Lp2 MG6200 Assignment/ MT6255 Lp2.1, Lp2.2

ieshaubgney

lp2_outine_case_study.pdf

Home >Business & Finance homework help >Management homework help >Lp2 MG6200 Assignment/ MT6255 Lp2.1, Lp2.2

the Journal of Behavioral and Applied Management September 2005 Vol. 7, No. 1

The official journal of the Institute of Behavioral and Applied Management

2 From the Editor

John Humphreys

Articles

4 The Effect of Peer Evaluations on Student Reports of Learning in a Team Environment: A Procedural Justice Perspective Lynn Bowes-Sperry, Deborah L. Kidder, Sharon Foley, and Anthony F. Chelte

25 A Multilevel Approach to Individual Readiness to Change David Desplaces

40 Enhancing the First-Year Experience for Business Students: Student Retention and Academic Success Pamela L. Cox, Elizabeth Dunne Schmitt, Paula E. Bobrowski, and Glenn Graham

Case Study

69 Jet-A-Way Inc.: Winning Despite the Odds

Bonita L. Betters-Reed and Lynda L. Moore

93 Does it Matter How We Get There (Really)? A Case of Ethics in Bidding Donald H. Schepers

From the Editor

Greetings from JBAM! Please let me begin by thanking Len White, my extraordinary Associate Editor, for his tireless efforts and technical expertise in bringing to fruition the journal you see before you. Also, an enormous debt of gratitude goes to the numerous reviewers who have stepped up to serve the Journal of Behavioral and Applied Management in such a positive manner. I continue to be impressed with your willingness to serve. The timely and constructive reviews you provide are the foundation of the publication and the importance of your contributions simply cannot be overstated. I would also like to thank the many authors who have submitted their work to JBAM. Although we can only accept a fraction of the articles and cases submitted, we very much appreciate the consideration as an outlet for your work. In my opinion we have a greater abundance of superior articles and cases in the pipeline currently than at anytime during my tenure with the journal. I believe the readership will appreciate the breadth and quality of manuscripts presented in this and forthcoming issues. In the current edition of JBAM, we offer quite an eclectic mix of articles and cases. The first article, by Lynn Bowes-Sperry, Deborah Kidder, Sharon Foley, and Anthony Chelte, is “The effects of peer evaluations on student reports of learning in a team environment: A procedural justice perspective.” This article examines the ways in which the peer evaluation process influences student teams, a common context for many business students. Their results indicated peer evaluations have significant implications for learning in team endeavors. I would invite readers, particularly practicing managers, to consider the inferences from this work to broader organizational team-based projects. The second offering is “A multilevel approach to individual readiness to change.” In this conceptual article, David Desplaces provides a model in the attempt to expand our understanding of individual readiness to change and its antecedents. The work explores the link between macro and micro levels of change and provides fertile ground for future empirical examinations. Our third article is “Enhancing the first-year experience for business students: Student retention and academic success.” This is a “hot” topic for those of us in academia. The study, by Pamela Cox, Elizabeth Dunne Schmitt, Paula Bobrowski, and Glenn Graham, investigated the success and retention of business students enrolled in a first-year experience course designed to ease the transition to college, create a sense of community, and provide business school expectations. The article provides support for the goals of such a program. We also have a couple of cases in this issue of JBAM. The first, by Bonita Betters-Reed and Lynda Moore, is titled, “Jet-A-Way, Inc.: Winning despite the odds.” In this case, Darlene Jeter, co-founder of Jet-A-Way, Inc., confronts numerous personal, firm, and financial issues in the attempt to recover from organizational crises.

Donald Schepers also brings us a timely case in this issue with “Does it matter how we get there (really)? A case of ethics in bidding.” This work will require students to analyze the costs and benefits of ethical behavior at the managerial level, as well as debate the requirements necessary to create an ethical organizational climate within the firm. I hope you find these articles and cases compelling and an enhancement to your work and knowledge. Please continue sending me your comments and suggestions as to how we might improve the journal. You may reach me at john_humphreys@tamu- commerce.edu. If you would like to give me feedback personally, I will be attending the upcoming annual conference, IBAM XIII (October 5th – 8th), in beautiful Scottsdale, AZ. I hope to see many of you there! As always, on behalf of the IBAM leadership and the Journal of Behavioral and Applied Management, thank you for your assistance and support. John Humphreys, Editor

The Effect of Peer Evaluations on Student Reports of Learning in a Team Environment: A Procedural Justice Perspective

Lynn Bowes-Sperry

Western New England College

Deborah L. Kidder Towson University

Sharon Foley

Drexel University

Anthony F. Chelte Midwestern Sate University

ABSTRACT Student peer evaluations are a form of student voice. However, research has not determined if the positive outcomes associated with voice in other contexts (e.g., judicial system, workplace) are also present in the student team environment. We collected data from student teams in business schools in the United States and Hong Kong to examine the ways in which peer evaluation influences student teams. Our results indicate that for students working on team projects, peer evaluations have implications for their learning.

An Overview of Teams and Fairness Business schools have embraced the team concept as an important instructional element in the delivery of the curriculum. This has provided students with opportunities to “experience” teamwork as part of their formal academic training and career preparation. In addition to the potential for helping students develop interpersonal skills and the understanding of different perspectives (Goldfind, Laybourne, MacLead & Stewart, 1999; Michaelson & Razook, 1999; Chelte, 2003), team projects may also enhance student learning of course content (Tinto, 1999). However, evidence strongly suggests that assigning team projects is not sufficient. Students benefit most from a design that incorporates team-building skills and skills required to overcome barriers to effectiveness (Feichtner & Davis, 1985; Bacon, Stewart, & Silver, 1999; Bolton, 1999; Ettington & Camp, 2002; Tonn & Milledge, 2002). One potential barrier to an effective student team project is a perceived lack of fairness or sense of justice surrounding the project. As noted by Houston and Bettencourt (1999), issues of fairness are relevant to many aspects of education including grades, evaluative feedback, access to information, and distribution of workload. Classroom concerns regarding justice issues have received some attention in the literature but this generally concerns the fairness of instructor-imposed aspects such as exams, grading,

etc. (Chory-Assad, 2002; Houston & Bettencourt, 1999; Ghorpade & Lackritz, 1998; Marsh & Overall, 1980; Rodabaugh & Kravitz, 1994). Furthermore, such research has not been informed by the extensive body of knowledge on the topic of procedural justice (see Chory-Assad, 2002 for an exception). The failure to rigorously examine issues of fairness in the classroom using a procedural justice framework represents an important gap in the collaborative learning literature. Procedural justice refers to the extent to which the procedures used by authorities in making allocation decisions are perceived as fair (Greenberg, 1990; Lind & Tyler, 1988; Thibaut & Walker, 1975). One of the best-known aspects of procedural justice is voice (Korsgaard & Roberson, 1995; Lind & Tyler, 1988; Shapiro, 1993). Research indicates that even when people receive unfavorable outcomes, they perceive the allocations as fairer when they are allowed voice or input into the decision than when they are not (Lind, Kurtz, Musante, Walker, & Thibaut, 1980), and this in turn leads to positive outcomes such as organizational citizenship behavior (Fahr, Podsakoff, & Organ, 1990). In the context of student team projects, one important allocation decision to be made by “authorities” (or in this case, professors) is to determine how grades earned on team projects will be allocated to individual students. In most courses, it is the professor who will determine the procedure for making this allocation decision. For example, professors could determine individual student grades for team projects with or without input from the students’ team members, i.e., they could allocate the same grade to all team members or use peer evaluation to make distinctions among team members. The course-level procedure of peer evaluation is a form of student voice. However, research has not determined if the positive outcomes associated with voice in other contexts (e.g., judicial system, workplace) are also present in the student team environment. In the present study, we address this gap in the literature. First, we seek to determine if peer evaluation procedures surrounding team projects influence students’ reports of their learning. Second, we seek to examine both instrumental and relational procedural justice effects of peer evaluations. The instrumental model suggests that voice is important because it allows individuals the opportunity to obtain a desired goal (e.g., Thibaut & Walker, 1975), whereas the relational (relational procedural justice is also referred to as non instrumental procedural justice and interactional justice) model proposes that voice is important (even when it has no instrumental value) because it signals to individuals that they are respected members of their group or community (e.g., Lind & Tyler, 1988; Tyler, Degoey, & Smith, 1996). Finally, we will discuss practical implications for educators and provide recommendations for future research.

Hypotheses

Course-Level Procedures And Student Reports Of Learning Empirical studies (e.g., Alexander & Ruderman, 1987; Bidder, Chang, & Tyler, 2001; Folger & Konovsky, 1989; Lind & Tyler, 1988; Moorman, 1991) have demonstrated the connection between organizational procedures used in decision-making and employees' reactions such as trust in management, intentions to turnover, approval of supervisor, job satisfaction, attendance, conformance to work procedures, and organizational citizenship behaviors. Past research also suggests that procedural justice affects performance (cf Greenberg, 1990 and Lind & Tyler, 1988). Research on teams in the workplace has also found connections between procedures (and thus perceived fairness) and group productivity and satisfaction (Colquitt, Noe, & Jackson, 2002; Cooper et al., 1992; Mossholder, Bennet, & Martin, 1998). Perhaps the findings most relevant to this study come from Chory-Assad (2002), who found that students’ perceptions of procedural justice were predictive of their motivation and affective learning, and Stubbline (2001) who found that teams with peer evaluations have higher levels of workload sharing, voice, cooperation, performance, and member satisfaction. Similarly, in the student team environment, we expect to find a relationship between the percent of grade determined by peer evaluation and positive student outcomes such as increased learning. Hypothesis 1: Percent of grade determined by peer evaluation will be positively related to student reports of learning in a team environment.

Course level procedures, team individualism-collectivism, and instrumental justice effects

Organizational justice research has found that differences in fairness perceptions are often associated with individualism-collectivism (Colquitt, Noe, & Jackson, 2002; Konovsky, 2000). Individualism is characterized by putting personal interests ahead of group needs (especially when group needs conflict with personal desires) whereas its opposite, collectivism, is characterized by allowing group interests to supersede those of the individual (Wagner & Moch, 1986). According to Tata (2001), it is necessary to understand the level of student individualism-collectivism when making predictions regarding the extent to which justice considerations are relevant to students. Although her work focused on the perceived fairness of grading, there are reasons to expect that student individualism-collectivism will provide insight into the effects of other forms of justice in the classroom, such as the opportunity to use voice. As described previously, research on procedural justice indicates that procedures (such as voice) may be important because they are instrumental or because they are relational. In the student team environment, procedures that allow students to achieve grades with which they are satisfied would be considered instrumental. We expect that the course level procedure of peer evaluation will have instrumental value for some

students. Liden, Nagao and Parsons (1985) found that students often complain of unfairness because they believe that group work results in grade inequities. When peer evaluations are available, students have the ability to use them to penalize social loafing members, thus restoring equity among team members. Research indicates that the ability to restore equity is important to individualists because they are motivated by self-interest (e.g., Early, 1989; Olson, 1971). Since they tend to be competitive, individualists want to receive recognition for their contributions, and thus would be likely to use peer evaluations to make distinctions between themselves and other team members. While merely having the opportunity to evaluate their peers is important, it is likely that individualists’ satisfaction with their ability to restore equity will increase as the percent of grade determined by peer evaluations increases. Furthermore, without procedures such as peer evaluation, which increase student accountability, students on individualistic teams may social loaf when working in a team environment because they will not be penalized for their lack of contribution. This social loafing is expected to increase as the percent of grade determined by peer evaluation decreases. In as much as peer evaluations increase students’ contributions to the team project, we expect students to perceive that their team has performed well. These expectations should, in turn, lead to increased satisfaction with anticipated grade. Finally, even if peer evaluations do not decrease actual social loafing, they may decrease perceived loafing within the team. Mulvely, Bowes-Sperry, and Klein (1998) found that student teams with lower levels of perceived loafing were more effective than those with higher levels. Alternatively, the satisfaction with anticipated grade of students working on collectivistic teams is less likely to be impacted by a percent of grade determined by peer evaluation. When working in teams, collectivists tend to be driven by social considerations more so than by task considerations (Gibson & Zellmer-Bruhn, 2001), and tend to view the team as a team rather than an aggregation of individuals (e.g., Wagner, 1995). Therefore, students working on collectivistic teams are less likely to be concerned with making distinctions among individuals on the team, i.e., they are less likely to use peer evaluations to reduce the grade of their team members. This notion is supported by research that finds collectivists to be receptive to team-based rewards (Kirkman & Shapiro, 2001). In the student team context, such satisfaction with team-based rewards would be likely to take the form of grade satisfaction. In addition to satisfaction with team-based rewards, collectivists perform better under conditions of shared responsibility (e.g., on student team projects) whether or not they are held personally accountable for the results of their work (Early, 1989; 1993). Therefore, the contributions of students working on collectivistic teams are not likely to be improved by the introduction of peer evaluations or by increasing the percent of grade determined by peer evaluation. These high levels of effort should translate into higher satisfaction with anticipated grade.

Hypothesis 2: Team individualism-collectivism will exert moderating effects such that percent of grade determined by peer evaluation will have greater influence on satisfaction with anticipated grade for students working on individualistic teams than for those working on collectivistic teams. Course level procedures, team individualism-collectivism, and relational justice effects Research on relational procedural justice has typically examined interpersonal treatment initiated by someone with authority such as a manager (Bies, 2001; Bies & Moag, 1986; Korsgaard, Roberson, & Rymph, 1998). For example, how does a manager communicate the fact that an employee will not receive a pay raise this year? Does he or she provide adequate justification and show concern for the employee or simply state that no raise will be forthcoming? In the context of the academic classroom, this focus on authority translates to the manner in which faculty members treat students. In addition to interpersonal treatment by those in positions of authority such as professors, interpersonal treatment by members of a student’s team also seem relevant when examining the effects of procedural justice on perceived student learning in a team environment. In most courses, once the professor has established the team project, authority is delegated to students to allocate the tasks and manage the processes involved in completing the project. In accordance with the group-value model of procedural justice (Lind & Tyler, 1988), procedures that allow students to feel that they are respected and valued members of their team would be considered relational. In addition to arguing that the percent of grade determined by peer evaluation will have instrumental effects on students, we also expect that it will exhibit relational effects. Research on procedural justice finds that both instrumental and relational effects often co-exist (e.g., Lind & Tyler, 1988). As with instrumental justice effects, theory suggests that relational justice effects stemming from peer evaluation will be stronger for individualistic teams than for collectivistic teams. Theory suggests a positive relationship between percent of grade determined by peer evaluation and relational justice within individualistic teams. By definition, individualists prefer to work alone rather than in a group because they do not have the social motivations for teamwork that collectivists have (Gibson & Zellmer-Bruhn, 2001; Wagner, 1995). Therefore, they are more likely to put their own self-interest ahead of that of the team. This may include engaging in behaviors that indicate a lack of respect for other team members. For example, since individualists are concerned with maximizing performance (Gibson & Zellmer-Bruhn, 2001), they are more likely than collectivists to force their ideas (at least when they believe that their ideas are superior to those of other team members) on their team members. They believe that the potential outcome (a better project) is more important than the process used to achieve that outcome (disrespectful communications). However, as the percent of grade determined by peer evaluation increases, students have more to lose by exhibiting negative behaviors in team environments. Team

members who feel that their opinions and ideas were not considered or valued have the ability to negatively impact the grade of a disrespectful or demeaning team member. For students on individualistic teams, this may serve as the motivation to be more considerate and respectful of the personalities, ideas and contributions of their team members. Conversely, we do not expect percent of grade determined by peer evaluation to improve relational justice effects for collectivistic teams. As mentioned previously, collectivists have social motivations for working in groups (Gibson & Zellmer-Bruhn, 2001) and therefore do not require extrinsic motivation (e.g., the threat of a reduced grade) to treat their team members as valued members of the team. Furthermore, the tendency of collectivists to subordinate personal goals to in-group goals (Triandis et al., 1985; 1988) and to behave more cooperatively (Cox, Lobel & McLeod, 1991) renders them less likely to push the team to accept their ideas (thus, respecting the opinions of other team members and treating them in a just manner). Hypothesis 3: Team individualism-collectivism will exert moderating effects such that percent of grade determined by peer evaluation will have greater influence on relational justice for students working on individualistic teams than for those working on collectivistic teams.

Instrumental procedural justice outcomes and student reports of learning As described previously, satisfaction with anticipated grade can be considered an instrumental outcome of the procedure of peer evaluation (e.g., Kane & Lawler, 1978; Murphy & Cleveland, 1991; Wexley & Klimoski, 1984). While we expect that satisfaction with anticipated grade will be an outcome of percent of grade determined by peer evaluation, we also expect that it will be an antecedent of student reports of learning. More specifically, we hypothesize that the positive relationship between percent of grade determined by peer evaluation and student reports of learning (predicted in Hypothesis 1) will be mediated by satisfaction with anticipated grade. The instrumental model of procedural justice views the fulfillment of self-interest as a mediator between a given decision-making procedure and judgments regarding the fairness of that procedure. In other words, when deciding if they think a procedure is fair, individuals will ask “Does this procedure serve my self-interest?” In this study, the process would unfold like this – If increasing the percent of grade determined by peer evaluation improves my grade, then it is a fair procedure (otherwise it is not). However, while it is interesting to know whether or not students perceive peer evaluations as fair, we are concerned with students’ judgments regarding the extent to which working on a team has improved their learning. We depict the instrumental model of student learning in Figure 1.

Figure 1 Procedural Justice Effects on Student Reports of Learning

Instrumental Model Relational Model

Course Level Procedure Percent of Grade

Determined by Peer Evaluation

Anticipated Grade

Student Reports of

Learning In Team Environment

In accordance with cognitive dissonance theory (Festin conflicting beliefs will experience a state of anxiety refe which they seek to reduce. Beliefs are defined as the l between an attitude object and various attributes (Fishb study, two beliefs of interest are the extent to which stu teams to complete course work (an attitude object) is re learning. Another relevant belief is the extent to which (another attitude object) are related to learning. In mos are used as the primary indication of student learning. and learning is extremely problematic (among other rea educational institutions are not accomplishing their obje accomplishments will not be accurately acknowledged. In accordance with the instrumental model of procedura receiving poor grades on projects that they believe dem

Course Level Procedure Percent of Grade

Determined by Peer Evaluation

Individualism/ Collectivism

ger, 1 rred to inkage ein &

dents lated stude t educ A disc sons) ctives

l just onstr

hts res

Interactions with Team Members

Individualism/ Collectivism

Student Reports of

Learning n Team Environment

957), individuals who hold as cognitive dissonance, s that people establish Ajzen, 1975). In this believe that the use of to (1) grades, and (2) nts believe that grades ational institutions, grades onnect between grades because it indicates that and that students’

ice, students anticipating or ate high levels of learning

erved. 10

will experience cognitive dissonance. There are several methods they may use to reduce this dissonance. First, they may argue that the procedure used for grading is unfair, thus attempting to persuade the instructor to change their grade. Alternatively, they may revisit their assessment of their own learning on the project – “I thought I learned a lot from doing this project, but I guess I didn’t.” Either method allows students to reestablish the link between grades and learning. Peer evaluation may also lead to less cognitive dissonance, particularly where there is satisfaction with the anticipated grade. However, where there is discontinuity between grades and the student’s expectation, the student may reduce dissonance by adjusting his or her perception of the peer evaluation process itself. Hypothesis 4: The instrumental outcome of satisfaction with anticipated grade will mediate the relationship between percent of grade determined by peer evaluation and student reports of learning in a team environment.

Relational procedural justice outcomes and student reports of learning

As with instrumental procedural justice, we hypothesize that the positive relationship between percent of grade determined by peer evaluation and student reports of learning (predicted in Hypothesis 1) will be mediated by interactions within the team that show respect for team members. The relational model of procedural justice views feelings of dignity as a mediator between a given decision-making procedure and judgments regarding the fairness of that procedure. In other words, when deciding if they think a procedure is fair, individuals will ask “Does this procedure make me feel that I am a valued member of the team?” In this study, the process would unfold like this – If increasing the percent of grade determined by peer evaluation makes me feel respected, then it is a fair procedure (otherwise it is not). Once again, we are interested in issues of learning or performance rather than fairness judgments. We depict the relational model of student learning in Figure 1. Research indicates that relational procedural justice is positively related to employee performance (Greenberg, 1990; Lind & Tyler, 1988; Robbins, Summer, Miller & Hendrix, 2000). We expect this to be the case for student performance or learning as well. In accordance with the group value model of procedural justice (Lind & Tyler, 1988), being treated respectfully is important to individuals because it indicates to them that they are valued members of the group or community. Teams experiencing higher levels of relational justice (e.g., respect) are likely to be more cohesive. Group cohesiveness has been found to be positively associated with better communication, cooperation, and performance (Mullen & Cooper, 1994; Shaw, 1976). In a study of teams in higher education, team cohesiveness was found to have a significant and positive influence on team member satisfaction and motivation (Robbins and Fredendall, 2001). We expect that team cohesiveness will also lead to perceptions of improved student learning because it will encourage teams to spend quality time as a team, thus resulting in synergistic effects. In addition to fostering team cohesiveness, relational procedural justice within a team is also likely to improve the dedication of team members to the goals of the team. For example, O’Reilly and Chatman (1986) found that feeling

connected to a group was positively associated with extra-role behaviors. In this study, extra-role behaviors, such as staying late to work on the team project, should indicate higher levels of learning. Hypothesis 5: The relational outcome of interactions within the team will mediate the relationship between percent of grade determined by peer evaluation and student reports of learning in a team environment.

The relative strength of instrumental and relational procedural justice As described previously, instrumental procedural justice outcomes reflect one’s ability to obtain some desired end (such as a grade with which one is satisfied). Alternatively, relational procedural justice outcomes convey to individuals that they are respected and valued members of a community or group (Lind & Tyler, 1988). Research on procedural justice effects indicates that relational procedural justice is typically a better predictor than instrumental procedural justice (Chory-Assad, 2002; Folger & Konovsky, 1989; Robbins et al, 2000). We expect to see the same pattern in the student team context. Hypothesis 6: Relational procedural justice will have a stronger effect than instrumental procedural justice on student reports of learning in a team environment

Methods

Sample and Research Design Data for this study were drawn from courses taught at one institution in the Northeast United States and one in Hong Kong. For the U.S. sample, School of Business courses offered during one semester were identified by examining the schedule of courses. Faculty members who were using team projects in these courses were identified by examining syllabi on file with the Dean’s office and through follow-up e-mails. Those using team projects were asked to participate in the study. Data was collected for 32 out of 43 courses in which team projects were being used. This represents a response rate of 74 percent. For the Hong Kong sample, one of the authors contacted two faculty members in the School of Business to participate in this study because they were known to use team projects in their courses. Both faculty members agreed to participate and data was collected for all nine of their courses. Both students and faculty members completed written questionnaires in class sometime during the last two weeks of the semester. Questionnaires were administered at the end of the semester in accordance with research by Watson and Michaelson (1988: 509) which found that interaction behaviors among students working on team projects “were much more statistically predictive of levels of performance at this point.” Two-hundred sixty-three teams were surveyed during the semester. The number of respondents per team averaged just over three, with a range from two to ten

respondents. After excluding cases with missing values, the final sample size was 761, of which 31.5% were Hong Kong students, and the remaining 68.5% were from the United States. The sample demographics are: 45% female; 57.8% Caucasian, 31.3% Asian, 6% Hispanic, and less than 2% each African-American, Native American, and Multi-racial; the average age was 22.5, ranging from a low of 18 to a high of 53; the subjects had on average 2.8 years full-time work experience and 2 years part-time work experience; approximately 21% of the sample had worked as part of a team at work. Measures The means and correlations for the variables used in our analyses can be found in Table 1.

TABLE 1 Means, Standard Deviations and Correlations

Variables1 µ S.D. 1 2 3 4 1. Percent of grade determined by Peer Evaluation

5.28 5.89

2. Team-level measure of Collectivism

4.69 0.76 .08*

3. Individual-level Satisfaction Anticipated Grade

5.55 1.07 -.01 .06

4. Team-level measure of Team Interactions

5.55 0.60 -.11** .12** .41**

5. Individual-level Perceived Student Learning

5.46 1.03 .12** .32** .37** .42**

N=761 individuals, 263 groups, 41 courses *= p < .05 ** = p < .01 Dependent variable. Student Reports of Learning was a 5-item scale developed for this study. Each item was rated by student subjects on a 1-7 Likert-type scale. An example of one of the items is “Working in a group improved my understanding of the concepts covered in class.” A principal axis factor analysis of the 5 items extracted one factor with an eigenvalue exceeding 1. We created one variable by averaging the items (alpha=.89). Although this variable is an individual level variable, interrater reliability for the sample is high (.94), which means that we do have strong agreement within teams across the sample as a whole about learning Independent variable. Data on what percentage of the final grade was determined by Peer Evaluation was collected from the instructors for each course to avoid issues of common method bias and to ensure accuracy. Instructors reported the percentage, from

0-100. Moderator variable. Our measure of Collectivism was drawn from Wagner (1995), which was designed to measure the value attached to working alone versus working with a group. (As noted by Early (1989), although individualism-collectivism is a multi- dimensional construct, researchers often use a single dimension that is most relevant to their particular study For example, he used subordination of individual goals to in-group goals in his examination of social loafing in work teams ) The student subjects rated the three-item measure on a 1-7 Likert-type scale. Even though all three items loaded on one factor, one item was dropped because it decreased the alpha of the scale to .76. The average of the two items (alpha=.83) was coded such that a high score indicated a high valuing of group work (and thus a high level of collectivism). In order to test if it was acceptable to aggregate this variable to the team level, the within-group interrater reliability of each item was calculated (James, Demaree, & Wolf, 1984). Each item was over .9, making it possible to aggregate the items by using the team average for each item.

FIGURE 2 Moderation effect of Individualism-Collectivism on the Relationship Between Peer Evaluation and Interactions within the Team

5.1

5.2

5.3

5.4

5.5

5.6

5.7

5.8

5.9

6.1

LOW Peer Evaluation HIGH Peer Evaluation

In te

ra ct

io n

w it

hi n

T ea

HIGH Collectivism LOW Collectivism

Mediator variables. Both the instrumental and relational justice items were measured with a 1-7 Likert-type scale. Satisfaction with anticipated grade was measured with two items developed for this study, “I think that the grade I will receive for my group

assignments will be fair”, and “I am satisfied with the grade I expect to receive on the group assignment.” The two items were averaged and had a coefficient alpha=.79. The variable of Interactions within Teams was measured with Niehoff and Moorman’s (1993) 5-item scale designed to assess interactional justice but was adapted to reflect the student team environment. The items were aggregated to the team level of analysis after the inter-rater reliability was calculated (all items were above .9), the team average was used for each item and then one variable was constructed from the average of the items (coefficient alpha= .92). Analyses The main-effect hypotheses were tested using multiple OLS regression analyses. The moderator hypotheses were tested using multiple hierarchical OLS regression analyses, with the main effects added in the first stage and the interaction effects added in the second stage. The significant moderator interactions were analyzed with the procedures outlined by West, Aiken, and Krull (1996). The moderator variable was centered and high and low scores calculated using one standard deviation above and below the mean. The mediation analyses were based on the analysis of mediation discussed in Baron and Kenny (1986). There are three steps to follow when testing for mediation. First, a significant relationship between the explanatory variable and the dependent variable must exist. Second, a significant relationship between the mediating variable and the dependent variable must exist. Third, when both the explanatory variable and the mediating variable are included in the model, the previously significant relationship between the explanatory variable and the dependent variable should become insignificant.

Results Hypothesis one suggested that there would be a significant and positive relationship between the percent of the course grade determined by peer evaluation and student reports of learning. This hypothesis was supported (see Table 2, column 1).

TABLE 2 Regression Results1

Variables H1

DV: Perceived Student Learning

H2 DV: Anticipated Grade Satisfaction

H3 DV: Interaction within Teams

Step 1

Peer Evaluation

.12** n.s. -.11**

Individualism-Collectivism

n.s. .11**

Adj-R2 .01 n.s. .01 F 12.01** n.s. 8.71** Step 2

Individualism-Collectivism x Peer Evaluation

-.12**

Adj-R2 .02 F

1 Standardized betas reported Hypothesis two suggested that individualism-collectivism at the team level would moderate the relationship between the independent variable, percent of grade determined by peer evaluation, and instrumental justice effects (i.e., satisfaction with anticipated grade). Hypothesis two was not supported, there was no significant relationship between percent of grade determined by peer evaluation and satisfaction with anticipated grade (see Table 2, column 2). Hypothesis three suggested a similar moderating relationship between percent of grade determined by peer evaluation and relational justice effects (team-level interactions). Hypothesis three was supported (see Table 2, column 3). The interaction term was significant. The interaction was plotted (see Figure 1), and the results of the plot indicated that percent of grade determined by peer evaluation had a markedly negative effect on collectivistic teams, while it had a marginally positive effect on individualistic teams. Hypothesis four argued that instrumental procedural justice effects would mediate the relationship between course level procedures (i.e., percent of grade determined by peer evaluation) and student reports of learning (See Table 3, column 1). The results indicated that course-level procedures and instrumental procedural justice effects were

both significantly related to perceived student learning (step 3), but that justice did not act as a mediator, so this hypothesis was not supported.

TABLE 3 Mediated Regression Results1

Variables H4

DV: Perceived Student Learning

H5 DV: Perceived Student Learning

Step 1

Peer Evaluation .12**

.12**

Adj-R2 .01 .01 F 12.01** 12.01** Step 2

Anticipated Grade Satisfaction .37**

Interactions within Teams

.42**

Adj-R2 .14 .18 F 145.77** 164.25** Step 3

Peer Evaluation .12**

.14**

Anticipated Grade Satisfaction .36**

Interactions within Teams

.43**

Adj-R2 .14 .19 F 73.02** 86.31**

1 Standardized betas reported Hypothesis five suggested that relational justice effects would mediate the relationship between course level procedures (i.e., percent of grade determined by peer evaluation) and student reports of learning (see Table 3, column 2). The results indicated that course-level procedures and relational justice effects were both significantly related to student reports of learning (step 3), but that justice did not act as a mediator, so this hypothesis was not supported.

Finally, hypothesis six argued that relational procedural justice would be more strongly related to student reports of learning than would instrumental procedural justice. This hypothesis was tested by examining the relative sizes of the R2’s between the two independent variables listed in Step 2 in Table 3. The adjusted-R2 for the relational procedural justice regression was .18, while the R2 for the instrumental procedural justice regression was .14, suggesting that relational justice does have a stronger impact on student reports of learning than does instrumental justice.

Discussion A procedural justice theory of the effects of peer evaluation on student learning in a team environment was partially supported. Our results indicate that for students working on team projects, peer evaluations have implications for their learning. Percent of grade determined by peer evaluation, which is one course level procedure providing students with voice, was positively related to student reports of learning. Furthermore, measures of both instrumental procedural justice and relational procedural justice were positively associated with student reports of learning in a team environment. However, these variables exhibited direct effects rather than serving as mediators in accordance with our hypotheses. Consistent with existing research on procedural justice (e.g., Robbins et al., 2000; Moorman, 1991) relational procedural justice exhibited stronger effects than did instrumental procedural justice. One particularly interesting finding of this study is the negative relationship between percent of grade determined by peer evaluation and interactional justice for collectivistic teams. While we expected peer evaluations to have a positive influence on students working on individualistic teams, we did not expect them to have a negative influence on those working on collectivistic teams. Perhaps the procedure of peer evaluation clashes with collectivists’ social motivations for working in groups. In essence, students on collectivistic teams may view peer evaluations (especially those that account for a large portion of their grade) as breaking team spirit, thus making interactions with team members less motivating and enjoyable for them. There are several limitations to this study. We used students’ subjective perceptions of their own learning rather than more objective indicators of learning such as professor’s evaluations (although these are often subjective too). Similarly, since we did not have access to students after the initial data collection, we used satisfaction with anticipated grade rather than satisfaction with actual grade. While the adjusted R2 for the instrumental and relational models are good, the adjusted R2 for percent of grade determined by peer evaluations alone is low. There are many issues surrounding peer evaluations yet our measure focused only on the extent to which one team member could influence the grade of other team members. Just because an instructor allows students to conduct peer evaluations does not mean that students will use them effectively. For example, a student who decides not to use peer evaluation to penalize team members (because they want to avoid a potential conflict) will not be likely to see them as a mechanism for improving his or her grade or relations within the team. Therefore, research that examines completed peer evaluations for type and amount of

feedback could provide insight into this topic. Finally, perhaps all peer evaluation procedures are not created equal. As described above, our measure of peer evaluation was quantitative. Including more qualitative aspects of the peer evaluation form and process itself is likely to provide interesting information as well. For example, perhaps justice effects and learning differ in accordance with the number of times peer evaluations are completed during the semester. It is easy to imagine that a mid-term peer evaluation which provides constructive written feedback will improve team functioning, and ultimately learning, more so than one evaluation conducted at the end of the semester Future research should examine the relationship between peer evaluation and instrumental outcomes other than satisfaction with anticipated grade. For example, a ‘fair’ distribution of workload among team members could be instrumental to students working on team projects because it allows them to escape unnecessary burdens. We theorized that percent of grade determined by peer evaluation resulted in satisfaction with anticipated grade, in part, because it resulted in decreased social loafing among team members (i.e., a fair distribution of workload). However, it may be that the relationship between percent of grade determined by peer evaluation and student reports of learning is mediated by distribution of workload rather than satisfaction with anticipated grade. Similarly, since satisfaction with anticipated grade is related to student reports of learning, future research should examine factors leading to this instrumental outcome variable other than percent of grade determined by peer evaluation. For example, a course level procedure of grading on a curve could impact satisfaction with anticipated grade, and thus student reports of learning. Finally, the effect of course level procedures on outcomes other than student learning could be investigated. For example, research exploring the link between course level procedures such as peer evaluation and students’ evaluations of their instructors would be especially informative. This study provides practical implications for deploying teams and utilizing peer evaluation in the classroom environment. By extension, these implications may be appropriate for work environments that rely on teams as a central component in the organization’s design. Instructors (in the educational context) and team leaders (in the broader organizational context) can improve the effectiveness of teams by making efforts to foster a favorable justice climate. Justice training may be necessary particularly for teams that lack collectivistic members (low collectivism) (cf Colquitt, Noe & Jackson, 2002). Attention should be focused on the selection of team members, the expected norms associated with team membership, and preparation and training for working in teams as well as for conducting peer evaluations. To facilitate learning in a team environment, instructors should understand how the procedures they use to administer team projects influence students’ perceptions of the fairness of valued outcomes, interactions among team members, and learning of course material.

References Alexander, S., & Ruderman, A. 1987. The role of procedural and distributive justice in organizational behavior. Social Justice Research, 1: 177-198. Bacon, D.R., Stewart, K.A. & Silver, W.S. 1999. Lessons from the best and worst student team experiences: How a teacher can make the difference. Journal of Management Education, 23, 467-488. Baron, R.M., & Kenny, D.A. 1986. The moderator-mediator variable distinction in social psychological research: Conceptual, strategic, and statistical considerations. Journal of Personality and Social Psychology, 51: 1173-1182. Bidder, S.L., Chang, C., and Tyler, T. R. 2001. Procedural justice and retaliation in organizational: Comparing cross-nationally the importance of fair group processes. International Journal of Conflict Management,12: 295-302. Bies, R. J. 2001. Interactional (in)justice: The sacred and the profane. In J. Greenberg and R. Cropanzano (Eds.), Advances in Organizational Justice. Palo Alto, CA: Stanford University Press, pp. 89-118. Bies, R. J. and Moag, J. S. 1986. Interactional justice: Communication criteria of fairness. Lewicki, I. R.; Bazerman, M., and Sheppard, B., Editors. Research on Negotiation in Organizations. Greenwich, CT: JAI Press, pp. 43-55. Bolton, M.K. 1999. The role of coaching in student teams: A “just-in-time approach to learning. Journal of Management Education, 23, 233-250. Chelte, A.F. 2003. Challenges of Virtual Teams in the Classroom. The Journal of Behavioral and Applied Management ,Winter Vol. 4, No. 2., 122-133. Chory-Assad, R. 2002. Classroom justice: Perceptions of fairness as a predictor of student motivation, learning, and aggression. Communication Quarterly, 50: 58-78. Colquitt, J. A., Noe, R. A., And Jackson, C. L. 2002. Justice in teams: Antecedents and consequences of procedural justice climate. Personnel Psychology, 55: 83-110. Cooper, C. L., Dyck, B., & Frohlich, N. 1992. Improving the effectiveness of gainsharing: The role of fairness and participation. Administrative Science Quarterly, 37: 471-490. Cox, T., Jr., Lobel, S. A., & McLeod, P. L. 1991. Effects of ethnic group cultural differences on cooperative and competitive behavior on a group task. Academy of Management Journal, 4: 827-847. Earley C. P. 1989. Social loafing and collectivism: A comparison of the United States and the People's Republic of China. Administrative Science Quarterly, 34: 565-581.

Early, C. P. 1993. East meets West meets Mideast: Further explorations of collectivistic and individualistic work groups. Academy of Management Journal, 36, 319-348. Ettington, D.R. & Camp, R.R. 2002. Facilitating transfer of skills between group projects and work teams. Journal of Management Education, 26: 356-379. Fahr, J. L., Podsakoff, P. M., & Organ, D. W. 1990. Accounting for organizational citizenship behavior: Leader fairness and task scope versus satisfaction. Journal of Management, 16: 705-721 Feichtner, S.B., & Davis, D.A. 1985. Why some groups fail: A Survey of student learning experiences with learning groups. The Organizational Behavior Teaching Review, 9: 58-71. Festinger, L. 1957. A theory of cognitive dissonance. Evanston, IL: Row, Peterson. Fishbein, M., & Ajzen, I. 1975. Belief, attitude, intention, and behavior: An introduction to theory and research. Reading, MA: Addison-Wesley. Folger, R. & Konovsky, M. A. 1989. Effects of distributive and procedural justice on reactions to pay raise decisions. Academy of Management Journal, 32: 115-130. Ghorpade, J. & Lackritz, J.R. 1998. Equal opportunity in the classroom: Test construction in a diversity-sensitive environment. Journal of Management Education, 22: 4. Gibson, C. B., & Zellmer-Bruhn, M. 2001. Metaphor and meaning: An intercultural analysis of the concept of teamwork. Administrative Science Quarterly, 46: 274-303. Goldfinch, J., Laybourne, P., MacLeod, L. & Stewart, S. 1999. Improving group working skills in undergraduate education through employer involvement. Assessment and Evaluation in Higher Education, 24: 41-51. Greenberg, J. 1990. Looking fair vs being fair: Managing impressions of organizational justice. Research in Organizational Behavior, 12: 111-157. Houston, M.B & Bettencourt, L.A. 1999. But that's not fair! An exploratory study of student perceptions of instructor fairness. Journal of Marketing Education, 21 (2): 84- 96. James, L.R., Demaree, R.G., & Wolf, G. 1984. Estimating within-group interrater reliability withi and without response bias. Journal of Applied Psychology, 69: 85-98. Kane, J. S. & Lawler, E. E. 1978. Methods of peer assessment. Psychological Bulletin, 85: 555-586.

Kirkman, B.L. & Shapiro, D.L. 2001. The impact of cultural values on job satisfaction and organizational commitment in self-managing work teams: The mediating role of employee resistance. Academy of Management Journal, 44(3): 557-569 Konovsky, M. 2000. Understanding procedural justice and its impact on business organizations. Journal of Management, 26: 489-511. Korsgaard, M.A., & Roberson, L. 1995. Procedural justice in performance evaluation: The role of instrumental and non-instrumental voice in performance appraisal discussions. Journal of Management, 21: 657-669 Korsgaard, M. A., Roberson, L., & Rymph, D. 1998. What motivates fairness? The impact of subordinate assertive communication on managers' interactional fairness. Journal of Applied Psychology, 83: 731-744. Liden, R. C., Nagao, D. H., & Parsons, C. K. 1985. Student and faculty attitudes concerning the use of group projects. The Organizational Behavior Teaching Review, 10 (4): 32-38. Lind, E. A., Kurtz, S., Musante, L., Walker, L., & Thibaut, J. 1980. Procedure and outcome effects on reactions to adjudicated resolutions of conflicts of interest. Journal of Personality and Social Psychology, 39: 643-653. Lind, E. A., & Tyler, T. R. 1988. The social psychology of procedural justice. New York: Plenum. Marsh, H. W. & Overall, J. U. 1980. Validity of students’ evaluations of teaching effectiveness: Cognitive and affective criteria. Journal of Educational Psychology, 72:468-475. Michaelson, L.K. & Kazook, N.M. 1999. Making learning groups effective. Selections: 16, 28-35. Moorman, R. H. 1991. Relationship between organization justice and organizational citizenship behaviors: Do fairness perceptions influence employee citizenship? Journal of Applied Psychology, 76: 845-855. Mossholder, K. W., Bennet, N., & Martin, C. L. 1998. A multilevel analysis of procedural context. Journal of Organizational Behavior, 19: 131-141. Mullen, B. & Cooper, C. 1994. The relation between group cohesiveness and performance: An integration. Psychological Bulletin, 115: 210-227. Mulvey, P. W., Bowes-Sperry, L., & Klein, H. J. 1998. The effects of perceived loafing and defensive impression management on group effectiveness. Small Group Research, 29: 394-415.

Murphy, K. R. & Cleveland, J, N. 1991. Performance Appraisal. Needham Heights, MA: Allyn & Bacon. Niehoff, B. P., & Moorman, R. H. 1993. Justice as a mediator of the relationship between methods of monitoring and organizational citizenship behavior. Academy of Management Journal, 36: 527-556 Olson, M. 1971. The logic of collective action: public goods and the theory of groups. Cambridge MA: Harvard University Press. O’Reilly, C. A., & Chatman, J. A. 1986. Organizational commitment and psychological attachment: The effects of compliance, identification, and internalization on prosocial behavior. Journal of Applied Psychology, 71: 492-499. Robbins, T. L., Summers, T. P., Miller, J. L., & Hendrix, W. H.; 2000. Using the group- value model to explain the role of noninstrumental justice in distinguishing the effects of distributive and procedural justice. Journal of Occupational and Organizational Psychology, 73 ; 511-518. Robbins, T. L., & Fredendall, L. D. 2001. Correlates of team success in higher education. Journal of Social Psychology, 141: 135 –137 Rodabaugh, R. C. & Kravitz, D. A. 1994. Effects of procedural fairness on student judgments of professors. Journal of Excellence in College Teaching, 5 (2): 67-84. Shapiro, D.L. 1993. Reconciling theoretical differences among procedural justice researchers by re-evaluating what it means to have one’s views "considered:" implications for third-party managers. In. R. Cropanzano (Ed). Justice in the workplace: approaching fairness in human resource management. Hillsdale, NJ: Lawrence Erlbaum. pp 51-78 Shaw, M. E. 1976. Group dynamics: The psychology of small group behavior. New York: McGraw-Hill. Stubblebine, Patrick C. 2001. Perception and Acceptance of Evaluations by Supervisors and Peers. Current Psychology. Spring, Vol 20: 85-95. Tata, J. 2001. The influence of national culture on the perceived fairness of grading procedures: A comparison of U.S. and China. Paper presented as part of symposium entitled Fairness in the classroom: Are we practicing what we preach? Academy of Management, Washington D.C. Thibault, J. & Walker, L. 1975. Procedural justice: A psychological analysis. Hillsdale, NJ: Lawrence Erlbaum Associates.

Tinto, V. 1999. Taking retention seriously: Rethinking the first year of college. NACADA Journal, 19: 5-9. Tonn, J. C. & Milledge V. 2002. Team building in an MBA “Gateway” course: Lessons learned. Journal of Management Education, 26: 415-428. Triandis, H. C., Leung, K., Villareal, M. J., & Clack, F. L. 1985. Allocentric versus idiocentric tendencies: Convergent and discriminant validation. Journal of Research in Personality, 19: 395-415. Triandis, H. C., Bontempo, R., Villareal, M. J., Asai, M., & Lucca, N. 1988. Individualism and collectivism: Cross-cultural perspectives on self–ingroup relationships. Journal of Personality and Social Psychology, 54: 323–338. Tyler, T. R., Degoey, P., & Smith, H. 1996. Understanding why the justice of group procedures matters: A test of the psychological dynamics of the group-value model. Journal of Personality and Social Psychology, 70: 913-930. Wagner III, J. A. 1995. Studies of individualism-collectivism: Effects on cooperation in groups. Academy of Management Journal, 38: 152-172. Wagner III, J. A. & Moch, M. K. 1986. Individualism-collectivism: Concept and measurement. Group and Organizational Studies, 11: 280-304. Watson, W. E., & Michaelsen, L. K. 1988. Group interaction behaviors that affect performance on an intellective task. Group and Organizational Studies, 13: 495-516. West, S. G., Aiken, L. S., & Krull, J. L. 1996. Experimental personality designs: Analyzing categorical by continuous variable interactions. Journal of Personality, 64: 1- 48. Wexley, K. N. & Klimoski, R. J. 1984. Performance Appraisal: An update. In K. Rowland & G. Ferris (Eds.), Research in Personnel and Human Resources, (Vol. 2, pp. 35-79). Greenwich, CT: JAI.

A Multilevel Approach to Individual Readiness to Change

David Desplaces University of Hartford

ABSTRACT

This research seeks to expand our understanding of individual readiness to change and its antecedents. Antecedents to change are explored including both the objective and subjective context of change in an effort to clarify their significance and relationship with individual readiness to change and in determining the success of change. A theoretically sound and testable individual readiness model is presented including a brief discussion on how to go about testing each variables of the proposed model.

Introduction

History tells us that organizational change is chaotic (Gleick, 1987) and can be dramatic for both the individual and the organization (Abrahamson, 2000). It can bring about many disruptions and adverse effects. Although some argue that not all changes are necessary (de Jager, 2001),Lewin (1951), later followed by Schein (1996), describes change as a difficult process involving painful unlearning and relearning, as employees attempt to restructure their thoughts, feelings and behaviors with regard to the change at hand. Porras and Robertson’s (1992) review of organizational development (OD) literature found that targeted organizational change was attained in only 38 percent of the cases examined, compared to 53 percent of the cases which showed no change, and nine percent of the cases which demonstrated change in opposite directions than intended. Despite these low rates of successful change, practitioners and scholars still use models to direct organizational change efforts. OD practice focuses mostly on changing the context and processes under which employees in an organization function. The assumption is that their alterations will result in changed employee behaviors in the form of low absenteeism, high performance, and/or low turnover, which will bring about changes in organizational outcomes such as increased revenue, reduction of costs, or improved market share, and/or market position. These models limit change efforts usually by taking single-level approaches that focus on individual, group, or organizational targets only. Furthermore, scholars point that the models themselves are underdeveloped theoretically (Pettigrew, Woodman, & Cameron, 2001; Porras & Robertson, 1992). This research attempts to clarify the role and potential contribution that the antecedents to individual readiness to change may have in change research. Therefore, one of the important contributions of this inquiry is to establish a framework for studying readiness to change by presenting a more comprehensive and testable individual change model. Specifically in this research, we seek to deepen our understanding of adoption by integrating theories and empirical research in readiness to change, individual readiness

to change, OD, organizational change, and other literatures to develop a more comprehensive model of individual behavioral change that takes into account dynamics at both the individual (micro) and organizational (macro) level of analysis. By recognize the relationship between objective and subjective work setting changes, and their significance in determining an individual’s readiness to adopt change; we propose that work setting changes and individual attitudes towards the change conjointly are set to affect the outcome of the change effort.

Review of the Literature

Readiness to Change

In the organizational context, individual readiness to change is defined as the extent to which an individual is prepared to participate in a different organizational activity (Huy, 1999). It is viewed as the precursor to the behaviors of either resistance to, or support for, a change effort undertaken by an organization (Allport, 1967; Armenakis, Harris, & Mossholder, 1993; Rafferty & Simons, 2001). Previous research seems to support that readiness of individuals in an organization to undertake change appears to be a precursor to successful change (Armenakis et al., 1993; Eby, Adams, Russell, & Gaby, 2000; Edwards, Jumper-Thurman, Plested, Oetting, & Swanson, 2000; Levesque, Prochaska, & Prochaska, 1999; Rafferty & Simons, 2001) and a prerequisite for meeting business objectives in a dynamic environment, it remains understudied and ill explored in organizational contexts where changes are being proposed. The following section reviews the current literature on individual readiness as an attitudinal construct, in an attempt to define the role that the attitude of readiness to change may have in organizational change research and practice.

Individual Readiness to Change as an Attitude

As an attitude, readiness to change is presented in this research as a field of forces, supporting or resisting change. Those forces must be altered for change to take place. Individual readiness to change reflects the thoughts, feelings and intentions of an individual, which may or may not lead to a particular behavior associated with his/her attitudes. Individual readiness to change, as an attitudinal construct, has just begun to be explored conceptually. Piderit (2000) attempts to clarify readiness to change as an attitudinal construct by distinctively identifying the three dimensions as cognitive, affective and intentional. These dimensions make up what is also known as the tripartite view of attitudes (Ajzen, 1984; Olson & Zanna, 1993). It is generally held in the attitude theory literature that an attitude exerts an influence upon the individual's behavioral response to objects and situations an individual faces (Allport, 1967).

The literature points to the importance of all three dimensions (Ajzen, 1984; Piderit, 2000), the distinctions between them (Ajzen, 1984; Eagly & Chaiken, 1993), and their potential interactions (Olson & Zanna, 1993; Piderit, 2000). Furthermore, recent research empirically tested individual readiness as an attitude (Desplaces & Beauvais, 2004) and as a predisposition (Oreg, 2003). However, an attitude toward change can better be understood when examined in relation to the change context being implemented (Pettigrew et al., 2001; Van de Ven & Poole, 2002). Therefore, it can be argued that change in the context gives rise to one’s attitudinal predisposition to change. Such contexts may include organizational context, perceived support for the change and perceived membership readiness to adopt change. We now turn our attention to a discussion of possible antecedents to an individual’s readiness to change.

The Antecedents of Individual Readiness to Change

The previous sections of this manuscript establish the importance of assessing and understanding individuals’ attitudes about change and point to the limited contributions of studies about individual readiness to change in the context of change have been made thus far. Therefore, it appears that previous theories and models of individual change have not focused on specifically linking individual readiness to adopt technologically based changes, perceptions of work setting changes, and subjective perceptions of organizational support and norms for change. The present research offers a testable approach to understanding individual readiness to adopt change in the work place. It speculates that employees derive meaning from their subjective perceptions of what is happening in their organizational situation. Individuals’ perceptions of organizational support for changes and of organization membership readiness to change affect personal readiness to change. Self-efficacy is posited to moderate the relationship between perceived organization support and readiness to change. Therefore, our model predicts that an individual will experience more readiness to change if he/she perceives that the environment supports the change, moderated by one’s self-efficacy regarding the required change, and that other organizational members are ready for the changes. It points to the significance of studying individual readiness to change in its context.

Figure 1 Integrative Approach to Individual Readiness to Change

Work Setting

Regarding Change

Perceived Work Setting Regarding

Change

Perception of Organizational Membership Readiness

to Change

Individual Readiness to Change

New Behavior

Variable Level

Process Level

Pre Change Change

Post Change

Time

Perceived Organizational

Support for Change

Subjective Context

Self- Efficacy with

Regards to Change

In the next sections, special attention is given to the antecedents of individual readiness to change. That is accomplished through the examination of organizational work setting variables (Porras & Robertson, 1992), and their links to both perceived organizational support (Eisenberger, Huntington, Hutchison, & Sowa, 1986) and perceived organizational membership readiness (Eby et al., 2000). These variables are also examined as mediating elements linking organization context to individual readiness to change. In addition, the moderating role of self-efficacy in the relationship between perceived organizational support and individual readiness to change is suggested. Work setting changes. OD is a system-wide set of planned changes that aims to improve an organization’s effectiveness. It is the study of “changing” an organization through individual behavioral changes. Emphasis is put on the premise that organizational change comes through collective individual behavioral changes; therefore, individual behavioral changes have organizational consequences. That assumption is at the root of this research, and is also reflected in much of the readiness to change literature (Armenakis & Bedeian, 1999; Eby et al., 2000). In changing organizations, OD approaches assume that individual members must do things differently (i.e., behave differently) for the system to change: thinking and feeling is not enough (Porras et al., 1992). Beer (1987) proclaims that individual behavioral

change is the crucial link between an organization’s intention to change and any organizational outcome. Porras and Robertson’s (1992) OD framework acknowledges the importance of behavioral change “as the intermediate factor linking change agent interventions in the work setting and organizational outcomes” (p.726), whereby “the change in the behavior of individual organizational members [is] a prerequisite for meaningful and lasting organizational change” (p. 724).

Porras and Robertson’s framework emphasizes the importance of work settings, which encompass more organizational variables than just culture, structure, strategy and processes. They argue that an organization’s vision, mediated by four key interrelated organizational factors (i.e., work setting variables), will shape and guide people’s cognitions, which in turn will influence their on-the-job behaviors.

The authors speculate that change in work settings, mediated by individual cognitions and member on-the-job behaviors, leads to changes in organizational and individual outcomes. The work setting variables are Organizing Arrangements, Social Factors, Physical Setting and Technology. Porras and Robertson’s proposed work setting variables represent the organizational change context, and serve as guiding elements in linking organizational level constructs with individual level readiness to change.

All of the above work-setting factors interact with each other to affect individual cognition, according to the authors. Porras and Robertson (1992) point out that expectancy (Porter & Lawler, 1968; Vroom, 1964) and social learning theories (Bandura, 1977, 1986, 1997) have established that the environment directly influences an individual’s conscious choices about one’s behavior, noting “the importance of [the] environment as a source of information about appropriate behaviors”(p. 727). Thus, Porras and Robertson (1992) say that “through natural processes of perception and attribution, individuals form beliefs regarding their organizational environment” (p.727) which then energize, direct and regulate behavior (Bernstein & Burke, 1989). These processes establish the link between individual cognition and on-the-job behaviors, a link that also has been suggested in the readiness to change literature. Therefore, perceptions of changes in these work setting variables are suggested to be a key determinant of individual attitudes and behaviors related to change.

Although their framework was not fully supported, Porras and Robertson (1992) show that when neither work setting nor individual behavior change occurred, 70 percent of the studies showed no change in desired outcomes. When either work setting or individual behavior change occurred, organizational outcomes changed in 87 percent of the cases.

These findings indicate a link between changes in work settings, individual change and organizational change. However, the inconsistent results indicate that we do not fully understand how these constructs are linked. First, cognitions (e.g., cognitive aspects of readiness to change attitude) are likely important mediators of the relationship between work setting changes and individual behavioral change. Porras and Robertson (1992) proposed that important link in their model, but did not examine it. Second, individual

perceptions of the organizational context surrounding change, not just the actual context itself, should be examined. These include not only perceptions of work setting variables, but also perceptions about how well the organization supports individual change, and perceptions about how well the general membership of the organization is prepared for change. Although the OD literature focuses on the objective changes made in work setting variables as precursors of individual change (Porras & Robertson, 1992), various bodies of literature (Berger & Luckmann, 1967; Czarniawska-Joerges, 1992; Eisenberger et al., 1986; Schein, 1991; Weick, 1995) acknowledge the importance of the individual’s subjective view of an organizational context and the changes that are occurring in this context. The authors of these studies posit that the subjective view is the critical influence on one’s attitudes and subsequent behavior. Therefore, in models of organizational change, it might be important to conceptually and empirically distinguish objective work setting changes (i.e., what changes were actually made in work settings) from subjective work setting changes (i.e., what changes individuals perceived occurred in the work setting).

Objective and subjective organizational context.

Objective context reflects the work setting variables (and possible changes in them) actually in place in the organization. Karl Weick, in his book Sensemaking in Organization (1995), on the other hand, highlights the importance of social construction of organizational phenomena. He posits that “to talk about sense making is to talk about reality as an ongoing accomplishment that takes form when people make retrospective sense of the situations in which they find themselves and their creations” (Weick, 1995, p. 15). Furthermore, Czarniawska-Joerges (1992) defines organizations as “.. nets of collective action, undertaken in an effort to shape the world and human lives. The contents of the action are meanings and things (artifacts). One net of collective action is distinguishable from another by the kind of meanings and products socially attributed to a given organization.” (p. 32) The social constructivist perspective infers that what people “know” as “reality” in their everyday lives represents the taken for granted view of the organization. “Knowledge” constitutes the fabric of meaning, without which no society [or organization] could exist (Berger & Luckmann, 1967, p. 15), where the “basic assumptions and beliefs [are] shared by organization members” (Schein, 1991, p. 6). Thus, the objective aspects of an organization are not always those that are perceived by an individual. These concepts highlight the existence of objective and subjective levels of an organizational context. OD practitioners and researchers assume that what is done in the work setting to institute change is reflected in individuals’ perceptions of these changes, but the objective and subjective may not always closely correspond with each other. Individuals perceive the context of the organization by attaching meaning to observations from their day-to-day dealings within the organization (Schein, 1991). For example, the level, quality and clarity of the message communicated by the change agents of a university while implementing a technology change might be perceived differently by different employees. On the other hand, we would expect that there would be some relationship between what has been done and what employees perceive has been done in the work settings. Therefore:

Proposition 1: Objective measures of organizing arrangements regarding change in the work setting will be positively related to subjective perceptions of work settings regarding change.

Perceived organizational support. The theory of perceived organizational support (Eisenberger et al., 1986) posits that employees tend to view actions by agents of the organization as actions of the organization itself (Levinson, 1965). The personification of the organization is assumed to represent an employee’s view of who controls that individual’s material and symbolic resources within the organization (Eisenberger et al., 1986). The theory suggests that through employee commitment and involvement, an employee develops global beliefs concerning the extent to which the organization values their contributions and cares about their well-being. In addition, the theory postulates that such effort-outcome expectancies would allow one to create a positive emotional bond with the organization and increase an employee’s effort to meet the organization’s goal (Eisenberger et al., 1986). Thus, perceived organizational support is a general perception concerning the degree to which the organization values employees’ contributions and cares about their well-being, which results in greater employee affective commitment towards the organization and increases efforts made by individuals on its behalf. In the present research, it is suggested that when introducing ERP systems in organizations, perceived organizational support might help employees develop a higher state of readiness to adopt the technology. The latest review of the perceived organizational support literature by Rhoades and Eisenberger (2002) yields 70 studies that support three major categories of antecedent variables that are positively related to perceived organizational support. The first category is fairness, which reflects available resources and their distribution among employees. Structural determinants of fairness represent the rules, procedures and policies concerning the decisions about change that will ultimately affect the employees (e.g., notice before implementation, accurate information, and employee input in the decision process). Fairness in resource allocation, on the other hand, includes the quality of interpersonal treatment in resource allocation to all employees. The second category of variables that is related to perceived organizational support is supervisor support, defined as the degree to which one’s supervisor is perceived to value one’s contributions and care for one’s well-being. The last category of variables related to perceived organizational support is rewards and favorable job conditions that reflect the human resource practices within the organization that recognize an employee’s contribution (i.e., pay, recognition, promotion, and training). All of the above categories of antecedents of perceived organizational support seem similar to the work setting variables described by Porras and Robertson (1992). That is, if employees perceive that changes in organizational arrangements, social factors and technology are supportive of the change initiative, then employees’ perceived organizational support might be enhanced. Therefore, we posit:

Proposition 2: Perceptions of work settings will be positively related to perceptions of organizational support.

Rhoades and Eisenberger (2002) found in their review that employee perceived organizational support is positively related to favorable employee attitudes (job satisfaction and organizational commitment) and behaviors (lessened withdrawal behaviors). Therefore, if employees perceive that the organization is supportive of change initiatives, then their attitudes toward change should be more positive (i.e., they should experience greater readiness to change). Therefore, we posit:

Proposition 3: Perceptions of organizational support will be positively related to the components of individual readiness to change.

Self-efficacy regarding change. Bandura (1977) states that self-efficacy reflects the belief of individuals that they have the capacity to attain desired goals within specific situations. Therefore, self-efficacy, as perceived by the individual, is a cognitive mechanism underlying behavioral change (Bandura, 1977; Cervone, 2000). Cervone (2000) states that despite one’s belief about what causes “outcomes or the contingencies between responses and outcomes in the environment, [individuals] are unlikely to take action to control events if they doubt their own capacity to execute requisite behaviors” (p. 31). Decisions involving choice of activities are partly determined by judgments of personal efficacy (Bandura, 1997), therefore self-efficacy is viewed to have a central role in the study of behavior change. That is, individual readiness to change might be affected by employees’ beliefs regarding their capacity to perform the new behaviors that the change requires. Bandura’s (1977) research, as well as subsequent research (Levesque et al., 1999; Wanberg & Banas, 2000), support perceived self-efficacy as a cognitive mechanism essential to behavior change. Research supports self-efficacy as a predictor of future performance. Silver and colleagues (1995) found that self-efficacy, even in unsuccessful performances, positively influences future performance (35%), as well as has a moderating effect on the relationship between performance and attributions. Through cognitive representation of future outcomes, individuals can generate current motivators of behaviors (Bandura, 1977). Therefore, theorists (Cervone, 2000; J. O. Prochaska & DiClemente, 1994) propose that a rise in self-referent thinking should allow the individual to embrace change by adopting new behaviors. Developers of the Transtheoretical Model (TTM) described earlier found self-efficacy to positively predict movement across stages (J. O. Prochaska, DiClemente, Velicer, Ginpil, & Norcross, 1985). That finding suggests that self-efficacy may have a direct effect on an individual’s readiness to change. On the other hand, the perceived organizational support (POS) literature posits that by enhancing an individual’s perceived competence, POS might heighten an employee’s interest in his/her job (Rhoades & Eisenberger, 2002). Therefore, perceived organizational support, compounded by self-efficacy, might increase an individual’s readiness to change. Thus, we suggest self-efficacy will have a

moderating effect on the relationship between perceived organizational support and the individual’s readiness to change. Therefore:

Proposition 4: Self-efficacy will moderate the relationship between perceived organizational support and the components of individual readiness to change.

Perceived organizational membership readiness to change. Eby and her colleagues emphasize that the importance of change must manifest itself throughout the organization. Characteristics of an organization must support and reinforce a climate conducive to change in order for change to be successful (Eby et al., 2000). Perceived organizational membership readiness is defined as the individual’s belief that the organizational membership is or is not ready to undergo the change. That perception is derived from the perceived actions of the membership in the organization as well as factors related to environmental and structural components of organizational climate. Schneider and Bowen (1990; 1993) have found strong support for the importance of such variables in sustaining favorable climate perceptions, which embeds the message for change that the organization projects to its members (Armenakis et al., 1993). Members pick up clues about what is happening in the organization by way of work setting changes that tell them that the organization is ready for change including the perception that others in the organization are ready for change. Characteristics of the organization including its membership must support and reinforce the climate for change (Eby et al., 2000). The more those changes are perceived in work settings, the more employees might believe that the organization and its membership are ready for change. Therefore, we posit: Proposition 5: Perceptions of work settings will be positively related to perceptions of membership readiness to change.

Furthermore, studies have also revealed that perceived organizational membership readiness significantly influences an individual’s readiness to change (Eby et al., 2000; Rafferty & Simons, 2001). Lastly, we theorize that:

Proposition 6: Perceptions of organizational membership readiness to change will be positively related to the components of individual readiness to change.

Variables and Measures Discussion

This paper examines the relationship between the context in an organization, both objective and as perceived by individuals, and an individual’s readiness to adopt change. Although not clearly operationalized in reliable measures in the literature, we explore means to measures the prescribed antecedents to individual readiness to change outlined in the previous sections.

Objective Work Setting Variables. Objective context reflects the organization arrangements, social factors, and technology surrounding the implementation of change. Although they have been operationalized by Porras and Robertson (1992), no reliable and meaningful measures for these constructs have been cited in the literature. One limitation is in the nature of the data which often comes in the form of words rather than numbers (Miles & Huberman, 1994). Answers to these items would come from key personnel interviews and content analysis of various sources of information distributed about the change across the organization (e.g., Newsletter, organization newspaper, change web site, memos and e-mails). It calls for a credible, dependable, and replicable means of measuring the context of change. Although defined as uncharted territory in the literature, it is a dimension of change rich in information that could offer significant insights on the qualitative nature of the context of change.

Subjective Context of the Organization. Subjective context represents the individuals’ perceptions of the work setting variables with regard to the change. Again no measures have risen from the literature since some (Agarwal, 2000) argue that situational influences are not separate constructs in and of themselves but embody complex combinations of managerial interventions, individual differences and social influences. Although the literature (Bandura, 1986; Davis, Bagozzi, & Warshaw, 1989; Rogers, 1995) has recognized the importance of perceptions it provides very few insights on how to develop reliable measures in the context of change. Following Porras and Robertson’s (1992) categorization of the objective context a list of perceptions of the objective context can be generated in an attempt to measure this dimension of the model (i.e., to test people’s subjective evaluation of the context of change we could ask employees if they have received clear communication about the change). It would offer some insight on how perceptions of the objective context would possibly mediate how the organization is designed to implement change (at least on paper) and how employees perceive the support and readiness as they get ready to adopt the change.

Perceived Organizational Support. Perceived organizational support mirrors an employee’s global belief that the organization values their contributions and cares about their well being, creating a positive emotional bond to the organization, resulting in extra efforts. This variable can be assessed using eight items from Survey of Perceived Organizational Support instrument (Eisenberger, Cummings, Armeli, & Lynch, 1997; Eisenberger et al., 1986; Rhoades & Eisenberger, 2002). Eisenberger and his colleagues selected these eight items from a pool of 36 items that were found to load highly on the main factor and that seem applicable to a wide array of organizations (Eisenberger et al., 1997). The scale has a reported Cronbach’s alpha of .90.

Perceived Organizational Membership Readiness to Change. Perceived organizational membership readiness to change is defined as the individual’s belief that the organization is or is not ready to undergo the change through the perceived actions of the membership in the organization. The variable can be measured using a nine item scale developed by Eby and colleagues (2000) which was subsequently validated (Rafferty & Simons, 2001), and has a reported reliability alpha of .86.

Individual Readiness to Change. Individual readiness reflects an individual’s beliefs, attitudes and behavioral intentions towards a change effort. It can be measured as a temporal construct, (i.e., stage of change), an attitudinal predisposition, and an attitudinal construct with three dimensions. The temporal construct, stages of change, characterizes an individual readiness to take action and can be assessed using a single item reflecting the work of Prochaska and colleagues (J. M. Prochaska, Levesque, Prochaska, Dewart, & Wing, 2001; J. O. Prochaska & DiClemente, 1984; J. O. Prochaska, DiClemente, & Norcross, 1992). The second measure of individual readiness depicted as a predispositional characteristic reflecting the effort of Oreg (2003). The third measure is based on assessing the cognitive, affective and behavioral intentions associated with a change readiness attitude developed by Desplaces & Beauvais (2004).

Self-efficacy. Self-efficacy echoes the belief of individuals that they have the capacity to attain desired goals. As a generative capacity in which cognitive, social and behavioral subskills are organized in course of action to serve the change that is currently being undertaken, this construct has received substantial attention particularly in the adoption of new behavior literature. We propose to use a 14-item scale developed by Levesque and her colleagues (1999) in part because of its reported high reliability (Cronbach’s alpha of .96).

Conclusion

This research sought to further our understanding of organizational change through individual behavioral change by focusing on the antecedents of individual behavior change, namely individual readiness to change. This comprehensive (although not exhaustive) approach to individual readiness to change and the study and its antecedents explore the link between the macro and micro levels of change, namely objective and subjective work settings, and proposing meaningful measures in an effort to link them to individual readiness to change. The model offers a potentially useful way to guide and evaluate individual readiness to change in its context. It echo Pettigrew and colleagues (2001) assertion that the context and action are inseparable and that the study of change regarding individual readiness must explore how contexts, content, and

processes of change together with their interconnections over time influence individual readiness to change. Therefore, future research should examine the impact that organizing characteristics have on change efforts, including developing reliable and objective measures that are psychometrically sound of measuring the variables defined in our model. In addition, future studies should seek to understand how contextual variables relate to individual change processes, such as self efficacy, motivation to change, and internal dispositional variables, such as tolerance for ambiguity, internal locus of control, dispositional construct of readiness to change. Further, group norms and organizational cultural values that support or discourage change need to be examined in terms of their effects on individual readiness to change attitudes in an effort to strive a balance between change and resistance to it (Leana & Barry, 2000). Finally, future work should test the full proposed model including testing the relationship between individual readiness to change and newly adopted behaviors to assess the role that individual readiness to change plays in determining newly adopted behaviors including the direct and indirect role of self efficacy on that relationship and the impact that the context of change has on an overall change effort.

References

Abrahamson, E. (2000). Change without pain. Harvard Business Review, 78(4), 75-79. Agarwal, R. (2000). Individual acceptance of information technologies. In R. W. Zmud (Ed.), Framing the domains of IT management: projecting the future through the past (pp. 85-104). Cincinnati, Ohio: Pinnaflex Education Resources, Inc. Ajzen, I. (1984). Attitudes. In R. J. Corsini (Ed.), Wiley Encyclopedia of Psychology (Vol. 1, pp. 99-100). New York: Wiley. Allport, G. W. (1967). Attitudes. In F. Martin (Ed.), Readings in Attitude Theory and Measurement (pp. 1-13). New York: JohnWiley & Sons, Inc. Armenakis, A. A., & Bedeian, A. G. (1999). Organizational change: A review of theory and research in the 1990's. Journal of Management, 25(3), 293-315. Armenakis, A. A., Harris, S. G., & Mossholder, K. W. (1993). Creating readiness for organizational change. Human Relations (43), 681-703. Bandura, A. (1977). Self-Efficacy: towards a unifying theory of behavior change. Psychological Review, 84, 191-215. Bandura, A. (1986). Social Foundations of Thought and Action: A Social Cognitive Theory. Englewood Cliffs, NJ: Prentice Hall.

Bandura, A. (1997). Self-Efficacy: the Exercise of Control. New York: W.H. Freeman. Berger, P. L., & Luckmann, T. (1967). The social construction of reality: a treatise in the sociology of knowledge. New York: Doubleday. Bernstein, W. M., & Burke, W. W. (1989). Modeling organizational meaning systems. In R. W. Woodman & W. A. Pasmore (Eds.), Research in organizational change and development (Vol. 3). Greenwich, CT: JAI Press. Cervone, D. (2000). Thinking about self-efficacy. Behavior Modification, 24(1), 30-56. Czarniawska-Joerges, B. (1992). Exploring complex organizations: a cultural perspective. Newbury Park, CA: Sage. Davis, F. D., Bagozzi, R. P., & Warshaw, P. R. (1989). User Acceptance Of Computer Technology: A Comparison Of Two theoretical models. Management Science, 35(8), 982-1002. de Jager, P. (2001). Resistance to Change: a new view of an old problem. The Futurist, 35, 24-27. Desplaces, D. E., & Beauvais, L. L. (2004). Readiness to Change Attitude. Paper presented at the Academy of Management, Seattle, WA. Eagly, A. H., & Chaiken, S. (1993). The Psychology of Attitudes. Forth Worth: HBJ. Eby, L. T., Adams, D. M., Russell, J. E. A., & Gaby, S. H. (2000). Perceptions of organizational readiness to change: Factors related to employee's reactions to the implementation of team selling. Human Relations, 53(3), 419-442. Edwards, R. W., Jumper-Thurman, P., Plested, B. A., Oetting, E. R., & Swanson, L. (2000). Community readiness: research to practice. Journal of Community Psychology, 28(3), 291-307. Eisenberger, R., Cummings, J., Armeli, S., & Lynch, P. (1997). Perceived organizational support, discretionary treatment, and job satisfaction. Journal of Applied Psychology, 82(5), 812-820. Eisenberger, R., Huntington, R., Hutchison, S., & Sowa, D. (1986). Perceived organizational support. Journal of Applied Psychology, 71(3), 500-507. Gleick, J. (1987). Chaos: making a new science. New York: Viking. Huy, Q. N. (1999). Emotional capability, emotional intelligence, and radical change. Academy of Management Review, 24(2), 325-345. Leana, C. R., & Barry, B. (2000). Stability and change as simultaneous experiences in organizational life. Academy of Management Review, 25(4), 753-759.

Levesque, D. A., Prochaska, J. M., & Prochaska, J. O. (1999). Stages of change and integrated service delivery. Consulting Psychology Journal: Practice and Research, 51(4), 226-241. Levinson, H. (1965). Reciprocation: the relationship between man and organization. Administrative Science Quarterly, 9, 372-378. Lewin, R. (1951). Field theory in social science. New York: Harper and Row. Miles, M. B., & Huberman, A. M. (1994). Qualitative Data Analysis (2nd ed.). Newbury Park, CA: Sage. Olson, J. M., & Zanna, M. P. (1993). Attitudes and attitude change. Annual Review of Psychology, 44, 117-138. Oreg, S. (2003). Resistance to change: developing an individual differences measure. Journal of Applied Psychology, 88(4), 680-693. Pettigrew, A. M., Woodman, R. W., & Cameron, K. S. (2001). Studying organizational change and development: challenges for future research. Academy of Management Journal, 44(4), 697-713. Piderit, S. K. (2000). Rethinking resistance and recognizing ambivalence: A multidimensional view of attitudes toward an organizational change. Academy of Management Review, 25(4), 783-794. Porras, J. I., & Robertson, P. J. (1992). Organizational development: theory, practice, and research. In M. D. D. L. M. Hough (Ed.), Handbook of industrial and organizational psychology (2nd ed., Vol. 3, pp. 719-822). Palo Alto, CA: Consulting Psychologists Press, Inc. Porter, L. W., & Lawler, E. E. I. (1968). Managerial attitudes and performance. Homewood, IL: Irwin. Prochaska, J. M., Levesque, D. A., Prochaska, J. O., Dewart, S. R., & Wing, G. R. (2001). Mastering change: A core competency for employees. Brief Treatment and Crisis Intervention, 1(1), 7-15. Prochaska, J. O., & DiClemente, C. C. (1984). The Transtheoretical Approach: Crossing Traditional Boundaries of Therapy. Homewood, Ill: Dow Jones-Irwin. Prochaska, J. O., & DiClemente, C. C. (1994). The Transtheoretical approach: Crossing traditional boundaries of therapy. Malabar, FL: Krieger Publishing Company. Prochaska, J. O., DiClemente, C. C., & Norcross, J. C. (1992). In search of how people change: applications to addictive behaviors. American Psychologist, 47(9), 1102-1114.

Prochaska, J. O., DiClemente, C. C., Velicer, W. F., Ginpil, S., & Norcross, J. C. (1985). Predicting change in smoking status for self-changers. Addictive Behaviors, 10, 395- 406. Rafferty, A. E., & Simons, R. H. (2001). An empirical examination of the relationship between change readiness perceptions and types of change. Paper presented at the Academy of Management Meeting, Washington, D.C. Rhoades, L., & Eisenberger, R. (2002). Perceived organizational support: A review of the literature. Journal of Applied Psychology, 87(4), 698-714. Rogers, E. M. (1995). Diffusion of innovation (Fourth ed.). New York, NY: The Free Press. Schein, E. H. (1991). Organizational culture and leadership: a dynamic view. San Francisco: Jossey-Bass. Schein, E. H. (1996). Kurt Lewin's change theory in the field and in the classroom: Notes towards a model of managed learning. Systems Practice, 9(1), 27-47. Schneider, B. (1990). The climate for service: an application of the climate construct. In B. Schneider (Ed.), Organizational climate and culture (pp. 383-412). San Francisco, CA: Jossey-Bass. Schneider, B., & Bowen, D. E. (1993). The service organization: human resources management is crucial. Organizational Dynamics, 21(4), 39-52. Silver, W. S., Mitchell, T. R., & Gist, M. E. (1995). Responses to successful and unsuccessful performance: the moderating effect of self-efficacy on the relationship between performance and attribution. Organizational Behavior and Human Decision Processes, 62(3), 286-299. Van de Ven, A. H., & Poole, M. S. (2002). Field research methods. In J. A. C. Baum (Ed.), Companion to organizations (pp. 867-888). Oxford: Blackwell Publishers. Vroom, V. H. (1964). Work and motivation. New York: Wiley. Wanberg, C. R., & Banas, J. T. (2000). Predictors and outcomes of openness to changes in a reorganizing workplace. Journal of Applied Psychology, 85(1), 132-142. Weick, K. E. (1995). Sensemaking in organizations. Thousand Oaks: Sage Publications.

Enhancing the First-Year Experience for Business Students: Student Retention and Academic Success

Pamela L. Cox

Elizabeth Dunne Schmitt Paula E. Bobrowski

Glenn Graham State University of New York at Oswego

ABSTRACT

This study examined the academic success and retention of first-year business students enrolled in a course designed to develop skills for academic success, provide a sense of community, ease the transition from high school to college, and provide a realistic preview of business school expectations. The course was designed to create the conditions regarded in the retention literature as critical in promoting academic success and persistence among first year students. Participating students were found to have lower academic disqualification rates, earn higher grade point averages, and continued their enrollment to the fall term of their second year at a higher rate.

Introduction

The first year of university study is in many ways the most formative and often the least satisfactory in terms of concept, curriculum, and pedagogy. As a result, freshman—the students who need the very best teaching—may actually receive the worst, and more of them fall away by the end of the freshman year than at any other time (Boyer, 1997; The Boyer Commission Report, 1995). In fact, the first year is the most crucial period in student retention with more than half the students who drop out of college doing so in their first year (Consortium for Student Retention Data Exchange, 1999; Levitz, Noel, & Richter, 1999; Tinto, 1999). Colleges with high first-year retention rates have been found to also have a higher percentage of students graduating within four years (Lau, 2003). As a result, many institutions are becoming increasingly concerned with improving retention rates, academic achievement, and student satisfaction during the first year (Barefoot, 1994; Kluepfel & Roberts, 1994; Murtaugh, Burns, & Schuster, 1999; Sanders & Burton, 1996; Starke, Harth, & Sirianni, 2001; Tinto, 1987). By re-examining the first-year experience and implementing new and innovative learning strategies, universities can help make students’ transition into college easier and improve student retention rates (Barefoot, 1993; Cuseo, 1991; Davis, 1992; Federman Stein, 1997; Fidler, 1991; Logan, Salisbury-Glennon, & Spence, 2000; Schutte & Malouff, 2002; Soldner, Lee, & Duby, 1999; Starke, Harth, & Sirianni, 2001; Tinto, 1993). Data indicate that more than 70% of colleges and universities now offer some type of first-year program (National Resource Center for the First-Year Experience and Students in Transition, 2000; Skipper, 2002).

At the same time, there has been a call for radical reform in business education (Accounting Education Change Commission, 1990; Porter & McKibbin, 1988). Critics of business education point out that new skills are required for managing diversity, globalization, downsizing and restructuring; skills that are lacking in today’s graduates (Mason, 1992). Business schools have also been criticized for omitting training in skills necessary to developing the ability to function as a generalist rather than a specialist in business (Chanko & Roberts, 1996). In addition, students entering business school may not have a clear idea of what a career in business is about. First-year business courses that use a hands-on, experiential approach can help students with little or no organizational experience to develop a better understanding of the connections between themselves and business (Lamb, Lee, & Vinton, 1997). There is little question that there is a call to reconfigure the first-year experience to bring together the teaching of discipline based concepts in harmony with developing students’ specific business skills in order to prepare them to meet the challenges of today’s managers. MGT 110 was developed in response to calls for reform in the first-year curriculum and business education. The course is designed to help students acquire the skills necessary to succeed in business school, while at the same time easing the transition from high school to college and building the first-year student’s sense of community with the university and the business school. This paper provides a review of the literature on student retention and first-year courses designed to increase retention; a description of the MGT 110 course design, implementation, and method of instruction; and an assessment of the course’s effect on student success and retention. A future research agenda is outlined with the focus on identifying factors leading to increased academic persistence.

Review of the Literature Several factors seem to be related to lower retention rates at the college level. Public universities, particularly those with “open” admission standards, have higher attrition rates than do private universities (ACT, 2000; Tinto, 2002). More selective admissions standards have been related to higher retention rates (ACT, 2000). Studies show that the following factors put students more at risk: lower SAT score, lower high school average, unmet financial need, and lower household income (Reason, 2003; Tinto, 2002). Hoyt & Winn’s (2004) review of the literature identified financial concerns as the most frequent reason for failing to return to college; thus, students with unmet financial need are at highest risk for attrition. Male students are less likely to persist than female students; colleges with a lower percentage of female students are likely to have higher attrition rates (Tinto, 2002). Health and psychosocial variables such as smoking, drinking, health-related issues, and maladaptive coping strategies have all been linked to decreased retention (DeBarard, Spielmans, & Julka, 2004). University grades have been found by several studies to be the best predictor that students will persist with college (Allen, 1999; Murtaugh, Burns, & Schuster, 1999). First year cumulative GPA is a particularly important factor in determining retention between the first and second year (Allen, 1999; Mitchel, Goldman, & Smith, 1999; Murtaugh et

al., 1999; Reason, 2003). States Reason (2003, p. 185) in a recent review of the retention literature: “… when considering retention between the first and second year of college, student achievement in college, as measured by first-semester grade point average, proves to be a significant variable in retention.” In fact, first-year GPA may have the greatest impact on student retention (Allen, 1999), accounting in one study for 56 % of the variance, an improvement in prediction over high-school GPA and SAT scores alone (25%) (DeBerard, Spielmans, & Julka, 2004). Student academic integration (interest and focus on learning) and social integration (sense of social belonging and development of friendships) have been associated with retention as has goal commitment to graduating with a certain degree (Tinto, 1979; 1982). In fact, there seem to be reciprocally interactive causal relationships among these three factors (integration, academic performance, and goal commitment) creating the possibilities of self-perpetuating upward or downward cycles beginning in the freshman year (Napoli & Wortman, 1999; Thomas, 2000). In other words, it is important to “get students started right”, preferably in the first semester. An extensive body of literature identifies the following conditions as critical in promoting academic success and retention among first year students: information and advice, support, involvement, and learning (Tinto, 1999). Studies of student retention identify several key factors in decreasing student attrition rates and enhancing student transition from high school to college:

1. Early and frequent interaction with faculty, staff, and peers 2. Clearly communicated academic expectations and requirements 3. Learning opportunities that increase involvement with other students 4. Academic, social, and personal support

Interaction with Faculty, Staff, and Peers

A number of studies identify early and frequent interaction with faculty, staff, and peers both in and out of the classroom as a key factor in promoting student academic integration and persistence with college (Astin, 1975; Gordon & Grites, 1984; Johnson, 1998; Kuh, Schuh, & Whitt, 1991; Milem & Berger, 1996; Seidman, 1991; Thomas, 1990; Tinto, 1990, 1993, 1999, 2002; Wagener & Nettle, 1998). States Tinto (1999): “ … involvement matters, and at no point does it matter more than during the first year of college when student attachments are so tenuous and the pull of the institution still so weak” (p. 6). Deliberate attention from faculty and staff has been shown to help students develop feelings of academic competence and a sense of identity (Sidle & McReynolds, 1999). Enrolling students in specially designed freshman courses (“first-year experience courses”) appears to be one strategy that is quite effective in promoting interaction and involvement with faculty, staff, and peers. These courses typically have the following characteristics (Soldner, Lee, & Duby, 1999):

1. Provide students with academic support and direction 2. Assist students to become users of campus and community resources 3. Encourage students to engage in career and college major exploration activities 4. Afford students opportunities to develop personally and to connect socially with

others Participation in a freshman course was predictive of better persistence even if the influence of possibly confounding variables (i.e. – age, high school GPA, SAT scores, residency) was factored out (Murtaugh, Burns, & Schuster, 1999). Studies confirm that students enrolling in specially designed first-term “experience” courses tend to complete more credit hours, earn higher cumulative grade point averages, and return to the institutions at higher rates than students who did not enroll in such first-term courses (Cuseo, 1991; Davis, 1992; Fidler, 1986; Hyers & Joslin, 1996; Richardson, 1994; Strumpf & Hunt, 1993). These results occurred even though the students who did not enroll in first-year “experience” courses were often described as being more academically qualified, on the basis of standardized test scores and high school ranks, than were students who enrolled in the courses (Sidle & McReynolds, 1999). “Block” scheduling is another strategy aimed at increasing student interaction with faculty and peers (Soldner, Lee, & Duby, 1999). Block scheduling builds freshman learning communities by allowing first-time freshmen to pre-enroll with other interested students in a block of 3-4 courses, one of which is often a “first-year experience” course. Benefits of block scheduling include increased student and faculty interaction that focuses on academic content (Soldner, Lee, & Duby, 1999), greater student satisfaction, and lower attrition rates (Baker & Pomerantz, 2000).

Clearly Communicated Academic Expectations and Requirements

Clearly communicated academic expectations have been associated with higher academic performance and, ultimately, greater persistence (Chickering, 1969; Congos, 2002; Sidle & McReynolds, 1999; Tinto, 2002). Communicating academic expectations and requirements involves clearly articulating the level of work expected and the level of challenge (Tinto, 2002). It appears to be especially important that colleges communicate “high” academic expectations (Chickering, 1969; Tinto, 2002) for as Tinto states (p. 6): “No student rises to low expectations.” Along with communicating high academic standards, student performance is enhanced with frequent feedback and expressed confidence in students’ ability to meet high standards. Self-efficacy for educational requirements has been associated with higher GPA and persistence (Lent, Brown, & Larkin, 1991).

Learning Opportunities that Increase Involvement with Other Students

The learning and performance of first-year students is enhanced with increased involvement with other students (Congos, 2002; Sidle & McReynolds, 1999; Tinto, 1997, 1999, 2002). One way to increase involvement with other students is through collaborative or shared learning groups that allow students to develop social and

academic networks (Tinto, 1997, 2002). These networks provide critical support, enabling students to persist in their attainment of degree requirements (Tinto, 2002). Collaborative learning has also been found to produce higher achievement, healthier psychological adjustment, and improved analytical, communication, and interpersonal skills (Johnson, Johnson, & Smith, 1991), and increased opportunities for class discussion (Braxton, Milem, & Sullivan, 2000). Block scheduling is yet another way to increase exposure of first-year students to their peers. Student enrollment in at least one course where class size is kept small also increases student involvement and interaction (Murtaugh, Burns, & Schuster, 1999).

Academic, Social, and Personal Support

In order to smoothly transition into college, students need to be provided with tools and support for managing both the academic and social aspects of school (Frost, 1993; Noel, Levitz, & Salur, 1985; Pascarella & Terenzini, 1991; Tinto, 1987). Increased involvement with peers and faculty provides student with the academic, social, and personal support critical to academic persistence (Tinto, 1997, 2002). Another effective way of providing academic and social support is to assign upper level students to work with first-year students as mentors and role models (Miller, 1991; Robert & Thomson, 1994; Wagener & Nettles, 1998). One study found that first-year students mentored by upper-level students had significantly higher final grades than did students in a control group (Rodger & Tremblay, 2003).

Making it easier for students to connect with campus resources is an additional way to provide academic support (Soldner, Lee, & Duby, 1999). For instance, instructors might accompany students to technology training sessions, assist librarians in teaching students how to use a college library, and provide hands-on training in time management skills. It may be especially important that first year courses emphasize academic support and skill development. First year programs that emphasize academic support may have the greatest impact on retention. One study compared students enrolled in a first year seminar that emphasized the development of learning skills and academic success strategies (strategy-focused seminar) with students enrolled in a first year seminar that emphasized socialization and social support (socialization-focused seminar). First year students enrolled in the strategy-focused seminar were significantly more likely to re-enroll the following fall than were first year students enrolled in the socialization-focused seminar (Ryan & Glenn, 2004, p. 19). State Ryan & Glenn (p. 20): “In our study, the strategy-based seminar appears to immunize first-time freshmen against the damaging effects of first-semester performance on one-year retention rates. We believe it does so by developing their learning skills and their sense of academic efficacy to an extent that enhances academic integration and institutional commitment.”

Course Overview

The primary focus of MGT 110 is on the development of learning skills and academic success strategies because we believe (and the literature supports this belief) that this emphasis results in higher first semester GPAs and greater persistence from the first to the second year of college. The course also attempts to provide students with a social

support structure through block scheduling, peer and faculty mentoring, and an emphasis on teamwork and collaborative learning.

Course Objectives

MGT 110 utilizes a combination of delivery methods. Students attend lectures and are assigned readings as part of the traditional approach to learning. Concurrently, students participate in interactive/experiential learning activities where they can learn and apply important key concepts in several key areas including knowledge building, critical thinking, and decision-making while developing the skills that are necessary to be effective both academically and professionally. The MGT 110 curriculum is designed to meet the following objectives:

• Develop skills necessary for academic success • Ease students’ transition from high school to college • Provide first-year students with a sense of community • Improve academic performance and retention rates • Provide a realistic preview of the School of Business and the business curriculum

Implementation/Method of Instruction

MGT 110 is a required course for all business students and fulfills their general education critical thinking, and lower-division, discipline-related writing requirements. The course includes one fifty-five minute lecture and two fifty-five minute recitation meetings per week. The lectures are attended by 150-200 freshmen that have declared their majors to be in the field of business. A business faculty member, or another appropriate professional familiar with the designated topic, presents the main lecture, panel, or discussion topic during the weekly lecture. The following topics are introduced during the weekly lecture sessions and supplemented with experiential material during the recitation sessions: group processes, critical thinking and problem solving, research skills, stress and time management skills, contemporary business issues, and business communications skills.

The recitation sessions meet twice a week and are attended by 15-19 students per section. Each recitation section is facilitated by a section instructor (business faculty member) who is responsible for teaching and implementing assignments and experiential activities in the areas of critical thinking, writing, and team-work as they relate to the business context. Instructors are assisted in each section by two undergraduate teaching assistants. The teaching assistants grade some of the homework assignments, take attendance, and act as mentors to the students. Teaching assistants play a crucial role in the delivery of the course in that they relieve much of the logistical burden of the course and help first- year students in their transition from high school to college.

The delivery of the course is overseen by a course coordinator (a business faculty member) who coordinates the activities of the recitation instructors and teaching assistants, plans the content of the lecture sections, and schedules guest lecturers. The course coordinator also meets with the recitation instructors and teaching assistants on a weekly basis to share ideas, answer questions, and discuss concerns relating to the delivery of the course. Figure 1 (below) depicts the topics, assignments, and exercises used to meet the course’s objectives.

Figure One – MGT 110 Topics and Assignments

Teamwork

Computer Skills • Team Charter assignment • Leadership Weekend Training • Industry report/presentation

• MSWord, PowerPoint, Excel • Email • Internet/library databases

Critical Thinking Business Writing • Evaluating evidence and

arguments • Recognizing errors in thinking • Group decision-making • Persuasion and application

• Journal writing • Abstract writing • Industry report • Resume/Portfolio development

Research Oral Communication Skills • Library overview • Industry report • Critical thinking assignments • APA documentation

• Classroom discussion • Presentation development/delivery • Experiential exercises • Industry presentation

Contemporary Business Issues Managing the Academic Experience

Building a Sense of Community • Leadership • Group Processes • Diversity and Globalization • Careers in Business/Internships • Business Ethics

• Stress/Time management • Registration and advisement • Peer mentoring • Leadership training

Improving Academic Success of First-Year Business Students

An extensive body of literature identifies the following conditions as critical in promoting academic success and retention among first year students: information and advice, support, involvement, and learning (Tinto, 1999). Students are more likely to be successful and persist in their education when they are provided with clear information

about academic requirements, receive academic, social, and personal support, and are involved in learning experiences with other first-year students.

Information and Advice about Requirements and Expectations

MGT 110 is designed to provide students with a clear understanding of the requirements and expectations of the business school. One week of the course is dedicated to providing students with information about school requirements, registration, and advisement. The session is followed by mandatory meetings with the students’ faculty advisors. An additional week is dedicated to introducing students to the requirements and career opportunities corresponding to the available business majors: marketing, business administration, management science, human resource management, accounting, and finance. Expectations of the business school are emphasized in the teaching of the following skills: writing, presentation, research, and teamwork. Students are expected to submit completed, proofread assignments on time. Class attendance is required and professional behavior is emphasized in the classroom.

Academic, Personal, and Social Support

The first semester of college can be a stressful one as students are often faced with challenges not encountered in high school. In order to better manage the stressors of college, one of the lecture sections is devoted to stress management techniques. A time management assignment is assigned to provide students with a better understanding of how they currently spend their time and how they might use time management techniques to manage their time more effectively. Academic support is provided in the recitation through close contact with the instructors and teaching assistants, and by introducing students to campus services like the writing center and office of learning services. The course emphasizes development of the skills necessary to obtain academic success in the School of Business with sessions on writing, research, computer, critical thinking, and presentation skills development. Reading assignments in the required text (Bobrowski & Cox, 2004) include information on effective lecture note- taking, reading comprehension and test-taking strategies, time management, and information literacy and study skills. Students are also provided with technology training sessions, introduced to the college library, and attend sessions on obtaining internships, international education opportunities, and career exploration. First year students receive study tips and academic skill training from the teaching assistants as well as the faculty. The teaching assistant’s role is not limited to academic support; we have found that students develop close relationships with the teaching assistants and seek their help with a variety of nonacademic issues related to making a smooth transition to college.

Involvement in Learning Experiences with Other Students, Faculty, and Staff

In most business schools, students do not take business courses until their sophomore or junior year. One objective of MGT 110 is to develop a sense of community among first-year business students through exposure to first-year and upper-level business

students, business faculty, and School of Business alumni in the first semester. All first- year business students meet together once a week in the lecture section of the course where they are introduced to upper-level business students, business faculty and alumni in a series of presentations, panel discussions, and interactive discussion. During the bi-weekly recitation meetings, students are provided with a more intimate setting for getting to know business faculty, upper-level teaching assistants, and other first-year business students. Student representatives are invited to come into the recitation sessions to provide students with information about becoming involved in the various student organizations on campus. The recitation sessions are designed to encourage interaction and discussion, and to provide academic support. Involvement with other business students is further encouraged through block scheduling. Students are block scheduled so that they are exposed to other first-year business students not only in MGT 110 but also in their other first-semester required courses. MGT 110 has been structured so that shared learning and active participation is the norm. Participation is even encouraged in the lecture sessions—students develop questions to ask the presenters before hand and receive participation points for asking and answering questions during the lecture. Each student is required to have a plastic name-plate on their desk so that lecture presenters can call on students by name. We further encourage participation by encouraging presenters to move up and down the aisles of the lecture hall answering questions and calling on students in all areas of the room. Shared learning is encouraged by organizing students in teams at the beginning of the semester. Each team drafts its own charter as a formal agreement among members documenting responsibilities and expectations (Cox & Bobrowski, 2000). An industry report is assigned as a team project in order to develop student collaborative skills and expose students to the collaborative nature of business. Team efforts culminate in a single research report that embodies the blended work of all the members. A three-hour intensive team training session provides students with tools for enhancing the effectiveness of their teams and improving interpersonal relationships. It is also an “out- of-class” bonding experience intended to help students become more comfortable with one another, build communication with team members, and further develop a sense of community among business students.

Assessing the Impact of MGT 110 on Student Outcomes

The effectiveness of first-year programs can be evaluated using several different methods including anecdotal information, descriptive statistics and inferential statistics (Congos & Schoeps, 1999). In our opinion, the use of inferential statistics is an essential piece to the accurate and detailed assessment of the effectiveness of these programs. To this end we use single-equation probit models to estimate the probability of retaining first year students using a database of the fall 2001 freshman class. This database contains academic, demographic, and financial variables for over 1300 students, along with information about their participation in various first-year programs. The data are used to estimate the probability of retention, academic disqualification, and

first-year GPA. Our results indicate that MGT 110 is effective in increasing retention and decreasing the probability of academic disqualification. We also find the course to have a positive impact on first-year GPA.

The Data

The data for this study are from the 2001 freshman class, admitted to the school for the Fall 2001 semester. The database includes over 1300 students, with 1136 students admitted under general admissions standards. We select variables in several categories for use in estimating the probability that students return, the probability of academic disqualification, and GPA. A complete list of variables is summarized in Appendix A. Demographic variables include various data on sex, age, race, living arrangements, and home state. Students self-report their race choosing White, Hispanic, Asian or Pacific Islander, Black (non-Hispanic), American Indian/Native Alaskan or Other. The variable MINORITY is one where race is reported as Black, Hispanic, or Native American, traditionally a high-risk population for attrition. Age is calculated based on the reported date of birth and September 1, 2001. For each student the residence hall or OFF is reported for local living arrangements. OFF is one if the student lives off campus. Also included in this category is the variable UNDEC, which is one if the student is admitted without declaring a major. Academic variables include SAT scores, high school average, and GPA for the 2001- 2002 academic year. SAT is the highest combined SAT score for each student. For all freshmen, 4 percent of SAT scores are missing. Students admitted under special programs and students beginning school over five years after leaving high school are not required to submit SAT scores. For this reason, SAT scores are not used as an explanatory variable in this study. HSAV is the student’s high school average. Only 25 high school averages are missing from the data set. Those observations are excluded from this analysis. Financial variables include financial information in the form of types of financial aid awarded, and unmet financial need. LOAN, WKST, and GRANT equal one if the student is receiving that type of aid. NEED is unmet need, a dollar calculation made at the campus level that indicates the amount of tuition, fees, and room and board not covered by financial aid or expected student/parent contribution. Although household income is reported to the federal government for those receiving aid, household income is missing for 13 percent of our observations, while unmet need is reported for all students, so we use unmet need to measure the student’s financial situation. MGT110 takes the value of one if the student is enrolled in the respective course. Finally, there are two binary variables to measure student outcomes. The first, RET, measures retention. RET is one if the student was registered at the college for the fall 2002 semester; i.e. returned for a second year. DQ measures academic disqualification. DQ is one if the student finished the first year with a cumulative GPA of less than 1.76. Students earning a GPA of less than 1.76 in their first year may return for the fall 2002,

if they successfully appeal disqualification. However, DQ is intended to measure only the potential for disqualification, regardless of whether a student successfully appeals and is readmitted for fall 2002. There are several variables not available to us that could be important for retention. Hours worked at a job on or off campus could affect academic success and feelings of belonging or attachment to the institution. Unfortunately, this database does not allow us to investigate this hypothesis. Student leadership and involvement in extra-curricular groups and related alumni are also potentially important, but unavailable in this database. Appendix B provides a breakdown of academic, demographic, financial and retention variables across the general student population and those enrolled in MGT 110. Looking at the overall retention rate, MGT 110 students return at a rate that is not statistically different from the overall college retention rate of 78 percent. However, as a group, the MGT 110 students have lower SAT scores and high school averages, a higher percentage of minority students and a higher percentage of males, all of which have been associated with lower retention numbers. A probit estimation, controlling for the academic and demographic differences, is the better way to assess the impact of MGT 110 on retention and academic success.

Estimation Results

Using a single equation probit model, we estimate the probability that a Fall 2001 freshman returns in the Fall 2002. We also estimate separately the probability that a student earns a GPA below 1.76, the cut-off for academic disqualification. Specifically we estimate the coefficients for the following two equations:

)X'()1DQ(obPr )X'()1RET(obPr

γΦ== βΦ==

where Ф(.) is the standard normal distribution, β and γ are coefficient vectors, and X is a matrix of the academic, demographic, financial, and first-year program variables described in the previous section. Appendix C reports the estimation results for both retention and disqualification probabilities. Both columns report the marginal probabilities for each variable, i.e. the impact of a one-unit change in that variable on the probability of retention or academic disqualification. Not surprisingly, high school average (HSAV) has a statistically significant and positive impact on student outcomes, as students with higher averages are more likely to return for a second year and are less likely to disqualify. Receiving work-study financial aid also has a positive impact on student outcomes. Also unsurprising is the negative impact of unmet financial need (NEED) on retention and academic outcomes. While the impact of NEED is statistically significant (i.e. nonzero), it is not practically significant, as

large changes in unmet need only have a small impact on retention and disqualification probabilities. Among the demographic variables, being either a male or minority student increased the probability of disqualifying. Living off campus (OFF) also had a negative impact on student outcomes. Turning our attention to the program of interest, MGT 110, we find that enrollment in this course during the first semester of college does in fact increase the probability of returning for the following academic year, and decreases the probability of academic distress. That is, controlling for the academic and demographic profile of student in MGT 110, we find that the course has a positive impact on student outcomes.

GPA Regression Results

One problem with single probit equation analysis in this application is that the decision to enroll in the first year programs is not random, and may very well depend on the same factors that affect the probability of returning for the 2002-2003 academic year. There is the potential for selectivity bias: Students who are more likely to return for a second year may self-select into certain programs. While all first-year business students are required to enroll in MGT 110, there are also sample selection issues in the decision to choose a major in the School of Business. In any case, endogeneity and/or selectivity bias will lead to biased parameter estimates and misleading conclusions about the efficacy of first-year programs. To deal with this issue, we estimate the impact of MGT 110 and the other database variables on student GPA for the academic year. The use of a non-discrete dependent variable (GPA) allows us to use a two-stage estimation process to control for the potential biases described above: First, we estimate the probability that students select certain first year programs. Then we use those estimation probabilities in an OLS regression with GPA as the dependent variable. The regression results are presented in Appendix D. MGT 110 is still associated with superior student outcomes, in this case a higher cumulative GPA for the first year.

What does this mean?

We offer a couple of examples to illustrate the impact of MGT 110. These are described in Appendices E and F. Using the coefficient estimates from our probit and regression equations, we compute probability estimates for retention and disqualification for two hypothetical students with and without MGT 110. In the first example (Appendix E), we consider a white male, age 19, with a high school average of 80%, no financial aid or unmet need, living off campus, and not participating in any first year programs:

• The probability of such a student returning in the Fall 2002 is 60%. • The probability of disqualifying after the first year is 49%. • The predicted first-year GPA is 2.19.

If we enroll that same student in MGT 110 in the Fall 2001:

• Retention probability climbs to 67%. • Disqualification probability falls to 41%. • Predicted first-year GPA rises to 2.32.

In the second example (Appendix F), we consider a minority female, age 18.5, with a high school average of 87%, receiving student loans, and having an unmet financial need of $1000:

• The probability of such a student returning in the Fall 2002 is 78%. • The probability of disqualifying after the first year is 11%. • The predicted first-year GPA of 3.11.

If we enroll that same student in MGT 110 in the Fall 2001:

• Retention probability climbs to 84%. • Disqualification probability falls to 7.5%. • Predicted first-year GPA rises to 3.24.

Why does MGT 110 work?

MGT 110 provides first-year students with academic and social support, increased involvement with peers, faculty, and staff, collaborative learning, and clearly communicated academic requirements and expectations. Students are blocked scheduled into MGT 110 along with two other courses (micro-economics and composition writing); thus increasing exposure and involvement with other first-year students. Class size is kept small in the MGT 110 recitation sections (15-19 students). All of these factors are cited in the literature as critical to academic persistence in the first-year. In addition, an emphasis on developing critical academic strategies and skills may (as suggested by Ryan & Glenn, 2004) increase student academic self-efficacy, thereby enhancing academic success and institutional commitment. State Ryan & Glenn (p. 22): “For many, developing the strategies they need to respond effectively to ordinary classroom challenges (e.g., text comprehension, lecture comprehension, test preparation, test taking, and time management) may confer the sense of academic efficacy that promotes a sense of legitimate membership in the academic community and the resolve to remain in that community.”

Appendices G and F provide additional anecdotal information that suggests reasons why enrollment in MGT 110 results in improved retention, decreased disqualification rates, and increased GPA. Students were asked to complete the EBI First Year Initiative Student Assessment at the end of the semester (Fall 2001). EBI (Educational Benchmarking, Inc.) provides assessment of various college programs and is in

partnership with several accrediting bodies including AACSB. The First Year Initiative Study was done in partnership with the Policy Center on the First Year of College. The project was designed to provide comparative student feedback for colleges and universities that offer courses or seminars specifically directed toward new incoming students. Appendix G provides mean scores for MGT 110 students on select items from the assessment. Students used the following scale for each item: 1=not at all, 4=somewhat, 7=significantly. Students indicated that taking MGT 110 improved their commitment to completing their degree (mean=5.29). The majority of students planned to return to school for their sophomore year (mean=5.77) and would recommend the university to a friend (mean=5.49). Students felt that MGT 110 improved the degree to which they set priorities (mean=5.23) and completed homework on time (mean=5.68). These factors may have contributed to improved GPA and lower disqualification rates.

The students also seemed to feel that the course increased their involvement with other students. Assessment items that suggest increased involvement include the following:

1. Taking this class improved my ability to meet new people (mean=5.30)

2. The course encouraged students to work together (mean=5.95)

3. Students taking the course felt accepted by other students (mean=5.74) and felt it was easy for them to make friends (mean=5.48)

Our own end of the semester assessment provides additional anecdotal information that may provide insight into the success of students taking MGT 110 (Appendix H). 80% of students taking the course felt that it clarified School of Business expectations. The majority of students also felt the course introduced them to helpful resources (84%), improved their ability to manage time (63%) and stress levels (65%). 80% of the students felt the course provided support in their transition to college and 72% indicated that the course helped them to develop a close bond with other business students.

Conclusion

The following factors have been identified in the literature as increasing student persistence at college: providing information and advice about academic expectations and requirements, providing academic, personal, and social support, and involving students in learning experiences that increase their exposure to peers, faculty, and staff. Results from the EBI and end of semester assessments indicate that MGT 110 provides these factors to first-year business students. MGT 110 students are more at risk for lower retention rates, lower GPA, and higher disqualification rates. In comparison to the rest of the university population (see Appendix B), students enrolled in MGT 110 have lower SAT scores and high school averages. They are also more apt to be male and minority students, have greater unmet financial need, and lower household income. All of these factors have been found to decrease retention rates. Yet, students enrolled in MGT 110 have an increased retention rate, higher GPAs, and lower disqualification rates when compared to first-year students at our university not enrolled in the course. The finding that MGT 110 students have significantly higher GPAs is especially

encouraging (p<.031). University grades, particularly first year cumulative GPA, have been found by several studies to be the single most important factor in determining retention and academic persistence (Allen, 1999; DeBerard et al., 2004; Mitchel et al., 1999; Murtaugh et al., 1999; Reason, 2003).

Ryan & Glenn’s (2004) comparison of academic-strategy-based and socialization-based first year seminars suggests it is the emphasis on academic support that matters most. Anecdotal information from our own end of the semester survey and the EBI assessment indicates that students felt MGT 110 increased their commitment to completing homework on time and setting priorities. Students felt the course clarified academic expectations, helped them to develop time and stress management skills, and introduced them to helpful academic resources. These aspects of the course may have helped students to achieve higher first semester GPAs and ultimately resulted in a higher retention rate.

On the other hand, survey results also indicate that students felt the course helped them to meet new people and achieve a closer bond with other students—socialization aspects of the course found in the literature to be related to retention. The challenge remains to pinpoint what aspects of the course contribute most significantly to retention. While it can be difficult to isolate the impact of different variables on retention, further research is needed to identify specific factors leading to increased persistence. Based on anecdotal evidence (student survey results) and student comments, it is our feeling that the academic support and skill development aspects of the course contribute most significantly to higher GPA and student persistence at college. Students have commented that they find MGT 110 to be their most rigorous first semester course, but that it forces them to manage their time with assignments due every week and a challenging team project involving a great deal of research, writing, and coordination among team members. Students have also commented that the academic skills they developed in MGT 110 enabled them to be successful in business courses taken in subsequent years. Thus, taking the course may increase academic self-efficacy among first-year business students. However, further research is needed to support this hypothesis.

A problem in analyzing a dataset such as ours is the importance of missing variables: academic motivation, coping skills, family support structures, and parents’ education all play an important role in the success of first year students, yet such information is rarely available in the typical student data collected by admissions and the registrar. Furthermore, if the selection of major or first year program is correlated with these factors, a selectivity bias enters into the analysis of these programs.

One solution to these problems is a richer dataset soon to be available to us from surveys given to freshmen in subsequent years. This data from the Noel-Levitz Retention Management System include highest level of education for each parent, academic rigor of high school, measures of motivation, attitudes towards education, coping skills, and general impressions of the institution. We plan to connect this RMS data to the demographic, academic, and financial data currently available to control for selectivity biases and better identify the specific features of MGT 110. We will also

attempt to isolate the impact of academic strategy and skill building aspects of the course from socialization aspects. By assembling a longitudinal data set, we can study long-term outcomes such as gradation rates, GPA, and median time to graduation.

Over 70% of colleges and universities now offer some type of first year program, yet few have attempted any type of assessment beyond the collection of anecdotal data. While limited in its scope, this study does attempt to assess the impact of a first year business course on GPA, retention, and academic disqualification rates. While we have not as of yet been able to isolate the aspects of the MGT 110 curriculum that contribute the most to first year persistence, this study is an important first step in assessing the efficacy of a first year business course designed to develop skills for academic success, provide a sense of community, ease the transition to college, and provide a realistic preview of business school expectations.

Appendix A

Variables Used to Assess Student Outcomes

Variable Name Description Demographic Variables AGE age of student MALE =1 if student is male MINORITY =1 if student self-reports as Black, Hispanic, or

Native American OFF = 1 if student lives off campus UNDEC =1 if student has not declared a major Academic Variables HSAV high school average OSGPA Oswego GPA up to Fall 2002 SAT highest combined SAT score Financial Variables GRANT =1 if student is receiving grants LOAN =1 if student is receiving loans NEED The dollar amount of unmet need for financial aid WKST =1 is student is receiving work study First Year Program Variable MGT110 =1 if student enrolled in MGT 110, Fall 2001 Retention Variables DQ = 1 if GPA < 1.76 RET = 1 if student is registered for Fall 2002

Appendix B

Summary Statistics for the 2001 Freshman Class

(Items in bold in the table are statistically different from those not in the specified group at the 5% level)

Freshman Class Fall 2001

General Admits

MGT 110 Participants

# of students 1136 179 % of total freshman 83% 13% % returning Fall 2002 78% 82% Academic Data SAT average 1080 1023 % not reporting SAT 3% 4%

HS average 87.16 85.34

GPA (up to Fall 2002) 2.56 2.56 Demographic Data % female 54% 47% % minority 4% 14% average age 18.65 18.55 % living off campus 11% Financial Data average unmet need $907.50 $1,244.86 average Household income $62,376.11 $56,467.88

Appendix C

Single Equation Probit Estimation Results, Marginal Probabilities (P-values in parentheses)

RET DQ

HSAV .01106** (.000)

-.01750** (.000)

MALE -.00009 (.997)

.03396* (.076)

MINORITY -.04061 (.356)

.06103* (.094)

AGE .00312 (.664)

-.00951 (.165)

OFF -.15570** (.000)

.13161** (.000)

UNDEC -.00712 (.789)

-.00475 (.825)

NEED -.00002** (.000)

.00001** (.000)

LOAN -.06814** (.020)

.00620 (.803)

WKST .14318** (.000)

-.11853** (.000)

MGT 110 .05455* (.097)

-.04321* (.102)

N 1335 1335

χ2(16) 106.59 (.000)

155.99 (.000)

Pseudo R2 .0748 .1313

** significant at the 5% level *significant at the 10% level

Appendix D

Regression Coefficients (P-values in parentheses)

OSGPA

HSAV .03700** (.007)

MALE -.02254 (.820)

MINORITY .22867 (.320)

AGE .02799 (.353)

OFF -.37268** (.000)

UNDEC .05097 (.718)

NEED -.00002 (.306)

LOAN .09767 (.412)

WKST .27477* (.094)

GRANT -.10961 (.520)

MGT 110 .13213** (.031)

**Significant at the 5% level

N 1334 F(17, 1316) 24.85

(.000) Adjusted R2 .2332

Appendix E

An Example of the Estimated Impact of MGT 110 on Student Outcomes

White Male, 19 years old

High School Average = 80% No financial aid, NEED = 0

Living off campus No participation in any first-year programs

Without

MGT 110 If enrolled in

MGT 110

Probability of returning in the Fall 2002 60% 67%

Probability of academic disqualification 49% 41%

Estimated first-year GPA 2.19 2.32

Appendix F

An Example of the Estimated Impact of MGT 110 on Student Outcomes

Minority Female, 18.5 years old

High School Average = 87% Receiving student loans, NEED = $1000

Without

MGT 110 If enrolled in

MGT 110

Probability of returning in the Fall 2002 78% 84%

Probability of academic disqualification 11% 7.5%

Estimated first-year GPA 3.11 3.24

Appendix G EBI First Year Initiative Student Assessment Items

Mean Responses (n=152)

(1=not at all, 4=somewhat, 7=significantly)

Item Mean

Taking this class improved my commitment to completing my degree 5.29

Taking this class increased the degree to which I completed homework assignments on time

5.68

Taking this class improved the degree to which I set priorities so I can accomplish what is most important to me

5.23

Taking this class improved my ability to meet new people 5.30

To what degree did this course include encouragement for students to work together

5.95

To what degree are you accepted by students at this college/university 5.74

To what degree is it easy for you to make new friends at this college/university

5.48

For the next academic year to what degree do you plan to return to this college/university

5.77

For the next academic year to what degree do you plan to transfer to another college/university

4.99

For the next academic year to what degree do you plan to not enroll in any college/university (Note: scale is reversed)

6.4

To what degree would you recommend this college/university to a friend 5.49

Appendix H Transition to College Item Responses

Percentage responding (n=157)

(a=strongly agree, b=somewhat agree, c=undecided or no opinion, d=somewhat disagree, e=strongly disagree)

Survey statement A b c d e

School of Business academic expectations

41% 39% 11% 4% 4%

Introduction to helpful resources 46% 38% 8% 8% 1%

Close bond with other business students

38% 34% 15% 10% 3%

Improvement in stress management

24% 41% 17% 14% 4%

Improvement in time management 24% 39% 18% 11% 5%

Support in my transition to college 41% 39% 11% 4% 4%

References

Accounting Education Change Commission. (August, 1990). AECC urges priority for teaching in higher education, Issue Statements No. 1 (Torrence, CA.).

ACT (2000).National college dropout and graduation rates, 1999. www.act.org/news/releases/200/02-16b00.html.

Allen, D. (1999). Desire to finish college: An empirical link between motivation and persistence. Research in Higher Education, 40(4), 461-485.

Astin, A.W. (1993). What matters in college? Four critical years revisited. San Francisco: Jossey-Bass.

Baker, S., & Pomerantz, N. (2000). Impact of learning communities on retention at a metropolitan university. Journal of College Student Retention, 2(2), 115-126.

Barefoot, B. (1993). Exploring the evidence: Reporting outcomes of freshman seminars. The freshman year experience: Monograph series number 11. South Carolina. (ERIC Document Reproduction Service No. ED 367 214).

Barefoot, B. (1994). The freshman seminar: A flexible fixture in American higher education. Columbia, S.C.: National Resource Center for The Freshman Year Experience.

Bobrowski, P.E. & Cox, P.L. (2004). Gateway to Business (4th Edition). Corvallis, Oregon: Pacific Crest.

Boyer, E. (1997). College: The undergraduate experience in America. New York: Harper & Row.

Braxton, J., Milem, J. & Sullivan, S. (2000). The influence of active learning on the college student departure process. The Journal of Higher Education, 71(5), 569-590.

Chanko, L.B. & Roberts, J. A. (1996). An innovative introduction to business course: Marketing the skills that marketing majors and others as business majors will need for success. Marketing Education Review, Fall, 53-77.

Chickering, A.W. (1969). Education and identity. San Francisco: Jossey-Bass.

Congos, D. H., & Schoeps, N. (1999). Methods to determine the impact of SI programs on colleges and universities, Journal of College Student Retention, 1(1), 59-82.

http://www.act.org/news/releases/200/02-16b00.html

Consortium for Student Retention Data Exchange. (1999). Executive summary 1988- 1999 CSRDE report: The retention and graduation rates in 269 colleges and universities. Norman, OK: Center for Institutional Data Exchange and Analysis, University of Oklahoma.

Cox, P.L. & Bobrowski, P.E. (2000). The team charter assignment: Improving the effectiveness of classroom teams. Journal of Behavioral and Applied Management, 1 (2), 92-103.

Cuseo, J.B. (1991). The freshman orientation seminar: A research-based rationale for its value, deliver, and content. (Monograph #4). Columbia, SC: University of South Carolina, National Resource Center for the Freshman Year Experience.

Davis, B. (1992). Freshman seminar: A broad spectrum of effectiveness. Journal of the Freshman Year Experience, 4, 79-94.

DeBerard, M.S., Spielmans, G.I., & Julka, D.L. (2004). Predictors of academic achievement and retention among college freshman: A longitudinal study. College Student Journal, 38(1), 66-80.

Federman Stein, D.R. (1997). Conditions that facilitate the implementation of innovative freshman experience courses: A comparative analysis of three courses, Ph.D. dissertation, Syracuse University.

Fidler, P.P. (1991). Relationship of freshman orientation seminars to sophomore return rates. Journal of the Freshman Year Experience, 3, 7-38.

Frost, S. (1993, Summer). Strategies to help freshmen succeed. Planning for higher education, 21.

Gordon, V.N., & Gites, T.J. (1984). The freshman seminar course: Helping students succeed. Journal of College Student Personnel, 25, 315-320.

Greene, W.H. (1990). Econometric Analysis. New York: Macmillan Publishing Co.

Hoyt, J.E. & Winn, B.A. (2004). Understanding retention and college student bodies: Difference between drop-outs, stop-outs, opt-outs, and transfer-outs. NASPA Journal (Online), 41(3), 395-417.

Hyers, A.D., & Joslin, M.N. (1996). The first year seminar as a predictor of academic achievement and persistence at a small state liberal arts college in the U.S. Unpublished manuscript (Version D8). North Adams, MA: North Adams State College.

Johnson, J. (1997). Commuter college students: What factors determine who will persist and who will drop out? College Student Journal, 31(3), 323-333.

Johnson, D.W., Johnson, R.T., & Smith, K.A. (1991). Active Learning: Cooperation in the college classroom. Edina, MN: Interaction Book Company.

Kluepfel, G.A. & Roberts, G. (1994). Introduction: Special issue on retention programs. Journal of Developmental Education, 17, 2-3.

Kuh, G., Schuh, J., & Whitt, E. (Eds). (1991). Involving colleges: Successful approaches to fostering student learning and development outside the classroom. San Francisco: Jossey-Bass.

Lamb, C.H., Lee, J.B., & Vinton, K.L. (1997). Developing a freshman seminar: Challenges and opportunities. Journal of Management Education, 21, 1, 27-43.

Lau, L.K. (2003). Institutional factors affecting student retention. Education, 124(1), 126- 136.

Lent, R.W., Brown, S.D., & Lark, K.C. (1991). Relation of self-efficacy expectations to academic achievement and persistence. Journal of Counseling Psychology, 31, 356- 362.

Levitz, R.S., Noel, L., & Richter, B.J. (1999). Strategic moves for retention success. In G.H. Gaither (Ed.), Promising practices in recruitment, remediation, and retention (pp. 31-50.) New Directions for Higher Education, n. 108. San Francisco: Jossey-Bass.

Logan, C.R., Salibury-Glennon, J., & Spence, L.D. (2000). The learning edge academic program: Toward a community of learners. Journal of the Freshman Year Experience, 12, 77-104.

Mason, J.C. (1992). Business schools: Striving to meet customer demand. Management Review, September, 21-27.

Milem, J., Berger, J. (1996). A modified model of college student persistence: Exploring the relationship between Astin’s Theory of Involvement and Tinto’s Theory of Student Departure. Paper presented at the annual meeting of the Association for the Study of Higher Education.

Miller, J.A. (1991). Experiencing management: A comprehensive, “hands-on” model for the introductory undergraduate management course. Journal of Management Education, 15, 2, 151-169.

Mitchell, D.F., Goldman, B.A., & Smith, M. (1999). Change factors affecting college matriculation: A re-analysis. Journal of the First-Year Experience and Students in Transition, 41(3), 395-417.

Murtaugh, P., Burns, L., Schuster, J. (1999). Predicting the retention of university students. Research in Higher Education, Vol. 40, 3, 355-31.

Napoli, A. & Wortman, P. (1998). Psychosocial factors related to retention and early departure of two-year community college students. Research in Higher Education, 39, 355-371.

National Resource Center for The First-Year Experience and Students in Transition. (2000). 2000 national survey of first-year seminar programming. Available: http://www.sc.edu/fye/research/surveys/survey00.htm.

Noel, L., Levitz, R., & Saluri, D. (Eds.) (1985). Increasing student retention. San Francisco: Jossey-Bass.

Pascarella, E.T. & Terenzini, P.T. (1991). How college affects students. San Francisco: Jossey-Bass.

Porter, L.W. & McKibbin, L.E. (1988). Management education and development: Drift or thrust into the 21st Century. New York: McGraw-Hill.

Reason, R.D. (2003). Student variables that predict retention: Recent research and new developments. NASPA Journal (Online), 40(4), 172-191.

Richardson, S.M. (1994). Identifying non-cognitive factors that influence success of academically under-prepared freshman. Journal of the Freshman Year Experience, 6 (2), 89-100.

Robert, E., & Thomson, G. (1994). Learning assistance and the success of underrepresented students at Berkely. Journal of Developmental Education, 7(3), 1-14.

Rodger, S. & Tremblay, P.F. (2003). The effects of a peer mentoring program on academic success among first-year university students. The Canadian Journal of Higher Education, 33(3), 1-18.

Ryan, M.P. & Glenn, P.A. (2004). What do first-year students need most: Learning strategies or academic socialization? Journal of College Reading and Learning, 34(2), 4-28.

Sanders, L. & Burton, J.D. (1996). From retention to satisfaction: New outcomes for assessing the freshman experience. Research in Higher Education, 37, 555-567.

http://www.sc.edu/fye/research/surveys/survey00.htm

Schutt, N.S. & Malouff, J.M. (2002). Incorporating emotional skills content in a college transition course enhances student retention. Journal of The First-Year Experience, 14, 1, 7-21.

Seidman, A. (1991). Faculty can make a difference in student persistence. Colleague. State University of New York, 21-25.

Sidle, M.W. & McReynolds, J. (1999). The freshman year experience: Student retention and student success. N ASPA Journal, 36(4), 288-300.

Skipper, T.L. (2002). Survey results and analyses. In National Resource Center for the First-Year Experience and Students in Transition, The 2000 national survey of first-year programs: Continuing innovations in the collegiate curriculum. (The First-Year Monograph Series No. 33, pp. 11-76). Columbia, SC: University of South Carolina. ERIC Document Reproduction Service No. ED471258.

Soldner, L., Lee, Y.,& Duby, P. (1999). Welcome to the block: Developing freshman learning communities that work. Journal of college student retention, 1, 2, 115-29.

Starke, M.C., Harth, M., & Sirianni, F. (2001). Retention, bonding, and academic achievement: Success of a first-year seminar. Journal of the First-Year Experience and Students in Transition, 13, 2, 7-35.

Strumpf, G. & Hunt, P. (1993). The effects of an orientation course on the retention and academic standing of entering freshmen: Controlling for the volunteer effect. Journal of the Freshman Year Experience, 5(1), 7-14.

The Boyer Commission Report on Educating Undergraduates in the Research University. (1995). Reinventing undergraduate education: A blueprint for America’s research universities. New Jersey: Carnegie Foundation.

Thomas, R.O. (1990). Programs and activities for improved retention. In D. Hossler, J.P. Bean & Associates (Eds.), The strategic management of college enrollments (pp. 186- 201). San Francisco: Jossey-Bass.

Thomas, S. (2000). Ties that bind. The Journal of Higher Education, 71 (5), 591-615.

Tinto, V. (1990). Principles of effective retention. Journal of the Freshmen Year Experience, 2 (1), 35-48.

Tinto, V. (1993, 1987). Leaving college: Rethinking the causes and cures of student attrition. Chicago: University of Chicago Press.

Tinto, V. (1996). Reconstructing the first year of college. Planning for Higher Education, 25, 1-6.

Tinto, V. (1999). Taking retention seriously: Rethinking the first year of college. NACADA Journal, 19, 2, 5-9.

Tinto, V. (2002). Promoting student retention: Lessons learned for the United States. Presentation at the 11th Annual Conference of the European Access Network, Prato, Italy, June 19, 2002.

Wagner, U., & Nettles, M. (1998). It takes a community to educate students: How three HBCUs succeed at retention. Change: The Magazine of Higher Learning, 20 (2), 18-25.

Jet-A-Way Inc.: Winning Despite the Odds

Bonita L. Betters-Reed Lynda L. Moore

Simmons College School of Management

ABSTRACT

This is the hand that God dealt me and I am going to play it Darlene Jeter, 1991.

Darlene Jeter, co-founder of Jet-A-Way Inc., a recycling and waste disposal company, became CEO in 1991 upon the death of her husband, Eddie Jeter. Despite a recent loss of almost 50% in their company’s revenue, Jeter decided to keep the cards she was dealt, playing for the longer run. Today, Jet-A-Way is a seventeen million dollar company. A certified minority-owned business near downtown Boston, Jet-A-Way became known as a family-run company that gives back to the community in jobs and in service. Now Jeter and her team face new challenges—a volatile industry, production issues and the succession of her son Jesse Jeter as CEO while Darlene shifts her role to “Madame Chair.”

Jet-A-Way In 1991, before Darlene Jeter became CEO of Jet-A-Way, a recycle and disposal company, the company was on the verge of failure. Increased competition, difficulties in the production line and a severe economic downturn, resulting in a near 50% loss of revenue had convinced her husband and business partner, Eddie Jeter, to sell the company when he succumbed to cancer. But after his death, Darlene decided to risk playing the cards she was dealt, confront the serious debt they had incurred and play the game for the longer run return to success. Success came after much due diligence. Revenue was up by 1992 and the company turned a profit by 1994. (Appendix A.) Throughout the 1990’s Jet-A-Way grew not only in size but also in notoriety. Established as a double certified minority business two miles from downtown Boston, Jet-A-Way became known as a family run company that gives back to the community in jobs and in service. Darlene Jeter’s leadership has been recognized by the Greater Boston Chamber of Commerce, the U.S. Small Business Administration, the Big Sister Association of Boston, the Massachusetts Black Legislative Caucus, and the National Solid Waste Management Association Hall of Fame. The leadership team she developed since 1991 has described her leadership style as unique. This story is about that leadership and the foundation of a company entering a new era. (Appendix B.)

Today, Jet-A-Way is a seventeen million dollar company. Darlene Jeter and her team face new challenges of a volatile industry, increasing competition, tough economic times and the bumpy installation of a new production line. Added to this environment is a major anticipated shift in Darlene Jeter’s role to “Madame Chair of the Board” as her son Jesse Jeter prepares to take over as CEO. Jet-A-Way is located in Roxbury Massachusetts, part of the greater Boston municipality (Appendix C). They provide solid waste collection services, construction and demolition (C&D) collection services for commercial customers and collection of materials for recycling. The company is licensed to process 750 tons per day of C&D debris in their 25,000 square foot transfer station. The Department of Environmental Protection has established a waste-recycling goal of 88% by 2010 and Jet-A-Way has reached an 80% level. Further efficiencies are projected with the re-engineering of their plant. Jet-A-Way has 78 employees, over 2/3 minority, and owns and maintains 36 vehicles and 500 open-top roll off containers.

The Leadership Team In 2003, Jet-A-Way Inc.’s internal leadership team consisted of Darlene Jeter the CEO, Pat Coady, Vice President of Operations, Ronald Ciesluk, Vice President and Chief Financial Officer and Jesse Jeter, the Vice President of Business Development (Appendix D). Pat Coady started working for Jet-A-Way in 1975 as a driver. He was promoted to foreman in 1978, supervised the transfer station in the early 80s and was promoted to Operations Manager shortly afterward. He became VP of Operations in 2001. Jesse Jeter is the youngest of the four Jeter sons. He grew up with the business. He became the VP of Sales and Marketing in 1998 and became the VP of Business Development in 2003. He has an MBA and BA in Economics. Ron Ciesluk joined the company in 1996 as its Chief Financial Officer and brought with him extensive administrative and financial management experience. His formal education included a BSBA in Accounting & Finance and an MBA. In 2001, Ron was appointed VP in addition to his role as CFO. The leadership team also included a Chief Operating Officer/Executive Vice President who had many years of operations management experience and worked in close partnership with Darlene. This COO left Jet-A-Way in 2004 and the position was not refilled.

Leadership Core Values “Service is our Difference”, the Jet-A-Way motto, reflects their strategic positioning as the high-end provider among the competitors. As Jesse Jeter says, “our job is to locate and develop relationships with businesses that have a high demand for excellent service” (Appendix E). This focus on excellence in service requires high standards across the firm and nowhere is this more evident than in human relations. As a small firm, Human Resource Management is functionally located with the finance part of the operation, but is also noticeably implemented across the organization in a strong commitment to providing internal opportunities for development and advancement. Dan Dellamano came on board in 1999 as a driver, worked for six months and was promoted to lead driver. Since then he has become the Supervisor and Dispatch Operator, heading the entire driving unit. He comments that: Everyone is outgoing and understanding, we are like a family and try to help as much as we can. I have moved up the ladder quickly…they came to me, they noticed, they see the potential in people and we always try to hire within the company first. Pat Coady, Vice President of Operations, has a similar story to tell that spans a much longer tenure at Jet-A-Way. He came in 1975 also as a driver and his high level of productivity was immediately noticed and rewarded. He received a 100-dollar bonus with his first paycheck. Monetary rewards are used to this day for notable work and for incentive to work during holidays and tough periods. He was promoted to Foreman in response to an outside job offer. In the early 80’s he was moved to the Transfer Station also managing the dispatch scale operation as Operations Manager. Coady became VP of Operations in 2001 overseeing Dan Dellamano and the Trucking Department, Maintenance, Transfer Stations and Customer Service. Pat has learned to be a good manager from Darlene. He comments on her confidence in her people: She (Darlene) has showed me how to handle negative situations …think about it first and ask questions of people with knowledge to help make decisions…in some cases she says, ‘you make the decision’ and you are always confident that she will back you up, her word is gold. Darlene Jeter frequently comments that she cannot run the business alone, that you can only do it with others helping. Pat Coady provides insight into how this belief in others creates a highly functioning team: When it comes to tough times, she knows how to motivate others – whatever it takes, we know we can do better, we just have to figure out how to get there…she (provides) good inspiration as a learner, someone who is patient, sees opportunity and expresses gratitude – every night Darlene says ‘Thank You”. This appreciation of employees and commitment to their development appears to be based on a clear understanding that it is the people that make the real difference and

they must pull together to be successful. Employees are part of the extended family and Darlene firmly believes that “when your business is not successful, it hurts everyone. All of the senior management has an open door policy. Yet, it is perhaps Darlene Jeter’s bigger view of employment that drives the supportive and nurturing culture. “Our company provides employment which brings money so employees can invest in their families, communities, and education.

The Industry Jet-A-Way Inc. is in the solid waste management or municipal solid waste (MSW) sector of the waste management industry (also known as environmental services). This sector in its broadest sense consists of waste collection, automatic disposals through landfills or incineration, recycling generally through transfer stations and waste-to-energy. Most of these services can be commercially and/or residentially based. The waste management industry is highly price sensitive, regulated at municipal, state and national levels, and directly tied to the economy, particularly housing and building growth. The government restricts inter-state disposals and Massachusetts has decreased its landfills significantly in the last decade. Recycling costs are greater than disposal costs creating a slow down in municipal recycling. It is an old male dominated industry in which the current competitors will fight to keep current contracts and new entrants are quick to see gaps and opportunity. The Big Dig in Boston, the largest public construction project in the world, brought in increased demand for C&D services, but it also created a truck driver shortage in an occupation that is frequently unionized. Truck driver turnover was high at Jet-A-Way. Although these many challenges make for an interesting industry, this level of uncertainty can also be a real impediment to effective planning.

Competitors Jet-A-Way’s major competitors in Massachusetts are Waste Management Inc. (WM), a company with $11.2 billion dollars in revenue, BFI (owned by Allied Waste Industries) with $5.5 Billion in revenues and Atlantic Waste Systems (owned by Casella Waste Systems) has $421 million in revenues. WM owns and operates multiples sites in Massachusetts, and offers, residential and commercial waste collection and disposal services via several transfer stations. BFI offers 9 waste hauling sites, owns its own landfill, and has a transfer station in Boston along with two recycling centers. Atlantic Waste Systems owns and operates one site in Peabody Ma, approximately 30 miles north of Boston. They offer waste collection, a transfer station, recycling and disposal services.

The Origins of Leadership Darlene brought a strong commitment to her maternal legacy when she took over the business in 1991. Born and raised in Lorain, Ohio, she learned the importance of a strong work ethic and the value of entrepreneurship at an early age. Three generations

of women were her role models: Great Grandmother Rebecca, Grandmother Mary Margaret and her mother “Ma”. Rebecca was an entrepreneur because she canned and made pies. I would help her at age five. Everyone who ate in her house worked. We sold the pies and canned goods. That was a good lesson…the importance of the work ethic. Her Grandmother Mary Margaret was also a baker. Sugar cookies were made in the old fashioned way… cookies were rolled out using a cookie cutter and decorated. They were packed in old yellow potato chip cans, using wax paper as a separator and stored in the basement. The annual project started at Thanksgiving and continued every evening till Christmas. Literally hundreds of cookies were made. Putting in long hours and being disciplined were a must. As Darlene says, “Learning to stay focused was important; otherwise it wouldn’t have gotten done. Mom taught us to work hard and stay with any project until it was done.” The cookies were given to shut-ins, the elderly, and the nursing homes. While Darlene’s family was poor, they focused on helping those less fortunate. This legacy of generosity and social responsibility influences Darlene’s community involvement and philanthropic activities today. Her charitable giving has been primarily directed to two not-for-profit organizations in the Boston area, Lena Park Community Development Corporation and the Big Sister Association of Greater Boston. Lena Park’s mission is to provide high quality service and programs to the underserved residents of Roxbury, Dorchester and Mattapan, three of Boston’s poorest and most underserved neighborhoods. Community focused educational programs, affordable housing, early care and adolescent services are provided. The Big Sister Association is a mentoring program for girls designed to cultivate confidence, competence and caring to help them attain life goals. Attention is given to creating access to information and resources girls need to make decisions about their future. Both of these organizations provide services to empower individuals and help communities become self-reliant. Darlene’s leadership challenges in Jet-A-Way continue to draw upon the team skills, hard work and dedication that began with baking and selling sugar cookies. The early years at Jet-A-Way however presented a series of challenges that tested this commitment and focus.

Leadership Challenges Jet-A-Way was debt ridden and in the throes of a recession when Darlene took the reigns in 1991. With the initial idea that the company had to be sold, Darlene, with the help of her management team, drove costs down. Long hours and hard work enabled them to turn things around. More stringent safety programs to cut back on accidents and worker’s compensation costs were implemented. The company’s administrative offices were moved from an office building into a string of trailers at the company’ transfer station. An aggressive cost reduction program and development of the sales force helped the business to grow. These combined efforts helped the company regain

solvency and profitability. The company remained in debt throughout 1992, in 1993 began to break even and as profits returned in 1994, the company began to refocus on growth. (Appendices F & G).

The late 90’s continued to pose some tough problems for the company. Jet-A-Way had to absorb successive increases in disposal costs because of contractual obligations with their customers that prevented them from passing on these added costs. Ron Ciesluk explained that “it was at times like this that we fully recognized that we are not the masters of our own destiny in that we do not have our own landfill and are thus at the mercy of those who do.” This situation began to correct itself in 2001 as these contracts began to expire. Additionally in 2001, Ron initiated refinancing of their Industrial Revenue Bond which ultimately dropped their borrowing rate by 50% from 10.5% to 5.34% and would save the company over $2.5 million over the next 10 years.

During this time, Darlene also consulted extensively with her COO. With his substantial operations and business background he helped Darlene address issues in a planned manner and helped to formalize company policies and procedures. Focused problem solving and an empowered team helped Jet-A-Way maneuver through the tough times. The team focused on “what had to be done”. In the eighties investments were made to update equipment. The nineties posed problems regarding maintenance and continued effectiveness with aging equipment. “We had to think strategically about where to invest” comments Director of Operations Pat Coady. Despite the challenging times in the disposal industry, Jet-A-Way was able to invest $6.5 million in new equipment of which more than 96 percent was funded through operating cash.

Darlene’s willingness to learn from others and develop an external team was evidenced in the evolution of the Board of Trustees. The original Board was “really advisory” according to Darlene. It consisted of 15 – 18 people with a three year term. In 2002, Darlene decided to downsize the Board to 6 people, scale the expertise and interest of members to core resources and use their contributions more strategically. The Board addressed issues such as purchasing another company and investing in new equipment. A separate family Board was established at the same time. It consisted of Darlene, her four sons, two lawyers and an executive coach. This team, which meets quarterly, was charged with addressing the firm’s leadership transition.

The Plant Closing Crisis In November 1999 the company faced a complex problem. With no notice, The Department of Environmental Protection (DEP) closed two landfills. As a result there were 500 tons a day coming in and Jet A Way’s facilities filled up quickly. The plant was closed for three days because there was nowhere to take the fill.

The Department of Environmental Protection (DEP) Master Plan restricted the amount of excess waste produced in Massachusetts, one third of which was construction and demolition, Jet A Way’s core business. The DEP stated that by the year 2010, firms should be recycling 88% of waste material. With this DEP recycling goal in place, it was improbable that new landfills would be built. Furthermore, residents throughout Massachusetts were vehemently opposed to the replacement of landfills within their communities. As landfills became scarce, companies had to search for new and creative solutions. The subsequent looming ban on the disposal of asphalt, concrete, metal, brick, cardboard and wood led Jet-A- Way to expand its processing and recycling capabilities. The company was then capable of recycling nearly 80% of its incoming tonnage. Jet-A-Way recognized the importance of being in the forefront of recycling technology and positioned itself to meet the increasing requirements of the DEP’s Solid Waste Master Plan.

The Union: Local 379 In the period of the late 1990’s through 2000, Boston’s “Big Dig” project drew many drivers because they were able to pay more (briefly explain Big Dig). Jet-A-Way tried to recruit licensed drivers and trained them to use their equipment. Problems with attendance and accidents led to a higher turnover rate of 27 drivers in the last two years. Because 50% of materials in the facility came in on Jet-A-Way trucks, drivers are critical to the company’s success. New drivers began to discuss the need for more supervisory control and better benefits. Jet-A-Way provided better pay, but the pension plan was a 401K with company matching funds. With the union plan, the pension is fully funded by the employer. Employees asked to have supervisors fired and Darlene, seeing no good reason to do so, refused. Employees had promised to unionize if their request was not honored, but Darlene refused to fire employees for which there was no performance problem. While the longer-term employees did not vote for the union, the newer drivers did. Darlene was disappointed, but with her usual straightforward approach moved forward to comply with the union contract. On January 16, 2003 Local 379 was voted in. The management team acknowledges the “silver lining” aspect of unionization: the company got union jobs, and enhanced the quality and longevity of the drivers. While unionization has provided more experienced drivers, it has added some substantial cost to Jet-A-Way’s bottom line. However, according to Pat Coady, the leadership team “expects with clear rules things will go well.”

Plant Modification Crisis While the union transition was occurring, talk of plant modification started. In 2002, faced with declining profit margins, increasing competition, new DEP regulations to increase recycling performance and an outdated plant (Appendix H), the decision was made to re-design the plant with new equipment that would significantly increase Jet-A- Way’s capacity and improve recycling efficiency.

Jet-A-Way’s production of 40-50 tons per hour was handicapped by equipment that had been in place since the company opened. They wanted to eliminate the high costs of bull dozers fuel and repair while improving shredder productivity early in the process. They invested $3 million dollar’s worth of new equipment which required re-engineering of the production line and the addition of an annihilator on the front end. CBI, an engineering firm in NH, was responsible for equipment modification and installation. From the beginning, the design and installation of the new equipment was fraught with problems. Late delivery of the Annihilator, an electronically powered, high torque slow speed shredder, in February of 2002 and an extended period of installation due to initial debugging slowed production down. Consequently, material backed-up and long lines started to form as their peak season commenced in March. From late May and throughout the summer they were only able to produce 30 tons per hour at best. Frequent shut-downs were necessary to ascertain the cause of equipment failure. Pat Coady initiated crisis intervention meetings with both shifts to get the information they needed and rectify the emergency itself. But, problems continued to escalate and the hydraulic pumps and motors failed causing the annihilator to cease operation on September 13, 2003. So on top of thousands of dollars already spent, they listened to the advice of technicians from three companies and invested another $45,000 to get the annihilator repaired and the plant up and running. Different perceptions of the problems, finger pointing within Jet-A-Way and with CBI, and a tremendous sense of urgency created a series of short term reactive responses that appeared to only add to the confusion and acceptance of the situation. Darlene captured this sentiment quite clearly: I was used to thinking it’s not that hard…why are we failing? We’ve got an excellent location and reputation. We should be doing at least break even, not this. And every day I would think, ‘what can we do to stop the bleeding?’ Pat Coady acknowledged that “we made an assumption that this wasn’t going to be too difficult to do, but oh, what a surprise it turned out to be.” In retrospect, everyone agreed that the timing was terrible, that perhaps they should have waited until their New Bedford competitor piloted the same equipment. In particular, Jesse Jeter wishes he had listened to his gut, “I believed that we were doing it incorrectly…I didn’t think the technology was a bad idea. It was the timing.” Reflecting upon his role at a family board meeting early during the crisis, Jesse adds, “I think if I was (more) forceful during that session, along with some of the other board members, it might have been enough to push that decision (about timing).” The former COO’s over riding desire to make the equipment work prevented management from getting any critical input from the line. Jesse recalled that this individual was leading the way, reminding him of a “commander” saying “I’m going to lead in this. I was victorious before, I’ll be victorious this time.” Subsequently, the Recycling Transfer Station (RTS) Plant Manager, felt pressured to make the new

equipment work. Pat Coady later learned that some of the plant personnel identified potential problems with the conveyor belts before they were installed, but this information “never went any further than the project manager”. Both Pat and Darlene acknowledge that the plant manager had been “promoted beyond his capabilities” indicating that trouble shooting went undocumented and personality conflicts interfered with information flow to management. Pat noted that it eventually became apparent “that we probably needed to make a change…the plant manager opened the door by telling us he was leaving.” Still plagued with break downs and serious financial loss, the leadership team decided to hire an experienced RTS manager and through word of mouth found Stan Banalewicz. While Stan was getting his feet on the ground, Darlene came to grips with the severity and impact of the ongoing crisis, “we have to accept the fact that the machinery was just not working, we did not have faith in it, we were throwing good money after bad…we had a terrible year.” During this critical time, Ron Ciesluk, Vice President and CFO, was not available due to ankle surgery. Having lost many of their biggest and oldest customers and confronted with a million dollar loss, Darlene consulted with an attorney and an outside accountant who advised, “You’d better do something and do it damn quick”. Subsequently she made the decision to ask the COO to leave. Acknowledging that she had listened to the wrong person, yet she was the one ultimately responsible, Darlene took control: I’m not going to continue to argue…it was friction all of the time about a company that I am responsible for. If it doesn’t work, the most they (employees) lose is a job or employment, or they go somewhere else. I lose everything. So I made the decision that this can no longer continue. The COO left Jet-A-Way in early January, 2004 and Darlene indicated that “we’re all in agreement that we should not hire a person (replacement)…I really think that it would be a mistake…it would be a real downer for the ones that have really pitched in.” The addition of Stan to the management team provided fresh perspective and more experience to tackle the level of problem solving demanded by the very complex plant modifications. Redeploying the old bull dozers and giving up on the annihilator, Pat and Stan implemented a more thorough documentation system and tried new approaches to making the line work. Downtime dramatically decreased and conversely RTS production rose (Appendices I and J). By February, 2004 they reached a goal of consistently maintaining 45-50 tons per hour. The next goal of minimizing down time and processing 70 tons per hour was reached March 6, 2004.

Going Forward – Recovery First Entering spring of 2004, their busy season, Darlene and her team were focused on the day to day operations necessary for a successful turn around for the company. Prior to the installation of the new equipment, Darlene had thought that Jesse’s succession to her position was imminent and strategic diversification would be his greatest future

challenge. But all of that changed with the threat of losing the business as she noted with seriousness and ever present good sense of humor: We have a couple, maybe two to three years of recovery. This isn’t going to go away overnight, not that kind of loss…I took a 20% pay cut too. And I think, yeah, I can manage, but just the same because of the losses and (because) the bank was here and I felt that we had to show them a lot to keep their comfort level…I took the pay cut. So naturally I’m not shopping like I used to. Jesse agreed with this shift in attention to the immediate future. He was faced with regaining long-time customers and restoring the customer base: …the theory says when you bring them (customers) back you’ve got to bring them back at a lower price, because why would they come back (otherwise)?The good news is, we’ve been in business for 35 years and we’ve got a great reputation, so we can bring them back. As Vice President of Business Development, Jesse was training someone relatively new to Jet-A-Way, Robert Katilus, to take over the Sales Management part of his job. Jesse, hoping that this transition works, commented that “I can’t leave until someone takes over my role.” Another personnel change at Jet-A-Way during the plant crisis created opportunity for a new degree of professionalism for the company. The hiring of Stan Banalewicz from the “outside” was a big move for the firm. Jesse, in particular, expressed that Stan added ‘some things to the company that were real good building blocks’ for Jet-A-Way. He further elaborated on this contribution: …he’s outside trained; he knows more than just his job. He understands the politics of business. He’s pretty articulate. He brings in a different professional dynamic to the company that we’re not used to. For the most part, (our) people have been Jet-A-Way trained, Jet-A-Way culture. He’s not Jet-A-Way culture. He’s a different culture. Darlene reinforced this cultural change by clearing the way at the top; a very difficult challenge for her given her legacy of care and support for her people and a strong bond with her COO of 13 years. But it was one of the very difficult lessons she learned, “As I say, I would never, ever let it go this long (again).” Explaining the delay in this decision Darlene noted, “I became somewhat attached to people and then you take your eye off of the prize…paying more attention to the person (than the problem).” The loss of the COO opened the door for an important strategic role to be filled by someone else. Reflecting upon the COO’s strengths Jesse summarized his leadership and what Jet-A-Way was missing as a result:

He wasn’t really involved in the day to day operations of the company, and I think that’s critically very wise…a good leader…ensures that the day to day operations survive and do well without him…he did that. I think we’ll miss him from the next step actions perspective. He was involved with ‘what do we do next’? Where does this company go next from a growth standpoint? Jesse acknowledged that while no one has talked about it, he believes that they’ll miss his strategic perspective and adds, “I’m hoping that’s something I can pick up.” Jesse was concerned that with COO gone, Darlene no longer has a buffer between her and the rest of the organization. This too had an impact on role changes for Jesse and the other managers as Jesse noted, “We had to put on our big boy shoes, Ron, Pat and myself, we had to (watch) what gets kicked up (to Darlene)….how much stress can she handle and how much did she want to handle at this point?” Darlene is the first to acknowledge that the past year took a tremendous toll on her personally, “I lost 25 pounds and didn’t sleep well at all. Holding a promise to take her daughter-in-law and three daughters on a vacation while in the throes of the business crisis, she spent the whole time thinking about ‘how bad things were back at home’ and she agonized: You’ve got 78 people that are counting on you for their livelihood. Oh, true they could go out and find employment elsewhere, but just the same, a lot of them have many years invested here, and that gave me great concern. This was the hand that Darlene Jeter was dealt. Drawing upon a strong leadership legacy and many lessons learned, she is confident about playing these cards, “you know I will survive.” She projected that Jet-A-Way’s recovery will continue for about two to three years more, “and then we’re going to work with Jesse to get him to the point that he basically will do what I’m doing now, and then I can step back.”

Appendix A: Summary Sales & Profits 1990 to 2002

-2.0 0.0 2.0 4.0 6.0 8.0

10.0 12.0 14.0 16.0 18.0

'90 '92 '94 '96 '98 '00 '02 Year

Total Annual Sales

After Tax Profit Total

Appendix B: Timeline of Significant Events

2004 Event 1, 1990: Company takes out $6.2 million bond

2002 Event 2, 1990: Economy takes a nosedive

2000 Event 3, 1991: John K hired as permanent employee

1998 Event 4, 1991: Eddie Jeter dies

1996 Year

Event 5, 1991: Revenues down $6 million; company in debt

1994 Event 6, 1993: Company breaks even

1992 Event 7, 1995: Company is profitable again

1990 Event 8, 1996: JAW receives SBA award

1988 Event 9, 1997: Ron Ciesluk hired

1 2 3 4 5 12 6 7 8 9 10 11 Event 10, 1999: Disposal crisis; JAW closed for 3 days

Event Event 11, 2002: Union enters JAW; Local 379

Event 12, 2003: Plant modifications

Appendix C – Greater Boston Map

Appendix D – Jet-A-Way Organization Chart

President Chief Executive Officer

Vice President Operations

Vice President Business Development

Vice President and Chief Financial Officer

Board of Directors

Professional Advisors

Recycling Transfer Station Plant Manager

Controller Sales Manager

Field Sales Supervisor Sales Admin Supervisor

Maintenance Manager H.R. Supervisor & Accounting

Account Exec

Sales Admin Assist

Driver and Dispatch manager Credit & Collection

Account Exec

Sales Admin Assist

Scale Master Systems Admin

A/P Clerk

Appendix E: JET-A-WAY, Inc.

Mission Statement TO LEAD IN THE RECYCLING, TRANSPORTATION, AND DISPOSAL OF CONSTRUCTION AND

DEMOLITION DEBRIS

To be competitive IN SOLID WASTE AND RECYCLING

TO SERVICE CUSTOMERS IN AN EXEMPLARY MANNER, ALWAYS ACTING WITH THE HIGHEST OF ETHICAL STANDARDS

TO PROVIDE A PROFESSIONAL WORK ENVIRONMENT THAT ENCOURAGES EVERYONE TO WORK

TOGETHER CONSTRUCTIVELY AND SAFELY FOR THE COMMON GOOD

TO TREAT CUSTOMERS, VENDORS, COWORKERS, AND OUR COMMUNITY WITH RESPECT AND DIGNITY

TO ACT RESPONSIBLY WITHIN THE COMMUNITY BY PROVIDING OPPORTUNITIES FOR EMPLOYMENT

AT COMPETITIVE LEVELS OF PAY AND UTILIZING FAIR POLICIES THAT WILL SUPPORT THE TRAINING AND PERSONAL DEVELOPMENT OF OUR EMPLOYEES

TO MANAGE MATERIALS IN AN ENVIRONMENTALLY SAFE AND PROPER MANNER\

TO BE A PROFITABLE AND SUCCESSFUL COMPANY TO SUPPORT FUTURE GROWTH AND

DEVELOPMENT

Appendix F: Percentage of Sales Growth 1990 to 2002

-20.00

-15.00

-10.00

-5.00

0.00

5.00

10.00

15.00

20.00

25.00

30.00

'90 '92 '94 '96 '98 '00 '02

% Sales Growth

Appendix G: Profit as Percentage of Sales 1990 to 2002

-14.0

-12.0

-10.0

-8.0

-6.0

-4.0

-2.0

0.0

2.0

4.0

6.0

'90 `91 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 Year

Profit as % of Sales

Belt A Infeed to the Annihilator Belt B Annihilator discharge Belt C Steel belt feed hopper Belt D Upfeed belt Belt E Pre-picking belt Belt F Overs from StarScreen 1 Belt G Picking belt (.10”) Belt H Unders from StarScreen 1 Belt I Crossover belt Belt J Infeed to StarScreen 2 Belt K Unders from StarScreen 2 Belt L Overs from StarScreen 2 Belt M Reversible belt to Grizzly Belt N Grizzly infeed Belt O Grizzly discharge

Appendix H: Jet-A-Way RTS Process Flow

rved. 87

RTS Production

0.00

10.00

20.00

30.00

40.00

50.00

60.00

70.00

80.00

90.00

06 -1

2- 03

13 -1

2- 03

20 -1

2- 03

27 -1

2- 03

03 -0

1- 04

10 -0

1- 04

17 -0

1- 04

24 -0

1- 04

31 -0

1- 04

07 -0

2- 04

14 -0

2- 04

21 -0

2- 04

28 -0

2- 04

06 -0

3- 04

13 -0

3- 04

20 -0

3- 04

27 -0

3- 04

T o

ns p

er h

ou r

Series1

Appendix I - RTS Production

Appendix J – RTS Downtime

Downtime

0 5

10 15 20 25 30 35 40

04 -1

0- 03

18 -1

0- 03

01 -1

1- 03

15 -1

1- 03

29 -1

1- 03

13 -1

2- 03

27 -1

2- 03

10 -0

1- 04

24 -0

1- 04

07 -0

2- 04

21 -0

2- 04

06 -0

3- 04

20 -0

3- 04

hr s/

w k

Series 1

References

Ackerman, Jerry. (1997, September 10). 1600 small firms gain. MassBusiness: Fast Track. The Boston Globe. Ciesluk, Ronald, K.. Jeter Case Study Notes: Interview with Ron Ciesluk. interview by Bonita Betters-Reed, March 28, 2003. Ciesluk, Ronald, K. Jeter Case Study Notes: Interview with Ron Ciesluk. Interview by Lynda Moore, March 28, 2003. Coady, Patrick. Jeter Case Study Notes: Interview with Patrick Coady. Interview by Bonita Betters-Reed, March 31, 2003. Coady, Patrick. Jeter Case Study Notes: Interview with Patrick Coady. Interview by Lynda Moore, March 31, 2003. Cullen, David. (1999, December). Getting the Clean Sweep: Fleet Owner, Primedia Business Magazines & Media, Inc., ISSN: 0731-9622. Daniels, Steve. (1997, August 18). Coming Back: C&D Outfits Survive Slump. Crain Communications, Inc. Darlene Jeter. Jeter Case Study Notes: Interview with Darlene Jeter. Taped proceeding done by Bonita Betters-Reed and Lynda Moore with an audio cassette, June 27, 2003. Darlene and Jesse Jeter. Jeter Case Study Notes: Interview with Darlene Jeter and Jesse Jeter. Taped proceeding done by Bonita Betters-Reed and Lynda Moore with a video cassette, November 7, 2003. Dellamano, Daniel. Jeter Case Study Notes: Interview with Daniel Dellamano. Interview by Bonita Betters-Reed, March 31, 2003. Dellamano, Daniel. Jeter Case Study Notes: Interview with Daniel Dellamano. Interview by Lynda Moore, March 31, 2003. Gendron, Marie. “Chamber names Jet-A-Way Small Business of the Year” The Boston Herald May 15, 1996 Howe, Peter J. (1989, June 18). $10 million recycling plant to be built in Roxbury. The Boston Globe. Jackson, Derrick. (1990, December 2). The grunt end of working for ecology. The Boston Globe.

Jeter, Darlene. Jeter Case Study Notes: Interview with Darlene Jeter. Interview by Bonita Betters-Reed, February 24, 2003. Jeter, Darlene. Jeter Case Study Notes: Interview with Darlene Jeter. Interview by Lynda Moore, February 24, 2003. Jeter, Jesse. Jet-A-Way’s Total Sales, Profit as % of Sales, Fiscal Growth as % of Sales. Jet-A-Way April, 2003. Jeter, Jesse. Jeter Case Study Notes: Interview with Jesse Jeter. Interview by Bonita Betters-Reed, 04/14/2003. Jeter, Jesse. Jeter Case Study Notes: Interview with Jesse Jeter. Interview by Lynda Moore, 04/14/2003. Jordan, Robert A. (1991, September 21). Farewell to a quiet hero. The Boston Globe. Kelso, John. Jeter Case Study Notes: Interview with John Kelso. Interview by Bonita Betters-Reed, February 24, 2003. Kelso, John. Jeter Case Study Notes: Interview with John Kelso. Interview by Lynda Moore, February 24, 2003. Kelso, John. Jeter Case Study Notes: Interview with John Kelso. Interview by Bonita Betters-Reed, March 24, 2003. Kelso, John. Jeter Case Study Notes: Interview with John Kelso. Interview by Bonita Betters-Reed, Lynda Moore, March 24, 2003. Management Team Meeting. Jeter Case Study Notes: Management Team Meeting. Taped proceeding done by Bonita Betters-Reed and Lynda Moore with an audio cassette, July 1, 2003. McNabb, John K. Jr. (1999, December 2). Letters To The Editor: The Wrong Way to Handle Waste. The Boston Globe. McQuarrie, Brian. (1999, November 25). Haulers dump on state over lack of landfill space. Say recycling goal not being met. The Boston Globe. Muller, Joann. (1996, June 26). Jet-A-Way’s long haul. The Boston Globe. Rodriguez, Cindy. (1998, November 11). City fines Roxbury waste site operators. The Boston Globe. Rosenberg, Ronald. (1996, September 18). Small business group honors Darlene Jeter. The Boston Globe.

Ryan, David L. (1997, March). How I Did It. Essence Magazine. Scharf, Stewart. (2003, April 24). Industry Surveys: Environmental & Waste Management. Standard & Poor’s. Staff Reporter. (2003, February). Chartwell Information Solid Waste Digest at www.wasteinfo.com. Staff Reporter. (2003, June 1). Waste Age 100 Waste Age.com at www.wasteage.com. Unknown staff writer. (1990, December 14) Bond Plans worth $91 m face board’s vote today. Boston Globe City Hall Bureau. The Boston Globe. Unknown staff writer. (1998, May). Darlene Jeter: Surviving the Rough Stuff. Waste Age News. Unknown staff writer. (1999, December 14). Coming Back. Waste News, Crain Communications, Inc, ISSN: 1091-6199. Unknown staff writer. (2001, June 25). Hauling & Disposal Rankings. Crain Communications, Inc.,

http://www.wasteinfo.com/

http://www.wasteage.com/

Does it Matter How We Get There (Really)? A Case of Ethics in Bidding

Donald H. Schepers

Zicklin School of Business Baruch College, City University of New York

Jim Snelling could not believe how tense he had become in the last 24 hours. A huge contract had become a huge headache. Just a week ago, Spectro had signed a $100 million contract, and everyone was celebrating. Profits shot up, and Christmas bonuses doubled. Then came the news that Spectro’s employees had the competitor’s price list, and used it to undercut their bid. This morning, he was due at an Ethics Committee meeting to discuss what steps to take from this point forward. As senior strategist for the company, he was concerned not just with the company’s sales and revenue for the three-year duration of the contract, but also the company’s position as a supply chain partner for years to come. The decision today would have long-range consequences both inside and outside Spectro, and he weighed his position carefully.

Spectro Electronics

Founded in the mid-1960’s, Spectro Electronics was a supply chain manager and distributor of electronic components to manufacturers. By 1995, Spectro was doing $6 billion in sales, and the demand for its services kept growing. Jim was projecting that Spectro would be doing $10 billion in sales within the next three years. Gross margins ran just over 16% of sales, and net income hovered right above 1% of sales, well within industry norms. Spectro had a world-wide presence, serving manufacturers in over 40 countries. The company was organized into a series of regional operations staffs, with each staff handling sales, distribution, and engineering responsibilities for its area. The sales staff would solicit business from manufacturers in the form of quotes to fill. A manufacturer would be preparing to make some electronic component (a motherboard for a computer, for example) and would need a source for the parts for that component. Typically, these manufacturers would prefer to single-source their purchasing, and so would put all the necessary parts onto one quote. This quote would then go to supply channel managers such as Spectro and its competitors. The engineering staff at Spectro would assist sales in breaking down the quote into its various parts. The distribution staff would then solicit bids from its suppliers to fill the quote. Spectro alone had over 600 vendors it used to fill its parts orders. Competition among the supply channel companies was fierce, each trying to get the parts cheap enough and the final bid low enough to get some advantage over their rivals. Typically, these bids would result in multi-year contracts. An average contract for Spectro ran over a 2 to 3 year period, and resulted in $10-15 million in sales. Once a contract was awarded, the specifications passed to the regional distribution staff to service the contract. This staff provided just-in-time parts delivery and service to the

manufacturer. At any one time, each regional distribution center was handling multiple existing contracts, as well as seeking new business. There were 150 sales staffs across the 40 countries where Spectro had a presence, and 25 distribution facilities where parts would be housed and shipped. Each sales staff was headed by an operations officer who reported to the area’s president. These area presidents were corporate officers. Spectro’s service areas had been broken down into North America, Europe and the Mid East, South America, and Asia Pacific. In addition to these corporate presidents, other corporate officers included a CEO, CFO, CIO, a vice-president for Human Resources, and a vice-president for Global Strategy and Operations. Figure 1 shows the organizational chart for Spectro.

Jim Snelling

Jim Snelling had joined Spectro in 1992 as vice-president for Global Strategy and Operations. He had both a BBA and an MBA, and had specialized in operations. Before joining Spectro, he managed global operations for an automotive component company. In his three-plus years at Spectro, the organization had grown tremendously, fueled in large part by the boom in technology services. As computers and other technology innovations dominated more and more in the workplace and home environments, supply chain management such as Spectro offered became an essential yet unseen part of the business environment. Each innovation spurred new demands and new contracts from manufacturers, and Spectro was working hard to make sure it had its piece of the pie. One part of Spectro’s growth strategy involved splitting regional sales staffs as that unit’s business grew. Each sales staff worked hard to bring in as much new business as possible, and with the tech boom, Spectro had seen its share of growth. When a regional staff grew too large for one operations manager to handle, the corporate office stepped in, divided the territory into two, and named a new operations manager for the new territory. Spectro used acquisitions as a second growth strategy. However, Spectro’s competitors were growing faster than Spectro was, and as a result, the competitors grew faster than Spectro’s ability to buy them. Try as it might, Spectro’s management could see it was beginning to fall behind. Growth brought new employees into Spectro, and the corporate office was very concerned with integration of employees into the culture of the firm. Within the first three months of their career at Spectro, new employees were brought to headquarters for a week of training. Training included introduction to the industry, as well as introduction to the company, its internal processes, and its culture, with the better part of one day devoted to ethics training. Employees from acquisitions were not brought in as

quickly as others, however. Since they “knew the business” of electronic supply chain management, their training was put off until it was more convenient.

The Opportunity and the Problem

Jim had been concerned for some time about Spectro’s strategies. While sales were good, they weren’t as strong as he thought they should be, given what he could figure competitors were doing. There were a lot of repeat contracts, but nothing really new. The growth strategy was not working, and he debated what to do to get the company moving again. In early 1996, Spectro’s acquisition strategy got a boost from an unusual source. The United States Department of Commerce had entered an anti-trust ruling against ElectroSource, one of Spectro’s main competitors. The ruling forced ElectroSource to divest some of its sales staffs, and Spectro acquired five of them in key regions where it had wanted to increase its presence. These staffs were merged into Spectro’s existing staffs in those areas. At first, the acquisition was rough. There were the usual frictions between long-standing and newly acquired employees over salaries, benefits, titles and the like. In addition, the cultures of the two companies didn’t mesh all that well. For one thing, the industry was pretty rough and tumble. It was not uncommon for buyers to get a boat or some other ‘goodie’ from one of Spectro’ competitors in return for a contract. ElectroSource operated close to the line, and everyone knew it. For its part, Spectro worked hard to run a clean operation. In addition, the ElectroSource employees saw the corporate structure at Spectro as having too much red tape. They perceived the electronics supply chain management business as rapidly moving, and they seemed to resent the oversight from Spectro’s corporate offices. Over the six months since the acquisition, however, Jim thought the resentment had waned, and the new employees were working out very well. They had brought new energy to the company, and he believed that would translate into new sales growth. Spectro needed a shot in the arm, and these employees seemed to have brought it. In fact, one of these newly acquired staffs in the Southeast US had just signed a remarkable contract, $100 million over 3 years. For Spectro, that was 6 to 10 times the normal contract size. That sale took Spectro’s operating profit for the year from $40 million to $56 million. And they had taken the business away from their former employer! When Jim heard the news, he was glad these former ElectroSource employees were now working for Spectro, and not for ElectroSource. They had a real killer instinct, and Spectro needed more of that attitude. It wasn’t long after the good news that some disturbing signs began appearing. In reviewing the contract, the sales team manager noticed that the margins were a little thinner than usual, and almost dismissed it, thinking that it wasn’t so out of line since the contract was so large. Looking at the team that won the bid, he also noticed that it was

entirely composed of former ElectroSource employees. These employees had not yet been taken through the training system at corporate headquarters. He began to ask about the process of building the quote that won the bid. He was hoping that they had simply remembered enough to be very aggressive, but he knew that was a slim hope with over 20,000 parts in this one bid. One of the ElectroSource employees quickly confirmed his worst fears: they had brought original paperwork with prices and quantities listed. After all, these employees had reasoned, they had already worked up the price list once, and using it again wasn’t illegal, so why not? The sales team manager took the situation to the Regional Operations Manager, who also served on the Ethics team for Spectro. The Operations manager took this to the President for the North American region, who then brought it to the CEO. When the CEO received the news yesterday, he quickly dictated a memo outlining the issue and circumstances of the bid, and called an emergency meeting of the Ethics Committee for the following morning to discuss the situation and develop an action plan. The Ethics Committee consisted of the CEO, the Vice-President for Strategy (Jim), the Vice-President for Operations, the President of the business unit involved (in this case, the President of the North American division), and the regional Operations Manager for the particular unit. The team met on both an ‘as needed’ basis, and as well as a quarterly basis, with the quarterly review including reports from the heads of Human Resources, Information, and Finance. The Ethics Committee influenced behavior in the company both through its decisions related to specific incidents, as well as general ethics campaigns, with slogans such as “Do the right thing, even when no one is watching!” Jim received the memo shortly after the CEO had dictated it. As he read the memo, his heart sank. Not only were the hopes for a revitalized strategy pushed aside, now there was all this to deal with. Jim had spent the night puzzling over what he thought about the situation. Now he was in the office early, putting his thoughts together in preparation for the meeting later that morning. He would have to speak his mind on the contract, how to deal with the competitor, and what to say to the client. Sure, there was an obligation to the client, but was there any to the competitor? In his own mind, he had debated every position he could think of. Spectro could say nothing and let the contract run its course, hoping that nothing leaked to the competitor or client. That way, Spectro could profit from the contract, and somehow deal with the employees quietly on its own. At the other end, Spectro could admit the whole thing to both client and ElectroSource. Both would have demands on Spectro, and there was no way to know how much the competitor might want in order to be made whole. And at the very least, the client would want everything at Spectro’s original prices. There were also issues inside the company. How should the employees involved be dealt with? What happens to the bonuses that would have come from the contract? As

he sat and looked out the window, he knew he had to make up his mind and take a position.

Figure 1. SPECTRO ELECTRONICS Chief Executive

Officera

President, Asia

Pacificb

President, Europe and

South Americab

President, North

Americab

Chief Financial Officer

Vice President,

Global Strategya

Vice President,

Operationsa

Senior Vice President, General Counsel

Chief Information

Officer

Vice President,

Global Human

Regional Operations Managerc

a Permanent member of the Ethics Committee.

b Each regional President served as an ad hoc member of the Ethics Committee. Sales c Each Area President handled many regional staffs, each organized as the one shown here. This person served on the Ethics Committee on an ad hoc basis.

Distribution

Engineering

Introduction
Review of the Literature
Computer Skills
Critical Thinking
Business Writing
Research
Oral Communication Skills
Library overview
Contemporary Business Issues
Leadership

Single Equation Probit Estimation Results, Marginal Probabil

Regression Coefficients (P-values in parentheses)
Appendix E
An Example of the Estimated Impact of MGT 110 on Student Out
An Example of the Estimated Impact of MGT 110 on Student Out

Leadership Challenges
The late 90’s continued to pose some tough problems for the
During this time, Darlene also consulted extensively with he
Darlene’s willingness to learn from others and develop an ex

Mission Statement