim is to attract,
retain and motivate talented and high-performing employees for the good of
the organization. However, despite growing offers of FWAs in organizations,
supervisors are still able to refuse an employee’s use of FWAs according to their
personal needs, for example by negotiating for i-deals. From the perspective of
signaling theory, employees’ reactions to FWAs should be dependent on the
consistency between signals sent by the organizations’ HR systems and
managers. Based on a sample of 83 German companies, Study 3 shows that
FWAs only positively influence organizational productive energy and
organizational performance if flexibility through the HR system is
complemented by i-deals negotiated between employees and their supervisors.
1.8.5 Chapter 5: Overall Discussion and Conclusion
The final chapter of this dissertation revisits the research motivation and
questions as well as discusses the most important results and theoretical
contributions of the three empirical studies against the background of the
literature on i-deals, FWAs, organizational justice, and leadership. Furthermore,
this chapter offers practical implications for all interest groups involved in the
negotiation and implementation of i-deals. Finally, it summarizes the overall
limitations of the three studies and opportunities for future research.
Study 1 – How Do I-Deals Relate to Organizational Performance? 41
2 How Do I-Deals Relate to Organizational Performance?
The Role of Collective Attitude, Coworker Relations
and Leadership Climate
Study 1 of this dissertation was inspired by Research Question 1 and 2. It focuses
on whether i-deals influence organizational performance and which
mechanisms mediate this relationship. The study aims at investigating, if
organizational median i-deals are related to organizational performance.
Inspired by previous research, two potential explanatory mechanism –
collective job attitude and coworker relations – are examined. Furthermore, this
study draws on Research Question 3 and examines different leadership climates
as moderators for the i-deals – performance relationship.1F
2
2.1 Introduction
Do organizations that encourage and allow i-deals perform better than
ones without i-deals?
Liao et al. (2016, p. 23)
The nature of work is changing, leaving behind a massive need for research on
this phenomenon (Barley, Bechky, & Milliken, 2017). Societal changes make
organizations realize that standardized HR practices do not suffice anymore
and that individual arrangements are needed (Broschak & Davis-Blake, 2006).
Customization at the workplace has primarily been investigated from the
perspective of i-deals (e.g., Hornung et al., 2008; Rousseau et al., 2009),
individually negotiated employment arrangements that are intended to benefit
2 An earlier version of this study has been accepted at an international peer-reviewed conference,
namely the to 78th Academy of Management Annual Meeting 2018
42 Study 1 – How Do I-Deals Relate to Organizational Performance?
both the employee and the organization (Rousseau, 2005). Extant i-deals
research has mainly focused on positive effects of i-deals on individual
employees and only first few studies have applied multilevel methods to
examine i-deals in a team or unit context (Bal & Boehm, 2017; Liao et al., 2017;
Vidyarthi et al., 2016). A huge gap in research remains as scholars have not yet
studied i-deals from an organizational perspective. However, as the quote in the
beginning of this study implies (Liao et al., 2016), it is one of the most important
questions in i-deals literature, if i-deals are actually beneficial for organizations.
From a research perspective, it needs to be established if i-deals are positive for
organizations because i-deals are defined as beneficial for both employees and
employer (Rousseau, 2005). Similarly, from a practical perspective, i-deals are
only justifiable if they are beneficial for everyone involved, including the
organization (Bal & Boehm, 2017).
Thus, it is time to make a step further in i-deals research and examine
consequences of i-deals for organizations. However, scholars suggest that it is
not sufficient to investigate, if i-deals influence organizations, but that it is also
necessary to explore how and under which conditions this is the case. For
instance, Liao et al. (2016) suggest for future research to examine the effect of i-
deals on collective performance by identifying intermediating processes and
boundary conditions on the collective level. This study follows these
suggestions and addresses the question of whether, how and when i-deals
influence organizational performance.
The contribution to i-deals literature of the current study is threefold. First, the
current study examines, if the amount of i-deals in an organization is related to
organizational performance. I address this question by applying the construct
of organizational median i-deals, reflecting the median level of i-deals in an
organization (Anand, 2012; Liao et al., 2016). Second, possible mediating
mechanisms on the organizational level are examined. Scholars assume, that the
effect between i-deals and performance on collective level is mediated by
collective processes (e.g., Liao et al. 2016). However, there is still only limited
empirical evidence on how i-deals function in the workplace and how they
Study 1 – How Do I-Deals Relate to Organizational Performance? 43
influence collective attitudes and behavior, and consequently organizations (Bal
& Rousseau, 2016). While Bal and Boehm (2017) showed that i-deals contribute
to collective commitment within units, researchers suggest that teams,
departments and organizations are likely to suffer from i-deals regarding
coworker relations and helping behavior between coworkers (Conway & Coyle-
Shapiro, 2016). Indeed, Broschak and Davis-Blake (2006) find nonstandard work
arrangements to be negatively related to coworker relations and helping
behavior. To gain more clarity about processes mediating the relationship
between i-deals and organizational performance, this study proposes and
contrasts two possible explanatory mechanisms, namely collective job attitude
and coworker relations. Specifically, the current study focuses on how collective
job satisfaction, as most commonly studied job attitude, and coworker directed
organizational citizenship behavior (OCBI) are affected by the amount of i-deals
in organizations. Previous literature indicates that the effect of i-deals on
collective job satisfaction might be positive, while a negative effect on collective
OCBI could be possible (Bal & Boehm, 2017; Broschak & Davis-Blake, 2006;
Conway & Coyle-Shapiro, 2016). Third, from an organizational perspective,
organizational context factors shaping the relationship between i-deals and
performance come into play. Based on Rousseau’s (2005) framework, the
organizational context including employees’ direct manager influences how i-
deals are perceived by employees (Rousseau, 2005). Furthermore, i-deals are
negotiated and implemented in the leader-follower relationship (Rousseau,
2005). However, research on the role of leaders in the negotiation and
implementation of i-deals has been scarce and limited to leader consideration
and LMX (e.g., Hornung et al., 2011; Liao et al., 2017), thus focusing on
leadership behavior directed at building a relationship with individual
employees. In order to do justice to i-deals in an organizational context, this
study also examines leadership behavior that refers to the collective. To enhance
our knowledge about the role of different leadership styles in the
implementation of i-deals, the individual- and collective-focused leadership
climate in an organization are examined as contextual factors.
44 Study 1 – How Do I-Deals Relate to Organizational Performance?
2.2 Theoretical Background
2.2.1 I-Deals
Although i-deals are individualized arrangements negotiated between one
individual employee and his or her employer to fit the employee’s needs
(Rousseau et al., 2006), i-deals should also benefit the employer (Rousseau et al.,
2006). Research has shown that i-deals have mostly positive effects for i-dealers
(Conway & Coyle-Shapiro, 2016), including a variety of positive employee
work-related perceptions, attitudes and behavior (Conway & Coyle-Shapiro,
2016; Liao et al., 2016) such as OCB (Anand et al., 2010), job satisfaction and
affective commitment (Hornung et al., 2008; Hornung et al., 2010a; Rosen et al.,
2013), work engagement (Hornung et al., 2010b), motivation and performance
(Hornung et al., 2009; Ng & Lucianetti, 2016). An extensive review of positive
outcomes on the individual level was presented in Chapter 1.5. Although
positive effects for organizations are assumed in the definition of i-deals,
evidence for a relation between i-deals and organizational performance is still
in its infancy (Bal & Boehm, 2017). As a first step, Bal and Boehm (2017) have
shown a relationship between individual i-deals, collective commitment and
client satisfaction in a multilevel model. To further address the usefulness of i-
deals to organizations (Liao et al., 2016) this study examines i-deals from an
organizational perspective. The level of i-deals in an organization is captured
by the concept of organizational median i-deals (Anand, 2012; Liao et al., 2016).
Following Anand (2012) and Liao et al. (2016), organizational median i-deals are
defined as the central tendency of i-deals in an organization. As discussed in
Chapter 1.4, i-deals differ in content, but previous research has shown that two
types of i-deals are most prevalent: time and location flexibility, and task and
development i-deals (Bal et al., 2012; Hornung et al., 2008; Rosen et al., 2013).
Therefore, this study will focus on these types of i-deals as well.
Study 1 – How Do I-Deals Relate to Organizational Performance? 45
2.2.2 Effects of Organizational Median I-Deals on Employee Job Attitudes
I-deals have been related to a variety of job attitudes, including job satisfaction
(Hornung et al., 2010a; Rosen et al., 2013). I focus on job satisfaction as it is one
of the most frequently studied job attitudes in psychological and individual-
level i-deals research (e.g., Liao et al., 2017; Rosen et al., 2013; Van Dick &
Monzani, 2017). Based on the core assumption of i-deals theory that employees
negotiate i-deals with their employer to match work arrangements to their
personal needs enhanced job satisfaction is a likely consequence (Hornung et
al., 2010a).
2.2.2.1 Collective job satisfaction
Job satisfaction is defined as “a pleasurable or positive emotional state resulting
from the appraisal of one's job or job experiences” (Locke, 1976, p. 1304) and is
regarded as an important aspect of employees’ well-being and mental health
(e.g., Warr, 2007). If outcomes at the organizational level are of interest, scholars
suggest construing job satisfaction at the collective level (Schneider, Smith, &
Sipe, 2000). Since employees of an organization share similar working
environments a collective job satisfaction is formed (Whitman, Van Rooy, &
Viswesvaran, 2010). Collective job satisfaction is defined as “shared internal
state that is expressed by affectively and cognitively evaluating shared job
experiences with some degree of favor or disfavor” (Whitman et al., 2010, p. 46).
2.2.2.2 Organizational median i-deals and collective job satisfaction
Research indicates that i-deals predict job satisfaction since they demonstrate
that the organization is concerned about the needs of individual employees
(Cropanzano, Rupp, Mohler, & Schminke, 2001b; Rosen et al., 2013; Tekleab,
Takeuchi, & Taylor, 2005). I-deals enable employees to change their jobs
through negotiation to meet their individual needs, which is likely to result in
increased job satisfaction (Hornung et al., 2010a; Rosen et al., 2013). Scholars
have argued based on work adjustment (Dawis & Lofquist, 1984) and self-
46 Study 1 – How Do I-Deals Relate to Organizational Performance?
determination theory (SDT; Ryan & Deci, 2000) that i-deals facilitate a greater
fit between the requirements at work, personal needs, and knowledge and
abilities of employees and thus enhance basic need satisfaction (Bal & Boehm,
2017; Ho & Kong, 2015). Studies show a positive relationship between i-deals in
general, task and work responsibilities i-deals as well as schedule flexibility i-
deals and job satisfaction (Hornung et al., 2010a; Liao et al., 2017; Rosen et al.,
2013). It is therefore likely that the higher the organizational median i-deals in
organizations, the more satisfied are employees with their jobs.
A variety of theories of attitude formation suggests that social interactions
between employees foster a collective job satisfaction (Whitman et al., 2010). Bal
and Boehm (2017) argue based on contagion theory that positive effects of i-
deals spill over between employees. Specifically, contagion theory explains that
attitudes within collectives are transferred from one employee to another
(Barsade, 2002) and Bal and Boehm (2017) indeed show that positive effects of
i-deals are transferred across organizational members. They found, that i-deals
are related to the formation of collective attitudes, in this case collective
commitment (Bal & Boehm, 2017). This is in line with Whitman et al. (2010) who
argue based on social comparison and social learning theory that collective job
satisfaction is formed because employees learn and build similar attitudes by
observing their coworkers (Whitman et al., 2010). Social comparison theory
implies that employees’ attitudes are influenced when important others, such
as coworkers, show that attitude (Festinger, 1954). Similarly, social learning
theory suggests that employees learn attitudes by observing the attitudes of
their coworkers (Bandura, 1977). Based on those theories, individual job
satisfaction caused by i-deals is likely to spread across employees, causing high
collective job satisfaction in organizations with a high level of i-deals. Thus, I
expect that the median level of i-deals positively influences collective job
satisfaction.
Hypothesis 1: Organizational median i-deals have a positive relationship with
employees’ collective job satisfaction.
Study 1 – How Do I-Deals Relate to Organizational Performance? 47
2.2.3 Effects of Organizational Median I-Deals on Coworker Relations
In contrast, the link to coworker relations seems to be more complex. As
Conway and Coyle-Shapiro (2016) state, collectives are likely to suffer from i-
deals in organizations regarding coworker relations and helping behavior
between coworkers. To examine the effect of organizational median i-deals on
coworker relations and helping behavior between coworkers, I focus on OCBI
in the following (Farmer, Van Dyne, & Kamdar, 2014).
2.2.3.1 Collective OCBI
Organ (1997, p. 95) defines OCB as “performance that supports the social and
psychological environment in which task performance takes place”. Williams
and Anderson (1991) categorize OCB on the basis of the target of the behavior.
Behavior benefitting the organization is called OCBO, while behavior directed
toward the benefit of other individuals, such as coworkers, is called OCBI. The
current study focuses on OCBI, which is defined as voluntary, extra-role
behavior directed toward other individuals (Williams & Anderson, 1991). In his
original definition of OCB, Organ (1988) states that while OCB is an individual
behavior, it influences organizational functioning in the aggregate across
individuals. Thereby, Organ emphasizes the importance of OCB for the
collective level, as positive effects for the organization are only realized when
OCB is not conceptualized as behavior at the individual but at the collective
level (Podsakoff, Podsakoff, MacKenzie, Maynes, & Spoelma, 2014).
2.2.3.2 Organizational median i-deals and collective OCBI
Due to several reasons, i-dealers engage in OCBI (Greenberg et al., 2004;
Rousseau et al., 2006). I-deals can create costs for coworkers since recourses are
most often constrained in organizations (Rousseau et al., 2006). Social exchange
theory (Blau, 1964) implies that i-dealers are likely to feel obligated to those who
granted or enabled their deals. Consequently, i-dealers will try to reduce
burdens caused by the deals for their coworkers through favors and helping
48 Study 1 – How Do I-Deals Relate to Organizational Performance?
behavior (Greenberg et al., 2004; Rousseau, 2005; Williams & Anderson, 1991).
Furthermore, recipients of i-deals might be inclined to convince their coworkers
that they are deserving of special working arrangements because they are
especially generous, high-performing and thus valuable employees (Greenberg
et al., 2004). By helping coworkers with work-related problems or to meet
important deadlines, for example, i-dealers eliminate the guilt and bad
conscience they feel (Greenberg et al., 2004). In addition, by engaging in OCBI
they are building close relationships with their coworkers who might feel
resentful of them (Greenberg et al., 2004; Rousseau, 2005). Indeed, OCBI has
been found to promote relationship quality among coworkers (Podsakoff,
MacKenzie, Paine, & Bachrach, 2000).
However, based on social exchange theory, i-deals do not seem to have
unlimited positive effects on collective OCBI. Following the argument of Anand
and Vindyarthi (2016), I propose that i-deals in an organization can change the
common understanding of exchanges. In fact, Takeuchi, Lepak, Wang and
Takeuchi (2007) found evidence indicating that employees can develop shared
exchange perceptions within their organizations. At low levels of i-deals (i.e.,
low organizational median i-deal), employees receive just few valuable
resources from the organizations. Therefore, employer and coworkers have
only limited expectations of reciprocity and i-dealers feel not obliged to
compensate their coworkers for potential losses (Vidyarthi et al., 2014). Thus, an
economics exchange climate is dominating the organization (Vidyarthi et al.,
2014). However, on moderate levels of i-deals (i.e., moderate organizational
median i-deal), the employer might already struggle to remain the balance
between being perceived as unfair and fulfilling the needs of i-deals seekers and
thus bigger costs might be caused for coworkers (Vidyarthi et al., 2014).
Therefore, the organization and coworkers will have higher expectations that i-
deal recipients will return the favor and employees feel pressured to engage in
helping behavior directed at their coworkers (Greenberg et al., 2004).
Consequently, a social exchange climate is emerging in organizations with
moderate organizational median i-deals (Rousseau et al., 2006). However, at
Study 1 – How Do I-Deals Relate to Organizational Performance? 49
high levels of i-deals (i.e., high organizational median i-deal), they may be taken
for granted, as benefits the organization generally should offer to all its
employees without any negotiations (Anand & Vindyarthi, 2016; Rousseau,
2005), causing again an economic exchange climate. Alternatively, Rousseau
(2005) proposes that too many i-deals create an economic exchange climate,
because every element of the employment relationship becomes subject to
negotiation when the level of i-deals is high. In this situation, employees might
have the perception that they need to bargain for every resource, reward and
benefit in their working relationship (Rousseau, 2005). Thus, exchanges in an
organization might be perceived a purely transactional, if the level of i-deals in
an organization is high (Anand & Vidyarthi, 2016). This means, employees feel
no longer obliged to return favors to parties who made their i-deal possible,
including their coworkers. Therefore, i-deals will not have much influence on
employees’ helping behavior towards coworkers (Anand & Vindyarthi, 2016).
Furthermore, given high levels of i-deals in organizations, recipients of i-deals
might not feel guilty towards their coworkers, as many others will also have i-
deals (e.g., Ng, 2017). Eventually, granting too many i-deals might change the
common understanding of exchanges in an organization again from a social to
an economic exchange climate (Anand & Vindyarthi, 2016). In line with this
assumption, research showed that the overuse of idiosyncratic arrangements
can be negative by creating dysfunctional conflict and competition among
employees (Mitchell & Silver, 1990). To summarize, I expect an economic
exchange climate at low levels of i-deals, a social exchange climate at moderate
levels of i-deals and again an economic exchange climate at high levels of i-deals
causing a curvilinear relationship between organizational median i-deals and
collective OCBI.
Hypothesis 2: Organizational median i-deals have an inverted U-shaped
relationship with employees’ collective OCBI.
50 Study 1 – How Do I-Deals Relate to Organizational Performance?
2.2.4 The Role of Leadership Climate
I-deals are created in the leader-follower interaction (Liao et al., 2017). Leaders
influence the negotiation (e.g., Ho & Tekleab, 2016; Hornung et al., 2014) and
the successful implementation of i-deals (Anand & Vidyarthi, 2016). Liao et al.
(2016) argue that transformational leaders create an environment encouraging
successful i-deals in organizations. Liao et al. (2017) show that it is relevant to
perceptions of i-deals in a group, if leaders highly differentiate between
employees or if all members of a collective are treated in a similar way.
Expanding on this idea, I follow Kark and Shamir (2002) who propose that TFL
includes behaviors directed toward the entire group and its individual members
simultaneously. Leader behavior can have very different effects, dependent on
whether the behavior is directed at individual employees or the collective (Wu,
Tsui, & Kinicki, 2010).
2.2.4.1 Individual- and collective-focused leadership climate
Leadership climate captures the average of perceptions and behaviors in
organizations (e.g., Boehm, Dwertmann, Bruch, & Shamir, 2015; Li &
Cropanzano, 2009; Kunze, De Jong, & Bruch, 2016; Zohar & Luria, 2005), similar
to other climate constructs in extant literature (e.g., Li & Cropanzano, 2009;
Zohar & Luria, 2005). The organizational leadership climate can result from a
variety of social processes that lead to similar leadership behavior and similar
perceptions of leadership behavior (Klein, Dansereau, & Hall, 1994) such as
socialization, attraction-selection-attrition mechanisms, shared experiences and
regular interactions among employees (Kozlowski & Hattrup, 1992; Kunze et
al., 2016; Morgeson & Hofmann, 1999; Schneider & Reichers, 1983; Walter &
Bruch, 2010).
2.2.4.1.1 Individual-focused leadership climate
Drawing on TFL theories, Wang and Howell (2010, p. 1135) define individual
focused leadership “as behavior aiming to empower individual followers to
Study 1 – How Do I-Deals Relate to Organizational Performance? 51
develop their full potential, enhance their abilities and skills, and improve their
self-efficacy and self-esteem”. An individual-focused leadership climate
emerges if leaders in organizations show two behavioral patterns rooted in TFL
theory (Kunze et al., 2016; Wang & Howell, 2010). These are intellectual
stimulation and individualized consideration (Chun, Cho, & Sosik, 2016; Kark
& Shamir, 2002; Kunze et al., 2016). Intellectual stimulation is the degree to
which a leader encourages followers to challenge assumptions about their work,
to take risks and to approach existing issues and problems in new ways (Judge
& Piccolo, 2004; Kunze at al., 2016). Individualized consideration is the degree
to which a leader treats every follower as an individual entity, shows respect
and encouragement, attends to his or her unique concerns and needs, and is
thus acting as a mentor or coach (Judge & Piccolo, 2004, Kunze et al., 2016).
These two behaviors have in common that they differentiate among followers
regarding their personal characteristics and individual skills (Atwater & Bass,
1994; Kark & Shamir, 2002).
2.2.4.1.2 Collective-focused leadership climate
Wang and Howell (2010, p. 1135) define collective-focused leadership as
“behavior aiming to communicate the importance of group goals, develop
shared values and beliefs, and inspire unified effort to achieve group goals”. A
collective-focused leadership climate develops if leaders in an organization
engage in specific behaviors directed toward the collective, such as articulating
a collective vision and fostering collective goals (Kunze et al., 2016). Articulating
a vision includes developing and communicating a fascinating idea for the
future of the collective to inspire employees (Podsakoff, MacKenzie, Moorman,
& Fetter, 1990). Fostering collective goals refers to a leader’s behaviors aimed at
supporting and promoting cooperation and teamwork among employees to
reach overarching and shared goals (Podsakoff et al., 1990). These two behaviors
show employees that leaders throughout the organization are committed to
collective goals (Kunze et al., 2016).
52 Study 1 – How Do I-Deals Relate to Organizational Performance?
As mentioned before, I suggest that examining i-deals from a collective
perspective requires to include both individual- and collective-focused
leadership climate. Line managers also need to meet the needs of the i-dealer’s
coworkers, the whole team and the organization in the negotiation and
implementation of i-deals (Greenberg et al., 2004). In the following, I therefore
argue that the individual- and collective-focused leadership climate in an
organization are moderating the effect of organizational median i-deals on
collective job satisfaction and collective OCBI, respectively.
2.2.4.2 Individual-focused leadership as moderator
Research has shown that an appropriate and suitable organizational climate is
necessary that management practices, such as i-deals, have an effect on
employees’ attitudes, behavior and subsequently on organizational
performance (Bal et al., 2012; Bowen & Ostroff, 2004; Ngo, Foley, & Loi, 2009).
Liao et al. (2016) also point to the importance of the organizational climate in
supporting and enabling succesful i-deals. Their multilevel model of i-deals
indicates that the leadership climate might be one important moderating factor
for the relationship between organizational median i-deals and employee
attitudes such as job satisfaction (Liao et al., 2016). In line with this assumption,
Bal et al. (2012) showed that the effects of i-deals can be enabled or hindered by
the nature of the collective climate and thereby prove the impact of social
context on the effectiveness of i-deals. Specifically, they find that successful
implementation and execution of i-deals is determined by whether the
organizational climate fits to the deals. When the organizational climate and
managerial practices, such as i-deals, are in line with each other such that they
both enable and encourage employees to fit their jobs to their unique needs,
employee motivation, performance and satisfaction might be enhanced
(Schulte, Ostroff, Shmulyian, & Kinicki, 2009).
Just as i-deals, an individual-focused leadership climate emphasizes the
uniqueness of each individual employee, and thus activates individual level
identities (Kark & Shamir, 2002). An individual-focused leadership climate
Study 1 – How Do I-Deals Relate to Organizational Performance? 53
causes individual differentiation, just like i-deals, because leaders adjust their
behaviors based on followers' individual differences (e.g., personal needs and
abilities; Tse & Chiu, 2014; Wu et al., 2010). When an individual-focused
leadership climate is present in an organization, leaders focus on individual
need satisfaction (e.g., Wu et al., 2010). Indeed, research showed that leader
consideration is encouraging i-deals (Hornung et al., 2011). I thus argue that the
individual-focused leadership climate supports employees in implementing
their i-deals according to their own specific needs and fosters employees’
acceptance for individualized arrangements in an organization, enhancing
collective job satisfaction. Hence, even though employees may have negotiated
i-deals, a lower individual-focused leadership climate hinders the realization of
i-deals.
Hypothesis 3a: The relationship between organizational median i-deals and
employees’ collective job satisfaction is stronger, if the individual-focused leadership
climate is high.
2.2.4.3 Collective-focused leadership climate as moderator
Anand and Vidyarthi (2016) propose that an i-dealer’s reciprocity towards
coworkers is most likely a function of the organizational context. Specifically,
the extent to which i-dealer engage in OCBI is likely dependent on the degree
to which they identify with their coworkers and the organization (Greenberg et
al., 2004; Tajfel & Turner, 1985). A collective-focused leadership climate
activates a collective identity by focusing on the collective rather than
individuals, by emphasizing similarities among employees and the uniqueness
of the collective (Dansereau, Alutto, & Yammarino, 1984; Kark & Shamir, 2002).
As Wu et al. (2010, p. 92) state, “group attributes such as shared values and
common goals become salient to the members, while individualized
idiosyncratic characteristics lose prominence” when the collective-focused
leadership climate is high. Thus, employees perceiving themselves as belonging
to a collective due to a high collective-focused leadership climate emphasize
collective interests (Brickson, 2000; Turner, Hogg, Oakes, Reicher, & Wetherell,
54 Study 1 – How Do I-Deals Relate to Organizational Performance?
1987). Consequently, a collective-focused leadership climate promotes common
efforts, collaboration, teamwork and reciprocal exchange relationships between
coworkers (Chun et al., 2016). Garg and Fulmer (2017) propose that negative
reactions of coworkers to others’ i-deals might be mitigated in collectives with
a strong shared identity. This argument, that the salience of the team identity
decreases effects of i-deals, is in line with findings of Vidyarthi et al. (2016) who
find that the positive relationship between relative i-deals and employee
performance was stronger in groups with low team orientation. It is thus likely
that employees are more attentive to individualization caused by i-deals in
organizations with a low collective-focused leadership climate. I-deals should
therefore influence collective OCBI, causing the inversed U-shaped
relationship. However, in organizations with a high collective-focused
leadership climate, employees pay little attention to individual differences and
prioritize common goal. Consequently, collective OCBI should already be high,
while effects of i-deals are mitigated, causing a non-significant relationship.
Hypothesis 3b: The relationship between organizational median i-deals and
employees’ collective OCBI is inverted U-shaped for low collective-focused
leadership climate, but non-significant for high collective-focused leadership climate.
2.2.5 The Link to Organizational Performance
Research suggests that i-deals are beneficial for organizations by being related
to main strategic outcomes such as employee motivation and retention,
workforce employability and organizational performance (Kroon et al., 2016).
However, scholars assume that effects of i-deals on collective performance are
not direct but mediated by collective processes (e.g., Bal & Rousseau, 2016; Liao
et al., 2016). Based on the foregoing hypotheses, I propose that the effect of
organizational median i-deals on organizational performance is mediated by
collective job satisfaction and collective OCBI.
Study 1 – How Do I-Deals Relate to Organizational Performance? 55
2.2.5.1 The link through collective job satisfaction
Few topics in organizational psychology have been studied as extensively as the
relationship between job satisfaction and job performance (Judge, Thoresen,
Bono, & Patton, 2001b). In their meta-analysis, Judge et al. (2001b) estimate the
mean true correlation between overall job satisfaction and job performance to
be .30. Job satisfaction does also have a positive relationship with organizational
outcomes (e.g., Harter, Schmidt, & Hayes 2002; Judge et al. 2001b; Koys 2001).
Already the original satisfaction-performance theories proposed by human
relations theorists focused on the organizational and not on the individual level
of analysis (Schneider, Hanges, Smith, & Salvaggio, 2003, Whitman et al., 2010).
In their meta-analysis, Whitman et al. (2010) find that job satisfaction has a
positive impact on performance, productivity and turnover, when all constructs
are construed at the collective level. The literature thus indicates that the
relationship between organizational median i-deals and organizational
performance is mediated by collective job satisfaction. Based on the foregoing
hypotheses predicting an interaction between organizational median i-deals
and the individual-focused leadership climate on collective job satisfaction, I
suggest a moderated and mediated relationship between organizational median
i-deals and organizational performance.
Hypothesis 4a: The relationship between organizational median i-deals and
organizational performance is mediated by employees’ collective job satisfaction and
moderated by the individual-focused leadership climate.
2.2.5.2 The link through collective OCBI
In the original definition of OCB, Organ (1988) states that OCB is an individual
behavior, which influences organizational effectiveness in its aggregate. Thus,
he emphasizes that OCB is most often not beneficial for individuals but for the
organization (Podsakoff et al., 2014). Several processes might link collective
OCBI to performance. First, Nielsen, Hrivnak and Shaw (2009) propose that
collective OCBI helps new employees to adapt through increased member
56 Study 1 – How Do I-Deals Relate to Organizational Performance?
interactions in teams, which enhances information sharing. Furthermore, high
levels of helping behavior between employees can free team resources, such as
supervisor time (Podsakoff et al., 2000; Podsakoff & MacKenzie, 1997). Finally,
collective OCBI is likely to lead to regular feedback between members of a
collective and the leader, eventually improving collective performance
(Sundstrom, 1999). A meta-analysis by Podsakoff, Whiting, Podsakoff and
Blume (2009) reported that OCBI is positively related to individual
performance. Furthermore, high correlations between OCB (including both
OCBO and OCBI) and performance, productivity, profitability and turnover (r
= .43, .37, .15 and -.22, respectively) were found, when both constructs are
construed at the collective level (Podsakoff et al., 2009). The reviewed literature
suggests that collective OBCI mediates the relationship between organizational
median i-deals and organizational performance. Based on the foregoing
hypotheses predicting an interaction between organizational median i-deals
and the collective-focused leadership climate on collective OCBI, I suggest a
moderated and mediated relationship between organizational median i-deals
and organizational performance. The overall hypothesized model including all
hypothesized relationships is depicted in Figure 2-1.
Hypothesis 4b: The relationship between organizational median i-deals and
organizational performance is mediated by employees’ collective OCBI and
moderated by the collective-focused leadership climate.
Study 1 – How Do I-Deals Relate to Organizational Performance? 57
2.3 Method
2.3.1 Data and Sample
As explained in Chapter 1.7, data was collected in cooperation with a
benchmarking agency in order to receive data from multiple organizations.
Data collection for this study was conducted in 2016 in Germany. In sum, 87
German organizations participated in the study. Participating companies had
to be organizations located in Germany with a maximum of 5,000 employees,
and thus were small to medium sized companies. The size of those
organizations ranged from 23 to 2,015 employees, with a median organizational
size of 194. The organizations were from various industry backgrounds
including manufacturing (30%), service (47%), finance and insurance (10%) and
retail and wholesale (13%). Data was gathered via online questionnaires and
each company received a detailed benchmark report in return for its
participation.
Individual-Focused Leadership Climate
Collective Job Satisfaction
Organizational Median I-Deals
Organizational Performance
Collective OCBI
+
Collective-Focused Leadership Climate
Figure 2-1. Overview conceptual model.
58 Study 1 – How Do I-Deals Relate to Organizational Performance?
In line with researchers’ recommendations on reducing the risk for common
source biases (Dickson, Resick, & Hanges, 2006; Erdogan, Liden, & Kraimer,
2006; Podsakoff, MacKenzie, Lee, & Podsakoff, 2003; Podsakoff, MacKenzie, &
Podsakoff, 2012), a split-sample design was used (Rousseau, 1985). Five
different data sources, namely three different groups of employees, data from
HR departments and the top-management team, were included in the study
design. The following standardized procedure was used across all
organizations. Similar to other scientific studies (e.g., Kunze et al., 2016), email
invitations with a link to a web-based survey were sent to employees by each
organization. This email explained the study’s purpose, guaranteed
respondents’ voluntary contribution and full anonymity. After clicking on the
link, employees were randomly and evenly distributed via an algorithm
programmed in the online survey to three separate employee questionnaires.
This was done first to rule out common method bias and second to reduce the
item number each employee had to fill in. Information about the demographics
(i.e., age, gender and tenure) was captured from all participating employees.
The three different survey versions measured a) i-deals and collective job
satisfaction, b) collective OCBI, and c) the individual- and the collective-focused
leadership climate. Additionally, HR executives provided general information
about the company (e.g., industry affiliation, organizational size). Finally,
members of the top-management team were asked to rate the performance of
each company.
Across all companies, 13,354 employees participated in the study by completing
the online survey. The resulting within-organization response rate was 53%.
Participants had a mean age of 39 years (SD = 5.8) and were mainly male (47%
male and 38% female; 15% did not provide an answer). Employees had on
average worked 8 years (SD = 4.2) in their organization. Participants were
invited to the study from all major divisions and hierarchical levels of the
organization including middle management (10%), first-line supervisors (9%),
employees without leadership responsibility (67%) and other groups (14%, e.g.,
freelancer).
Study 1 – How Do I-Deals Relate to Organizational Performance? 59
2.3.2 Measures
All survey measures were translated into German applying a double-blind
back-translation procedure, because the study was exclusively conducted with
German companies (Schaffer & Riordan, 2003). The study focuses on the
organizational level, and thus all constructs measured through individual
responses were aggregated to the organizational level. Intra-class correlation
coefficients (ICC1 and ICC2; Bliese, 2000) and the average deviation index as an
interrater agreement measure (ADM(J); Burke, Finkelstein, & Dusig, 1999;
LeBreton & Senter, 2008; Smith-Crowe, Burke, Kouchaki, & Signal, 2013), were
calculated to justify the aggregation of constructs measured at the individual
level to the organizational level. ICC1 values are based on a significant one-way
ANOVA and thus are generally acceptable based on p-values. ICC2 values of
more than 0.60 are usually considered sufficient (Bliese, 2000; Chen, Mathieu, &
Bliese, 2004; Kenny & La, Voie, 1985). For the cutoff criteria for the ADM(J), I
followed LeBreton and Senter (2008), who suggest that values should be below
0.8 for measures assessed on a 5-point rating scale and below 1.2 for measures
assessed on a 7-point rating scale.
2.3.2.1 Organizational median i-deals
I-deals were measured using a 8-item scale based on Rosen et al. (2013), covering
schedule and location flexibility and work responsibility i-deals. Example items
are: “My supervisor considers my personal needs when making my work
schedule.”, “Because of my individual needs, I have negotiated a unique
arrangement with my supervisor that allows me to complete a portion of my
work outside of the office.” and “I have successfully asked for extra
responsibilities that take advantage of the skills that I bring to the job.”,
respectively. A 5-point rating scale (1 = strongly disagree, 5 = strongly agree)
was used. As in other i-deals research (e.g., Ng & Lucianetti, 2016), i-deals were
treated as one unidimensional construct. An exploratory factor analysis (EFA)
of the eight items shows that all of them loaded on one factor (factor loadings:
.80; .85; .83; .83; .81; .66; .79; 80; extracted variance = 64 percent). Internal
60 Study 1 – How Do I-Deals Relate to Organizational Performance?
consistency estimates were α = .89. The within-organizational median of the
individual-level i-deals scores was used to depict the central tendency among i-
deals within organizations. I-deals theory says that special work arrangements
vary considerably across employees in regards to scope (e.g., Rousseau, 2005).
Thus, within-organizational agreement is not expected for i-deals, and the
median is better suited for aggregation to the organizational level than the mean
(Bliese, 2000; Henderson, Liden, Glibkowski, & Chaudhry, 2009; Liden,
Erdogan, Wayne, & Sparrowe, 2006).
2.3.2.2 Collective job satisfaction
Collective job satisfaction was assessed with a 4-item scale by Judge, Parker,
Colbert, Heller and Ilies (2001a). An example item is: “Overall, how satisfied are
you with your job?” The other three items focused on perceptions of
development opportunities, salary and advanced training options. A 7-point
rating scale (1 = strongly disagree, 7 = strongly agree) was used. The definition
of collective job satisfaction presumes that employees of a collective share a
similar level of job satisfaction (Whitman et al., 2010). Collective job satisfaction
is therefore often conceptualized as direct consensus model, using the aggregate
of all individual scores (Whitman et al., 2010). Thus, individual ratings were
aggregated into a single organizational-level measure, which was supported by
aggregation statistics (ICC1 = .13, p < 0.001; ICC2 = .85; mean ADM(J) =1.19).
Internal consistency estimates were α = .89.
2.3.2.3 Collective OCBI
Collective OCBI was assessed with a 6-item scale by Lee and Allen (2002). An
example item is: “I take time to support others with work-related or other
problems.” A 7-point rating scale (1 = strongly disagree, 7 = strongly agree) was
used. Again, a direct consensus model was used as in most studies on collective
OCB (Podsakoff et al., 2014). Thus, individual ratings were aggregated into a
single organizational-level measure. The aggregation was supported by the
Study 1 – How Do I-Deals Relate to Organizational Performance? 61
respective statistics (ICC1 = .04, p < 0.001; ICC2 = .65; mean ADM(J) =.76). Internal
consistency estimates were α = .73.
2.3.2.4 Individual-focused leadership climate
The construct includes two sub-scales: intellectual stimulation and
individualized consideration. Seven items from Podsakoff, MacKenzie and
Bommer (1996) were used to assess the two sub-scales. As in previous research
on TFL climates (e.g., Kunze et al., 2016; Walter & Bruch, 2010), employees were
asked to assess the extent to which their direct supervisors displayed leadership
behavior on the two dimensions. All seven items had an individual referent. An
example item is: “My direct supervisor takes my personal needs into account”.
A 5-point rating scale (1 = strongly disagree, 5 = strongly agree) was used. A
direct consensus composition model (Chan, 1998) was used for the aggregation
to the organizational level. Aggregation statistics provided support for an
aggregation to the organizational level of analysis (ICC1 = .12, p < 0.001; ICC2 =
.84; mean ADM(J) =.77). Internal consistency estimates were α = .93.
2.3.2.5 Collective-focused leadership climate
The construct includes two sub-scales: articulating a vision and fostering
collective goals. Nine items developed by Podsakoff et al. (1996) were used to
assess the subscales. Once again, employees were asked to evaluate the extent
to which their direct supervisor showed leadership behavior on the two
dimensions of the construct. This time, all items had a collective referent (i.e.
“My direct supervisor encourages employees to be team players”). A 5-point
rating scale (1 = strongly disagree, 5 = strongly agree) was used. As for
individual-focused leadership climate, a direct consensus composition model
was used for the aggregation on the organizational level (Chan, 1998).
Aggregation statistics provided support for an aggregation to the
organizational level of analysis (ICC1 = .14, p < 0.001; ICC2 = .84; mean ADM(J)
=.75). Internal consistency estimates were α = .96.
62 Study 1 – How Do I-Deals Relate to Organizational Performance?
2.3.2.6 Organizational performance
To account for a variety of organizational performance outcomes (Combs,
Crook, & Shook, 2005), organizational performance was measured with three
items relating to the overall company performance, employee productivity and
efficiency of business processes. All three performance items were assumed to
load on one common performance factor, which was confirmed by the results
of an EFA (factor loadings: .80; .84; .88; extracted variance = 71 percent). I gauged
the information on organizational performance by asking members of the top
management team. Previous literature (Rogers & Wright, 1998) measured
subjective performance metrics by asking top managers to rate their company's
performance relative to their direct competitors in the industry. I adopted this
approach for the current study. Furthermore, top-managers rated the
performance of their companies on a 7-point scale (1 = far below average; 7 = far
above average). Internal consistency estimates were α = .79. For 53
organizations, more than one top-manager provided information on the
company’s performance. For those companies, aggregation statistics justified
the aggregation to the organizational level (ICC1 = .28, p < 0.001; ICC2 = .57; mean
ADM(J) = .53).
2.3.2.7 Control variables
I controlled for variables that might provide alternative explanations for the
hypotheses. Company age and size were included as control variables as they
are related to organizational performance (e.g., Choi & Shepherd, 2005),
employee behaviors and outcomes (Ragins, Cotton, & Miller, 2000),
respectively. Company age and size were measured by asking HR managers for
the company’s founding year and for the total number of employees. As both
measures were skewed, I log-transformed them. Second, I controlled for the
characteristics of employees because research has shown that employee
attributes influence effects of i-deals on a variety of individual-level outcomes
(Bal et al., 2012; Marescaux & De Winne, 2016) by including employee age,
gender and tenure. As the measure for tenure was skewed, it was log-
Study 1 – How Do I-Deals Relate to Organizational Performance? 63
transformed. I further included a variable displaying organizational structure,
namely the number of locations per company. This variable was included in the
analysis because research showed that organizational structure influences the
organizational culture (e.g., Conrad & Sydow, 1984). The variable was also log-
transformed due to skewness. Furthermore, I included affiliation to industry
sectors, because industry affiliation can relate to organizational effectiveness
(Dickson et al., 2006). I added one dummy to capture service industry versus
other sectors (including manufacturing, finance and trade). The service sector
was chosen because Stavrou (2005) showed that flexibility at work can mainly
be found in the service sector. I further controlled for i-deals differentiation
operationalized by within-organization standard deviation. Liao et al. (2016)
suggest that the extent to which levels of i-deals vary within an organization
might influence effects of i-deals on employees. Thus, organizational median i-
deals should not be studied without controlling for i-deals differentiation.
Furthermore, to increase the predictive validity of the individual- and the
collective-focused leadership climate measures, I controlled for the potentially
related construct of LMX. I-deals research has shown, that the quality of the
relationship between employee and supervisor influences i-deals negotiation,
and has an impact on performance related outcomes (e.g., Anand et al., 2010;
Rousseau et al., 2006). Seven items based on Scandura and Graen (1984) and
adapted by Tangirala, Green and Ramanujam (2007) were used to measure
LMX. An example item was “My direct superior understands my problems and
needs” (1 = do not agree at all; 7 = agree completely). Internal consistency
estimates were α = .97. Finally, as research has shown that leadership climates
are influencing employee attitudes and behavior, and organizational
performance, I also controlled for direct effects of the individual- and the
collective-focused leadership climate on the mediators and outcome variables
(e.g., Kunze et al., 2016).
64 Study 1 – How Do I-Deals Relate to Organizational Performance?
2.4 Results
2.4.1 Descriptive Statistics
Means, standard deviations and intercorrelations among the variables are
presented in Table 2-1. The correlation matrix shows no signs of
multicollinearity between study variables (Kennedy, 1979). In line with the
hypotheses, organizational median i-deals are positively correlated to both
collective job satisfaction and collective OCBI (r = .47, p < .01 and r = .38, p < .01,
respectively). Furthermore, both collective job satisfaction and collective OCBI
are positively correlated with organizational performance (r = .30, p < .01 and r
= .32, p < .01, respectively). As in other studies combining measured of both
leadership behaviors (e.g., Kunze et al., 2016), the individual- and the collective-
focused leadership climate show relatively high intercorrelations (r = .86, p <
.01). A confirmatory factor analysis (CFA) shows, that both scales can be
considered as two distinct factors despite their high correlation. To evaluate the
model fit, I assessed the standardized root mean square residual (SRMR) in
combination with two incremental fit indices, the comparative fit index (CFI)
and the incremental fit index (IFI; Bentler 2007). I used conventional cut-off
points to assess these indices (>.90 for the CFI and IFI and <.08 for the SRMR;
Hu & Bentler 1999). I furthermore report the Akaike information criterion (AIC;
Akaike, 1987), with lower values indictaing better fit. According to those fit
statistics, the two-factor model showed better fit (χ2 = 423, df = 103; CFI = .81, IFI
= .81, SRMR = .073; AIC = 495) than an alternative one-factor model (χ2 = 443, df
= 104; CFI = .80, IFI = .80, SRMR = .076; AIC = 507). I followed the
recommendations by Becker (2005) and kept only those six control variables in
the further analysis that showed significant correlations with the mediator and
outcome variables. These were company age, company sectors, company
locations, employee age and tenure, and LMX. This approach leads to more
stable estimates through a better parameter to sample size ratio.
Study 1 – How Do I-Deals Relate to Organizational Performance? 65
Ta
ble
2-1.
Mea
ns, s
tand
ard
devi
atio
ns a
nd in
terc
orre
latio
ns a
mon
g st
udy
vari
able
s.
V
aria
ble
M
SD
1 2
3 4
5 6
7 8
9 10
11
12
13
14
1Em
ploy
ee T
enur
e (lo
g)
.87
.21
2 Em
ploy
ee A
ge
39.1
7 5.
81
.46*
*
3 Em
ploy
ee G
ende
r 1.
43
.21
-.09
-.12
4 C
ompa
ny S
ize
(log)
5.
14
1.06
.3
0**
.02
.01
5 C
ompa
ny A
ge (l
og)
3.42
.9
4 .7
1**
.34*
* -.0
3 .4
2**
6 In
dust
ry S
ervi
ce
.47
.50
-.44*
* -.1
5 .1
5 .0
1 -.3
8**
7 O
rgan
izat
iona
l Loc
atio
ns
(log)
.4
5 .4
3 .0
5 -.0
8 .1
5 .4
3**
.11
.09
8 Le
ader
-mem
ber e
xcha
nge
5.00
.5
3 -.4
1**
-.25*
-.0
1 -.0
5 -.4
8**
.37*
* .1
6
9 I-
Dea
ls D
iffer
entia
tion
.81
.23
.08
-.03
-.14
.36*
* .1
5 -.0
9 .1
4 .0
2
10
Org
aniz
atio
nal M
edia
n I-
Dea
ls
3.27
.5
6 -.4
9**
-.18
-.05
-.17
-.50*
* .4
1**
.03
.60*
* -.1
5
11
Indi
vidu
al-F
ocus
ed
Lead
ersh
ip C
limat
e
3.63
.3
1 -.3
7**
-.16
.05
-.09
-.49*
* .3
6**
.12
.86*
* -.0
3 .5
4**
12
Col
lect
ive-
Focu
sed
Lead
ersh
ip C
limat
e 3.
70
.38
-.42*
* -.2
3*
.06
-.05
-.44*
* .2
3*
.16
.88*
* .0
4 .5
7**
.86*
*
13
Col
lect
ive
Job
Satis
fact
ion
4.97
.5
1 -.2
6*
-.22*
.1
7 -.1
1 -.3
7**
.12
.07
.44*
* -.2
0 .4
7**
.45*
* .4
6**
14
Col
lect
ive
OC
BI
6.04
.2
4 -.1
5 -.1
7 .1
3 .1
5 -.1
2 .3
1**
.29*
* .5
1**
.01
.38*
* .5
5**
.53*
*.3
4**
15
Org
aniz
atio
nal P
erfo
rman
ce
5.52
.6
9 -.1
1 -.0
5 .1
4 .0
0 .0
2 .0
1 .0
6 .2
2*
-.03
.07
.15
.24*
.3
2**
.30*
*
Not
e. *p
<.05
, **p
<0.0
1.
66 Study 1 – How Do I-Deals Relate to Organizational Performance?
2.4.2 Data Analysis and Hypothesis Testing
The proposed hypotheses were tested within a structural equation model (SEM)
in order to test all hypothesized relationships in one model. The statistical
software package Amos 23 was used to test the proposed model. Several
researchers argue that SEM is a preferable alternative to partial least squares
(PLS), even when sample sizes are small (Goodhue, Lewis, & Thompson, 2012).
Relying on Monte Carlo simulations with varying sample sizes, Goodhue et al.
(2012) found that PLS, an approach often considered as superior to regression
and SEM for testing models with small sample sizes, is no solution to overcome
this challenge. At reasonable sample sizes (n = 90), SEM produces reliable results
and has equal power and greater accuracy than PLS (Goodhue et al., 2012).
Thus, the SEM approach was used for testing the hypothesized model.
Considering the small sample size of 87 organizations (Marsh & Hau, 1999;
Rego, Vitória, Magalhães, Ribeiro, & e Cunha, 2012), composite measures were
used in the model, which means that item scores were averaged to form a score
measuring each construct. To assess the fit of the model, three common fit
statistics were inspected: the root mean square error of approximation (RMSEA)
index and two incremental fit indices, the CFI and the IFI (Bentler 2007). I used
conventional cut-off points to assess these indices (>.90 for the CFI and IFI and
<.08 for the RMSEA; Hu & Bentler 1999). I also report the AIC (Akaike, 1987),
with lower values indicating better fit. Since the model assumes a curvilinear
relationship, the independent variable was squared before calculating
interactions terms and conducting the statistical analysis (e.g., Lechner,
Frankenberger, & Floyd, 2010). Furthermore, due to interaction effects,
varibales were mean centered before conducting the analysis (Aiken & West,
1991).
All hypotheses were tested in a moderated mediation model (see Figure 2-2).
The overall fit statistics were supportive (χ2 = 5.3, df = 9, p < .81; CFI = 1.00, IFI =
1.00, RMSEA = .00, AIC = 327). The overall model including standardized
coefficients is depicted in Figure 2-2. Organizational median i-deals are
positively related to collective job satisfaction (β = .29, t = 1.98, p < .05),
Study 1 – How Do I-Deals Relate to Organizational Performance? 67
supporting Hypothesis 1. Furthermore, organizational median i-deals squared
shows a significant negative relationship with collective OCBI (β = -.23, t = -2.00,
p < .05), supporting Hypothesis 2. In line with Hypotheses 3a and 3b, the results
revealed significant interaction effects between organizational median i-deals
and the individual-focused leadership climate (β = .25, t = 2.04, p < .05) as well
as between organizational median i-deals squared and the collective-focused
leadership climate (β = .37, t = 2.33, p < .05). To further inspect those interaction
effects, I plotted the simple slopes at one standard deviation above and below
the mean of the individual- and the collective-focused leadership climate (see
Figure 2-3 and 2-4; Aiken & West 1991). Simple slopes were calculated based on
bias-corrected bootstrap intervals. 20000 bootstrap samples were used. The
relationship between organizational median i-deals and collective job
satisfaction was significant positive for high levels of individual-focused
leadership climate (β = .53, p < .05), whereas under conditions of low individual-
focused leadership climate I observed a non-significant relationship (β = .00, p =
.89), supporting Hypothesis 3a. In support for Hypothesis 3b, the relationship
between organizational median i-deals and OCBI was inversed U-shaped for
low collective-focused leadership climate (β = -.27, p < .05) and non-significant
for high levels of collective-focused leadership climate (β = .03, p = .68).
Furthermore, as expected, collective job satisfaction and OCBI were both
positively associated with company performance (β = .38, t = 3.40, p < .001; β =
.34, t = 2.75, p < .01; respectively). The effect sizes showed that the model
explained 37, 49 and 30 percent of the variance in collective job satisfaction,
collective OCBI and company performance, respectively.
68 Study 1 – How Do I-Deals Relate to Organizational Performance?
Figu
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Study 1 – How Do I-Deals Relate to Organizational Performance? 69
Figure 2-3. Moderation effect of the individual-focused leadership climate on the relationship between
organizational median i-deals and collective job satisfaction.
Figure 2-4. Moderation effect of the collective-focused leadership climate on the relationship between
organizational median i-deals and collective OCBI.
5.85.9
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High Organizational Median I-Deals
Low Organizational Median I-Deals
High Organizational Median I-Deals
70 Study 1 – How Do I-Deals Relate to Organizational Performance?
To test Hypotheses 4a and 4b, predicting a moderated mediation model, I
examined whether the indirect relationship between organizational median i-
deals and organizational performance mediated by a) collective job satisfaction
and b) collective OCBI was conditional on a) the individual-focused leadership
climate and b) the collective-focused leadership climate. Applying
bootstrapping procedures (again 20000 bootstrap samples; Cheung & Lau, 2008)
I tested for the significance of the indirect effects between organizational
median i-deals and organizational performance under different values of the
individual- and the collective-focused leadership climate. The conditional
indirect effect of organizational median i-deals on organizational performance
was significantly positive for high levels of individual-focused leadership
climate (β = .27, p < .05), but non-significant for low and mean levels of
individual-focused leadership climate (β = .00, p = .90; β = .13, p = .07;
respectively). Furthermore, the conditional indirect effect of organizational
median i-deals squared on organizational performance was significantly
negative for low and mean levels of collective-focused leadership climate (β = -
.27, p < .05; β = -.12, p <. 05; respectively) but non-significant for high levels of
collective-focused leadership climate (β = .03, p = .57). Therefore, Hypothesis 4a
and 4b were supported.
2.4.3 Alternative Model Testing
To further inspect the robustness of the results, I compared the hypothesized
model with alternative models that could be proposed as potential alternative
explanations for the findings. To compare alternative model solutions with the
original model, I relied also on AIC (Akaike, 1987). Higher AIC values
compared to the hypothesized model (AIC = 327) indicate worse fit. First, I
tested if the individual-focused leadership climate also moderated the path via
OCBI and if the collective-focused leadership climate also moderated the path
via collective job satisfaction. In support of my theory and hypothesis, none of
those paths became significant. The alternative model had worse model fit,
however the difference was not significant (Δχ2 = 0.7, Δdf = 4, ns, AIC = 334).
Study 1 – How Do I-Deals Relate to Organizational Performance? 71
Second, a “no controls” model was tested by restricting all paths from the
controls to the dependent variables to zero. This model did not show a
significantly better fit (Δχ2 = 26.4, Δdf = 218, ns, AIC = 317), indicating that the
findings are not dependent on control variables. In the model without controls,
all hypothesized relationship remained significant, indicating a low probability
of bias due to control variables (Becker, 2005). Third, a “direct effects only”
model was tested, in which indirect relationships were set to zero. This resulted
in a significantly worse model fit than the original model (Δχ2 = 26.5, Δdf = 4, p
< .001, AIC = 346), suggesting that the indirect effects are essential to understand
the relationships between the model’s key variables. Fourth, to inspect if the
model indeed needs two parallel mediators, I tested two alternative models,
namely, a “collective OCBI only” model in which collective job satisfaction was
excluded as a mediator variable, and a “collective job satisfaction only” model
that excluded collective OCBI. Both models had a significantly poorer fit (Δχ2 =
64.2, Δdf = 12, p < .001, AIC = 366; Δχ2 = 49.8, Δdf = 13, p < .001, AIC = 351;
respectively), showing that the proposed framework indeed requires two
parallel mediators. Finally, I tested a model including paths between collective
OCBI and job satisfaction, because previous research shows that both variables
influence each other (e.g., Bateman & Organ, 1983). Both paths were non-
significant, and the model fit was slightly, however not significantly, worse
compared to the original model (Δχ2 = 1.7, Δdf = 2, ns, AIC = 330). In sum, these
results clearly support the hypothesized relationships and the overall model.
They suggest that alternative explanations are not likely a cause for the findings
of the proposed model.
2.5 Discussion
The current study examines the effect of organizational median i-deals on
organizational performance via two mediating paths. The results reveal several
key findings. First, i-deals have a linear positive effect on collective job
satisfaction but an inversed U-shaped relationship with collective OCBI.
Second, the path via collective job satisfaction is moderated by the individual-
72 Study 1 – How Do I-Deals Relate to Organizational Performance?
focused leadership climate and the path via collective OCBI is moderated by the
collective-focused leadership climate. Finally, organizational median i-deals are
related to organizational performance via the mediators collective job
satisfaction and collective OCBI.
2.5.1 Theoretical Implications
The findings of this study corroborate and extend contemporary theory in the
area of i-deals in several ways. First, results from the current study add to our
understanding of mediating mechanisms that explain the functioning of i-deals
from an organizational perspective. While studies so far have mainly focused
on individual i-dealers, this study compares two mediators (i.e., collective job
satisfaction and collective OCBI) in the i-deals – performance relationship on
the organizational level. The findings in line with the hypotheses show that
organizational median i-deals are related to collective job satisfaction in a linear
and positive manner, while the relationship to collective OCBI is inversed U-
shaped. These results are in line with findings of Bal and Boehm (2017), who
show a positive relationship between i-deals and another collective job attitude,
namely collective commitment. Furthermore, the current findings support
suggestions that i-deals might be negative for coworker relations (e.g., Conway
& Coyle-Shapiro, 2016), at least under some conditions. Second, researcher
believe that leadership plays an important role regarding i-deals (e.g.,
Rousseau, 2005). However, they have focused mainly on LMX and leader
consideration (e.g., Anand et al., 2010; Hornung et al., 2010a; Hornung et al.,
2010b; Liao et al., 2017; Rosen et al., 2013). The current study reinforces and
expands the focus on leadership in i-deals research. Results show that not only
leadership styles focusing on the individual employee are important but that
collective-focused leadership plays an evenly important role. Specifically,
results show that the individual-focused leadership climate moderates the
relationship between organization median i-deals and collective job satisfaction,
while the collective-focused leadership climate moderates the relationship
between organizational median i-deals and collective OCBI. Finally, I built and
Study 1 – How Do I-Deals Relate to Organizational Performance? 73
subsequently tested a unified organizational-level framework of the relation
between organizational median i-deals and organizational performance. This
addresses the prominent and yet unanswered question in i-deals literature, if i-
deals are also positive for employers (e.g., Conway & Coyle-Shapiro, 2016; Liao
et al., 2016) and opens up new theoretical avenues for future research on i-deals
from an organizational perspective. To my knowledge, this is the first study
examining, if i-deals influence organizational performance. In line with the
hypothesized moderated mediation model, results show that both effects of i-
deals on collective attitudes as well as on coworker relations are transferred to
organizational performance. Negative effects on organizational performance
are caused when organizational median i-deals are high and the collective-
focused leadership climate is low. On the other hand, organizational median i-
deals have a positive effect on organizational level when both organizational
median i-deals and the individual-focused leadership climate are high. The
results therefore imply, that i-deals indeed influence organizational
performance under some conditions.
The current study has also implications for theory development in i-deals
research. Social exchange theory is most prominent to explain the link between
i-deals and individual attitudes and behaviors (Conway & Coyle-Shapiro, 2016).
Liao et al. (2016) suggest that a huge need exists for theory development on the
organizational level. This study addresses this gap in i-deals research by
applying social exchange-based mechanisms to the organizational level. Results
imply that i-deals indeed may be able to change the exchange climate in an
organization (Rousseau, 2005). Furthermore, and in line with existing research
(Bal & Boehm, 2017; Liao et al., 2017; Vidyarthi et al., 2016), other theories
focusing on interactions between employees and collective dynamics, such as
contagion, social comparison, social learning and social identity theory, are
applied to i-deals research on the organizational level. Results of this study
imply that those perspective are valueable to i-deals research on the
organizational level, as effects of i-deals seem to spread across employees, to
74 Study 1 – How Do I-Deals Relate to Organizational Performance?
foster attitudes and behavior on the collective level and to operate depending
on the social context.
2.5.2 Strengths, Limitations and Future Research
An important methodological strength of the study design increases my
confidence in the results. Data from three different groups of employees, top-
managers and HR managers was included in the analysis. Multi-source data
minimizes the influence of common source bias and enhanced the validity of
the study design. However, the current study is not without limitations. First,
all organizations included in the study were from Germany, limiting
generalizability of the results. Second, all companies were SMEs with small to
medium numbers of employees. This fact works in favor of the proposed
hypotheses, increasing the probability that collective attitudes and behaviors as
well as leadership climates are formed in an organization. Future research
should examine if the results are robust in other cultural contexts and big
companies. Third, the current study is based on a fairly small sample of 87
organizations. Although research finds that SEM is reliable with n = 90
(Goodhue et al., 2012), I could not use latent constructs due to the sample size
in combination with numerous study variables. Therefore, measurement errors
in the constructs could not be taken into account. Future research should test
those or similar relationships in a larger sample size. Furthermore, future
research could rely on multilevel models to capture the structure of an
organization including individuals, teams and the whole company more
adequately as Bal and Boehm (2017) have done. Fourth, although it is common
practice in research to use a composite model with an individual referent to
capture collective job satisfaction and collective OCBI (Whitman et al., 2010,
Podsakoff et al., 2014), it would be preferable to use for example a referent-shift
consensus model with the collective as referent (Podsakoff et al., 2014). Finally,
i-deals were measured as one composite scale. However, future research should
take potential different effects of different i-deals into account (e.g., Rosen et al.,
2013).
Study 1 – How Do I-Deals Relate to Organizational Performance? 75
In addition, the study has further significant implications for potential future
research. Following suggestions of Bal and Boehm (2017), the currents study is
a further step in enhancing our limited knowledge of i-deals in the
organizational context. As current results show that effects for organizations
can be both positive and negative depending on how the organizational work
environment is shaped, i-deals research focusing on the organizational level
becomes even more relevant. Liao et al. (2016) suggest that organizations
providing i-deals might be more successful and productive than organizations
which do not provide i-deals. The current results indicate that the question of
whether or not i-deals improve organizational performance is not easy to
answer. Future research should examine this question for example with a focus
on additional relevant context conditions which might cause positive or
negative effects for organizations (e.g., Liao et al., 2016). As discussed in Chapter
1.6, the organizational justice climate might be a further important context factor
and will be examined in Study 2. Second, as also discussed in Chapter 1.6 of this
dissertation, it is an important step for i-deals literature to examine i-deals
differentiation on the organizational level and potential negative effects for
organizations. This will also be done in Study 2 of this dissertation. Third, to
expand research from an organizational level it is time to follow suggestions
(e.g., Liao et al., 2016) to examine we-deals. It is likely that we-deals have
different effects on teams and organizations than i-deals. For example, social
comparison might not take place between single employees in teams but
between teams and departments. Furthermore, the current study extends on our
knowledge on how i-deals influence organizations. Further mechanisms at the
collective level should be examined as for example justice climates in
organizations (e.g., Liao et al., 2016), which will be considered in Study 2 of this
dissertation. Finally, the current study shows that employees engage in OCB in
response to i-deals to mitigate potential drawbacks for coworkers. As Garg and
Fulmer (2017) state, potential other strategies of i-dealers to enhance coworker
support for their deals might be possible and should be considered by future
research.
76 Study 1 – How Do I-Deals Relate to Organizational Performance?
2.5.3 Practical Implications
Ng and Feldman (2010, p. 419) state: “Practically speaking, idiosyncratic deals
are costly to organizations”. The currents findings partially support this
perspective. While i-deals seem to be positive for collective attitudes, coworker
relations are affected differently. The current results indicate that organizations,
leaders and HR mangers need to be aware of the potential detrimental effects of
different leadership styles for organizational effectiveness, when i-deals are
granted to employees. The boundary condition of leader behavior cautions that
employers may need to consider a balance between i-deals and the context
within which they are negotiated and implemented. While a low individual-
focused leadership climate only hinders positive outcomes of i-deals, a low
collective-focused leadership climate causes even negative effects when
organizational median i-deals are high. These results are especially crucial in
the context of findings (Hill, 2007) that leaders underestimate their
responsibility to manage collectives. In contrasts, leaders often believe that
investing in relationships with each employee is sufficient to enhance
effectiveness at work (Hill, 2007). A first managerial implication of this study
therefore is that practitioners should realize that low focus on collective-focused
leadership could have detrimental effects on coworker relations and
organizational performance, when they wish to use i-deals. Second, I advise
managers to promote not only the collective-focused leadership throughout the
organization but also the individual-focused leadership, as effects for personal
attitudes and coworker relations as well as organizational performance are
more positively, when organizations use i-deals. Organizations could assess the
individual- and collective-focused leadership competencies during the
processes of recruiting and promoting leaders, as TFL can be assessed in a
relatively reliable way in organizations for example by employee surveys
(Goodstein & Lanyon, 1999). In addition, organizations could implement
leadership development programs focusing on individual- and collective-
focused leadership behaviors to promote both components of TFL to foster a
Study 1 – How Do I-Deals Relate to Organizational Performance? 77
strong leadership climate (Bass, 1990; Day, 2000). Thereby, a strong basis for
successful i-deals can be fostered in organizations.
2.5.4 Conclusion
Regarding the question if organizations providing i-deals are more successful
than organizations not providing i-deals (Liao et al., 2016), the results imply that
there is no definite answer. I found that the effect of organizational median i-
deals on collective job satisfaction and collective OCBI depends on the
respective leadership behavior, implying that effects of i-deals might be
conditional on a variety of context factors in organizations. I hope that the
current results offer scholars inspiration to continue investigating the role of i-
deals on collective attitudes and behavior and ultimately for organizational
effectiveness. Moreover, I hope that this study is beneficial for practice by
providing an empirically supported framework through which the functioning
of i-deals in the organizational context can be better understood, managed and
supported.
78 Study 2 – I-Deals Differentiation and Organizational Performance
3 I-Deals Differentiation and Organizational
Performance: Does Idiosyncrasy Make I-Deals Non-
Ideal?
Study 1 was guided by Research Question 1 and 2, whether i-deals have an
impact on organizational performance and through which mediating
mechanisms. Study 2 builds on these findings and focuses on i-deals
differentiation and subsequent collective perceptions of distributive justice in
organizations. Accordingly, consistency in opportunity to negotiate i-deals
including procedural justice climate, as stated in Research Question 4, is
examined in this study2F
3.
3.1 Introduction
The embeddedness of employees in a collective workforce can make i-
deals unsettling for all parties.
Rousseau (2005, p. 212)
In departing from traditional personnel management approaches,
organizations and managers must meet the challenge of promoting
organizational justice in their use of individualized arrangements.
Bal & Rousseau (2016, p. 128)
Customized work arrangements have become increasingly common in
organizations in recent years (Bal & Rousseau, 2016). An increasing number of
organizations is adopting individualized working arrangements to meet a
variety of economic and societal trends and a corresponding diversification of
3 An earlier version of this study has been accepted and presented at an international peer-reviewed
conference, namely the 77th Academy of Management Annual Meeting 2017.
Study 2 – I-Deals Differentiation and Organizational Performance 79
employee needs (Esser & Schelenz, 2013). I-deals, created through negotiation
between employee and employer, are one way to customize working
arrangements (Rousseau, 2001). A study by Rosen et al. (2013) found that the
majority of employees had negotiated at least one customized element in their
working arrangement. While employees strive to better fit their work with
personal needs, organizations aim to retain valuable employees and to motivate
them to perform better (Bal & Rousseau, 2016). However, as the quotes by
Rousseau (2005) and Bal and Rousseau (2016) illustrate, challenges may ensue
the introduction of i-deals to organizations due to perceived injustice. One such
challenge is that i-deals have been shown to create inequality between
coworkers (Liao et al., 2016; Marescaux & De Winne, 2016). As employment
arrangements constitute observable and salient characteristics of employees,
they are likely to affect employees’ attitudes and behavior at work, especially
when differences exist between employees (Broschak & Davis-Blake, 2006).
Although “workplaces [today] are full of idiosyncrasies” (Rousseau, 2005, p. 27)
leading to heterogeneity between employees, research has mainly neglected the
degree to which idiosyncratic working arrangements effect organizations (as
exception see Bal & Boehm, 2017). In general, research on i-deals demonstrates
a positive bias among researchers about effects on employees and employers
(Bal & Lub, 2016). I-deals have been linked to a variety of beneficial outcomes
at the individual level such as employee work-related perceptions, attitudes and
behavior (Conway & Coyle-Shapiro, 2016; Liao et al., 2016). As already
presented in Chapter 1.5 and Chapter 2.2, positive individual level outcomes
are OCB (Anand et al., 2010), job satisfaction and affective commitment
(Hornung et al., 2008; Rosen et al., 2013), work engagement (Hornung et al.,
2011), increased performance and motivation (Hornung et al., 2009; Ng &
Lucianetti, 2016). Despite the assumption that they play a major role (e.g.,
Greenberg et al., 2004; Rousseau, 2005), researchers have only just begun to shed
light on the role of i-dealer´s coworkers (Lai et al., 2009; Ng & Lucianetti, 2016).
Vidyarthi et al. (2016) introduced the concept of relative i-deals in teams and
showed a relationship to individual performance. In a first attempt to link i-
80 Study 2 – I-Deals Differentiation and Organizational Performance
deals to organizational performance, Bal and Boehm (2017) showed a
relationship to client satisfaction in a multilevel model. However, and most
surprisingly, effects of i-deals on organizations have not been further examined,
although several researchers have called for research in this area (Anand &
Vidyarthi, 2016; Conway & Coyle-Shapiro, 2016; Kroon et al., 2016; Liao et al.,
2016). In addition, the potential drawbacks of i-deals at the organizational level,
in particular, have also been neglected (Bal & Boehm, 2017).
Therefore, it is currently unclear as to whether i-deals are in fact beneficial to
both employees and organizations, as is stated in their definition (Conway &
Coyle-Shapiro, 2016; Kroon et al., 2016). This study addresses this gap in
research by following the suggestions in previous literature and introduces the
collective level of analysis to the i-deals literature (e.g., Anand & Vidyarthi,
2016). Specifically, the current study builds on the “multilevel model of i-deals”
proposed by Liao and colleagues (2016). However, while their focus lies at the
team level, I apply their propositions from an organizational perspective. The
authors claim that in particular, two phenomena related to i-deals occur at
collective levels, which are median i-deals and i-deals differentiation (Liao et al.,
2016). As i-deals are embedded in social and organizational contexts (Rousseau,
2005), the “multilevel model of i-deals” suggests intermediating processes and
organizational boundary conditions such as collective processes, organizational
culture, and climate to mediate and moderate effects of i-deals on collective
performance (Liao et al., 2016).
The current study makes the following contributions by transferring the
“multilevel model of i-deals” to an organizational perspective and by deriving
first specific hypotheses from this comprehensive model. First, I intend to
answer the question, if differentiating between employees is positive or
negative for organizations, addressing concerns regarding the differential
distribution of i-deals and the potential negative effects on employee attitudes
and behaviors and therefore on organizations (Greenberg et al., 2004). I delve
into this question by examining the effect of i-deals differentiation on
organizational performance through collective distributive justice perceptions
Study 2 – I-Deals Differentiation and Organizational Performance 81
as explanatory mechanism (Liao et al., 2016). Organizational justice perceptions
are proposed to be an essential explanatory mechanism through which i-deals
might influence employees’ performance (Greenberg et al., 2004; Rousseau et
al., 2006). Because i-deals challenge perceptions of distributive justice by
violating the rule of equal treatment (Rousseau, 2005), a special role is assigned
to distributive justice perceptions (Marescaux & De Winne, 2016). In addition,
research suggests that effects of i-deals differentiation might depend on context
factors (e.g., Rousseau, 2001, 2005), highlighting in particular consistency in
opportunity to negotiate i-deals (e.g., Greenberg et al., 2004; Lai et al., 2009; Liao
et al., 2016). Two context factors, which influence perceived consistency in
opportunity to negotiate i-deals are identified: the prevalence of i-deals in an
organization and the procedural justice climate.
3.2 Theoretical Background
3.2.1 I-Deals
Because i-deals are a form of customizing job tasks and conditions (Rousseau,
2005), they grant employees special employment conditions differing from
standard employment arrangements of their coworkers to satisfy their personal
needs (Hornung et al., 2008; Rousseau et al., 2006). According to their own
definition, i-deals cause an unequal distribution of resources (Rousseau, 2005),
resulting in intra-organizational heterogeneity (Klein et al., 1994). This is the
case because i-deals are not available to everyone (e.g., Liao et al., 2016;
Rousseau, 2001, 2005) and differences exist in the scope of i-deals, which refers
to the ratio of idiosyncratic to standardized features of an employment
arrangement (Liao et al., 2016). It is possible that an employee might negotiate
for an entirely idiosyncratic employment contract. Alternatively, low scope
results from a largely standardized work arrangement including only one or
two customized elements. Consequently, the amount of employees’ i-deals may
differ considerably between and within organizations (Liao et al., 2016). To
capture heterogeneity, both between and within organizations, I examine the
82 Study 2 – I-Deals Differentiation and Organizational Performance
relevant conceptualizations of collective i-deals in this study, namely
organizational median i-deals and i-deals differentiation. Organizational
median i-deals are, as already in Study 1, defined as the central tendency of i-
deals in an organization (Anand, 2012; Liao et al., 2016). Furthermore, i-deals
differentiation is defined as the variability of individual i-deals within an
organization focusing on the extent to which levels of i-deals vary within an
organization rather than their varying content (Liao et al., 2016).
As in Study 1, I follow research which has shown that employees negotiate i-
deals across four content domains: schedule flexibility, location flexibility, work
responsibilities, and financial incentives (Rosen et al., 2013). As the majority of
studies on i-deals focuses on the first three typologies, I limit my focus on them
as well.
3.2.2 Organizational Justice Climate
Organizational justice is a widely discussed topic in regards to i-deals (e.g.,
Greenberg et al., 2004; Marescaux & De Winne, 2016). Literature on i-deals
assumes that i-deals both have a significant impact on employees’ perceptions
of justice (e.g., Hornung et al., 2010a; Marescaux & De Winne, 2016) and that
employees evaluate i-deals in the context of organizational justice perceptions
(e.g., Greenberg et al., 2004). Organizational justice includes perceived fairness
of resource allocations and outcomes (distributive justice), decision-making
procedures and allocation processes (procedural justice) and interpersonal
treatment one receives from others (interactional justice; Li & Cropanzano,
2009). Research to date has examined employees’ distributive justice
perceptions only at the individual’s level regarding their own i-deals (Hornung
et al., 2010b) or a colleague’s i-deal (Marescaux & De Winne, 2016). Building on
i-deals research to date and following researchers’ suggestions (Liao et al., 2016;
Marescaux & De Winne, 2016), I focus on distributive and procedural justice
climates at the organizational level in relation to i-deals. Justice scholars
recognize that in addition to individual perceptions, collectives develop shared
cognitions of justice (Roberson & Colquitt, 2005). Due to regular interactions in
Study 2 – I-Deals Differentiation and Organizational Performance 83
these collectives, members learn how each other are treated (Roberson, 2006).
Engaging in collective sense making (Roberson, 2006), employees develop a
distinct collective-level cognition regarding how members are treated in general
(Tyler & Lind, 1992). Justice researchers have suggested that forces such as
information sharing and cognitive contagion give rise to the emergence of a
justice climate (Li & Cropanzano, 2009; Spell & Arnold, 2007). For instance,
when leaders distribute resources and rewards unequally between members of
a collective, feelings of injustice are likely to follow both at the individual and
collective level (Liden et al., 2006; Scandura, 1999). Pointing to organizational
justice climate as a potential explanatory mechanism for effects of i-deals on
organizational performance, research has furthermore shown that
organizational justice climate is related to work attitudes and behavioral
outcomes on individual as well as on collective level (e.g., Li & Cropanzano,
2009; Moliner, Martinez-Tur, Peiro, Ramos, & Cropanzano, 2005; Moon,
Kamdar, Mayer, & Takeuchi, 2008; Olkkonen & Lipponen, 2006; Simons &
Roberson, 2003; Spell & Arnold, 2007).
3.2.3 I-Deals Differentiation and Distributive Justice Climate
Because i-deals constitute an ‘exception to the rule’ and lead to unequally
distributed resources in organizations, they are likely to prompt questions of
fairness among employees (Rousseau, 2005). Thus, perceived organizational
justice has been proposed as one important driver of coworkers’ reactions
towards others’ i-deals (Greenberg et al., 2004; Lai et al., 2009). A key role has
been assigned to distributive justice by i-deals research (e.g., Marescaux & De
Winne, 2016), as unequal treatment of employees is likely to affect evaluations
of distributive justice (e.g., Greenberg et al., 2004). Furthermore, employees’
distributive justice perceptions are influential on a variety of workplace
behaviors such as higher work performance (Cohen-Charash & Spector, 2001).
Judgments about distributive justice in the workplace depend to a great extent
on social comparison among coworkers (Greenberg, Ashton-James, &
Ashkanasy, 2007; Rousseau, 2005). Thereby, the perceived distributive justice of
84 Study 2 – I-Deals Differentiation and Organizational Performance
i-deals can be assessed through the comparison of employees’ outcomes with
those of other members of the organization (Adams, 1965; Greenberg et al.,
2007) based on three principles: equality, equity and need (Deutsch, 1985;
Leventhal, Karuza, & Fry, 1980; Masrescaux & De Winne, 2016; Nauta & Van de
Ven, 2016). Equality implies that all employees receive the same output, while
equity refers to outputs being equal to employee inputs and need means that
outcomes are perceived as fair if they match employees’ needs (Adams, 1965;
Marescaux & De Winne, 2016). While i-deals, according to their own definition,
violate the equality rule (Greenberg et al., 2004; Rousseau, 2005), the principles
of equity and need make negative as well as positive judgments of distributive
fairness possible (Marescaux & De Winne, 2016). The equity norm of
distributive justice implies that people are rewarded in proportion to the work
they perform (Adams, 1965; Deutsch, 1985). When applied to the context of i-
deals, the equity principle implies that an i-deal is perceived as distributively
(un)fair, when it (distorts) maintains the input-output ratio of the i-deal receiver
compared to his or her coworkers (Marescaux & De Winne, 2016). Scholars (e.g.,
Colella, 2001) have further emphasized the importance of the need rule for
perceptions of distributive justice, which might be especially important in
regards to i-deals. As Rousseau (2005) states, i-deals are intended to meet the
increasingly diverse needs of the workforce. Furthermore, they constitute a
possibility for employees to match their employment arrangement to their own
individual needs (Rousseau, 2005). Transferred to the context of i-deals, the
need rule implies that an i-deal is considered as distributively fair when the
special work arrangement addresses specific individual needs of the i-deal
receiver in the coworkers’ view (Marescaux & De Winne, 2016). On the other
hand, i-deals might be perceived as distributively unfair, if coworkers do not
believe that the i-deal is nessecary to meet the receiver’s specific needs
(Marescaux & De Winne, 2016).
The reasoning above suggests that i-deals differentiation might both lead to
positive and negative judgments of distributive justice, depending on whether
i-deals are perceived to be in accordance with the equity and need rule
Study 2 – I-Deals Differentiation and Organizational Performance 85
(Marescaux & De Winne, 2016). Marescaux and De Winne (2016) found that
how employees assess the fairness of their coworkers’ i-deals depends on
gender and i-deals content and suggest for future research to examine other
situational factors that could play a role. This is in line with Rousseau (2001,
2005), who states that it depends on a variety of context conditions as to how
employees perceive i-deals and how effective they are for organizations. I
therefore propose that the organizational context determines whether i-deals
are assessed as fair or unfair. This proposition receives support from related
research on LMX, which has shown that providing employees in collectives
with different levels of resources may result in both positive and negative
evaluations and reactions, depending on context factors (Erdogan & Bauer,
2010). Therefore, based on the foregoing literature review, I suggest that
perceptions of distributive justice climate caused by i-deals differentiation
might be either positive or negative depending on organizational factors.
Potential organizational context factors are discussed in the following.
3.2.4 Organizational Median I-Deals and Procedural Justice Climate as Moderators
of the Relation between I-Deals Differentiation and Distributive Justice
Climate
Depending on how i-deals are managed, they might either be perceived as fair
or unfair (Greenberg et al., 2004; Rousseau, 2001). One of the main challenges of
managing i-deals within an organization is that i-deals differentiation
contradicts the rule of consistency (Liao et al., 2016). Differential distribution of
i-deals causes inequality between employees (Liao et al., 2016; Rousseau, 2005),
which might erode the organizational justice climate (Leventhal, 1980).
However, a way to foster the distributive justice climate is to implement
consistency in employee opportunities to negotiate i-deals (Liao et al., 2016). In
this case, i-deals differentiation might not lead to perceived injustice and
reduced organizational effectiveness (Rousseau, 2001; Rousseau et al., 2006).
Consistency in employee opportunities to negotiate i-deals means that all
employees in an organization believe that they have the opportunity to make
86 Study 2 – I-Deals Differentiation and Organizational Performance
customized arrangements similar to those of coworkers (Rousseau et al., 2006).
Coworkers’ belief in the chance to negotiate for future i-deals is positively
related to their acceptance of another’s i-deal (Lai et al., 2009). This is because
coworkers of an i-dealer are themselves prospective i-dealers (Rousseau et al.,
2006). Therefore, their beliefs about the likelihood of successfully negotiating i-
deals, if needed, is likely to influence perceived distributive fairness (Greenberg
et al., 2004; Rousseau et al., 2006). In other words, whether i-deals differentiation
is perceived as distributively fair or unfair might be highly dependent on
employees’ beliefs of having the chance to negotiate for i-deals themselves.
Consistency in opportunity to negotiate i-deals might be promoted by two
factors, which are organizational median i-deals and procedural justice climate.
3.2.4.1 Organizational median i-deals
The first factor influencing perceived consistency in opportunity to negotiate i-
deals is the perceived prevalence of i-deals in an organization reflected by the
organizational median i-deal. Employees working for the same organization
interact with one another on a regular, sometimes even daily basis (Liao, Liu, &
Loi, 2010). Such work environments facilitate social comparison (Henderson et
al., 2009). Consequently, employees evaluate their situation relative to those of
colleagues (Liao et al., 2010) and are constantly aware of what their coworkers
have or do not have in comparison to their own situation (Duchon, Green, &
Taber, 1986; Ng & Lucianetti, 2016; Weick, Sutcliffe, & Obstfeld, 2005). I-deals
are fueling social comparison between employees as differences in employment
arrenegments are in most cases easily noticed by coworkers (Greenberg et al.,
2007). Employees are likely to compare their i-deals with those of other
organizational members, and this social comparison is influencing the effects of
i-deals (Vidyarthi et al., 2016).
Ng (2017) showed that whether coworkers become jealous because of others’ i-
deals depends on the level of i-deals granted in an organization. This finding
emphasizes that employees’ reactions to i-deals depend on whether i-deals are
available to all employees in an organization (Ng, 2017). This is in line with
Study 2 – I-Deals Differentiation and Organizational Performance 87
Harder (1991), who argues that negative reactions to receiving comparatively
low outcomes are attenuated when people strongly expect to receive better
outcomes in the future. Furthermore, the way organizations and supervisors
handle i-deals is likely to have a signaling function (Ho & Kong, 2015; Rousseau
et al., 2006) and provides social clues that employees use to construct social
norms (Ng & Lucianetti, 2016). Employees who witness their coworkers
receiving a high level of i-deals are likely to believe that their organizations and
their supervisors are willing to grant customized work arrangements (Ng &
Lucianetti, 2016). Furthermore, when employees witness their coworkers’
requests for i-deals being granted, a social norm is created where i-deals are
accepted and supported by the organization (Hornung et al., 2008; Ng &
Lucianetti, 2016). As Hornung et al. (2008) state, a high level of varied
employment arrangements in an organization “convey[s] a normative message
to both workers and supervisors that idiosyncrasy, in employment terms, is
legitimate” (p. 656). Thus, high median i-deals in organizations signal to
employees that it is possible and socially acceptable to receive i-deals (Ng &
Lucianetti, 2016).
It is therefore that I propose employees feel they have the same opportunity to
negotiate for i-deals as their coworkers, if the organizational median i-deal is
high. Consequently, i-deals differentiation should be perceived as distributively
fairer in organizations with high median i-deals than in organizations with low
median i-deals.
3.2.4.2 Procedural justice climate
The second factor influencing perceived consistency in opportunity to negotiate
i-deals is procedural justice climate. Lai et al. (2009) propose that coworkers’
beliefs in the likelihood of obtaining comparable future opportunities to obtain
i-deals is closely related to justice perceptions. Based on the definition of
procedural justice as the fairness of decision-making procedures (Cropanzano,
Byrne, Bobocel, & Rupp, 2001a), procedural justice climate is specified as a
collective level cognition of how procedurally fair employees are generally
88 Study 2 – I-Deals Differentiation and Organizational Performance
treated in an organization (Naumann & Bennett, 2000). The central principles of
a procedural justice climate such as clear criteria for allocating benefits and
inducements, consistency in decision making procedures and a clear legitimate
basis of differences between employees are likely to support the creation of fair
i-deals (Rousseau, 2001). Therefore, leadership consistency across employees is
one of the six key procedural justice rules (Leventhal, 1980). Applying the
consistency criterion of procedural justice to i-deals, organizations and
supervisors give coworkers of i-dealers an equal opportunity to have a
comparable i-deal (Greenberg et al., 2004). A procedural justice climate indicates
the leaders’ consistency in applying decision procedures (Leventhal, 1980).
Therefore, all employees should be able to negotiate i-deals following the same
procedures (Anand, 2012). In other words, when organizations adhere to rules
of procedural justice, employees have the impression that they are able to
negotiate i-deals, if needed, in the future (Greenberg et al., 2004). Following
rules of procedural justice is likely to foster employees’ beliefs that their
supervisor will be willing to grant comparable i-deals if needed. Procedural
justice climate increases perceived consistency of opportunities to negotiate i-
deals as coworkers of i-dealers believe that they are generally treated fairly, and
supervisors are consistent in their decision making (Greenberg et al., 2004;
Rousseau, 2001). Consequently, employees have reason to believe that when
they need an i-deal, the procedural fairness climate will make it possible for
them to negotiate a customized deal (Greenberg et al., 2004).
I therefore propose that employees believe that they have the same
opportunities to negotiate for i-deals as their coworkers, so long as the
organizational procedural justice climate is high. Consequently, i-deals
differentiation should be perceived as distributively fairer in organizations with
high procedural justice climate than in organizations with low procedural
justice climate.
Taken together, these arguments suggest that i-deals differentiation should be
combined with both high organizational median i-deals and procedural justice
climate. In this way, employees perceive that everyone has the same
Study 2 – I-Deals Differentiation and Organizational Performance 89
opportunity to negotiate for i-deals in an organization. Consequently, the
distributive justice climate in an organization is perceived as high. In contrast,
when organizational median i-deals and procedural justice climate are low,
distributive justice climate should also be perceived as low. Thus, the
relationship between i-deals differentiation and distributive justice climate is
expected to be negative. Relative to organizations that have low median i-deals
and low organizational procedural justice, those that have high median i-deals
or high procedural justice climate should have a higher distributive justice
climate, while those organizations that have both high median i-deals and a
high procedural justice climate should have the highest distributive justice
climate.
Hypothesis 1: Organizational median i-deals and procedural justice climate jointly
moderate the relationship between i-deals differentiation and distributive justice
climate in such a way that i-deals differentiations and distributive justice climate
will have the strongest, positive relationship for high organizational median i-deals
and high procedural justice climate and a negative relationship for low
organizational median i-deals and low procedural justice climate.
3.2.5 Mediation Effect of Distributive Justice Climate
Although i-deals are defined as beneficial for both employees and employers,
several researchers recognize that i-deals differentiation might have the
potential to be both positively and negatively related to organizational
performance, depending on how i-deals are perceived by employees
(Greenberg et al., 2004; Liao et al., 2016; Rousseau, 2001). Organizational justice
perceptions are proposed as one important explanatory mechanism, through
which i-deals influence employees’ performance (Greenberg et al., 2004;
Rousseau et al., 2006). Guest (2004) suggests that effects of special work
arrangements on employee attitudes and behavior, as for example job
performance, are mediated by fairness perceptions. Employees who perceive
that wide differences exist in how members of a collective are treated and who
feel that these differences are not justified, may respond by withholding effort
90 Study 2 – I-Deals Differentiation and Organizational Performance
and performing lower than would be expected (Liden et al., 2006). Initial
research shows evidence for this theoretical proposition. Indeed, i-deals, which
are perceived as distributively unjust, cause coworkers to react in ways that
make i-deals less beneficial or even entirely ineffective. Specifically, i-deals
considered distributively unjust support counterproductive work behavior, for
example counteraction and the withholding of effort (Marescaux, De Winne, &
Sels, 2013b as cited in Marescaux & De Winne, 2016). Supporting my argument
at the organizational level, research shows that organization focused
distributive justice and distributive justice climate are related to several
organization oriented behavioral outcomes, such as turnover intentions and
extra-role performance (Li & Cropanzano, 2009; Olkkonen & Lipponen, 2006;
Moliner et al., 2005; Moon et al., 2008; Spell & Arnold, 2007).
Based on this reasoning, I propose that i-deals differentiation is related to
organizational performance through perceived distributive justice climate. As
Hypothesis 1 argues that the effect of i-deals differentiation on distributive
justice climate is reliant upon organizational median i-deals and procedural
justice climate, I propose a moderated mediation model (see Figure 3-1). In other
words, I assume that the mediation effect of distributive justice climate between
i-deals differentiation and organizational performance is dependent upon
organizational median i-deals and procedural justice climate.
Hypothesis 2: I-deals differentiation is related to organizational performance via
conditional indirect effects, such that the relationship with organizational
performance is moderated by organizational median i-deals and procedural justice
climate and mediated by distributive justice climate.
Study 2 – I-Deals Differentiation and Organizational Performance 91
3.3 Method
3.3.1 Data and Sample
As already explained in Chapter 1.7, data for Study 2 was collected with a
similar procedure as in in Study 1. As part of a larger study, data for Study 2
was collected in 2014 in cooperation with a benchmarking agency located in
Germany. 96 organizations participated in the study and in return, each
received a detailed benchmarking report. In order to participate in the study,
organizations had to be located in Germany and employ between a minimum
of 20 and a maximum of 5,000 people. Thus, the study’s sample consists of small
to medium sized companies. The organizations represented a variety of
industries (40% manufacturing, 36% services, 7% finance and insurance, and
17% retail and wholesale). The size of the organizations ranged from 28 to 3,659
employees (median number of employees = 238).
A split-sample design was used (Rousseau, 1985) in order to reduce concerns
about common method bias (Dickson et al., 2006; Erdogan et al., 2006; Podsakoff
et al., 2003; Podsakoff et al., 2012). In summary, I used four different data
sources – namely three unique groups of employees and data from HR
departments. Email invitations to the survey were sent through the HR
department of each participating organization in which the study’s purpose was
Organizational Median I-Deals
I-Deals Differentiation
Procedural Justice Climate
Distributive Justice Climate
Organizational Performance
Figure 3-1. Moderated mediation model of the relationship between i-deals differentiation and
organizational performance.
92 Study 2 – I-Deals Differentiation and Organizational Performance
explained and respondents were guaranteed full anonymity. A web-based
algorithm evenly transferred participants to one of three versions of the
employee survey. Demographic information (i.e., age, gender and tenure) was
captured from all employees. Furthermore, Survey Version 1 captured i-deals,
Survey Version 2 measured procedural and distributive justice climate and
Survey Version 3 asessed interactional justice climate (which was captured to
be used as control variable). Additionally, HR executives were asked to provide
information on their organization’s performance as well as general information
(i.e., industry affiliation and organization size).
Overall, 15,060 employees chose to participate in the survey, resulting in a
within-organization response rate of 30%. Employees’ mean age in the
participating organizations was 40 years (SD = 4.1) and mean tenure was 9 years
(SD = 4.1). Participants included more males (51%) than females (41%) with 8%
not indicating a gender. Participants also represented all major divisions of their
organizations on different hierarchical levels of the organization (9% middle
management; 11% first-line supervisors; 72% employees without leadership
responsibility and 8% other (e.g., freelancer)).
3.3.2 Measures
All survey versions were translated into German following a double-blind back-
translation procedure (Schaffer & Riordan, 2003). To justify the aggregation of
individual measures at the organizational level, I inspected common
aggregation statistics, such as ICC1 and ICC2 (Bliese, 2000) and the ADM(J) as an
interrater agreement measure (Burke et al., 1999; LeBreton & Senter, 2008;
Smith-Crowe et al., 2013). The same cutoff values as in Study 1 were applied to
assess these aggregation statistics and and were generally found to be adequate
to justify aggregation processes. Unless stated otherwise, 5-point rating scales
(1 = strongly disagree, 5 = strongly agree) were used to assess the measures
described in the following.
Study 2 – I-Deals Differentiation and Organizational Performance 93
3.3.2.1 Organizational median i-deals
I-deals were measured using a 4-item scale based on Rosen et al. (2013), covering
schedule flexibility, location flexibility and work responsibilities. One example
items is: “Because of my individual needs, I have negotiated a unique
arrangement with my supervisor that allows me to complete a portion of my
work outside of the office”. Following Ng and Lucianetti (2016), i-deals were
treated as a unidimensional construct in the analysis. An EFA of these four items
shows that all of them loaded on one factor (factor loadings: .88; .82; .83; 83;
extracted variance = 70 percent). Internal consistency estimates were α = .83.
Akin to Study 1, I used the within-organizational median of individual-level i-
deals scores, rather than the mean, to depict the central tendency among i-deals
within organizations. Because i-deals theory is based on the premise that special
work arrangements tend to vary significantly across employees (e.g., Rousseau,
2005), within-organizational agreement is not expected. Therefore, the median
serves better for aggregation in such circumstances when the mean is not an
appropriate measure of aggregation (Bliese, 2000; Liden et al., 2006; Henderson
et al., 2009). In addition, the median best represents the middle level of i-deals
within an organization, taking extreme values into account (Henderson et al.,
2009).
3.3.2.2 I-deals differentiation
Within-organization standard deviation was used to operationalize i-deals
differentiation for each organization. Higher within-organizational standard
deviation represents a greater variability in employees’ level of i-deals, meaning
more differentiation.
3.3.2.3 Procedural justice climate
Perceptions of procedural justice climate were assessed with a 4-item scale by
Erhart (2004). An example item is: “Procedures used to arrive at rewards have
been free of bias in our company”. Aggregation statistics provided support for
94 Study 2 – I-Deals Differentiation and Organizational Performance
an aggregation to the organizational level of analysis (ICC1 = .17, p < 0.001; ICC2
= .85; mean ADM(J) =.85). Internal consistency estimates were α = .92.
3.3.2.4 Distributive justice climate
Perceptions of distributive justice climate were assessed with a 4-item scale by
Colquitt (2001). An example item is: “In our company recognitions reflect the
efforts employees have put into their work”. Individual ratings were
aggregated into a single organizational-level measure. Aggregation statistics
again provided support for an aggregation to the organizational level of
analysis (ICC1 = .15, p < 0.001; ICC2 = .86; mean ADM(J) =.79). Internal consistency
estimates were α = .99.
3.3.2.5 Organizational performance
In line with Combs et al. (2005) and as already applied in Study 1, I defined
company performance as consisting of both organizational and operational
performance dimensions. For operational performance, I used two items
relating to efficiency of business processes and employee loyalty. To assess
organizational performance, I used four items relating to the overall company
performance, the current financial situation, overall return on investment, and
company growth. As in Study 1, the results of a CFA confirmed that all six
performance items loaded on one common performance factor, (χ2= 21, df = 9;
CFI = .95, IFI = .95, SRMR = .05; Hu & Bentler, 1999). Following prior studies
(Rogers & Wright, 1998), the subjective performance measure was benchmarked
by asking the HR managers to evaluate the performance of their company
compared to their direct industry rivals on a 7-point scale (1 = far below average;
7 = far above average). Internal consistency estimates were α = .86.
3.3.2.6 Control variables
In addition to the aforementioned variables, I also included several control
variables in the analysis. Because company size has been shown to be associated
Study 2 – I-Deals Differentiation and Organizational Performance 95
with various employee behaviors and outcomes (Ragins et al., 2000), I included
it as a control factor. Following research showing that company age is related to
productivity (Choi & Shepherd, 2005), I controlled for the companies’ age by
asking for the company’s founding year. As both measures were skewed, I log-
transformed them. Third, I controlled for the characteristics of the companies’
employees by including measures for employee age, gender and tenure as
research has shown that employee attributes influence effects of i-deals (Bal et
al., 2012; Marescaux & De Winne, 2016). I further included variables displaying
organizational structure, which is known to be highly influential on
organizational culture (Conrad & Sydow, 1984). Specifically, I determined
whether companies were family-owned or independent, including whether
companies were separate entities or part of a holding/subsidiary. Furthermore,
I included affiliation to industry sectors as a dummy variable, because industry
affiliation can relate to organizational effectiveness (Dickson et al., 2006). I
added one dummy to capture service industry versus other sectors (including
manufacturing, finance and trade), due to the fact that research finds the service
sector to be especially prone to flexible work arrangements (e.g., Stavrou, 2005).
Finally, to increase the predictive validity of the distributive and procedural
justice climate measures, I controlled for the potentially related construct of
interactional justice climate. Based on Colquitt (2001) I adapted three items to
measure interactional justice climate. An example item was “My direct
supervisor shows respect for my feelings” (1 = never; 5 = extremely
often/always). Aggregation to the organizational level was justified (ICC1 = .04,
p < 0.001; ICC2 = .60; mean ADM(J) =.83). Internal consistency estimates were α =
.90.
96 Study 2 – I-Deals Differentiation and Organizational Performance
3.4 Results
3.4.1 Descriptive Statistics
Means, standard deviations and intercorrelations among the variables are
presented in Table 3-1. The correlation matrix shows a correlation of .82 for
distributive and procedural justice climate, pointing to multicollinearity
between both variables (Kennedy, 1979). However, the variance inflation factors
(VIF) of 4.6 and 4.2 for procedural and distributive justice, respectively, indicate
that multicollinearity is not a major concern for the model (Bowerman &
O´Connell, 1990; Myers, 1990). The tolerance statistic also indicates that
multicollinearity constitutes no serious problems with all tolerance values
above 0.2 (Menard, 1995). Nevertheless, I considered potential multicollinearity,
which might increase the difficulty of interpreting the results of the multiple
regression analysis, during this process (Kraha, Turner, Nimon, Reichwein
Zientek, & Henson, 2012). Although multicollinearity does not affect the overall
fit of the regression model nor result in bad predictions, I considered correlation
coefficients during the interpretation of the results in order to evaluate each
predictor’s contribution to the overall regression model (Kraha et al., 2012).
Furthermore, I conducted a CFA, which shows that both justice scales can be
considered as two distinct factors despite their high correlation. A two-factor
model showed considerable better fit (χ2 = 32, df = 19; CFI = .99, IFI = .99, SRMR
= .02) than an alternative one-factor model (χ2 = 115, df = 20; CFI = .92, IFI = .92,
SRMR = .08).
3.4.2 Data Analysis and Hypothesis Testing
I used moderated regression models to evaluate the hypotheses. Variables were
mean centered before calculating interactions terms and conducting the
statistical analysis (Aiken & West, 1991). All tests conducted were two-tailed
and on the organizational level of analysis. The results of the moderated
regression analyses predicting distributive justice climate and organizational
performance are presented in Table 3-2 and 3-3. Results of the regression
Study 2 – I-Deals Differentiation and Organizational Performance 97
analysis as well as the correlation matrix support my proposition that i-deals
differentiation has no direct effect on distributive justice climate (Table 3-2,
Model 2).
Hypothesis 1, predicting a three-way interaction between i-deals
differentiation, organizational median i-deals and procedural justice climate is
supported. As shown in Table 3-2 (Model 4), the three-way interaction effect
was significant (b = -1.97, p < .01). The incremental variance explained by the
three-way interaction effect is 3%. To probe the nature of the significant
interaction effect, it was plotted. The plot is presented in Figure 3-2.
Consistent with my prediction, I find that the relationship between i-deals
differentiation and distributive justice climate is positive when either
organizational median i-deals or procedural justice are high. A simple slope test
using Preacher’s online interaction utility (Preacher, Curran, & Bauer, 2006)
showed that both slopes for low median ideals and high procedural justice
climate as well for high median i-deals and low procedural justice climate are
significantly positive (b = 1.02, p < .05; b = 0.99, p < .05; respectively). However,
and against the hypothesis, while the slope for high median i-deals and high
procedural justice climate is in its tendency positive, it is non-significant (b =
0.17, p = .53). Similarly, the slope for low median i-deals and low procedural
justice climate has a negative tendency as proposed, but is also non-significant
(b = -0.27, p = .29).
To more formally test the differences across the lines displayed in Figure 3-2, a
slope difference test based on Dawson and Richter (2006) was used. The analysis
shows that the slope for organizations with low median i-deals and low
procedural justice is significantly different from both slopes with either high
organizational median i-deals or high procedural justice (p < .05). Furthermore,
the slope with low median i-deals and high procedural justice is significantly
different from the slope with high median i-deals and high procedural justice
climate (p < .05).
98 Study 2 – I-Deals Differentiation and Organizational Performance
Tabl
e 3-
1. M
eans
, sta
ndar
d de
viat
ions
and
inte
reco
rrel
atio
ns a
mon
g st
udy
veri
able
s.
V
aria
ble
M
SD
1 2
3 4
5 6
7 8
9 10
11
12
13
1 Em
ploy
ee T
enur
e 8.
84
4.05
2 Em
ploy
ee A
ge
39.5
8 4.
07
.61*
*
3 Em
ploy
ee G
ende
r 1.
44
.21
-.18
-.07
4 C
ompa
ny S
ize
(log)
2.
36
.59
.43*
* .3
1**
-.02
5 C
ompa
ny A
ge (l
og)
1.54
.3
8 .6
5**
.28*
* .0
4 .3
1**
6 In
dust
ry S
ervi
ce
.36
.48
-.44*
* -.2
6*
.09
-.06
-.37*
*
7 Fa
mily
-Ow
ned
1.41
.4
9 -.0
5 -.0
6 -.0
1 -.1
6 -.0
8 .1
7
8 C
ompa
ny In
depe
nden
ce
.66
.48
-.29*
* -.2
5*
.13
-.41*
* -.1
5 .1
8 .0
2
9 In
tera
ctio
nal J
ustic
e C
limat
e 3.
66
.33
-.36*
* -.1
9 .1
1 -.0
7 -.2
7**
.24*
.0
3 .2
1*
10
I-D
eals
Diff
eren
tiatio
n .8
2 .2
2 -.0
3 -.1
3 -.1
5 -.1
0 .0
1 -.0
4 .1
1 -.0
9 -.0
9
11
Org
aniz
atio
nal M
edia
n I-D
eals
3.
22
.58
-.27*
* -.0
7 .1
1 -.2
4*
-.26*
* .2
7**
.14
.26*
*.4
7**
-.07
12
Proc
edur
al Ju
stic
e C
limat
e 3.
19
.47
-.27*
* -.2
3*
.15
-.20*
-.2
6*
.30*
* -.0
3 .3
1**
.44*
* -.2
1*
.60*
*
13
Dis
trib
utiv
e Ju
stic
e C
limat
e 3.
03
.54
-.26*
* -.2
1*
.11
-.38*
* -.2
5*
.23*
.0
6 .3
4**
.41*
* -.0
9 .5
0**
.82*
*
14
Org
aniz
atio
nal P
erfo
rman
ce
5.50
.8
1 -.2
4*
-.16
-.03
-.03
-.09
.03
-.07
.10
.30*
* .0
3 .2
6*
.36*
* .4
3**
Not
e. *p
<.05
, **p
<0.0
1.
Study 2 – I-Deals Differentiation and Organizational Performance 99
Tabl
e 3-
2. R
esul
ts o
f mod
erat
ed re
gres
sion
ana
lysi
s pr
edic
ting
dist
ribu
tive
just
ice
clim
ate.
M
odel
1
M
odel
2
M
odel
3
M
odel
4
Var
iabl
es
B SE
B SE
B SE
B SE
Con
stan
t 1.
64
.89
2.
55
.61
2.
48
.63
2.
57
.61
Empl
oyee
Ten
ure
.04
.02
.0
1 .0
1
.01
.01
.0
1 .0
1
Empl
oyee
Age
-.0
1 .0
2
.01
.01
.0
1 .0
1
.00
.01
Empl
oyee
Gen
der
.19
.23
-.0
2 .1
5
.01
.16
-.0
4 .1
6
Com
pany
Siz
e (lo
g)
-.31*
* .1
0
-.21*
* .0
7
-.22*
* .0
7
-.20*
* .0
6
Com
pany
Age
(log
) -.1
8 .1
7
.00
.11
.0
0 .1
2
-.02
.11
Indu
stry
Ser
vice
.1
6 .1
2
-.01
.08
-.0
1 .0
8
.03
.08
Fam
ily-O
wne
d -.0
4 .1
0
.05
.07
.0
5 .0
7
.09
.06
Com
pany
Inde
pend
ence
.1
4 .1
1
.03
.07
.0
4 .0
8
.08
.07
Inte
ract
iona
l Jus
tice
Clim
ate
.60*
**
.16
.1
7 .1
1
.17
.12
.1
6 .1
1
I-D
eals
Diff
eren
tiatio
n
.17
.15
.1
9 .1
6
.48*
.1
9
Med
ian
I-D
eals
-.07
.07
-.0
5 .0
8
-.14
.08
Proc
edur
al Ju
stic
e C
limat
e
.94*
**
.09
.9
4***
.0
9
.91*
**
.09
I-D
eals
Diff
eren
tiatio
n * M
edia
n I-D
eals
-.2
2 .3
2
.18
.34
I-D
eals
D
iffer
entia
tion
* Pr
oced
ural
Ju
stic
e C
limat
e
.1
8 .4
5
.25
.43
Med
ian
I-D
eals
* Pr
oced
ural
Just
ice
Clim
ate
.05
.13
.2
3+
.14
I-D
eals
D
iffer
entia
tion
* M
edia
n I-D
eals
*
Proc
edur
al Ju
stic
e C
limat
e
-1.9
7**
.69
Adj
uste
d R
² .2
7
.70
.6
9
.72
Δ R
²
.4
3***
.01
.0
3**
Not
e. A
ll te
sts a
re tw
o-ta
iled,
+ p<.
1, *p
<.05
, **p
<0.0
1, **
* p<0
.001
.
100 Study 2 – I-Deals Differentiation and Organizational Performance
Hypothesis 2 predicts that i-deals differentiation is related to organizational
performance via conditional indirect effects. While i-deals differentiation is not
directly related to organizational performance (Table 3-3, Model 2), Table 3-3
(Model 5) shows a significant and positive effect of distributive justice climate
on organizational performance (b = .65, p < .05).
To further test the overall moderated mediation model suggested in Hypothesis
2, a conditional indirect effects analysis was performed (Hayes, 2012; Preacher,
Rucker, & Hayes, 2007). The index of moderated moderated mediation is
significant (95% CI [-3.65, -0.25]; SE = .9), supporting Hypothesis 2. The results
depicted in Table 3-4 further show that i-deals differentiation has a significant
effect on organizational performance for low median i-deals and high
procedural justice climate, for moderate median i-deals and moderate as well as
high procedural justice climate. All significant conditional indirect effects of i-
deals differentiation on organizational performance are positive.
1.5
1.7
1.9
2.1
2.3
2.5
2.7
2.9
3.1
3.3
3.5
Dis
trib
utiv
e Ju
stic
e C
limat
e
(1) High Median I-Deal,High Procedural Justice
(2) High Median I-Deal,Low Procedural Justice
(3) Low Median I-Deal,High Procedural Justice
(4) Low Median I-Deal,Low Procedural Justice
Figure 3-2. Three-way interaction on distributive justice climate.
Low I-Deals Differentiation
High I-Deals Differentiation
Study 2 – I-Deals Differentiation and Organizational Performance 101
Tabl
e 3-
3. R
esul
ts o
f the
mod
erat
ed re
gres
sion
ana
lysi
s pr
edic
ting
orga
niza
tiona
l per
form
ance
.
M
odel
1
M
odel
2
M
odel
3
M
odel
4
M
odel
5
Var
iabl
es
B SE
B SE
B SE
B SE
B SE
Con
stan
t 3.
79
1.51
4.59
1.
56
4.
67
1.62
4.88
1.
56
3.
21
1.68
Em
ploy
ee T
enur
e -.0
7+
.04
-.0
9*
.04
-.0
8*
.04
-.0
8*
.04
-.0
9*
.04
Empl
oyee
Age
.0
0 .0
3
.01
.03
.0
1 .0
3
.01
.03
.0
0 .0
3 Em
ploy
ee G
ende
r -.4
2 .4
0
-.53
.39
-.4
9 .4
1
-.62
.40
-.6
0 .3
9 C
ompa
ny S
ize
(log)
.1
2 .1
7
.22
.17
.2
2 .1
7
.25
.16
.3
8*
.17
Com
pany
Age
(log
) .2
7 .3
0
.40
.29
.3
7 .3
0
.33
.29
.3
4 .2
8 In
dust
ry S
ervi
ce
-.20
.20
-.3
3+
.19
-.3
5+
.20
-.2
4 .2
0
-.26
.20
Fam
ily-O
wne
d -.0
9 .1
7
-.05
.17
-.0
6 .1
7
.02
.16
-.0
4 .1
6 C
ompa
ny In
depe
nden
ce
.06
.19
-.0
1 .1
9
.01
.19
.1
1 .1
9
.06
.19
Inte
ract
iona
l Jus
tice
Clim
ate
.64*
* .2
7
.28
.29
.2
6 .3
0
.23
.29
.1
2 .2
8 I-
Dea
ls D
iffer
entia
tion
.4
0 .3
8
.44
.42
1.
13*
.40
.8
2+
.49
Med
ian
I-D
eals
.07
.18
.1
0 .2
1
-.10
.21
-.0
1 .2
1 Pr
oced
ural
Just
ice
Clim
ate
.6
3**
.23
.6
3**
.24
.5
5*
.23
-.0
4 .3
4 I-
Dea
ls D
iffer
entia
tion
* Med
ian
I-Dea
ls
-.32
.82
.6
4 .8
7
.52
.85
I-D
eals
Diff
eren
tiatio
n * P
roce
dura
l Jus
tice
Clim
ate
.38
1.20
.57
1.11
.40
1.09
M
edia
n I-
Dea
ls *
Proc
edur
al Ju
stic
e C
limat
e
-.0
8 .3
2
.36
.35
.2
1 .3
5 I-
Dea
ls D
iffer
entia
tion
* Med
ian
I-Dea
ls *
Proc
edur
al
Just
ice
Clim
ate
-4
.70*
* 1.
78
-3
.42+
1.
82
Dis
trib
utiv
e Ju
stic
e C
limat
e
.6
5*
.28
Adj
uste
d R
² .0
6
.14
.1
1
.17
.2
2 Δ
R²
.08*
.03
.0
6**
.0
5*
Not
e. A
ll te
sts a
re tw
o-ta
iled,
+p<
.1, *
p<.0
5, **
p<0.
01, *
** p
<0.0
01.
102 Study 2 – I-Deals Differentiation and Organizational Performance
Tabl
e 3-
4. B
oots
trap
ping
resu
lts fo
r the
test
of c
ondi
tiona
l ind
irec
t effe
cts
at s
peci
fic v
alue
s of
the
mod
erta
or: m
ean
and
+/- s
tand
ard
devi
atio
n.
95
% C
onfid
ence
Inte
rval
Dep
ende
nt V
aria
ble
Val
ue o
f Mod
erat
or
Med
ian
I-Dea
ls
Val
ue o
f Mod
erat
or
Proc
edur
al Ju
stic
e C
limat
e
Con
ditio
nal I
ndir
ect
Effe
ct
SE
Low
er
Upp
er
Org
aniz
atio
nal
Perf
orm
ance
- 1 S
D (-
0.58
) - 1
SD
(-0.
47)
-.21
.29
-1.0
8 .1
9
- 1 S
D (-
0.58
) M
(0.0
0)
.29
.27
-.10
1.02
- 1 S
D (-
0.58
) +
1 SD
(0.4
7)
.78*
.4
9 .0
8 2.
12
M (0
.00)
- 1
SD
(-0.
47)
.28
.32
-.26
.98
M (0
.00)
M
(0.0
0)
.37*
.2
4 .0
5 1.
02
M (0
.00)
+
1 SD
(0.4
7)
.46*
.2
8 .0
3 1.
17
+ 1
SD (0
.58)
- 1
SD
(-0.
47)
.76
.6
5
-.1
7 2.
37
+ 1
SD (0
.58)
M
(0.0
0)
.44
.39
-.05
1.
51
+ 1
SD (0
.58)
+
1 SD
(0.4
7)
.13
.23
-.28
.67
Not
e. R
esul
ts a
re b
ased
on
1000
0 bo
otst
rap
sam
ples
. Con
ditio
nal i
ndir
ect e
ffect
test
s ar
e tw
o-ta
iled.
Study 2 – I-Deals Differentiation and Organizational Performance 103
3.4.3 Robustness Analysis
To further evaluate the robustness of the findings, I tested the hypotheses
independently of the control variables uncorrelated with the mediator and the
outcome variable (Becker, 2005; i.e., employee gender, family owned). In these
tests, the three-way interaction is significant (b = -1.80, p = .01) and distributive
justice climate is positively related to organizational performance (b = .65, p <
.05). Without non-significant control variables, these two regression coefficients
are therefore in the same direction and of the same significance level as those
coefficients obtained from models with all control variables included. Again,
conditional indirect effects of i-deals differentiation on organizational
performance were significant for low median i-deals and high procedural
justice climate, for moderate median i-deals and moderate as well as high
procedural justice climate.
3.5 Discussion
This research applies the concept of i-deals at the organizational level. My
underlying motivation was the need to clarify whether or not i-deals are
actually beneficial for organizations (e.g., Conway & Coyle-Shapiro, 2016). To
gain insight into this issue, this research drew on the organizations level
concepts i-deals differentiation and organizational median i-deals. My study
results yield three overarching findings. First, i-deals differentiation has no
direct effect on distributive justice climate or organizational performance.
Second, the effect of i-deals differentiation on distributive justice climate
depends on organizational median i-deals and procedural justice climate. Third,
the effect of i-deals differentiation on organizational performance is moderated
by organizational median i-deals and procedural justice climate and mediated
by distributive justice climate.
104 Study 2 – I-Deals Differentiation and Organizational Performance
3.5.1 Theoretical Implications
This research makes an important contribution to i-deals theory by examining
effects from an organizational perspective. Various researchers have
emphasized the need to verify the benefits of i-deals for organizations since they
are defined as being beneficial for employee and employer (e.g., Convey &
Coyle-Shapiro, 2016; Rousseau, 2005). Furthermore, the question has been
raised as to under which conditions i-deals are more beneficial or detrimental
for organizations (e.g. Liao et al., 2016; Rousseau, 2005).
The results mainly support the hypotheses. In the title of the study I posed the
question, whether idiosyncrasy makes i-deals non-ideal. The clear answer
provided by the results is no. Consistent with literature on LMX differentiation
(e.g., Erdogan & Bauer, 2010; Liden et al., 2006) and assumptions made in i-deals
literature (e.g., Liao et al., 2016; Marescaux & De Winne, 2016; Rousseau, 2005)
the results demonstrate that i-deals differentiation is not per se perceived as
distributively fair or unfair. In contrast, employees’ evaluations of i-deals
differentiation depend on organizational context factors. As proposed, the
results revealed a three-way interaction effect of i-deals differentiation,
organizational median i-deals and procedural justice climate.
Supporting my assumptions regarding the three-way interaction, I found a
positive relationship between i-deals differentiation and distributive justice
climate when either median i-deals or procedural justice climate are high.
Surprisingly, although slightly positive, the relationship between i-deals
differentiation and distributive justice is non-significant for high median i-deals
and high procedural justice climate. Both justice and i-deals literature give some
hints to explain the non-significant relationship between i-deals differentiation
and distributive justice climate for both high median i-deals and high
procedural justice climate.
I-deals literature postulates that a high level of i-deals can reduce differences
between employees and limit social comparison (Hornung et al., 2008). Liao et
al. (2016) suggest that differential treatment through i-deals may be more
Study 2 – I-Deals Differentiation and Organizational Performance 105
acceptable in collectives where most employees have i-deals. A single employee
with an i-deal is probably attracting attention if he or she is the only member
with special working arrangements (Liao et al., 2016). I-deals differentiation can
alter the relative standing of members of an organization (Rousseau, 2005).
However, due to heightened social comparison, i-deals differentiation might
only lead to salient status differences, if the median level of i-deals is low in an
organization (Hornung et al., 2008; Liao et al., 2016). Accordingly, justice
literature proposes that procedural justice most strongly affects perceived
distributive justice when status differences are high. While research finds that
perceptions of distributive justice can be enhanced by the presence of high levels
of perceived procedural justice (Brockner, Tyler, & Cooper-Schneider, 1992;
Cropanzano & Konovsky, 1995; Konovsky, 2000; Shapiro & Kirkman, 1999),
results also show that employees react more strongly towards perceived
procedural justice when status differences between employees are salient (Van
Prooijen, Van den Bos, & Wilke, 2002). The buffering effect of procedural justice
on reactions to decisions is further increased by unfavorable outcomes (Kwong
& Leung, 2002). As argued above, status differences and outcome
unfavourability should be highest for high i-deals differentiation and low
median i-deals. This might explain why a high procedural justice climate more
strongly enhances perceived distributive justice climate in organizations with
low median i-deals than in organizations with high median i-deals.
The final, and probably most important contribution of the current study is that
I am able to confirm that i-deals indeed have an influence on an organization’s
performance. These findings are in line with results of Study 1 of this
dissertation. Consistent with my expectations, i-deals differentiation has a
conditional, indirect effect on organizational performance. Specifically, i-deals
differentiation has a positive effect on organizational performance in
organizations with low median i-deals and high procedural justice climate as
well as for moderate levels of i-deals and both moderate and high procedural
justice climate. For all other combinations of organizational median i-deals and
procedural justice climate, i-deals differentiation has no effect on organizational
106 Study 2 – I-Deals Differentiation and Organizational Performance
performance. This is consistent with finding the strongest positive relationship
between i-deals differentiation and distributive justice climate for low median
i-deals and high procedural justice climate.
3.5.2 Limitations and Future Research
Despite numerous strengths, the following limitations should be considered
when interpreting the results of the current study. First, generalizability of the
study might be limited as data was collected from a unique sample comprised
of companies in only one country (Germany). Furthermore, the specified nature
of the sample comprising mainly small and medium-sized companies might
have worked in favor of the hypotheses. The social comparison processes that I
assume as an underlying theoretical mechanism for the proposed relationships
might be more likely to occur in small companies. In those settings, employees
get to know each other more - beyond the boundaries of groups and
departments - than in larger companies with several thousand employees and
numerous departments or even subsidiaries (Kunze, Boehm, & Bruch, 2013).
Thus, future studies could transfer the documented effects to larger companies
from different cultural backgrounds. In addition, the sample size was limited to
96 organizations and I encourage replications and extensions of the current
research in larger samples. Second, although data was collected from two
groups of employees and human resource executives, the research design does
not allow for causal inferences since all data was collected at one measurement
point. Avenues for future research might include examining the relationship of
i-deals on organizational level with organizational outcomes in longitudinal
settings. Third, i-deals were treated as unidimensional constructs, as the EFA
showed that the measurement items loaded on only one factor. However, Rosen
et al. (2013) demonstrated the existence of different subtypes of i-deals. Future
research could expand the findings of the current study by including
comparisons between subtypes of i-deals.
Beyond these limitations, my research offers several interesting directions for
future research. Rousseau (2005) defines i-deals as beneficial for both employees
Study 2 – I-Deals Differentiation and Organizational Performance 107
and employer. This study adds to current literature by being the first to
empirically examine i-deals differentiation on an organizational level. The
results imply, i-deals differentiation might either have a positive or non-
significant effect for organizational performance, depending on specific context
factors. In accordance with Conway and Coyle-Shapiro (2016) this study thus
supports the notion that we do not know enough yet to recommend the use of
i-deals to organizations. Because the effects of i-deals differentiation is highly
dependent on organizational context factors, future research should study other
relevant factors. In the current study, results show positive or nonexistent
effects of i-deals differentiation on organizations. However, under other
conditions it might also be possible that negative outcomes are transferred to
the organizational level. Potential moderators are different forms of
organizational justice, leadership climate, organizational size or sector
(Greenberg et al., 2004; Liao et al., 2016; Rousseau, 2005). As Study 1 has shown
that the leadership climate influences the relationship between organizational
median i-deals and organizational performance, this might also be possible for
i-deals differentiation. Supporting this idea, Vidyarthi et al. (2016) found that
employees compare own i-deals to those of others in the context of a team’s
social and structural attributes. Thus, leadership behavior might be important
in shaping reactions to i-deals differentiation in a collective context. I further
advise future researchers to also study other firm relevant outcomes, for
example employee health and turnover rates as well as objective performance
outcomes. Having profound implications for i-deals theory (Conway & Coyle-
Shapiro, 2016) it seems to be an enriching avenue for future research to examine
potential effects on organizations in detail.
Furthermore, the current research mainly focused on organizational justice
theory and social comparison processes. However, by transferring i-deals
research to the collective level, other theoretical frameworks and explanatory
mechanisms might come into play (Liao et al., 2016). Conway and Coyle-
Shapiro (2016) suggest that current conceptualizations and definitions might be
108 Study 2 – I-Deals Differentiation and Organizational Performance
insufficient in accounting for the effect of i-deals at collective levels. In my
opinion, this question possesses great potential for future research.
3.5.3 Practical Implications
The above limitations notwithstanding, the current research has important
implications for practice, especially for organizations who intend to use i-deals
as HR instruments for the success of the organization (Kroon et al., 2016). This
study points out to the fact that the mere presence of i-deals differentiation is
not per se positive or negative. It is rather the context that determines the extent
to which i-deals differentiation is beneficial for organizations: on one hand, the
number of i-deals granted in organizations plays a major role, while the on the
other hand, this study implies that a focus should be put on organizational
climate. In accordance with Rousseau (2005), this study therefore suggests that
practitioners, specifically line managers and HR managers, must monitor how
many i-deals are granted in an organization and under which conditions. Rather
than informally handling i-deals, organizations should have strict guidelines as
to how many i-deals can be granted (Hornung et al., 2014). Furthermore, it is
especially the task of direct supervisors to adhere to rules of procedural justice,
when i-deals are granted to individual workers (Greenberg et al., 2004).
Thereby, optimal effects on the organization might be created. This task is
complicated by the fact that both conditions must be met in order to induce
positive effects on the organization, demanding special attention from
organizations.
3.5.4 Conclusion
While i-deals theory assumes i-deals to be positive for employees and
employers, this study is the first to show that positive effects might actually
occur at the organizational level due to the idiosyncratic nature of i-deals. By
examining the effects of i-deals differentiation on organizational performance
this study gives rise to a variety of not yet examined areas in i-deals research.
The current study confirms that new constructs and thereby additional
Study 2 – I-Deals Differentiation and Organizational Performance 109
theoretical explanatory mechanisms come into play, when i-deals are examined
at the collective level. I hope that this research serves as an ideal starting point
for future research to investigate the relation between i-deals at collective level
and organizational outcomes and helps organizations capitalize on the benefits
of increasingly diverse working arrangements.
110 Study 3 – Combining I-Deals and Human Resource Practices
4 Combining I-Deals and Human Resource Practices:
Enhancing Organizational Performance through
Consistency
Study 3 focuses on Research Question 5 and inspects the interplay between i-
deals and HRM. Specifically, the interaction between FWAs, offered as modern
HR practices, and i-deals, negotiated with the supervisor, on organizational
productive energy and subsequently on organizational performance is
examined.
4.1 Introduction
I-deals are most effective in serving the employer’s interest when their
use is consistent with the firm’s strategy and HR system.
Rousseau (2005, p. 190)
Close interactions with HR departments can be crucial in maintaining
and promoting successful i-deals in the workplace […]
Bal & Rousseau (2016, p. 128)
In the context of a strong trend of individualization at work, an increasing
number of companies is including FWAs in their HRM (De Menezes & Kelliher,
2017; Rudolph & Baltes, 2017). Organizations and their HRM are becoming
increasingly interested in FWAs because evidence indicates that they facilitate
the wellbeing of their employees and increase the organization’s profitability
and effectiveness (e.g., Lewis, 2003; Montano, Hoven, & Siegrist, 2014; Quick,
Murphy, & Hurrell, 1992; Rudolph & Baltes, 2017). Even governments as for
example the European Union encourage greater availability of FWAs in
organizations to meet diverging needs of the modern workforce (European
Study 3 – Combining I-Deals and Human Resource Practices 111
Commission, 2012; as cited in De Menezes & Kelliher, 2017). However, it is
important to draw a distinction between flexible working policies in
organizations and actual flexible working by employees (e.g., Bayazit & Bayazit,
2017; Rudolph & Baltes, 2017). When organizations adopt FWAs, it is assumed
that employees are free to utilize them according to their personal needs
(Bayazit & Bayazit, 2017). However, organizations rather give employees the
right to ask for flexibility when they implement FWAs and managers still have
the right to refuse employees’ requests for flexible working conditions (Bayazit
& Bayazit, 2017). For example, research showed that although schedule
flexibility is the most commonly requested customized work arrangement, such
requests are only granted and implemented 58% of the time (Lauzun,
Morganson, Major, & Green, 2010). However, how HR practices are realized by
line managers may matter equally or even more for organizational performance
than the pure presence of FWAs in organizations (Edgar & Geare, 2005).
Therefore, it is important to make a distinction between the presence of FWAs
on the one hand, and how these HR practices are implemented and enacted by
direct line managers on the other hand (Marescaux, De Winne, & Sels, 2013a).
As proposed by Bayazit and Bayazit (2017), i-deals might play an important role
in the effective implementation of FWAs. I-deals are individually negotiated
working arrangements between employee and employer, intended to meet the
personal needs of the employee (Rousseau, 2005). Faced with individuals who
differ in what they need and how they want to work, managers can use i-deals
as a means to make HR practices accessible to employees (Rousseau, 2005).
This research contributes to the literature on FWAs and i-deals in various ways.
While an increasing number of organizations is adopting FWAs (Rudolph &
Baltes, 2017), it is still not clear, whether FWAs are positive for organizational
effectiveness and under which conditions (e.g., Allen, Johnson, Kiburz, &
Shockley, 2013; De Menezes & Kelliher, 2011; Lewis, 2003). I propose, that the
possibility to negotiate for i-deals with line managers is one important context
condition for the effectiveness of FWAs. Indeed, research showed that i-deals
are one way for employees to make use of FWAs according to their own needs
112 Study 3 – Combining I-Deals and Human Resource Practices
(Bayazit & Bayazit, 2017). Thus, the current study addresses recent calls to
distinguish between effects of formalized flexibility offered by the HR system
and informal flexibility negotiated with the direct supervisor (e.g., Bayazit &
Bayazit, 2017; Rudolph & Baltes, 2017). Furthermore, their interplay is examined
as suggested by several researchers (e.g., Bal & Rousseau, 2016; Kroon et al.,
2016; Rousseau, 2005). As the quotes by Rousseau (2005, p. 190) and Bal and
Rousseau (2016, p. 128) cited in the beginning of the study suggest,
organizations should ensure compatibility between their HR systems and their
managers’ behavior and decisions. Building on signaling theory, I suggest that
merely implementing flexibility through the HR system of an organization does
not affect organizational productive energy and thereby organizational
performance. I rather propose that managers need to act consistently to the HR
system and allow employees to actually leverage flexibility in the form of i-
deals, if FWAs are included in the HR system.
4.2 Theoretical Background
4.2.1 Flexible Working Arrangements
The focus of this study lies on HR practices providing flexibility for employees,
rather than flexibility of employees (Alis, Karsten, & Leopold, 2006; De Menezes
& Kelliher, 2011). This highlights the importance of FWAs to serve the
individual needs of employees. More and more organizations are implementing
HR practices to offer FWAs to their employees (e.g., De Menezes & Kelliher,
2017). FWAs are defined as “employer provided benefits that permit employees
some level of control over when and where they work outside of the standard
workday” (Lambert, Marler, & Gueutal, 2008, p. 107). FWAs are HR practices
offering a variety of options for flexibility, for example flexible working time,
working from home, part-time work, compressed work week and job-sharing
(Allen et al., 2013; Dunham, Pierce, & Castaneda, 1987; Lewis, 2003; Pierce &
Newstrom, 1982). Therefore, the term FWAs includes not only when (i.e.,
flexible working time) but also where (i.e., home office) and how long (i.e., part-
Study 3 – Combining I-Deals and Human Resource Practices 113
time work) employees work (Lambert, et al., 2008; Lewis, 2003). FWAs are often
also called family-friendly or work–life policies highlighting their purpose to
serve employees’ needs (Lewis, 2003).
Research evidence implies that offering employees freedom to design their
work environments more flexible through FWAs can be a valuable HRM
strategy. Numerous studies, reviews and meta-analyses showed that FWAs can
have positive effects on organizations (e.g., Baltes, Briggs, Huff, Wright, &
Neuman, 1999; Friedman & Greenhaus, 2000; Glass & Estes, 1997; Hill,
Hawkins, Ferris, & Weitzman, 2001; Kossek & Ozeki, 1999). Nevertheless, the
nature of the relationship between FWAs and relevant organizational outcomes
does not seem to be fully understood. Reviews and meta-analysis show that
results in studies on FWAs are not always consistent, effects of FWAs on
outcomes are often small in magnitude and contingent upon other critical
factors (Allen et al., 2013; Lewis, 2003). In a recent meta-analysis, Allen et al.
(2013) attribute the mixed findings among other things to the studies’
operationalization of FWAs via availability versus the actual use of flexibility.
Organizations which offer FWAs are giving employees only a right to request
flexibility (Bayazit & Bayazit, 2017). However, this implies that line managers
might refuse those requests for flexibility (Bayazit & Bayazit, 2017). Therefore,
the actual use of FWAs in organizations is dependent on the final approval of
supervisors (Bayazit & Bayazit, 2017). In line with Lewis (2003), I therefore
suggest that the availability of FWAs is only beneficial for organizations, if
employees perceive the availability of FWAs and are successful in negotiating
flexibility according to their personal needs. The question therefore is, whether
organizations offer FWAs, but more importantly, if requests for flexibility are
approved by line managers. This question can be addressed by examining the
role of i-deals in complementing FWAs.
4.2.2 I-Deals
As already dicussed in Chapter 1.4 of this dissertation, i-deals are often
negotiated to fit working arrangements to the needs of individual employees,
114 Study 3 – Combining I-Deals and Human Resource Practices
however, without neglecting the needs of the organization (e.g., Rousseau,
2005). Therefore, i-deals might be a vealuable instrument in combination with
more standardized HR practices to make those more applicable to individual
employees (e.g., Kroon et al., 2016).
As discussed already in Study 1 and 2, i-deals research shows that employees
negotiate i-deals across four content domains, which are schedule flexibility,
location flexibility, work responsibilities and financial incentives (Rosen et al.,
2013). Extant research has shown that two types of i-deals are most prevalent in
organizations: time and location flexibility i-deals and development or task and
work responsibility i-deals (Bal et al., 2012; Hornung et al., 2008; Rosen et al.,
2013), which are therefore also the focus of the current study. This is in
accordance with Study 1 and 2 of this dissertation. Furthermore, this focus is in
line with a study of Bayazit and Bayazit (2017) who related FWAs to i-deals in
the areas of flexible work schedules, work locations and work load. Prevalence
of i-deals in an organization is reflected by the organizational median i-deal.
Based on Anand (2012) and as in Study 1 and 2, organizational median i-deals
are again defined as the central tendency of i-deals in an organization. Due to
their individualized nature, i-deals are suggested as a possibility to make HR
practices, which are focused on flexibility and the individual needs of each
employee (i.e., FWAs), accessible to the workforce (Rousseau, 2005).
4.2.3 Flexible Working Arrangements and Organizational Performance
Increasing research evidence points to the importance of HR practices for
organizational performance (e.g., Becker & Huselid, 1998; Boselie, Dietz, &
Boon, 2005; Combs, Liu, Hall, & Ketchen, 2006). Research shows a positive
association between HRM and firm performance (e.g., Arthur, 1994; Delery &
Doty, 1996; Huselid, 1995). Additionally, two major reviews of HRM research
(Boselie et al., 2005; Combs et al., 2006) confirmed that the large majority of
published studies demonstrates a positive relationship between HRM and
organizational performance.
Study 3 – Combining I-Deals and Human Resource Practices 115
Similarly, several studies have examined the effect of FWAs on different
indicators of mainly individual-level performance. While a variety of studies,
reviews and meta-analyses have reported mixed results, the majority of results
points to a positive relationship with relevant organizational outcomes as for
example employee performance, absenteeism and job satisfaction (Allen et al.,
2013; Baltes et al., 1999; Friedman & Greenhaus, 2000; Glass & Estes, 1997; Hill
et al., 2001; Kossek & Ozeki, 1999). For instance, De Menezes and Kelliher (2011)
found in their review that the link between FWAs and outcomes on
organizational level is not clearly established. Especially the link of FWAs with
productivity and other performance and financial measures seems questionable
(De Menezes & Kelliher, 2011). However, more recent studies suggest a positive
association between flexibility for employees and employee performance (De
Menezes & Kelliher, 2017). This is supported by a recent study by Berkery,
Morley, Tiernan, Purtill and Parry (2017) who found that employees are more
productive in organizations which offer FWAs. Shen, Chanda, D'netto and
Monga (2009) further suggest that HR diversity management practices, which
are closely related to FWAs, are related to organizational performance.
Following these findings and propositions in extant literature, I suggest that
FWAs are positively related to organizational performance.
Hypothesis 1: FWAs have a positive relationship with organizational performance.
4.2.4 The Intermediate Effect of Organizational Productive Energy
While earlier research assumed a direct link between HR practices and
organizational performance, recent evidence suggests that this link is mediated
by employee attitudes and behavior (Alfes, Truss, Soane, Rees, & Gatenby,
2013b). Researchers found this relationship to be mediated by factors such as
job satisfaction, commitment, task performance, and OCB (Bowen & Ostroff,
2004; Den Hartog, Boselie, & Paauwe, 2004; Guest, Conway, & Dewe, 2004;
Kinnie, Hutchinson, Purcell, Rayton, & Swart, 2005; Kuvaas, 2008; Snape &
Redman, 2010; Takeuchi, 2009). The theoretical model describing the
relationship between HR practices and performance introduced by Guest (1997)
116 Study 3 – Combining I-Deals and Human Resource Practices
suggests that employee perceptions of HR practices lead to attitudinal
outcomes, which in turn lead to behavioral outcomes such as performance. In
line with this model, Alfes et al. (2013b) showed that the effect of perceived HR
practices on task performance is mediated by employee engagement.
This mediated relationship with performance is also suggested for the special
case of FWAs. Initial research showed that FWAs are positively related to a
variety of individual level attitudes such as job satisfaction, commitment and
employee engagement (Bond & Galinsky, 2006; Nadeem & Metcalf, 2007). De
Menezes and Kelliher (2011) conclude in their literature review on FWAs that
the literature suggests several mediators for the relationship between FWAs and
performance, such as job satisfaction, organizational commitment and
engagement.
Alfes, Shantz, Truss and Soane (2013a) propose that the relationship between
HR practices and behavioral outcomes is mediated by constructs which
comprise emotional, cognitive and physical components simultaneously, as for
example employee engagement. Viewing this relationship from an
organizational perspective, I propose organizational productive energy as
mediator on the collective level for the relationship between FWAs and
organizational performance. In accordance with the proposition of Alfes et al.
(2013a), organizational productive energy is characterized by three
components: affective energy, cognitive energy, and behavioral energy (Cole,
Bruch, & Vogel, 2012). First, affective energy refers to employees’ shared
experience of positive feelings and emotional arousal at work, second, cognitive
energy describes the shared intellectual processes that cause employees to think
constructively and to search persistently for solutions to problems at work, and
third, behavioral energy reflects employees’ collaborative efforts to benefit the
organization, such as pace and intensity with which employees purposefully
invest physical resources to contribute to the organization’s performance (Cole
et al., 2012; Lykken, 2005; Quinn & Dutton, 2005; Spreitzer & Sonenshein, 2004;
Spreitzer, Sutcliffe, Dutton, Sonensheim, & Grant, 2005). Based on this
definition, organizational productive energy is conceptualized by previous
Study 3 – Combining I-Deals and Human Resource Practices 117
literature as collective-level construct (Cole et al., 2012). Raes, Bruch and De
Jong (2012) further argue that a climate of productive energy can emerge in
organizations, which describes “the extent to which employees’ collective
resources and effort are focused on productive work (p. 171)
4.2.4.1 The signaling function of FWAs
The mediated effect of HR practices on organizational performance is often
explained by the signaling function of HR systems (Bowen & Ostroff, 2004). HR
practices have a signaling function by sending messages that employees
interpret to make sense of their work situation and their relationship to their
employer (e.g., Rousseau, 1995). HR practices can thus be considered as
communication from employer to employee (Guzzo & Noonan, 1994; Rousseau,
1995; Tsui et al., 1997). An organization’s HR practices represent a possibility
for the employer to signal long-term investment in employees which obligates
those to engage in reciprocation through positive attitudes and behavior (Gong,
Chang, & Cheung, 2010; Shaw, Dineen, Fang, & Vellella, 2009; Sun, Aryee, &
Law, 2007). HR practices imply that the organization values their employees
and cares about their well-being (Allen, Shore, & Griffeth, 2003). Specifically,
FWAs signal that the organization is supportive of employees and is seeking to
build a strong and long-lasting social exchange relationship with them because
FWAs are HR practices that suggest investment in employees and show
recognition of employee contributions by providing flexibility in working
conditions (e.g., Allen et al., 2003). Availability of FWAs signals that employees
are allowed to ask their supervisors for flexibility (Bayazit & Bayazit, 2017) and
that the organization is willing to support employees who wish to use flexible
working conditions (Ehrnrooth & Björkman, 2012; Bowen & Ostroff, 2004).
Thus, FWAs can be perceived as investment in the relationship to the employee
by the employer (e.g., Allen et al., 2003). To summarize, “HRM practices are one
way for employers to signal their willingness to invest in and support their
employees” (Alfes et al., 2013a, p. 334). Hence, perceived FWAs may be linked
118 Study 3 – Combining I-Deals and Human Resource Practices
with organizational productive energy and subsequently with organizational
performance.
4.2.4.2 FWAs, organizational productive energy and organizational performance
As research shows, employees’ energy is enhanced by perceiving both the
interest and support of their organization (Cole et al., 2012; Dutton, 2003). In
fact, Dutton and Heaphy (2003) propose that high-quality connections at work
cause positive feelings including vitality, alertness and energy. Indeed, research
showed that employees, who have a high-quality relationship with their
employer and thus feel supported by their organization report more positive
emotions and arousal, and increased experienced energy at work (Cameron,
Dutton, & Quinn, 2003; Dutton, 2003; Ryan & Frederick, 1997). Similarly,
Atwater and Carmeli (2009) found that employees with a supportive, high-
quality relationship with their leaders experience more energy at work.
Furthermore, the relationship to the organization is of importance for
employees’ energy level as perceived organizational support is related to
employee affective well-being at work (Panaccio & Vandengerghe, 2009).
In addition, organizational productive energy is related to organizational
performance. Extant literature conceptualizes employees’ energy at work as a
key motivational force that has positive implications for both individual
employees and organizations (Cole et al., 2012; Dutton, 2003; Russo, Shteigman,
& Carmeli, 2015). As Dutton (2003) states, energy makes “organizations and the
people within them extraordinary” (p. 6). Cole et al. (2012) propose that
energized employees are more likely to engage in knowledge creation and
successful problem-solving that benefit the organization’s performance.
Furthermore, organizational-level productive energy is proposed to be
beneficial for organizational goal attainment because employees invest more
effort in their work, and thereby positively affect organizational performance
(Cole et al., 2012). Indeed, Cole et al. (2012) showed that organizational
productive energy is positively related to overall organizational performance.
Similarly, Bruch and Vogel (2011) found that organizations with high levels of
Study 3 – Combining I-Deals and Human Resource Practices 119
organizational productive energy show significant higher overall firm
performance. Specifically, they showed that organizational productive energy
is strongly and positively related to a variety of performance parameters,
including organizational performance, profitability and efficiency (Bruch &
Vogel, 2011). Based on this review of recent literature, I suggest that the effect
of FWAs on organizational performance is mediated by organizational
productive energy.
Hypothesis 2: FWAs have a positive effect on organizational performance, which is
mediated by organizational productive energy.
4.2.5 The Moderating Effect of I-Deals
Employees’ direct managers play an increasingly important role in the
implementation of HR practices on the individual level (Purcell & Hutchinson,
2007). The HR practices experienced by employees are increasingly those
enacted by their direct supervisors and not those officially offered by the
organization (Purcell & Hutchinson, 2007). At the same time, researchers
observe a gap between practices formally offered in HR systems and what
supervisors actually provide their employees (Purcell & Hutchinson, 2007). An
important way how line managers might implement FWAs are i-deals (Bayazit
& Bayazit, 2017). Bayazit and Bayazit (2017) suggest, that employees can only
make use of FWAs, when line managers allow them to negotiate i-deals, which
in turn might lead to beneficial outcomes for both employees and the
organization.
4.2.5.1 The signaling function of i-deals
Similar to FWAs, i-deals convey messages to employees (Ho & Kong, 2015). Ho
and Kong (2015) assume that i-deals function as signals of the employer to the
employee based on signaling theory. They suggest that i-deals can be used as
signals by the employer to convey positive evaluations, recognition and
commitment to valued and high-performing employees in order to elicit
120 Study 3 – Combining I-Deals and Human Resource Practices
desirable attitudinal and behavioral responses that are beneficial for the
organization (Ho & Kong, 2015). Rousseau et al. (2006, p. 979) note that i-deals
‘‘can signal [to the employee] the value an employer places on him or her”. In
extant research on i-deals, scholars have assigned i-deals a signaling function
because they can function as powerful social cues by conveying positive signals
from employer to employees (e.g., Rousseau et al., 2006; Rousseau et al., 2009).
4.2.5.2 Signal consistency between FWAs and i-deals
In the organizational context, signals never operate in isolation but always
against the background of other organizational signals (Ho & Kong, 2015). As
Belogolovsky and Bamberger (2014, p. 1708) state, signals ‘‘may vary as a
function of signals inferred from other related management policies or
practices”. This implies that FWAs and i-deals represent signals that are
interpreted by employees in mutual dependency. As already mentioned before,
organizations which include FWAs in their HR system only provide employees
the opportunity to request customized working conditions from their
supervisors (Bayazit & Bayazit, 2017). However, those still can refuse to provide
their employees the flexibility they want (Bayazit & Bayazit, 2017). If this is the
case, the organization is not consistent in the messages which are sent to
employees. Signal consistency is defined “as the agreement between multiple
signals from one source” (Connelly, Certo, Ireland, Reutzel, 2011, p. 54), in this
case the organization. Researchers indicate that employees prefer consistency in
their working environment (e.g., Kelley, 1973; Siehl, 1985), which includes
agreement between signals sent by the organization (e.g., through HR practices
and line managers; Bowen & Ostroff, 2004). Inconsistency between messages
occurs, when signal are related to each other and the same subject or content,
but when they are incongruent or contradictory to each other (Bowen & Ostroff,
2004). Inconsistency between signals might have severe consequences for the
organization (Bowen & Ostroff, 2004; Connelly et al., 2011; Siehl, 1985).
Conflicting and inconsistent signals confuse employees, making the
organization’s communication less effective (Bowen & Ostroff, 2004), while in
Study 3 – Combining I-Deals and Human Resource Practices 121
turn signal consistency enhances a message’s effectiveness (Chung & Kalnins,
2001; Connelly et al., 2011; Fischer & Reuber, 2007).
HR systems characterized by high consistency are considered as strong HR
systems (Bowen & Ostroff, 2004, Guest & Conway, 2011). Through signal
consistency employees develop a shared interpretation of the organization's HR
practices as well as a shared perception about what behaviors are expected,
supported and rewarded by the employer (Bowen & Ostroff, 2004; Sun et al.,
2007). Consequently, strong HR systems are assumed to lead to a strong
organizational climate about the HRM content, in which employees share a
common understanding of HR practices, which means a shared perception of
the supportive organizational environment emerges (Bowen & Ostroff, 2004;
Sun et al., 2007). This organizational climate in turn motivates employees to
show positive collective attitudes and behavior which subsequently enhance
organizational performance (Bowen & Ostroff, 2004; Sun et al., 2007).
Consistency between signals is closely related to consensus between
organizational actors and key decision makers (Bowen & Ostroff, 2004, Guest &
Conway, 2011). This might be the case if both HRM and line managers support
flexibility for employees. Signals send trough HR practices are likely to interact
with signals send by managers by implementing those practices in affecting the
development of a collective climate about the HRM content (Ashforth, 1985;
Bowen & Ostroff, 2004; Ostroff, Kinicki, & Tamkins, 2003). Supervisors are the
organizational agents who enact and implement HRM practices for individual
employees (Bayazit & Bayazit, 2017). When employees perceive their direct
managers to implement practices, those actions support a common
interpretation and shared perception of the organizational climate regarding
HR practices among employees (Kozlowski & Doherty, 1989; Naumann &
Bennett, 2000). On the other hand, it becomes difficult to send unambiguous
and internally consistent messages to employees if HRM and supervisors do not
agree on the level of flexibility they are willing to offer (Fiske & Taylor, 1991).
Agreement among HRM and supervisors and therefore among the signals they
are sending (e.g., by FWAs and i-deals) fosters greater consensus among how
122 Study 3 – Combining I-Deals and Human Resource Practices
employees perceive their working environment and thus the emergence of an
organizational climate about the HRM content (Bowen & Ostroff, 2004). Thus,
supervisor behavior in line with the HRM system and formally offered practices
may strenghen the relationships between HR practices and the organizational
climate about HRM content, which influences in turn employee collective
attitudes and behavior, and finally organizational performance (Bowen &
Ostroff, 2004; Sun et al., 2007).
Regardless of the strength of the HRM system (Bowen & Ostroff, 2004), frequent
interactions and communication among employees are likely to result in
collective sense making in organizations (Jackofsky & Slocum, 1988). Thus, in
organizations where the strength of the HRM system is strong, the sense making
processes among employees will most likely result in the emergence of an
organizational climate regarding HRM content, which means shared
perceptions of a supportive organizational environment arise (Bowen & Ostroff,
2004; Guest & Conway, 2011; Sun et al., 2007). If the HRM system is weak, HRM
practices send signals to employee that are ambiguous, contradictory, and
inconsistent and subject to each individual employee’s interpretation (Bowen &
Ostroff, 2004). Shared perceptions about HR practices and their content in the
form of a collective climate will not emerge (Bowen & Ostroff, 2004; House,
Rousseau, & Thomas-Hunt, 1995), because employees individually interpret the
messages sent by HRM practices (Bowen & Ostroff, 2004). Thus, weak HR
systems, characterized by low consistency between signals, are likely to be
related to constructs at the individual but not at the organizational level (Bowen
& Ostroff, 2004). From this argument it follows that only strong HR systems,
which are those characterized through signaling consistency are influencing
collective employee attitudes and behavior as well as organizational
performance (Bowen & Ostroff, 2004; Guest & Conway, 2011). I therefore
suggest, that FWAs will only have a positive impact on organizational
productive energy and organizational performance, if they are complemented
by a high median i-deal in organizations. If the median i-deal is low, FWAs will
Study 3 – Combining I-Deals and Human Resource Practices 123
have no relationship to organizational productive energy and organizational
performance.
Hypotheses 1 and 2 suggest that the effect of FWAs on organizational
performance is mediated by organizational productive energy. Furthermore,
the reasoning above suggests that i-deals moderate the relationship between
FWAs and organizational productive energy. I propose two hypotheses to
model this interaction effect as well as the overall moderated mediation model
(James & Brett, 1984; Preacher et al., 2007). These relationships are reflected in
the overall theoretical model, illustrated in Figure 4-1.
Hypothesis 3: Organizational median i-deals moderate the relationship between
FWAs and organizational productive energy, such that the effect of FWAs on
collective productive energy is positive for high organizational median i-deals and
non-significant for low organizational median i-deals.
Hypothesis 4: The mediated effect of FWAs on organizational performance through
organizational productive energy is moderated by organizational median i-deals,
such that the effect of FWAs on organizational performance is positive for high
organizational median i-deals and non-significant for low organizational median i-
deals.
Figure 4-1. Moderated mediation model of the relationship between FWAs and organizational
performance.
Organizational Median I-Deals
FWAs Organizational Productive Energy
Organizational Performance
124 Study 3 – Combining I-Deals and Human Resource Practices
4.3 Method
4.3.1 Data and Sample
A similar data collection procedure was conducted as for Study 1 and 2 of this
dissertation. Data was collected from 88 organizations in 2015 in cooperation
with a German benchmarking agency via an online survey. However, 5
organizations had to be excluded from the analysis due to missing data.
Consequently, 83 organizations from a variety of industries (33%
manufacturing, 42% services, 6% finance and insurance, and 19% retail and
wholesale) and ranging between 20 and 5,200 employees (median = 190)
remained in the study.
Participating employees received a link to the online survey by each
participating organization. Three different data sources were used to reduce
concerns about common method bias (e.g., Dickson et al., 2006; Podsakoff et al.
2012). Employees provided information about the demographics (i.e., employee
age and gender), i-deals and organizational productive energy. HR executives
provided information on the organizations offers regarding FWAs as well as
general information (i.e., industry affiliation, organization size and age). Finally,
members of the top-management team were asked to provide information on
their organization’s performance.
15,694 employees across all 83 organizations participated in the online survey.
Employees’ mean age was 40 years and mean tenure was 8.7 years. Participants
included more males (50%) than females (36%). 14% of the employees did not
provide an answer regarding their gender. The participating employees were
from all major divisions and hierarchical levels of the organizations (9% middle
management; 11% group manager; 67% employees without leadership
responsibility; 6% trainee; 1% mini-jobber, freelancer and contract worker; 3%
other groups and 3% provided no answer).
Study 3 – Combining I-Deals and Human Resource Practices 125
4.3.2 Measures
To meet the needs of the German sample, again all survey versions were
translated to German following a double-blind back-translation procedure
(Schaffer & Riordan, 2003). Because the study focuses on the organizational
level, data analysis was conducted at the organizational level. Thus, all
measures assessed through individual level responses by employees were
aggregated to the organizational level. To justify the aggregation of individual
measure at the organizational level, common aggregation statistics, such as the
index for interrater agreement rwg (James, 1982; James, Demaree, & Wolf, 1984;
Klein & Kozlowski, 2000), and ICC1 and ICC2 (Bliese, 2000) were inspected. For
ICC1 and ICC2, the same cut-off values as in Study 1 and 2 were used. All values
of the ICC1 and ICC2 were satisfactory and supported aggregation of the
measures to the organizational level. For the rwgs, I followed recommendations
of LeBreton and Senter (2008), who state that values above .71 can be interpreted
as strong agreement between raters. The rwgs were indicating moderate to high
agreement for all organizations (LeBreton & Senter, 2008). Unless stated
otherwise in the description of all specific measures below, 5-point rating scales
(1 = strongly disagree, 5 = strongly agree) were used to measure the following
scales.
4.3.2.1 FWAs
FWAs were assessed with 11 items based on Lyness, Thompson, Francesco and
Judiesch (1999). HR executives answered with yes or no if their organizations
offered part-time employment, telework, sabbaticals, flexible working hours,
day care facilities, financial support for day care, support for elder care, further
training during parental leave, paid parental leave (for the care and education
of children, regardless of the age of the children), plans for reintegration after
parental leave and lifetime working time accounts. A total FWAs availability
score was computed by summing the number of items checked as yes by HR
executives so that higher scores indicated a greater number of FWAs available.
These 11 items create a formative measure. This means that the individual items
126 Study 3 – Combining I-Deals and Human Resource Practices
are not expected to correlate with each other because the assessed indicators are
considered to be the cause of the resulting construct (Bayazit & Bayazit, 2017).
Thus, the reliability of the composite measure for FWAs was not computed
(Edwards & Bagozzi, 2000).
4.3.2.2 Organizational median i-deals
In line with Study 2, 1-deals were measured using a 4-item scale based on Rosen
et al. (2013). The items were covering schedule and location flexibility as well as
task and work responsibility i-deals. An example item for schedule flexibility is:
“My supervisor considers my personal needs when making my work
schedule”. Following the approach of Ng and Lucianetti (2016), i-deals were
again conceptualized as a unidimensional construct in this study. The
unidimensional construct was supported by a factor analysis. An EFA of the
four items used to measure i-deals shows that all of them loaded on one
common factor (factor loadings: .76; .80; .90; 76; extracted variance = 65 percent).
Internal consistency estimates for the measure were α = .78. As discussed in
Study 1 and 2, I did not use the mean but the within-organizational median to
aggregate i-deal scores to the organizational level, because within-
organizational agreement is not expected for i-deals in one organization (e.g.,
Rousseau, 2005). Thus, the median is preferable to reflect the central tendency
among i-deals within organizations (Bliese, 2000; Henderson et al., 2009; Liden
et al., 2006; Rousseau, 2005).
4.3.2.3 Organizational productive energy
Organizational productive energy was measured with a 14-item scale by Cole
et al. (2012). An example item for the affective dimension is: “The employees are
energetic in their job”, an example item for the cognitive dimension is: “The
employees have a collective desire to make something happen” and an example
item for the behavioral dimension is: “The employees are currently working at
a very fast pace”. Aggregation statistics provided support for an aggregation to
Study 3 – Combining I-Deals and Human Resource Practices 127
the organizational level of analysis (ICC1 = .06, p < 0.001; ICC2 = .74; median rwg
=.77). Internal consistency estimates were α = .94.
4.3.2.4 Organizational performance
In line with Combs et al. (2005) and measures of organizational performance in
Study 1 and 2, I defined company performance as consisting of two dimensions:
organizational and operational performance. For operational performance, I
used two items relating to employee productivity, as well as employee retention
and fluctuation. To assess organizational performance, I used two items
addressing overall company performance and the current financial situation as
indicators. All four performance items were again loading on one common
performance factor. The one factor structure of the items was approved by a
CFA (χ2= 3.7, df = 2; CFI = .98, IFI = .98, SRMR = .04; Hu & Bentler, 1999). Akin to
performance measures in Study 1 and 2, the subjective performance measure
was benchmarked by asking top-managers to evaluate the performance of their
company compared to other organizations acting in their industry (Rogers &
Wright, 1998). Ratings were given on a 7-point scale (1 = far below average; 7 =
far above average). Internal consistency estimates were α = .77. For those
companies in which more than one top manager (n = 44) answered, aggregation
to the organizational level was justified (ICC1 = .31, p < 0.001; ICC2 = .65; median
rwg =.82).
4.3.2.5 Control variables
I included numerous control variables in the analysis that might bias the current
results. Company size was used as control variable because it is related to
numerous behaviors and attitudes within companies (Ragins et al., 2000).
Following research showing that company age is related to a firm’s productivity
(Choi & Shepherd, 2005), I controlled for the companies’ age by asking for the
company’s founding year. Company age was measured by asking an HR
manager for the founding year of the organization. As both vairables - company
age and size - were skewed, I log-transformed them before the analysis. Third,
128 Study 3 – Combining I-Deals and Human Resource Practices
I controlled for the characteristics of the companies’ employees and included
measures for employee age, gender and tenure as control variables. Previous
research has shown that employee attributes influence effects of i-deals on
outcomes, such as if i-deals are perceived as fair (e.g., Bal et al., 2012; Marescaux
& De Winne, 2016). Fourth, I included affiliation to industry sectors as dummy
variable, because industry affiliation can relate to organizational effectiveness
(Dickson et al., 2006). I added one dummy variable to capture service industry
versus other sectors (i.e., manufacturing, finance and trade), because first,
organizations in the service sector tend to have greater flexibility (e.g., Stavrou,
2005) and second, the majority of companies from the sample came from the
service sector. Fifth, I controlled for the number of organizational locations per
company. Kunze et al. (2013) suggest that collective processes and climates are
more likely created when employees have the chance for regular interactions,
which is the case in smaller companies with only one or just few organizational
locations. Finally, I controlled for i-deals differentiation as researchers propose
that the effects of the average level of i-deals and i-deals differentiation in
collectives are not independent from each other (e.g., Liao et al., 2016). This
assumption was supported by results of Study 2. Therefore, i-deals
differentiation was added to the analysis, which included organizational
median i-deals as moderator. This variable was operationalized with the within-
organizational standard deviation (as it was already done in Study 2).
Study 3 – Combining I-Deals and Human Resource Practices 129
4.4 Results
4.4.1 Descriptive Statistics
Table 4-1 provides the means, standard deviations, and intercorrelations of our
study variables. In line with Hypothesis 1, FWAs are positively related to
organizational performance (r = .24, p < .05). As proposed by Hypothesis 2,
FWAs are also positively related to organizational productive energy, which in
turn has a positive relationship to organizational performance (r = .22, p < .05; r
= .36, p < .05, respectively). Table 4-1 does not present high intercorrelations
between any of the variables that could raise concerns about multicollinearity
between the constructs.
4.4.2 Data Analysis and Hypothesis Testing
I utilized the PROCESS macro (Hayes, 2013) to estimate the mediation model
specified in Hypothesis 1 and 2 and the moderated mediation model proposed
by Hypothesis 3 and 4. I decided to use the PROCESS macro because it is
recognized as relying on a rigorous approach for detecting the significance of
conditional indirect effects because this method is based on bootstrap sampling
(Kisbu-Sakarya, MacKinnon, & Miočević, 2014). Variables were mean centered
before calculating interactions terms and conducting the statistical analysis
(Aiken & West, 1991). All tests were conducted two-tailed and on the
organizational level of analysis.
130 Study 3 – Combining I-Deals and Human Resource Practices
Tabl
e 4-
1. M
eans
, sta
ndar
d de
viat
ions
and
inte
rcor
rela
tions
am
ong
stud
y va
ribl
es.
V
aria
ble
M
SD
1 2
3 4
5 6
7 8
9 10
11
1 Em
ploy
ee T
enur
e 8.
69
3.04
2 Em
ploy
ee A
ge
39.8
8 3.
98
.48*
*
3 Em
ploy
ee G
ende
r 1.
39
.22
-.13
-.12
4 C
ompa
ny S
ize
(log)
2.
28
.46
.31*
* .0
0 .0
8
5 C
ompa
ny A
ge (l
og)
1.52
.4
3 .4
7**
.01
-.11
.40*
*
6 O
rgan
izat
iona
l loc
atio
ns
7.08
14
.88
.07
-.03
.20
.48*
* .1
3
7 In
dust
ry S
ervi
ce
.42
.50
-.28*
* -.0
7 .2
9**
-.10
-.36*
* -.0
9
8 I-
Dea
l Diff
eren
tiatio
n .8
3 .1
8 .0
6 .0
2 .1
3 .2
5*
.12
.00
-.10
9 O
rgan
izat
iona
l Med
ian
I-Dea
ls
3.29
.4
2 -.0
7 .0
6 -.0
9 -.1
1 -.0
3 -.0
3 .0
4 -.2
0
10
FWA
s .4
5 .1
7 -.0
2 -.0
3 .1
1 .1
5 -.0
4 .0
8 .1
0 .0
0 .3
3**
11
Org
aniz
atio
nal P
rodu
ctiv
e En
ergy
3.
53
.25
-.10
-.19
-.07
-.23*
-.1
9 -.0
2 .0
6 -.0
9 .3
7**
.22*
12
Org
aniz
atio
nal P
erfo
rman
ce
5.55
.7
9 -.0
3 -.0
3 -.0
8 -.0
1 .0
1 .1
7 -.0
6 .0
7 .0
3 .2
4*
.36*
*
Not
e. *p
<.05
, **p
<0.0
1.
Study 3 – Combining I-Deals and Human Resource Practices 131
Table 4-2. Regression results for the estimated coefficients of the mediation model.
Predictor B SE
Mediator variable model: Organizational Productive Energy
Constant
FWAs
Employee Tenure
Employee Age
Employee Gender
Company Size (log)
Company Age (log)
Industry Service
Organizational locations
𝑅𝑅2
4.67***
0.37*
0.02
-0.02*
-0.15
-0.17*
-0.10
0.01
0.00
.45*
(0.39)
(0.16)
(0.01)
(0.01)
(0.13)
(0.07)
(0.08)
(0.06)
(0.00)
Dependent variable model: Organizational Performance
Constant
Organizational Productive Energy
FWAs
Employee Tenure
Employee Age
Employee Gender
Company Size (log)
Company Age (log)
Industry Service
Organizational locations
𝑅𝑅2
1.68
1.03**
0.86+
-0.02
0.01
-0.37
-0.14
0.23
-0.05
0.01
.46*
(2.09)
(0.50)
(0.50)
(0.04)
(0.03)
(0.41)
(0.24)
(0.24)
(0.19)
(0.01)
Note: All tests are two-tailed, +p≤.1, *p<.05, **p<0.01, *** p<0.001.
132 Study 3 – Combining I-Deals and Human Resource Practices
The direct positive relationship between FWAs and organizational performance
predicted in Hypothesis 1 was not supported by the results of the regression
analysis. As shown in Table 4-2 the relationship is only marginally significant
(b = .86, p = .09). In line with Hypothesis 2, Table 4-2 furthermore reveals a
positive relationship between FWAs and collective productive energy and
between organizational productive energy and organizational performance (b =
.37, p < .05; b = 1.03, p < .01). To further test the indirect effect, I used PROCESS
analysis with 20000 bootstraps samples (Hayes, 2013). In contrast to other
theory tests (e.g. Sobel test), the bootstrapping procedure does not rely on
distribution assumptions, which is preferable to other tests, since the
assumption that indirect effects conform to normal distributions is often
problematic and inapplicable (Shrout & Bolger, 2002). Results show a significant
indirect effect (b = .38; 95% CI [0.01, 0.95]; SE = .25) of FWAs on organizational
performance via organizational productive energy. Therefore, Hypothesis 2
was supported. Hypothesis 3, predicting that organizational median i-deals
moderate the relationship between FWAs and organizational productive
energy was supported by the results of the regression analysis depicted in Table
4-3. The interaction effect was significant (b = .83, p < .05). To interpret the
interaction effect, it is shown in Figure 4-2. Furthermore, simple slopes analysis
shows that the effect of FWAs on organizational productive energy is
significantly positive for high median i-deals (b = .52, p < .05), but non-significant
for mean and low median i-deals (b = .11, p = .48, b = -.26, p = .33, respectively).
To further test the overall moderated mediation model suggested in Hypothesis
4, a conditional indirect effects analysis was performed (Hayes, 2012; Preacher
et al., 2007) based on 20000 bootstrap samples. I tested the conditional indirect
effect at the mean as well as at one standard deviation above and one below the
mean. The results show that FWAs have a positive relationship with
organizational performance mediated by organizational productive energy for
high organizational median i-deals and a non-significant relationship for low
and mean levels of organizational median i-deals as presented in Table 4-4,
which is supporting Hypothesis 4.
Study 3 – Combining I-Deals and Human Resource Practices 133
Table 4-3. Regression results for the estimated coefficients of the moderated mediation model.
Predictor B SE
Mediator variable model: Organizational Productive Energy
Constant
FWAs
Organizational Median I-Deals
FWAs * Organizational Median I-Deals
Employee Tenure
Employee Age
Employee Gender
Company Size (log)
Company Age (log)
Industry Service
Organizational locations
I-Deals Differentiation
𝑅𝑅2
4.66***
0.14
0.20**
0.83*
0.02*
-0.02*
-0.13
-0.16*
-0.12+
0.03
0.00
0.10
.58**
(0.37)
(0.16)
(0.06)
(0.38)
(0.01)
(0.01)
(0.12)
(0.07)
(0.07)
(0.06)
(0.00)
(0.15)
Dependent variable model: Organizational Performance
Constant
Organizational Productive Energy
FWAs
Employee Tenure
Employee Age
Employee Gender
Company Size (log)
Company Age (log)
Industry Service
Organizational locations
I-Deals Differentiation
𝑅𝑅2
1.95
1.02**
0.87+
-0.02
0.01
-0.46
-0.21
0.20
-0.02
0.01
0.60
.48*
(1.69)
(0.36)
(0.50)
(0.04)
(0.03)
(0.41)
(0.24)
(0.24)
(0.19)
(0.01)
(0.49)
Note: All tests are two-tailed, +p<.1, *p<.05, **p<0.01, *** p<0.001.
134 Study 3 – Combining I-Deals and Human Resource Practices
Figure 4-2. Moderation effect of organizational median i-deals on the relationship between FWAs and
organizational productive energy.
4.4.3 Robustness Analysis
Following Becker’s (2005) recommendation, the analysis was also conducted
without those control variables which were not significantly correlated with
either the mediator or the outcome variable. Therefore, only organizational size
remained in the analysis as control variable. Results in both the mediation
model and the moderated mediation model are in the same direction and of a
similar or higher significance level as those coefficients obtained from models
with all control variables included. Results without non-significant control
variables show again a significant indirect effect (b = .39; 95% CI [0.03, 0.89]; SE
= .22) of FWAs on organizational performance via organizational productive
energy. Furthermore, the conditional indirect effect of FWAs on organizational
performance was also significant for high levels of organizational median i-
deals (b = .56; 95% CI [0.08, 1.20]; SE = .29).
4.45
4.5
4.55
4.6
4.65
4.7
4.75
4.8
4.85
Low FWAs High FWAs
Org
aniz
atio
nale
Pro
duct
ive
Ener
gy
LowOrganizationalMedian I-Deals
HighOrganizationalMedian I-Deals
Study 3 – Combining I-Deals and Human Resource Practices 135
Tabl
e 4-
4. B
oots
trap
ping
resu
lts fo
r the
test
of c
ondi
tiona
l ind
irec
t effe
cts
at s
peci
fic v
alue
s of
the
mod
erat
or: m
ean
and
+/- s
tand
ard
devi
atio
n.
95%
Con
fiden
ce In
terv
al
Med
iato
r V
alue
of M
oder
ator
Med
ian
I-Dea
ls
Con
ditio
nal I
ndir
ect
Effe
ct
SE
Low
er
Upp
er
Org
aniz
atio
nal P
rodu
ctiv
e
Ener
gy
- 1 S
D (-
0.48
) -.2
6 .3
1 -.9
6 .3
2
M (-
0.04
) .1
2 .2
2 -.2
6 .6
1
+ 1
SD (0
.46)
.5
6 .3
3 .0
1 1.
28
Not
e. R
esul
ts a
re b
ased
on
2000
0 bo
otst
rap
sam
ples
. Con
ditio
nal i
ndir
ect e
ffect
test
s ar
e tw
o-ta
iled.
136 Study 3 – Combining I-Deals and Human Resource Practices
4.5 Discussion
The aim of the current research was to take a first step to clarify the complex
interplay between HR practices and i-deals (Kroon et al., 2016; Rousseau, 2005).
The current study makes two key contributions to current literature. First, it
supports the notion, that FWAs are not directly related to organizational
performance but that the effect is mediated by employee organizational
productive energy. Second, the current study shows, that FWAs are only
beneficial for organizational performance if they are complemented by i-deals
enacted by direct supervisors. Otherwise, FWAs have no effect on
organizational productive energy and thereby on organizational performance.
4.5.1 Theoretical Implications
The current study has numerous important implications for research on FWAs
and i-deals. The aim was to clarify, how flexibility on the one hand through the
HR system and on the other hand through negotiation with the direct
supervisor complement each other (e.g., Kroon et al., 2016; Rousseau, 2005). The
current study thereby addresses recent calls to distinguish between the impact
of formalized, policy-based access to FWAs and discretionary idiosyncratic
arrangements negotiated by individual employees with their direct supervisor
(Bayazit & Bayazit, 2017; Rudolph & Baltes, 2017).
Most of the hypotheses were supported by the results. First, and against
Hypothesis 1, the current findings show, that FWAs are not directly related to
organizational performance, since the relationship was only marginally
significant. Second, and in line with Hypothesis 2, the results show that the
effect of FWAs on organizational performance is mediated by collective
employee attitudes and behavior, which was operationalized with
organizational productive energy in the current study. However, these results
are in line with the literature on HR practices and FWAs. Recent research is also
supporting a mediated rather than a direct relationship (e.g., De Menezes &
Kelliher, 2011; Lewis, 2003). However, the current study also adds to existing
Study 3 – Combining I-Deals and Human Resource Practices 137
literature. While research so far has mainly focused on individual level
mediators and outcomes (e.g., Lewis, 2003), I follow suggestions of Bowen and
Ostroff (2004), that strong HR systems are influencing collective level outcomes
compared to weak HR systems which lack consistency between signals. Second,
research so far has mainly focused on effects of FWAs on outcomes as work-life
conflict (e.g., Bayazit & Bayazit, 2017) or individual performance (e.g., De
Menezes & Kelliher, 2017). The current findings extent on existing research by
showing a relationship between FWAs and organizational performance, which
has so far been established for general HR systems (e.g., Bowen & Ostroff, 2004)
and suggested for the closely related construct of HR diversity management
practices (Shen et al., 2009). Third, the results support the quotes by Rousseau
(2005, p. 190) and Bal and Rousseau (2016, p. 128) I referred to in the beginning
of the study. Indeed, HR systems and i-deals seem to be most effective for
employees and employers, if they are used consistently. Supporting my
assumptions, FWAs have only a positive effect on organizational productive
energy and organizational performance, when the median level of i-deals is
high in an organization. For organizations with low median i-deals, I find no
relationship at all. This is also in line with other research highlighting the
importance to differentiate between formalized HR based FWAs and informal
and negotiated i-deals (e.g., Bayazit & Bayazit, 2017; Rudolph & Baltes, 2017).
Furthermore, as Bowen and Ostroff (2004) suggest, it seems that only strong HR
systems, characterized by consistency, are related to collective-level outcomes.
4.5.2 Limitations and Future Research
Numerous strength notwithstanding, the study has limitations which should be
addressed by future research. First, I focused only on German companies,
limiting the generalizability of the results. Future research could try to replicate
the results of the current study in other countries with different cultural
backgrounds. Furthermore, the sample is limited to small and medium-sized
companies. This fact might have worked in favor of the hypotheses. The
signaling function of HR systems and i-deals might be stronger and more
138 Study 3 – Combining I-Deals and Human Resource Practices
homogeneous in small companies. In large companies with several thousand
employees and numerous departments or even subsidiaries, it is more likely
that employees perceive HR practices to be different and that they have
supervisors who treat them more differently regarding i-deals. Therefore,
FWAs and i-deals are more likely to cause an organizational productive energy
in small to medium-sized companies. Thus, future studies could transfer the
documented effects to larger companies. Third, although controlling for same-
source bias, I measured all variables at the same point in time, inhibiting causal
interferences. Furthermore, since availability of FWAs was measured by asking
HR managers, I did not account for the fact, whether employees and their
supervisors perceive FWAs to be available. Future research might not only
account for the availability of FWAs and the actual use of flexibility but also the
influence of how available employees perceive FWAs in their organization
(Lewis, 2003). In addition, the sample size is limited to 83 organizations and I
encourage replications and extensions of this research in larger samples.
Despite the limitations of this study, future research could address the following
gaps in research. In a first attempt to study the interplay between HR systems
and i-deals, I focused on the implementation of flexibility focused HR practices,
namely FWAs, through a combination with i-deals. However, several
researchers suggest considering the interplay between HR practices and i-deals
from a different perspective. The focus thereby lies on the tension between
standardization and individualization (e.g., Liao et al., 2016; Rousseau, 2005).
Liao et al. (2016) suggest that there might be an optimal ratio between HR
practices and i-deals or in other words between standardization and flexibility.
Because the current study focuses on flexible HRM and i-deals, I did not
consider the standardized features of HRM. While this study implies that
organizations benefit most from both high FWAs and high i-deals, examining
other HR practices might reveal the proposed trade-off between standardized
HR practiced and i-deals. Furthermore, the current study focused on a
collective-level mediator and outcome compared to the majority of existing
studies on FWAs (e.g., Bayazit & Bayazit, 2017; Lewis, 2003). As Bowen and
Study 3 – Combining I-Deals and Human Resource Practices 139
Ostroff (2004) state, there might be a difference between the effect of strong and
weak HR systems. While systems characterized by consistency between FWAs
and i-deals should affect collective-level outcomes, systems low in consistency
should only affect individual level outcomes (Bowen & Ostroff, 2004). Future
research is advised to take a step further and compare the different mechanism
how strong and weak HR systems caused by the respective combinations of
FWAs and i-deals differently affect employees in organizations. Inconsistency
between HR practices and the use of i-deals might influence attitudes and
behavior on the individual level – propably positively for those employees who
receive i-deals and negative for those who don’t receive i-deals. Finally, as line
managers seem to take over an important role in making HR practices effective,
future research might consider how organizations and HR managers can
support and motivate line managers to implement i-deals in their teams and
departments.
4.5.3 Practical Implications
While HRM lays the foundation with designing HR instruments, supervisors
are the ones in charge of implementing HR practices and granting requests for
differentiation, always balancing the interests of the employee and the
organization (Hornung et al., 2009). The increasing appearance of
individualized deals shows that HR practices nowadays are not only imposed
on employees in a top-down process, but that individual employees try to find
a match between their own needs and the requirements of the organization in a
bottom-up process (Kroon et al., 2016). Nonetheless, i-deals are not meant as a
substitute for HR instruments. I-deals can rather complement standard HR
practices to make flexibility offered by organizations accessible to each
employee according to his or her individual needs (Hornung et al., 2014; Ostroff
& Schulte, 2007).
Therefore, the current findings suggest that supervisors need to act in
accordance with the official HR policies of the organization and be open to
negotiate i-deals with their employees if FWAs are included in the HR system.
140 Study 3 – Combining I-Deals and Human Resource Practices
I-deals can work as a valuable supplement for FWAs rooted in a firm’s HR
system. Thus, line managers should be supported in granting i-deals. To ensure
the effectiveness of FWAs, HR managers need to sensitize line managers and
employees for their responsibility to implement flexible and customized
arrangements for the benefit of both the employees and the employer. For
example, HRM should educate line managers, that i-deals are desired practices
in an organization and offer to help them to negotiate, distribute and
communicate i-deals in their teams and departments (e.g., Greenberg et al.,
2004). It needs to be changed that to date, a large part of flexibility requests is
rejected by supervisors (Lauzun et al., 2010). Furthermore, and in line with
suggestions by Bayazit and Bayazit (2017) the current findings imply that
individual employees should be proactive in negotiating customized and
flexible arrangements according to their own needs with their line managers.
This is especially the case, when the HR system sends the signal, that flexibility
is accepted by introducing FWAs (Bayazit & Bayazit, 2017). Finally, the current
findings highlight the importance of government policies and regulations
(Bayazit & Bayazit, 2017), which aim at supporting employees who seek to
negotiate i-deals. The current study shows that processes to support employees
to successfully request flexibility according to their needs might benefit both
employees and employer.
4.6 Conclusion
While many organizations are introducing FWAs to their HR systems to meet
numerous societal trends, it is still unclear, whether they are beneficial for
employees and employer and by which intermediate processes. Furthermore,
concerns have been raised regarding the differentiation of formalized and HR
based FWAs and the implementation of i-deals created through individual
negotiation processes. The current study shows that FWAs are only beneficial
for organizations, if they are complemented by i-deals. This study gives rise to
the idea that FWAs need to be introduced by the HRM but also implemented
by direct line managers as customized deals. I hope that this study functions as
Study 3 – Combining I-Deals and Human Resource Practices 141
a first step for future research to explore the role of i-deals in modern HR
systems.
142 Overall Discussion and Conclusion
5 Overall Discussion and Conclusion
This is the closing chapter of this dissertation. First, it recaps the research
motivation of this dissertation (i.e., whether i-deals are relevant for
organizational performance and how organizations successfully implement and
maintain i-deals) and, based on this, links the five derived research questions
with the findings of the three empirical studies intended to respond to these
questions. Then, the chapter highlights the most important comprehensive
findings and integrates them into the literature of i-deals, leadership,
organizational justice and FWAs. Finally, the chapter discusses general
limitations and directions for future research and offers the main integrative
practical implications of the three studies.
5.1 Summary and Integration of Research Findings
With this dissertation, I intended to broaden our limited knowledge about the
effects of i-deals on organizational performance. This dissertation thereby
makes an important contribution to i-deals research and theory. Extant i-deals
research has mainly focused on individual-level effects and only few studies
have applied multilevel analyses to examine i-deals in a team or unit context
(Bal & Boehm, 2017; Liao et al., 2017; Vidyarthi et al., 2016). From a theoretical
perspective, researchers need to find out if i-deals are positive for organizations
because i-deals are defined as beneficial for both employees and employer
(Rousseau, 2005). Akin, from a practical perspective, i-deals are only justifiable
if they can bring advantages for all parties and do not disadvantage anyone –
be it the i-dealer’s coworkers or the employer. However, it is not sufficient to
investigate, if i-deals influence organizations (Research Question 1). It is also
necessary to explore how (Research Question 2) and under which conditions
this is the case (Research Question 3, 4 & 5). To this aim, three studies were
conducted on the organizational level of analysis. For organizational level
research, new constructs to capture i-deals on the organizational level were
Overall Discussion and Conclusion 143
needed. Consequently, two constructs suggested by i-deals scholars were
introduced to the organizational level: organizational median i-deals and i-
deals differentiation (Anand, 2012; Liao et al., 2016). Study 1 (Chapter 2) and 2
(Chapter 3) of this dissertation examined if organizational median i-deals and i-
deals differentiation, respectively, affect organizational performance. Both
studies considered relevant mediation mechanisms and context factors as
moderators (i.e., leadership and organizational justice climate). Study 3
(Chapter 4) deals with the integration of i-deals and FWAs, as modern HR
practices, and their combined effect on organizations. While the specific results
of the empirical investigations have already been discussed in detail within each
study (see Chapters 2.5, 3.5, and 4.5), I will summarize the overall findings of
all three studies from an integrative perspective. From an integrative
perspective, the conducted studies yield the following three key conclusions.
5.1.1 I-Deals and Organizational Performance
First, this dissertation finds that i-deals are related to organizational
performance, and thereby provides an answer to Research Question 1. A
relationship to organizational performance was found, when i-deals were
examined from the perspective of the median level of i-deals in an organization
(i.e., organizational median i-deals), or the variety in scope between employees’
i-deals (i.e., i-deals differentiation). Organizational median i-deals were
operationalized with a composite measure of all individual scores in one
organization and i-deals differentiation was captured with the within-
organizational standard deviation (e.g., Anand, 2012). Indeed, Study 1 and
Study 2 showed that organizational median i-deals and i-deals differentiation,
respectively, are related to organizational performance. Organizational
performance was assessed by subjective ratings of organizational and
operational performance following Combs et al. (2005), evaluated once by the
top-managements team (Study 1) and once by an HR manager (Study 2). In
Study 1, organizational median i-deals had a direct relationship to
organizational performance (Study 1), which was positive and linear. In Study
144 Overall Discussion and Conclusion
2, i-deals differentiation had no direct but an indirect relationship with
organizational performance. However, both Study 1 and 2 suggest that the
relationship between organizational median i-deals as well as i-deals
differentiation and organizational performance is mediated through
intermediate processes.
5.1.2 Intermediate Processes
Consequently, this dissertation implies second, that the relationship between
organizational median i-deals as well as i-deals differentiation and
organizational performance is mediated by a variety of intermediate processes
on the organizational level. The dissertation thereby provides a first answer to
Research Question 2. Specifically, Study 1 showed that organizational median
i-deals are related to organizational performance via two parallel mediating
processes: collective job satisfaction and collective OCBI. While the effect of
organizational median i-deals on collective job satisfaction and thereby on
organizational performance was positive, the effect of organizational median i-
deals on collective OCBI and thereby on organizational performance was
curvilinear, namely inversed U-shaped. Moreover, Study 2 showed that the
relationship between i-deals differentiation and organizational performance is
mediated by the distributive justice climate in the organization. In sum, both
studies imply that organizational median i-deals and i-deals differentiation are
related to organizational performance via mediating mechanisms such as
collective attitudes, behavior, and organizational climate. However, all these
effects depend on context factors, which leads to the third major conclusion of
this dissertation.
5.1.3 Context Factors
The third key finding of this dissertation is that the valence of the relationship
between i-deals on organizational level, operationalized as either organizational
median i-deals or i-deals differentiation, and organizational performance
depends on a variety of context factors. Specifically, this dissertation addresses
Overall Discussion and Conclusion 145
organizational median i-deals in interaction with the organizational leadership
climate (Study 1) and HR practices (Study 3) and i-deals differentiation in
interaction with organizational median i-deals and the organizational
procedural justice climate (Study 2).
Study 1 addresses Research Question 3, if the relationship between i-deals and
performance at the organizational level depends on the leadership climate in an
organization. The results of Study 1 show that the relationship between
organizational median ideals, collective job satisfaction, collective OCBI and
organizational performance indeed depends on the leadership climate in an
organization. Findings reveal that the individual-focused leadership climate
moderates the relationship between organizational median i-deals, collective
job satisfaction and organizational performance, such that the relationship is
significantly positive for a high individual-focused leadership climate, but not
significant for a low individual-focused leadership climate. In turn, the
collective-focused leadership climate moderates the relationship between
organizational median i-deals, collective OCBI and organizational performance,
such that the relationship is inversed U-shaped for a low collective-focused
leadership climate, but not significant for a high collective-focused leadership
climate.
Study 2 addresses Research Question 4, focussing on whether the relationship
between i-deals and organizational performance is dependent on the
organizational justice climate. The results imply that both procedural justice
climate and organizational median i-deals shape the relationship between i-
deals differentiation and organizational performance. Specifically, the results of
Study 2 show a significant positive relationship between i-deals differentiation,
distributive justice climate and organizational performance, when either
median i-deals or procedural justice climate are high in an organization.
However, the relationship is non-significant, when both organizational median
i-deals or procedural justice climate are high or low.
146 Overall Discussion and Conclusion
Study 3, which is mainly focusing on Research Question 5, examines if the
interplay between i-deals and HR practices influences organizational
performance. Results show that the fit to HR practices in an organization is a
further context condition, which determines if i-deals are positive for
organizations. Study 3 implies, that i-deals, representing working conditions for
individuals, interact with higher-level employment conditions, created for
groups of employees. Specifically, Study 3 shows that i-deals are closely related
to the HR practices in an organization. In fact, i-deals enable a positive effect of
FWAs on organizations. In Study 3, FWAs have a positive effect on
organizational productive energy and organizational performance, when
organizational median i-deals are high. Specifically, i-deals and FWAs only
have a positive effect on organizational productive energy and organizational
performance, when both are high. Having just high FWAs or high i-deals in an
organization, does not suffice to boost performance. When i-deals and HRM do
not fit together, no positive effects occur for organizations. Thus, while i-deals
represent a necessary condition for FWAs to be effective, FWAs in turn
represent a necessary context condition for beneficial i-deals as well.
In sum, this dissertation indicates that there indeed exists a link between i-deals
constructs at the organizational level, such as organizational median i-deals and
i-deals differentiation, and organizational performance. This link is mediated
by collective employee attitudes, behavior, and organizational climate. These
findings imply that the median level of i-deals in an organization as well as
differences in scope between employees’ i-deals influence employees’ collective
attitudes, behavior, and organizational climate (i.e., collective job satisfaction,
collective OCBI and distributive justice climate) and subsequently
organizational performance. However, the valence of the effects of both,
organizational median i-deals and i-deals differentiation is dependent on
context factors. I-deals function in the context of leadership climate,
organizational justice climate and HR practices. The results outline an
empirically supported framework which helps to better understand and
manage the functioning of i-deals in the organizations.
Overall Discussion and Conclusion 147
5.2 Theoretical Contributions
In addition to the theoretical contributions presented in the discussion sections
of the individual studies, this dissertation also provides some comprehensive
theoretical contributions to extant research and theory, which are outlined
below. To present the key theoretical contributions of this dissertation, the
findings are integrated into extant literature and theory in the areas of i-deals,
TFL, organizational justice and HRM.
5.2.1 I-Deals Theory
5.2.1.1 Mutual benefit of i-deals
This dissertation addresses one of the most popular but as yet unanswered
questions in i-deals research, namely whether i-deals are only beneficial for the
i-dealer or also for the employer who grants the deal (e.g., Conway & Coyle-
Shapiro, 2016). This question is especially interesting and relevant from a
theoretical perspective as Rousseau (2005) defined and differentiated i-deals
from other constructs such as shady deals (e.g., preferential treatment) by
referring to their “win-win” character. This implies, that customized work
arrangements can basically only be referred to as i-deals, if they are proven to
be beneficial for the employee and the employer. However, besides numerous
advantages such as flexibility, i-deals literature has identified several potential
drawbacks of i-deals, which jeopardize positive effects for organizations, as for
example negative reactions of coworkers and perceived injustice (e.g., Garg &
Fulmer, 2017; Greenberg et al., 2004). This dissertation reacts to these worries
and contributes to i-deals theory by examining effects of i-deals on the
organizational level and by taking potential negative effects into account (Bal &
Boehm, 2017). The results of all three studies indicate that i-deals can have
positive effects on organizations. However, they need to be managed in the
right way. Thereby, this dissertation follows researchers’ call for an integrative
perspective on the relationship between i-deals and organizational performance
by considering several context factors (e.g., Liao et al., 2016). Potential levers
148 Overall Discussion and Conclusion
identified in this dissertation are the leadership climate (Study 1), the
organizational justice climate (Study 2), the amount of i-deals in an organization
(i.e., organizational median i-deals; Study 2) and the fit to HR practices in an
organization (Study 3). This means that individualized working arrangements
negotiated between employee and employer just fulfill the defining criteria of
an i-deal when they are embedded in an organizational context characterized
by those prerequisites. This has far-reaching implications for i-deals theory as i-
deals have only the expected effects, if context conditions enable them to be
beneficial.
5.2.1.2 I-deals constructs at the organizational level
A second important contribution to i-deals research lies in the fact that this
dissertation applies two constructs, which have been proposed by i-deals
scholars, to the organizational level, which are organizational median i-deals
and i-deals differentiation (Anand, 2012; Liao et al., 2016). While Anand (2012)
has already applied median i-deals and variability in i-deals to the group level,
this dissertation is to my knowledge the first research examining those construct
at the organizational level of analysis (Study 1, 2 & 3) and thereby shows that i-
deals are meaningful and influential at the organizational level, too.
First, this dissertation shows (Study 1) that organizational median i-deals are
related to employees’ collective attitudes and behavior and thus implies that the
prevalence of i-deals in organizations is perceived by employees and shapes
their perceptions, evaluations and subsequently attitudes and behavior. While
organizational median i-deals were positively associated with an attitude
directly related to one’s own work (i.e., job satisfaction), they were related to
coworker relations (i.e., OCBI) in a curvilinear manner (Study 1). Thus, for
organizations with high organizational median i-deals, the effect on OCBI is
becoming negative (Study 1). A similar phenomenon became evident in Study
2, which showed that i-deals evaluations of distributive justice are most positive
for organizations with high procedural justice climate but low organizational
median i-deals. These results imply that organizational median i-deals might
Overall Discussion and Conclusion 149
have different effects on diverse outcomes. It might be that merely job-related
outcomes are more positively affected than outcomes related to the social
context in which i-deals operate. In sum, this dissertation shows that
organizational median i-deals are a complex construct highly relevant for i-
deals research.
Second, as their idiosyncratic nature is a defining feature of i-deals, they are
different for each employee per definition (Rousseau, 2005). This fact makes i-
deals differentiation especially relevant for i-deals research. This dissertation
indeed supports the notion that heterogeneity between employees’ i-deals is an
important perspective in i-deals research. Specifically, I found that i-deals
differentiation can both be non-significant and positive for organizational
climate and performance (Study 2), depending on the procedural justice climate
and the median level of i-deals in an organization. This finding is in line with
LMX research, which shows that providing employees in collectives with
different levels of resources may result in both positive and negative
evaluations and reactions, depending on context factors (e.g., Erdogan & Bauer,
2010). Furthermore, and in accordance with propositions by Liao et al. (2016),
this dissertation suggest that i-deals differentiation is a construct highly relevant
to i-deals research on the collective level. This dissertation therefore opens up a
new area of interesting research questions regarding the influence of i-deals
differentiation on collective processes and outcomes from a group and
organizational perspective.
Furthermore, Study 2 of this dissertation implies that organizational median i-
deals and i-deals differentiation are two aspects of the same construct and
should not be examined in separation. It is an important implication for i-deals
theorizing and research on the team, unit and organizational level that both
constructs are intertwined and should be studied in combination by studying
their combined effect (as in Study 2) or at least by considering the other
construct as control variable (as in Study 1 and 3).
150 Overall Discussion and Conclusion
5.2.1.3 Explanatory mechanisms on the organizational level
The current dissertation further adds to i-deals theory by theorizing on
explanatory mechanisms on the organizational level. So far, the social exchange
perspective is dominating the majority of i-deals research. This predominance
points out that the explanatory framework used in i-deals research should be
broadened by investigating other potential mechanisms (Liao et al., 2016). This
dissertation aimed at examining potential explanatory mechanisms from an
organizational perspective. The results imply that theories focusing on
collective processes gain importance at the collective level.
Study 1 shows that social exchange-based mechanisms, which are most often
applied to i-deals theory, can also be useful at the organizational level.
However, results imply that social exchange climates in organizations are not
as positively affected by i-deals as social exchange relationships between i-
dealer and organization, which were in the focus of i-deals research so far.
Specifically, while a medium level of i-deals in an organization seems to cause
a social exchange climate, too much i-deals in an organization seem to create an
economic exchange climate. This is in line with suggestions that too many i-
deals might hamper the organizational climate (e.g., Rousseau, 2005).
Furthermore, Study 1 applies contagion theory, which was already used by Bal
and Boehm (2017) for i-deals research at the unit level, as well as social learning
and social comparison theory to argue that effects of i-deals spread across
employees and hence cause collective attitudes. Social comparison theory
(Festinger, 1954) was proposed as useful perspective to shed light on the effects
of i-deals in the social context of organizations, where coworkers compare each
other’s working relationships (Liao et al., 2016). Similar to other studies focusing
on i-deals in a group context, Study 1 indicates that social comparison theory is
a promising perspective to study and explain the functioning of i-deals in an
organizational context. Akin, Study 2, applied social comparison in
combination with justice theories, which have so far mainly used in individual-
level i-deals research. However, especially at the team, unit and organizational
Overall Discussion and Conclusion 151
level, these perspectives seem promising as is cannot be neglected that
employees compare their own work arrangements with those of others,
especially because i-deals are different for every employee regarding scope and
content (Rousseau, 2005). Study 1 furthermore applies social identity theory, as
Vidyarthi et al. (2016) have done, on the organizational level, to show that i-
deals operate depending on the social context they are embedded in.
In addition, Study 3 shows based on signaling theory that HRM and i-deals
commonly influence the organizational climate. Although i-deals tend to be
created at the individual level, this research based on signaling theory shows
that i-deals influence all employees in an organization, just as HR practices do.
Thus, theories from HR literature, such as signaling theory but also for example
resource-based view stating that employees can be a competitive advantage for
organizations (Barney, 1991), might lead to valuable insights applied to i-deals
on the organizational level (Kroon et al., 2016).
In sum, this dissertation builds on theories already used in i-deals literature and
applies them to the organizational level. In addition, this dissertation uses
completely new theoretical arguments for i-deals research, as for example social
learning theory (Study 1) and signal consistency (Study 3). Therefore, this
dissertation follows calls for more and better theorizing in i-deals research (e.g.,
Conway & Coyle-Shapiro, 2016) and hopefully functions as inspiration for
future work. The findings imply that some theoretical mechanisms already
applied to the individual level are also relevant for the team and organizational
context, such as social exchange perspective. However, these mechanisms
might function differently on higher levels and new explanatory mechanism
gain importance, which focus on collective processes.
5.2.2 I-Deals and TFL Theory
This dissertation contributes by integrating i-deals and TFL theory. I-deals are
created in the leader-follower relationship (e.g., Rousseau, 2005). Thus, to
understand the functioning of i-deals in the workplace, it is essential to study
152 Overall Discussion and Conclusion
the role of leadership behavior. However, leadership has received relatively few
research interest in i-deals literature to date. Nevertheless, or perhaps because
of that, researchers have called for more research on the role of the direct leader
in regards to the negotiation, implementation and maintenance of i-deals (e.g.,
Liao et al., 2016). Although often assumed in initial studies on i-deals (e.g.,
Hornung et al., 2011), the creation and implementation of i-deals is not restricted
to the dyadic relationship between i-dealer and line manager. A variety of
parties, such as coworkers, plays a role, when i-deals are seen from a social
perspective (e.g., Greenberg et al., 2004; Rousseau, 2005; Rousseau et al., 2006).
Thus, it seems evident that an emphasis on leadership behavior targeting the
relationship to individual employees cannot be sufficient to shape the
functioning of i-deals in the organizational context. On the contrary, manager
also need to be attentive to and serve the needs of the i-dealer’s coworkers, the
whole team and the organization (Greenberg et al., 2004). While prior research
has focused primarily on LMX and individual-focused leadership, such as
individual consideration (e.g., Anand et al., 2010; Hornung et al., 2010a;
Hornung et al., 2010b; Liao et al., 2017; Rosen et al., 2013), the current
dissertation reinforces and expands the focus on leadership in i-deals literature.
While i-deals are a construct focusing on the individual, calls have been raised
that i-deals are embedded in a social context, which should not be neglected
(e.g., Liao et al., 2016). This dissertation follows this call by integrating i-deals
with TFL theory, which assumes a dual-level effect of leadership, highlighting
different effects of leader behavior directed towards the collective and the
individual (Wang & Howell, 2010). Study 1 indeed shows that the individual-
as well as the collective-focused leadership climate in an organization are
essential in making the effect of i-deals on organizations as beneficial as
possible. So far, i-deals literature has assumed that especially individual-
focused leadership is important for the negotiation and implementation of i-
deals (e.g., Rousseau, 2005). This dissertation shows that the focus on leadership
and i-deals has to be broadened, as both the individual- and the collective-
focused leadership climate shape the effect of i-deals on organizational
Overall Discussion and Conclusion 153
performance. While prior literature has already suggested to include TFL in i-
deals research, researchers have mainly focused on individual consideration
and intellectual inspiration, both leadership behaviors directed at individual
employees (e.g., Liao et al., 2016; Rousseau, 2005). In sum, this dissertation
shows that in i-deals literature, the collective level plays a major role and
accordingly, leadership addressing a collective identity seems to be essential to
understand the functioning of i-deals in the workplace.
5.2.3 I-Deals and Justice Theory
This dissertation is a further step in bridging literature on idiosyncratic work
arrangements and justice. Study 2 identifies boundary conditions for the
formation of justice perceptions and thereby also introduces organizational
justice climate as boundary condition for the i-deals – performance relationship
on the organizational level. Employees’ justice perceptions are one of the most
important and prominently discussed topics in i-deals research (e.g., Greenberg
et al., 2004; Rousseau, 2001). I-deals are defined as being different regarding
content and scope from the employment conditions of an i-dealer’s coworkers
(Rousseau, 2005). Thus, i-deals have the potential to cause perceived injustice
(Rousseau, 2005). Distributive but also procedural, interpersonal and
informational justice have been discussed as basis on which employees evaluate
i-deals (Greenberg et al., 2004). Much has been written and theorized about i-
deals and justice (e.g., Greenberg et al., 2004; Rousseau et al., 2006). Liao et al
(2016) suggest that collective justice climate can function first, as a mediator and
second, as a moderator for the i-deals – performance relationship. Initial
research by Marescaux and De Winne (2016) and Liao et al. (2017) supports that
distributive and procedural justice perceptions are influenced by i-deals.
Furthermore, Marescaux and De Winne (2016) suggest that especially
procedural justice might be able to buffer potential negative effects of i-deals on
distributive justice perceptions. Scholars highlight the importance of justice in
managing i-deals (Greenberg et al., 2004). Liao et al (2016) recommend for future
research to investigate how it can be prevented for example trough
154 Overall Discussion and Conclusion
transparency that i-deals lead to coworkers’ perceptions of inequity and thereby
jeopardizing their own legitimacy. Nevertheless, surprisingly few research
exists on that topic (e.g., Conway & Coyle-Shapiro, 2016; Marescaux & De
Winne, 2016). This dissertation contributes to the integration of i-deals and
justice literature by suggesting that i-deals may be associated with employee
distributive justice perceptions at the collective level. Indeed, i-deals
differentiation is related to distributive justice climate to a greater or lesser
degree according to the procedural justice climate and the amount of i-deals
granted in an organization. The results of this dissertation show that
organizational justice climate can both be a context condition shaping reaction
to i-deals and also a consequence of how i-deals are managed in an organization
(Study 2). The results further support that procedural justice is a prerequisite to
beneficial i-deals (Greenberg, 1987). Furthermore, the results of Study 2 are in
line with Hornung (2018, p. 267) who suggests “the social-psychological
importance of procedural over distributive justice” in i-deals theory.
5.2.4 I-Deals and HRM Literature
Literature streams on HRM and i-deals are strongly related fields and much has
been written about the relation between i-deals and HRM (e.g., Kroon et al.,
2016; Rousseau, 2005). I-deals literature suggests that i-deals are highly related
to organizational HR practices or might even be a part of the HR strategy
(Rousseau, 2005). Kroon et al. (2016) argue that employees are becoming more
important in constructing HRM in the modern world of work and suggest that
more attention is needed to how employees contribute to HRM by negotiating
and closing i-deals. Rousseau (2005) summarizes three options, how employers
might allocate resources to employees: first, general HR practices for all
employees, second, special practices and resources for high-status employees or
third, individually bargained deals. I-deals thereby can be a substitute or
supplement to more standardized HR practices, whereby the second option is
highlighted more in the i-deals literature (Kroon et al., 2016; Rousseau, 2005).
Although scholars suggest an important relation, only initial research exists
Overall Discussion and Conclusion 155
linking i-deals and HRM (Bayazit & Bayazit, 2017). Study 3 of this dissertation
builds on this initial research and further explores the meaningful interplay
between i-deals and HRM. Study 3 of this dissertation supports Rousseau’s
(2005) assumption that i-deals should be aligned to HR practices and that
employees’ proactive behavior is increasingly important in designing an
organization’s HR practices. The role of i-deals might indeed lie in making HR
practices even more suitable to fit employees’ needs (Rousseau, 2005). Much has
been theorized about the FWAs - performance relationship in extant literature
(e.g., De Menezes & Kelliher, 2011) and indeed, this dissertation (Study 3)
implies that i-deals theory has much to add to HR literature in this regard. I-
deals seem to be one possibility to enable positive effects of FWAs for
organizations. This dissertation therefore supports literature that has already
suggested a strong link between i-deals and HRM (e.g., Bayazit & Bayazit, 2017,
Kroon et al., 2016; Rousseau, 2005) and implies that the interplay between i-
deals and HRM might be relevant to clarify the link between both constructs
and performance. Both HR practices and i-deals are intended to attract, retain
and motivate employees. However, it may well be that both will only contribute
to the success of the company if they are precisely matched. This means for
research and theory on i-deals as well as on HRM that there lies indeed high
potential in combining both fields.
156 Overall Discussion and Conclusion
5.3 Practical Implications and Recommendation
Despite the widely assumed superiority of standardized HR practices for all
employees in organizations, differential treatment of employees has inevitably
become an essential part of today’s managerial practice (Rousseau, 2005).
Although research on i-deals has flourished during the last years (e.g., Bal &
Boehm, 2017), research seems to be a step behind practice regarding i-deals. As
Conway and Coyle-Shapiro (2016) pointed out, researchers are not yet “in a
position to prescribe i-deals to organizations” (p. 62). Many organizations still
shy away from granting i-deals to their staff. I-deals seem to be costly by taking
time and effort during the negotiation process (Kroon et al., 2016) and
organizations and managers fear negative reactions of coworkers (e.g.,
Greenberg et al., 2004). In addition, there are some examples of companies that
have failed with the introduction of flexible and individualized work.
Organizations such as Yahoo and IBM, whose experiences with customized
work arrangements have been presented in the introduction of this dissertation,
have made headlines with their decisions to abolish flexibility policies such as
the possibility to work from home (Kossek et al., 2015). These experiences show
that flexibility and individualization were causing problems such as
undermining collaboration among employees, due to a missing fit between
flexibility policies and the existing corporate culture (Kossek et al., 2015). Other
companies might feel discouraged by those prominent examples in the press. In
addition, managers are overstrained with i-deals as they have little experience
negotiating and maintaining individualized working arrangements (Greenberg
et al., 2004). As this dissertation has aimed at examining the i-deals –
performance relationship from an organizational perspective, this dissertation
contributes to managerial practice. All three studies of this dissertation have
already provided practical implications based on the study’s findings.
Incorporating those insights, I develop propositions, which describe and
summarize how to successfully negotiate, implement and maintain i-deals in
organizations. The aim is to provide organizations and agents involved in i-
deals with hands-on suggestions to make the use of i-deals less frightening.
Overall Discussion and Conclusion 157
As i-deals are increasingly requested and used in the contemporary world of
work, HR managers, line managers, employees, and co-workers are likely to
find themselves involved in i-deals. Involvement might either be directly, as
participants, indirectly, as third parties who are influenced by the deals or most
likely both (Greenberg et al., 2004). The results of this dissertation suggest that
i-deals are doomed to fail if the interests of all stakeholders are not respected
and balanced in their negotiation and implementation. In addition, all these
stakeholders have to contribute with their behavior to make i-deals work. In the
following, suggestions are given to all these interest groups.
5.3.1 Employer
In the context of current societal trends highlighting individualization at the
workplace, employers might feel that allowing employees to negotiate i-deals
is an option to attract a skilled, motivated, and diverse work force. However, i-
deals should not be included in an organization’s HR strategy in a rush. To
make sure that i-deals actually have the desired effects on the company, the
employer must consider a few aspects in advance.
5.3.1.1 Lever 1: Ensure fit to the organization
This dissertation shows that i-deals are mainly beneficial for the organization
and their employees, when the use of i-deals fits to the organization and is in
line with the organizational culture. Before employers decide to use i-deals as a
means to make their organization more attractive to the modern workforce and
thus instruct their HRM and management team to negotiate i-deals with
employees in the future, employers should make sure that i-deals fit to the
company’s culture and HR system (Study 1, 2 and 3). Companies could for
example conduct an employee survey or workshops with representatives of
each interest group to make sure that i-deals fit the existing corporate culture
and to find out whether i-deals are desired by everyone in the company. If
employees, line managers, or HR managers have reservations about i-deals and
158 Overall Discussion and Conclusion
do not want to use them, it may be better to invest in culture development in
advance.
5.3.1.2 Lever 2: Involve all stakeholders
This dissertation supports suggestion of Rousseau (2005) and Greenberg et al.
(2004) that several stakeholders have to be taken into account, when i-deals are
used in organizations. Key stakeholders are the employer himself or the
organization, supervisors, HR managers, i-dealers and their coworkers. All
three studies included in this dissertation imply that organizations can indeed
use i-deals as a means to increase organizational performance. However, this is
only the case if i-deals are managed carefully by all parties involved. Thus, the
key stakeholders should be included in the process of implementing i-deals in
an organization. As dicussed above, companies should first consider whether
employees, line managers and HR managers are ready and willing to use i-
deals. Second, i-deals must match the more standardized HR practices offered
by the organization (Study 3). Third, managers need to be able to build a strong
leadership and justice climate in an organization (Study 1 and 2) and fourth,
employees must be willing to ask and negotiate for i-deals in a transparent
process and to compensate coworkers for potential disadvantages of the deal
(Study 1 and 2). Thus, all three parties should constantly be accompanied and
trained in the negotiation, implementation and maintenance of i-deals by the
employer. In addition, the employer is reliant on regular feedback by all three
parties on how well the i-deals are implemented in an organization. If not
already existing, the employer should implement regular feedback processes in
order to obtain feedback from employees, HR managers and line managers. In
the following, I discuss in detail levers for successful i-deals for each interest
group (i.e., HR managers, line managers and employees).
5.3.2 HR Managers
HRM is changing – HR practices are increasingly including flexible working
options (e.g., Bayazit & Bayazit, 2016). However, in a modern world of work,
Overall Discussion and Conclusion 159
HR practices are not just designed top-down, but also bottom-up (Kroon et al.,
2016). To meet a variety of different employee needs, i-deals are a possibility to
make already flexible HR practices (such as opportunities for home office) even
more accessible to employees, as each worker is able to use those practice
according to own needs (e.g., Hornung et al., 2008). For example, some
employees might not want to work from home at all, some might want to work
from home on special days (e.g., to care for sick children), and again others
might want to make use of home office on a regular basis between one and five
days per week. Although i-deals are most often negotiated in the leader-
follower relationship (e.g., Rousseau, 2005), HR managers have a huge
responsibility in guiding this process.
5.3.2.1 Lever 1: Ensure fit to HR practices
Nowadays, various organizations are implementing flexible working
arrangement in their HRM (e.g., Lewis, 2003; Montano et al., 2014; Quick et al.,
1992; Rudolph & Baltes, 2017). This dissertation shows that this implementation
should not be done hastily. I-deals will be of no benefit for the organization, if
they do not match and complement the existing HR practices in the organization
(Study 3). If i-deals complement an HR system, which is oriented towards
flexibility for employees, the company can profit from i-deals, otherwise, no
impact on the organizational performance can be expected (Study 3). Therefore,
HR managers need to ensure that i-deals are in line with existing HR practices
or, if necessary, adjust them before introducing i-deals to the organization.
5.3.2.2 Lever 2: Involve employees and managers
Using a top-down approach to introduce flexibility and individualization in
organizations seems to be no promising approach. While introducing flexibility
into HR practices does give employees and line managers the possibility to
negotiate i-deals, it does not guarantee that they do so. In contrast, Study 3 of
this dissertation implies that HR managers need to make sure that all parties are
ready for i-deals and open to negotiate and use i-deals. As a first step, HR
160 Overall Discussion and Conclusion
manager should find out about employee needs, for example in the context of
an employee survey. Second, HR managers need to educate line managers and
employees that flexibility and customization is supported in the organization
(Study 3). It is the task of HR managers to promote a lively dialogue and lived
practice concerning i-deals in their organization. This is essential because the
communication between employees and their direct supervisors is the most
important place, at which i-deals are negotiated. By setting a reliable framework
for open and honest communication, employees can be encouraged to ask for
flexibility and line managers are encouraged to offer i-deals. This might foster
an open organizational culture, where employees have the courage to express
their needs and ask for an i-deal. In addition, employees might also talk with
their coworkers about their negotiations or the whole team might become part
of the negotiation process, enhancing transparency between employees about
their deals and thereby increase perceived fairness.
5.3.2.3 Lever 3: Implement leadership training
Furthermore, line managers need to be trained in areas such as individual- and
collective-focused leadership (Study 1) and procedural justice rules like voice
and transparency (Study 2). Especially TFL, which includes both individual-
and collective-focused leadership behavior, can be assessed in a relatively
reliable way by asking employees for their perceptions on their leader’s
behavior (Goodstein & Lanyon, 1999). In the aftermath and based on the the
results of the employee survey, HR managers and organizations can gauge
individual and collective focused leadership skills in the recruiting and
promotion process of leaders. In addition, organizations could conduct
systematic leadership trainings based on individual- and collective-focused
leadership behavior to foster a strong leadership climate, which makes i-deals
beneficial for the organization. Akin to TFL, a procedural justice climate can be
strengthened through leadership trainings. Aspects like consistency in
treatment and giving employees voice in decision-making processes can be
Overall Discussion and Conclusion 161
trained and enhances employees’ perceptions of the organizational justice
climate (Skarlicki & Latham, 1997).
5.3.2.4 Lever 4: Guide the negotiation process
Finally, HR managers could become involved in the i-deals negotiation process
with employees who request i-deals, their line managers and in the best case
also their coworkers who will be affected by the deal. It is the task of HR
managers that all parties follow the identified rules for successful i-deals
implementation, such as transparency. Knowledgeable people should be
established who help employees and their supervisors to coordinate their
different interests and advise all interest groups during the negotiation process.
Those people must be visible in the organization so that employees and
managers know whom to turn to if they need help with negotiating, designing
and implementing i-deals. Thereby, HR managers can enhance the chance that
i-deals are successfully negotiated, implemented and maintained, without
negative but positive influences on all parties and thus on the organization.
5.3.3 Line Managers
Line managers have a great responsibility in negotiating i-deals in a fair and
responsible way (e.g., Rousseau, 2005). However, this dissertation implies that
leaders also play a critical role in implementing and maintaining i-deals (Study
1 and 2). Managers need to recognize that their behavior influences, if
employees ask for i-deals, if i-deals are accepted by coworkers, if i-deals are
perceived as fair and how i-deals influence employees’ collective attitudes,
behavior and consequently organizational performance. This dissertation
however indicates that it is no easy task to manage i-deals in a beneficial way,
because managers need to consider a variety of points in creating successful and
long-lasting i-deals.
162 Overall Discussion and Conclusion
5.3.3.1 Lever 1: Balance individual- and collective-focused leadership
This dissertation suggests that the leadership style applied is crucial for
successfully maintaining i-deals. Study 1 shows that low individual-focused
leadership only hinders positive outcomes of i-deals, while low collective-
focused leadership causes even negative effects when organizational median i-
deals are high. Leaders need to recognize that their leadership behavior,
specifically low focus on collective-focused leadership could have detrimental
effects on coworker relations and organizational performance, when i-deals are
used in an organization. Managers need to be self-critical, reflect on their
leadership style and promote both collective- and individual-focused
leadership, to make outcomes of i-deals as beneficial as possible for everyone
involved. Managers could also ask their team for feedback regarding their
leadership style, in order to be able to adapt their behavior accordingly.
Showing individual- and collective-focused leadership behavior means
empowering and developing individual employees while at the same time
emphasizing and developing group goals, common values and beliefs (Wang &
Howell, 2010).
5.3.3.2 Lever 2: Be procedurally fair
In accordance with previous suggestions (e.g., Greenberg et al., 2004; Hornung,
2018) Study 2 shows that rules of procedural justice are key to a successful use
of i-deals in organizations. For several reasons, line managers often resign from
being open and transparent about their decisions on i-deals. Some line
managers do not want to justify themselves in front of their employees or are
afraid of causing a flood of other employees requesting i-deals (Garg & Fulmer,
2017). However, by being open and transparent about to whom, when and why
i-deals are granted, managers can reduce negative and enhance positive
reactions to i-deals (Study 2; Greenberg et al., 2004). Coworkers’ reactions to i-
deals are likely to differ depending on the reasons why an i-deal was granted –
as reward for high professional achievements, as reaction to specific personal
needs or as favor based on a strong supervisor-employee relationship (Liao et
Overall Discussion and Conclusion 163
al., 2016). If employees do not receive any information, they will speculate about
the reasons for the deal. This will quickly lead to mistrust and dissatisfaction
between coworkers (Greenberg et al., 2004). Attributions employees make about
others’ i-deals can have implications for the organizational climate and create
social costs (Liao et al., 2016; Study 2). In the best case, coworkers are even
included in the i-deal negotiation process. As suggested by Study 2, line
managers should be transparent and grant voice to everybody, who is involved
and affected by the deal (Greenberg et al., 2004). The i-deal is more likely to be
perceived as fair if the i-dealer and his or her coworkers decide together,
especially when interdependence is high between workers, which is often the
case in organizations (e.g., Greenberg et al., 2004; Rousseau, 2005). Maintaining
openness about i-deals is an opportunity for leaders to enhance procedural
justice (Greenberg, 1986). Furthermore, joint decisions making processes
represent a solid basis for finding solutions for any complications and conflicts
the deal creates. As Study 2 implies, all employees should have the chance to
receive an i-deal, if they need one (Study 2). This impression might be enhanced
when transparency and voice are guiding the negotiation process (Liao et al.,
2016). Finally, if managers feel not at ease with communicating an i-deal to the
i-dealer’s coworkers, it might be a strong sign that coworkers will find the deal
suspect. In this case, it might be better not to grant the deal at all than to keep it
secret. The chances are high that coworkers will find about the deal and then
regaining their trust will be difficult (e.g., Greenberg et al., 2004).
5.3.3.3 Lever 3: Monitor the amount of i-deals
Finally, this dissertation implies that manager should have an eye on the
amount of i-deals they are granting. Study 1 implies that although
organizational median i-deals have unlimited positive effects on collective job
satisfaction, they are only positive for collective OCBI to a certain point and then
the effect becomes negative again. Furthermore, Study 2 implies that the
relationship between i-deals differentiation and the distributive justice climate
in an organization is most positive for high procedural justice climate but low
164 Overall Discussion and Conclusion
organizational median i-deals. Therefore, these studies show in accordance with
other i-deals literature (e.g., Greenberg et al., 2004) that too many i-deals are not
the perfect solution to increase performance. Leaders should know very well
how many i-deals they are granting in their teams. Line managers need to be
aware that granting every employee an i-deal is not automatically perceived as
fair (Study 2). Furthermore, if too many i-deals are approved in an organization,
employees might take i-deals for granted and feel not pressured to reciprocate
to coworkers and organization (Study 1). Managers should therefore only grant
i-deals if necessary. Every deal should have a good reason – which is again
related to the rule of procedural justice dicusses in Section 5.3.3.2. If it is
important for managers to be able to justify every deal in front of themselves,
the team, and the organization through its usefulness to all parties, there should
not be too many deals in an organization.
5.3.4 Employees
Employees are probably the most important party involved in the process of
negotiating, implementing and maintaining an i-deal. In most cases, i-deals are
initiated by employees and not by other parties such as HR managers or line
managers (Rousseau, 2005). Furthermore, employees can take on the role of the
i-dealer, the role of the i-dealer’s coworker or most likely both in the modern
world of work.
5.3.4.1 Lever 1: Ask for i-deals
I-deal negotiations are initiated in most cases by employees (Rousseau, 2005).
Accordingly, individualization of work is rarely initiated by managers. Thus, it
is important that employees voice their wishes for flexibility. Employees who
express their needs, life and career planning to their leaders are relatively likely
to get the opportunity to include them in their work in one way or another. The
current dissertation implies that employees should indeed have the courage to
ask for i-deals, as they can be confident that the deal will also benefit the
organization (Study 1, 2 and 3). These results strengthen the bargaining
Overall Discussion and Conclusion 165
arguments of the employees and they can feel confident to ask for i-deals. If
those arguments, that i-deals have the potential to be beneficial for all parties
and even for organizational performance, are presented in the negotiation
process, managers and employers might be more inclined to grant i-deals.
5.3.4.2 Lever 2: Avoid negative effects for coworkers
The results of this dissertation also provide some clues as to how employees can
increase the certainty that the process of negotiation and implementation of the
i-deal runs positively. The results imply (Study 2) that employees should be
open about their requests for i-deals in front of their coworkers to enhance
transparency about i-deals in organizations (Study 2). Furthermore, tactics to
compensate coworkers for potential negative effect caused by an i-deal might
be promising to prevent negative effects for relations to coworkers and
organizations (Study 1). If such behavior is displayed, coworkers and the
organization might be more likely willing to support and maintain the i-deals
in the long term, as organizational performance is enhanced.
5.4 Limitations and Directions for Future Research
The studies of this dissertation have numerous methodological strengths. The
studies are based on a valuable data base. First, not many studies exist on the
organizational level of analysis as data gathering is complex and time
consuming. To my knowledge, the studies presented in this dissertation are the
initial organizational-level studies in i-deals research (e.g., Liao et al., 2016).
Second, the studies are based on data from 83 to 96 organizations, representing
impressive and relatively large samples for studies on the organizational level.
Third, data from different rater groups were included in each study (i.e.,
different groups of employees, HR managers and top-managers). Multi-source
data minimizes the influence of common source bias and enhanced the validity
of the study design, increases my confidence in the results. Furthermore, studies
including multi-source data are not common in i-deals research (Conway &
166 Overall Discussion and Conclusion
Coyle-Shapiro, 2016). These strengths notwithstanding, the studies of this
dissertation show some common limitations.
5.4.1 Measurement of I-Deals
Rosen et al.’s (2013) measure to assess i-deals was used for all three studies.
While they addressed limitations of previous measures with their scale, still
limitations remain (Liao et al., 2016). For example, only five out of sixteen items
include that i-deals are special arrangements which should be negotiated.
Second, some items refer to the basis upon which i-deals are negotiated
including employees’ needs, unique skills or contributions, while others do not.
To date, no better option exists to assess i-deals (Liao et al., 2016), which is why
this measure was used. However, limitations of this measure are also limitations
of this dissertation.
The current dissertation has further measured i-deals as a uni-dimensional
construct in all three studies. Although i-deals have mainly been examined
separated by content, Liao et al. (2016) propose that i-deals can be treated as a
single theoretical concept that represents the extent to which employees have
negotiated customized work arrangements. This approach has already been
applied by several i-deals studies (e.g., Bal & Boehm, 2017; Ng & Feldman,
2010). However, specific content dimensions (e.g., flexibility and task i-deals) of
an aggregated multidimensional construct are not necessarily highly correlated
with each other, meaning that employees who receive a flexibility i-deal may
not necessarily receive a task i-deal (Liao et al., 2016). Indeed, research showed
that depending on the content, i-deals might have different effects on
organizations (e.g., Rosen et al., 2013). In sum, there are good reasons to
construe i-deals as a multidimensional construct just as there are good reasons
to treat different forms of i-deals as distinct variables (Liao et al., 2016). As Liao
et al. (2016, p. 13) state, “[t]he appropriateness of each approach depends on the
nature of the research question”. In a first approach to examine i-deals on the
organizational level and to answer the question if i-deals have an impact on
organizational performance, I chose to treat i-deals as one general concept. This
Overall Discussion and Conclusion 167
is in line with initial multilevel studies in i-deals reseach, which also included
the collective level and used i-deals as an overall construct including several
sub-dimensions (Bal & Boehm, 2017; Liao et al., 2017; Vidyarthi et al., 2016).
Future research should however differentiate between different forms of i-deals
also on the organizational level of analysis, to clarify which forms of i-deals have
impact on what kind of performance indicators (e.g., financial performance,
employee turnover, company growth). Developmental i-deals have shown to
be stronger related to employees’ effort to contribute to the organization than
flexibility i-deals (Liao et al., 2016). Furthermore, developmental i-deals often
involve scarce resources compared to flexibility i-deals and therefore more
negatively impact justice perceptions (Liao et al., 2016; Rousseau, 2005). Varying
effects of different forms of i-deals might also be noticeable on organizational
level regarding climate and performance. Furthermore, it might be that it
depends on the organizational industry, organizational size or culture which
specific i-deals are beneficial or detrimental to collective processes and
ultimately to organizational performance. Google, for example, tries to avoid
location flexibility, however, fosters unequal pay between employees
depending on their contribution to the organization, to remain true to their
organizational values and corporate culture (Bock, 2015; Quartz, 2016). Future
research should clarify if such strategic decisions indeed have an impact on the
organization’s performance and if effects of different forms of i-deals are
dependent on the organizational culture.
The current dissertation further excluded financial i-deals following findings of
Rosen et al. (2013) that flexibility as well as task and work responsibilities i-deals
are more common than financial i-deals. However, Kroon et al. (2016) suggest
that financial i-deals might have different effects on organizational relevant
outcomes such as turnover rates than other forms of i-deals. Thus, when future
research aims at comparing effects of different forms of i-deals on organizations,
financial i-deals should in any case be included.
Furthermore, as other i-deals research (e.g., Liao et al., 2017), I did not make an
empirical distinction between participating in the i-deal negotiation process and
168 Overall Discussion and Conclusion
obtaining an i-deal. I differentiated between employees who received an i-deal
and those who did not receive an i-deal. In fact, there is however a difference
between employees, who have not asked for an i-deal, employees who have
asked for but not received an i-deal and employees who have asked for and
received an i-deal. Especially those workers who have asked for an i-deal but
not received one, might react especially negative to others’ i-deals.
Finally, this dissertation focused on i-deals differentiation regarding the scope
of i-deals in an organization. However, researchers have also proposed the
importance of variability in regards to i-deals content between employees (Liao
et al., 2016). In addition to organizational median i-deals and i-deals
differentiation regarding scope, future research should also measure and
examine i-deals differentiation regarding i-deals content. Teams, units and
organizations provide suitable contexts to compare effects of all three
conceptualizations of i-deals (i.e., organizational median i-deals, i-deals
differentiation regarding scope and content) and to examine their combined
effects for example in a three-way interaction. Furthermore, it is an interesting
question for future research whether one of these constructs is more salient to
employees and therefore most likely influences collective attitudes, behavior
and culture in organizations (Liao et al., 2016).
5.4.2 Level of Analysis
This dissertation focused on the organizational level of analysis to address the
question of whether i-deals are beneficial to the employer. However, the team
and unit level were neglected. Furthermore, theorizing is necessary on whether
and how i-deals function differently on the team, unit and organizational level.
In addition, i-deals research could not just explore if i-deals have different
effects on individuals and collectives, but also, if difference exist in outcomes
for teams, units and organizations. It is also a question for future i-deals
research, if effects on different collective levels are distinguishable in the
modern world of work. Assumptions of static team boundaries, with
employees’ work being restricted to only one team are increasingly inaccurate
Overall Discussion and Conclusion 169
due to the changing nature of work (Mortensen, 2014). Researchers indeed
suggest, that teams in organizations are increasingly interlinked and
overlapping (e.g., Ancona & Bresman, 2007; Matthews, Whittaker, Moran,
Helsley, & Judge, 2012; O’Leary, Mortensen, & Woolley, 2011). When
employees are members in several teams, i-deals also have an impact on
coworkers in more than one team. It is thus an interesting question for future
research, if i-deals function differently at various collective levels.
Although introducing the organizational level of analysis to i-deals literature,
the current dissertation also focuses on one level of analysis as most other
studies did (as exception, see Bal & Boehm, 2017; Liao et al., 2017; Vidyarthi et
al., 2016). However, cross-level relationships are assumed to be highly
important to understand how i-deals function in an organizational context (Bal
& Boehm, 2017; Liao et al., 2016). For example, as the results of this dissertation
imply, group and organization-level characteristics are relevant contextual
factors that might also have cross-level effects on the functioning of i-deals at
the individual level. Future research might want to address the gap in i-deals
research that cross-level phenomena have not received much attention and also
include the organizational level in multilevel models on i-deals.
5.4.3 Study Design
All three studies of the current dissertation rely on cross-sectional data. This
limits the quality of the results in that no cause-effect relationship can be
inferred from the studies. Liao et al. (2016, p. 24) claim that “the most important
methodological shift in future i-deals research is the adoption of longitudinal
designs". They propose that i-deals themselves and their effects propbably
evolve over time (Liao et al., 2016). Furthermore, the benefits and drawbacks for
the different parties (i.e., i-dealer, coworker, team, leader, and organization)
might be realized at different points in time (Liao et al., 2016). For example,
perceptions of an i-deal’s justice might change over time, especially when
coworker also receive i-deals. Future insights could be created by applying a
170 Overall Discussion and Conclusion
longitudinal design to explore how effects of i-deals spread throughout the
organization and change with time.
Furthermore, all three studies are based on a sample of German companies.
Although a meta-analysis of Liao et al. (2016) shows that the correlations
between i-deals and other variables are relatively robust across Western and
Eastern cultures, results reveal also several differences. Rousseau (2005) for
example states that it might be much easier to negotiate for individual work
arrangements in the USA than in Germany due to more flexible human resource
practices. Future research should more closely investigate differences between
i-deals in different cultural background and test potential effects on
organizational performance. As Rousseau (2005) proposes, it might be easier to
negotiate i-deals in other cultures than in the German society, due to low
acceptance of negotiability. This might lead to higher median i-deals in
organizations, changing reactions of employees and subsequently effects for
organizational performance.
5.4.4 Additional Directions for Future Research
All research questions posed in this dissertation represent prominent and major
gaps in i-deals literature (e.g., Bal & Rousseau, 2016; Conway & Coyle-Shapiro;
Kroon et al., 2016; Liao et al., 2016). However, this dissertation has only taken a
first step in the direction to answer these questions exhaustibly. Thus, the three
studies still leave many questions open, or the results even raise interesting new
questions.
First, examining leadership and organizational justice climate as moderators in
the i-deals – performance relationship represents just a first step in studying
potential relevant context factors from an organizational perspective. As this
dissertation shows that the effects of i-deals are strongly dependent on context
factors, it becomes highly relevant to gain a holistic picture of potential
influencing factors. For example, organizational characteristics such as industry
and size might also moderate the relationship between i-deals and
Overall Discussion and Conclusion 171
organizational performance (Liao et al., 2016). Furthermore, leadership and
organizational justice themselves provide options for future research. Future
studies interested in i-deals and leadership could explore sub-dimension of TFL
separately (i.e., articulating a vision, providing an appropriate model, fostering
the acceptance of group norms, high performance expectations, individualized
support, intellectual stimulation; Podsakoff et al., 1996). As research shows, sub
dimension of TFL have considerably different relationships to employee
attitudes (Podsakoff et al., 1990). Furthermore, modern forms of leadership
might be highly relevant for future research on i-deals. Empowering or shared
leadership might enhance employee responsibility taking for their work, and
foster i-deals negotiation and implementation together in a team. Empowering
leadership “encourages initiative, self-responsibility, self-confidence, self-goal
setting, positive opportunity thinking, and self-problem solving” (Sims, Faraj,
& Yun, 2009, p. 151). Because employees are led to discover their own potential
(Sims et al., 2009), empowering leadership might encourage employees to ask
their supervisors for i-deals. Researchers further suggest that shared leadership
in a team fosters group-level caring, characterized by connecting with other
emotionally and helping others to develop and learn (Houghton, Pearce, Manz,
Courtright & Stewart, 2015). It might thus be that in teams with high shared
leadership, employees are encouraged to negotiate for i-deals, the i-deal
negotiation process includes the whole team and i-deals implementation is
supported by all members. Changing team structures including memebrships
in several teams (Mortensen, 2014) in the modern world of work further leads
to the question, how i-deals are negotiated, when employees have several line
managers with different interest, with whom they have to negotiate for the deal.
Furthermore, different aspects of the organizational justice climate need to be
examined in future research. Interpersonal justice and informational justice
(Greenberg et al., 2004) have not yet been examined in i-deals literature.
Nonetheless, it might be that perceptions of i-deals are strongly influenced by
how well employees feel treated and informed during the negotiation and
implementation of others’ i-deals (Greenberg et al., 2004).
172 Overall Discussion and Conclusion
The same applies to the intermediate processes between organizational median
i-deals, i-deals differentiation and organizational performance. Different aspect
of the organizational climate might be interesting for i-deals research, for
example climate for inclusion (Kroon et al., 2016) could be examined in further
research. In addition to organizational climates, a variety of collective processes
such as collaboration between employees become relevant at the collective level
(Liao et al., 2016). Rich possibilities for future research on intermediate
processes on the organizational level of analysis also exist in regards to potential
organizational-level theorizing. As on individual level, mediating mechanisms
might for example vary based on the type of i-deals (Hornung et al., 2014).
Furthermore, consistent with arguments I have raised in my discussion of the
theoretical contributions of this dissertation to i-deals research (Section 5.2.1),
much may be gained by going beyond social exchange theory when explicating
mechanisms by which i-deals are linked to performance on the organizational
level (Liao et al., 2016). Scholars (e.g., Liao et al., 2016; Liao et al., 2017; Vidyarthi
et al., 2016) have suggested that justice, social comparison, and social identity
theory are promising perspective. Theorizing and research based on such
theories focusing on the functioning of i-deals in collectives should be extended
by future research.
Finally, this dissertation implies that i-deals and HR practices in an organization
are strongly intertwined and should not be viewed in isolation. However, many
open questions remain, as for example the trade-off between standardization in
the HR systems and flexibility through i-deals (Kroon et al., 2016). Since HR
strategy increasingly combines standardized and customized employments
arrangements to manage human capital, combining i-deals with HR research
with a different focus than FWAs is highly relevant (Kroon et al., 2016). As Liao
et al. (2016) state, there might be an “ideal ratio of i-deals to standard HR
management practices that maximize firm performance” (p. 23). If this is the
case, future research should explore this ratio in detail. Furthermore, Rousseau
states that the “tension between consistency and flexibility is not a problem to
solve, but a fact to be managed.” (Rousseau, 2005, p. 193). Examining how
Overall Discussion and Conclusion 173
managers could handle i-deals such that everybody receives the flexibility he or
she needs but that enough consistency is established so that the work
environment is still perceived as fair, is another fruitful direction for future i-
deals research.
5.5 Conclusion and Outlook
This dissertation adds to i-deals literature by transferring i-deals research to the
organizational level and by focusing on the theoretically and practically
relevant question of whether i-deals are beneficial for organizations. In sum, the
studies of this dissertation imply that i-deals can have a positive effect on
organizational performance, if i-deals are carefully managed from an HRM,
leadership and organizational justice perspective. This dissertation has a variety
of implications for i-deals research and theorizing on collective level, regarding
important constructs (e.g., median i-deals and i-deals differentiation), and
theories for explanatory mechanisms (e.g., signaling theory, social exchange
theory, social identity theory, justice theories and social comparison theory). I
hope that the findings of this dissertation inspire other scholars to explore i-
deals from a collective perspective. Future research should further consider the
important defining feature of i-deals of being mutually beneficial for employee
and employer and context conditions which enable those positive effects.
Ultimately, I believe that i-deals can have a huge positive potential for
organizations. It is up to HR and line managers to recognize this potential and
turning it into a competitive advantage for the organization.
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Curriculum Vitae
Anna Franziska Schuler, born August 7, 1990 in Ueberlingen, Germany
EDUCATION
2014 – 2018 University of St.Gallen, St. Gallen, Switzerland
Doctoral Studies in Management (Dr. oec.)
2013 – 2014 Erasmus University Rotterdam, Rotterdam, The
Netherlands
Master of Science in Organizational Psychology
2009 – 2013 University of Konstanz, Konstanz, Germany
Bachelor of Science in Psychology
2001 – 2009 Droste-Hülshoff-Gymnasium, Meersburg, Germany
Abitur (equivalent to high school diploma)
WORK EXPERIENCE
Since 2014 University of St.Gallen, St. Gallen, Switzerland
Research Associate, Institute for Leadership and Human
Resource Management
2012 – 2013 University of Konstanz, Konstanz, Germany
Research Assistant and Tutor, Department for Methodology
2011 – 2012 Center for Creative Leadership (CCL), Brussels, Belgium
Internship in Leadership Training
2010 – 2011 University of Konstanz
Research Assistant and Tutor, Department for Methodology