Professional Documents
Culture Documents
indicates
the rarity of the particular EI program. The probability that an establishment had a
12
specific policy depends on an establishments degree of EI use (
u
) and the frequency
level of an EI program (
). The function
u
is specified to have a logistic form, giving
equation (2):
(2)
exp( )
( 1)
1 exp( )
i j
ij
i j
P X
u
u
= =
+
, i, establishment, j, EI practice.
We use maximum likelihood to estimate the establishment parameter (
u
) and the
EI policy parameter (
).
6
The estimate of
u
is our measure of EI use in plants. Its value
ranges from 1 to 1. While conceptually preferable to a simple count of the number of EI
programs that an establishment has, the Rasch measure is highly correlated with a
summated rating count variable (r =0.98).
To examine the dynamics of adopting or terminating EI programs in a given year,
we use a 0/1 dependent variable that measures whether or not the firm added at least one
EI program between year t and year t+1; and whether or not the firm dropped at least one
EI program between year t and year t+1. To assess how explanatory factors affected these
decisions, we estimated the following models:
(3) 1 it it i t it
A X | o c
= + + +
, 1 it it i t it
T X | o c
= + + +
,
where A
it
is the measure of EI adoption in year t, and T
it
measures EI termination in year
t; X
it-1
are a set of time-varying explanatory variables lagged one year; and where i
o
are
individual plant dummy variables, which control for plant fixed effects, and t
are year
dummy variables. The two equations are estimated using the Least Square Dummy
Variable (LSDV) method, and specified as the linear probability model with White robust
standard errors. The LSDV estimators show how much a change in an explanatory
variable affects the probability.
7
13
Columns 1-4 of Table 6 reports the estimated coefficients and standard errors on
variables in regressions of the level of EI use on the explanatory variables for pooled
observations for all establishments and years. The odd-numbered regressions include
variables measuring plant-specific time-invariant characteristics, such as union status or
durable manufacturing. Since there may be other plant-specific variables impacting the
adoption and termination decisions, the even-numbered regressions drop these time-
invariant variables but include year and plant dummy variables to control for all observed
and unobserved plant fixed effects. The odd-numbered regressions are embedded in the
more general even-numbered models.
The first two columns use our Rasch measure of EI as the dependent variable. To
see whether the results are sensitive to the EI measure used, columns 3-4 estimate the
model using the summated rating index of EI that give the same weight to different EI
programs. This links our results to those in earlier studies that give each EI policy the
same weight. The estimates in columns 1 and 3 show that companies with group bonus
and gain-sharing and profit-sharing have higher EI use than companies without these
programs. This is consistent with the notion that EI programs are complementary with
these programs. In addition, individual incentive pay is also positively related to the
extent of EI. Unionized firms and larger plants are less likely to have EI programs. The
coefficients on the measures of management strategy show that firms that emphasized the
growth of market share made greater use of EI than managements that emphasized other
strategies. The estimates in columns 2 and 4, which include plant dummy variables and
less important, year dummies, give weaker results on some of the variables such as profit
sharing but find that firms that have programs to train and appraise workers were more
likely to use EI.
14
Columns 5 through 8 turn to the dynamics of the process. They give estimates of
the determinants of adoption and termination of EI use. We expect variables to have
opposite effects on adoption and termination. Factors that cause firms to adopt EI may
also explain why the firms keep the policies and thus reduce the rate of termination. This
is generally the case in these calculations. The estimated influence of the existing level of
EI in the top line is significantly negative in the adoption equation and significantly
positive in the termination equation. Comparing coefficients for other variables that are
significant in at least one of the equations, the coefficients have opposite signs in 5 of 7
cases. For instance, the column 6 estimates show that establishments that emphasize
market growth are more likely to adopt EI while the column 8 estimates shows that
emphasizing market growth reduces the likelihood of terminating a program. Firms
seeking niches in the market are less likely to introduce EI programs in the adoption
equation but more likely to terminate programs in the termination model.
6. Markov Analysis
The evidence in our sample that firms added and terminated EI programs in the
decade under study indicates that they were involved in a dynamic adjustment process
that had not settled down to some equilibrium mix of programs. With nine EI programs
and just ten years of data, a time series regression model will not readily illuminate the
dynamics of the adjustment process nor predict the possible equilibrium state to which
the firms might be heading. As an alternative, we apply a Markov chain model to our
data to exploit the longitudinal dynamics. The Markov model assumes that a system is
represented by a set of states, which we specify as the number of EI programs that a firm
has in a given year.
8
The model posits that firms change the number of programs
according to fixed transition probabilities dependent solely on the current state. For
15
instance, if a firm had no EI programs, the model might predict a 20% chance of moving
to one program, a 30% chance of moving to two programs, a 5% chance of moving to
three programs, and a 45% chance of maintaining the zero program status quo. A firm in
the state of having three EI programs would have different transition probabilities,
allowing for termination of some of those programs or adoption of other programs.
The process is represented by a transition matrix that gives the probability that the
firm changes the number of programs by adopting new ones or terminating existing ones
in the next period, or that it maintains its current EI system. Traditional matrix algebra
analysis of Markov models allows us to predict whether the EI use of the establishments
converges to a steady-state distribution, and if so, the distribution of EI use among the
establishments at the equilibrium.
Table 7 gives the Markov matrix that we use to analyze the adoption and
termination of EI programs. The elements of the matrix are obtained by averaging all
transitions in the data, regardless of year. The averaging is simple. If five firms had three
programs in year t and none changed their number of programs and five (possibly
different) firms had three programs in year n and three of the firms increased their
programs to four while two firms reduced them to two, our estimated transition matrix
would have a probability of staying with three programs of 0.5, of increasing to four
programs of 0.3, of decreasing to two programs of 0.2, and zero probability of other
transitions. The table groups the eight and nine programs together because we have few
observations for that part of the distribution.
9
The summary statistics in the table give the equilibrium distribution from the
Markov analysis and contrast that distribution with the initial distribution in 1986 and the
distribution in 1995. It shows that the initial distribution moved toward the equilibrium
16
over the period. As a measure of the distance between distributions, we take the sum of
the absolute value of the difference between the proportions in different states.
10
In 1986,
the actual distribution differed from the equilibrium distribution by 80 percentage points.
By 1995, the sum of the absolute value in the differences between the distribution and the
equilibrium distribution was just 16 percentage points. The model predicts that the
distribution would reach the equilibrium by 2006. Thus, the adoption and termination
process takes about 20 years to equilibrate, with much of the movement toward
equilibrium occurring within 10 years. Examining longitudinal human resource policy
data for the U.S. economy Lisa Lynch finds that manufacturing firms coalesce around a
core set of policies in the mid-to late 1990s (Lynch, 2007).
7. Conclusion
Our analysis of 10-year retrospective data from on-site visits to establishments
has found that even in a period of increasing EI use, many establishments terminate EI
programs. On-site interviews with the plant managers, workers and union representatives
suggested that the process of adopting and terminating EI is a trial-and-error process
which has a lot of uncertainties. But beneath this pattern our data reveal empirical
regularities. In our sample establishments were more likely to adopt EI programs and
less likely to terminate them when they had other advanced human resource practices and
when their business strategy emphasized growth of market shares. The factors that lead
firms to terminate programs paralleled those that lead firms to introduce them, suggesting
that both decisions reflected the aspects of the plants situation. Moreover, the
distribution of numbers of EI practices appears to converge over time. Our Markov chain
analysis suggests that the process reaches a steady state distribution in about 20 years
with most changes occurring during the first 10 years.
17
Notes
1
The Census of Manufactures asks all establishments in manufacturing (over 200,000
plants) about the business they conduct, geographic location, type of ownership, total
revenue, payroll, and employees. The data are confidential and only available with an
application to the Census.
2
The commonly used strategy categories in the literature are low cost, differentiation
(such as innovation or quality and service) and focus strategies (Porter, 1980; Delery and
Doty, 1996; Cabrera et al., 2003). The niche market strategy we asked is similar to the
focus strategy.
3
They are consistent with theory and empirical approaches developed by Ichniowski
and Shaw (1995), and Ichniowski , Shaw, and Prennushi, 1997).
4
An alternative calculation would use a multinomial which takes account of the
difference in the frequency of each particular program.
5
We find a similar pattern if we examine the introduction or termination of plans.
Plants introduce 5 or 6 policies at once in 7.5% of the cases when they adopt EI
programs, whereas if they adopted plants independently, they should almost never
introduce 5-6 plans at once. Similarly, in 8% of terminations plants terminate 2 or more
programs in 24% of the times they terminate 2 or more plants. Given the data in Table 4
both patterns are highly unlikely.
6
We use the Quest computer software package to estimate the Rasch measure of EI
system.
7
Estimates using probit and logit specifications showed similar results and are
available from the authors.
8
The alternative would be to take each possible combination of EI practices as a
possible state for the firm, but with nine different programs, there would be 512 (=2
9
)
possible combinations, which is non-tractable with our data. Thus, rather than modeling
the links between specific programs, we make the distribution of the number of programs
the target of analysis.
9
In fact, because we have so few observations on firms with eight policies, it turns out
be an absorbing state, which is highly unlikely with additional observations.
10
This is a widely used measure of the difference between two distributions. Half of the
sum of the absolute value of the differences gives the amount of change necessary for the
two distributions to be the same.
18
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20
Table 1. Means and standard deviations of the proportion of establishments with EI programs by year, 1986-1995
Year (number of
reporting plants)
1986
(n=48)
1987
(n=48)
1988
(n=48)
1989
(n=48)
1990
(n=49)
1991
(n=51)
1992
(n=51)
1993
(n=51)
1994
(n=51)
1995
(n=51)
All years
(n=496)
J ob Rotation
0.47
(0.50)
0.47
(0.50)
0.47
(0.50)
0.48
(0.50)
0.53
(0.50)
0.63
(0.49)
0.69
(0.47)
0.73
(0.45)
0.75
(0.44)
0.75
(0.44)
0.60
(0.49)
Suggestion System
0.43
(0.50)
0.45
(0.50)
0.49
(0.51)
0.50
(0.51)
0.49
(0.50)
0.49
(0.50)
0.51
(0.50)
0.55
(0.50)
0.53
(0.50)
0.59
(0.50)
0.50
(0.50)
Quality of Work
Life
0.31
(0.47)
0.31
(0.47)
0.33
(0.47)
0.28
(0.45)
0.31
(0.47)
0.35
(0.48)
0.35
(0.48)
0.37
(0.49)
0.41
(0.50)
0.41
(0.50)
0.34
(0.48)
Quality Circles
0.35
(0.48)
0.37
(0.49)
0.37
(0.49)
0.30
(0.46)
0.27
(0.45)
0.29
(0.46)
0.22
(0.42)
0.24
(0.43)
0.27
(0.45)
0.29
(0.46)
0.30
(0.46)
TQM
0.35
(0.48)
0.37
(0.49)
0.37
(0.49)
0.32
(0.47)
0.33
(0.48)
0.45
(0.50)
0.43
(0.50)
0.41
(0.50)
0.43
(0.50)
0.47
(0.50)
0.39
(0.49)
Self-Managed
Work Team
0.10
(0.31)
0.10
(0.31)
0.10
(0.31)
0.10
(0.30)
0.16
(0.37)
0.22
(0.42)
0.29
(0.46)
0.35
(0.48)
0.31
(0.47)
0.33
(0.48)
0.21
(0.41)
J ob Redesign
0.22
(0.42)
0.22
(0.42)
0.22
(0.42)
0.22
(0.42)
0.25
(0.44)
0.29
(0.46)
0.31
(0.47)
0.35
(0.48)
0.41
(0.50)
0.43
(0.50)
0.30
(0.46)
J oint Labor -
Management
Committee
0.45
(0.50)
0.45
(0.50)
0.43
(0.50)
0.40
(0.49)
0.45
(0.50)
0.51
(0.50)
0.53
(0.50)
0.57
(0.50)
0.63
(0.49)
0.67
(0.48)
0.51
(0.50)
Employee
Representation
on Board of
Directors
0.06
(0.24)
0.06
(0.24)
0.06
(0.24)
0.06
(0.24)
0.08
(0.27)
0.08
(0.27)
0.06
(0.24)
0.06
(0.24)
0.06
(0.24)
0.06
(0.24)
0.06
(0.24)
Source: Interviews at 51 manufacturing establishments.
Notes: standard deviations are in parentheses.
21
Table 2. Correlation coefficients for EI policies and those policies with selected HR practices, 1986-1995
Job
Rotation
Suggestion
System
Quality
of work
Life
Quality
Circles
TQM Self-
Managed
Work
Team
Job
Redesign
Joint Labor-
Management
Committee
Employee
Representation
on Board of
Directors
Selection Performance
Appraisal
Suggestion
System
0.24*
Quality of work
Life
0.34* 0.25*
Quality Circles 0.02 0.27* 0.30*
TQM 0.14* -0.01 0.41* 0.26*
Self-Managed
Work Team
0.18* 0.10* 0.46* 0.17* 0.39*
J ob Redesign 0.22* 0.08 0.38* 0.10* 0.42* 0.51*
J oint Labor-
Management
Committee
0.20* 0.20* 0.33* 0.26* 0.37* 0.22* 0.48*
Employee
Representation
on Board of
Directors
-0.05 0.19* 0.26* 0.29* 0.09* 0.21* 0.12* 0.19*
Selection -0.02 0.06 0.18* 0.11* 0.11* 0.12* 0.14* 0.22* 0.05
Performance
Appraisal
0.10* -0.09* 0.20* 0.08 0.21* 0.08 0.29* 0.31* -0.13* 0.11*
Training 0.25* 0.05 0.20* -0.01 0.13* 0.08 0.09* 0.26* 0.21* 0.36* 0.29*
Source: Interviews at 51 manufacturing establishments.
Notes: * indicates that the pair-wise correlation coefficient between the two variables is significant at the 5% level.
22
Table 3. Differences in EI use between multi-plant and single-plant companies using the metric of the number of practices that differs
between establishments by year
1986 1987 1988 1989 1990 1991 1992 1993 1994 1995
Multi-plant companies
1 (2 plants) 2.00 2.00 2.00 2.00 4.00 3.00 2.00
2 (4 plants) 4.33 3.83 3.83 4.33 4.17 4.00 4.33 4.33 4.67 4.67
3 (2 plants) 2.00 1.00 1.00 1.00 2.00 2.00 1.00 2.00 2.00 2.00
4 (3 plants) 3.33 3.33 3.33 3.33 4.00 4.00 4.00 4.00 4.00 4.00
5 (2 plants) 3.00 4.00 4.00 5.00 3.00 3.00
6 (3 plants) 3.33 3.33 3.33 3.33 3.33 4.00 4.00 4.00 4.00 4.00
7 (2 plants) 6.00 6.00 6.00 6.00 6.00 6.00 5.00 5.00 6.00 6.00
Single-plant companies
(33 plants)
3.47 3.48 3.49 3.28 3.58 3.84 3.74 3.84 3.83 3.84
Source: Interviews at 51 manufacturing establishments.
Notes: the numbers indicate the total number of differences (in absolute values) in nine EIs between the plants belonging to the same company as
well as among the single-plant companies. If the number of pairs for comparison is greater than 2, we calculate the average total number of
differences. We test the differences between multi-plant and single-plant companies, such as multi-plant company 1, 2,,7 versus single plant
companies. Two of the seven multi-plant companies have a significantly smaller within-company variance in EI than the variance across the
single-plant companies; two have a significantly larger variance; the rest three are no different from single-plant companies.
23
Table 4. Number of establishments with specified EI programs and numbers adopting (+) or terminating (-) programs by year
Adoption of Policy
1986
(left-
censored) 1987 1988 1989 1990 1991 1992 1993 1994 1995
Total
Number at
end
J ob Rotation 23 1 3 5,-1 4 2,-1 2 38
Suggestion System 21 1 2,-1 2 -2 3 2,-2 1 3 30
Quality of Work Life 15 1,-2 2 2,-1 1,-1 2 2 21
Quality Circles 17 2,-1 -3 -2 1,-2 3,-4 1 2 1 15
TQM 17 1 -2 -2 3 6,-2 1,-1 -1 2 2 24
Self-Managed Work Team 5 -1 1 3 3, -1 5 3, -3 1 1 17
J ob Redesign 11 -1 1 2 2, -1 2 2 3 1 22
J oint Labor-Management
Committee 22 -1 -1 3 3, -1 2 2 3 2
34
Employee Representation on
Board of Directors 3 1 -1
3
Total Number of Adoptions
and Terminations (-)
4,-2 3, -11 5,-4 18, -2 24, -14 18, -2 14, -7 16 10 112, -42
Number of EI programs at the
51 establishments 134
136
128
129
145
155
171
178
194
204
Source: Interviews at 51 manufacturing establishments.
Notes: The numbers associated with individual programs with minus signs give the number of firms in the specified period that terminated
programs, while the positive numbers give the number that introduced the program.
24
Table 5. The duration of EI use before termination or by 1995
The total number of
adoptions
( - number of termination)
The mean
duration before
termination
(years)
The mean duration by
1995 if not terminated
(years)
J ob Rotation 40(-2) 4 9.3
Suggestion System 35(-5) 5 9.4
Quality of Work Life 25(-4) 8.5 9.7
Quality Circles 27(-12) 4.2 11.1
TQM 32(-8) 6.5 7.3
Self-Managed Work Team 22(-5) 8.3 4.6
J ob Redesign 24(-2) 10 5.7
J oint Labor-Management
Committee
37(-3)
7.7
9.8
Employee Representation on
Board of Directors
4(-1)
6
14
Source: Interviews at 51 manufacturing establishments.
Notes: The total number of adoptions is the sum of adoptions over time for each EI. Minus signs give the total number of terminations over time.
25
Table 6. Regression estimates for the analysis of the level of EI and adoption and termination of programs
Rasch
Level of EI
(1)
Rasch
Level of EI
(2)
Summated rating
index of EI
(3)
Summated rating
index of EI
(4)
Adoption
of EI
(5)
Adoption
of EI
(6)
Termination
of EI
(7)
Termination
of EI
(8)
EI value
t-1
-0.057*
(0.017)
-0.089***
(0.029)
0.017*
(0.010)
0.076***
(0.024)
Union
-0.745***
(0.147)
-1.148***
(0.227)
0.004
(0.047)
-0.013
(0.028)
Log Plant Size
-0.242*
(0.133)
-0.421*
(0.186)
-0.041
(0.027)
0.0003
(0.026)
Durable Manufacturing
-0.048
(0.176)
-0.295
(0.256)
0.088
(0.054)
0.024
(0.029)
Age of plant
-0.017
(0.009)
-0.008
(0.039)
-0.023
(0.014)
-0.013
(0.054)
-0.005*
(0.003)
0.022
(0.018)
-0.0002
(0.002)
0.006
(0.012)
Age Squared/100
0.009
(0.009)
0.001
(0.030)
0.011
(0.013)
-0.010
(0.043)
0.005*
(0.003)
-0.017
(0.015)
0.001
(0.002)
-0.004
(0.010)
Restructuring
t-1
-0.053
(0.215)
0.156
(0.170)
-0.745**
(0.354)
-1.096**
(0.442)
0.029
(0.072)
0.091
(0.100)
0.002
(0.038)
-0.099
(0.070)
Selection
t-1
0.021
(0.044)
-0.097*
(0.058)
0.080
(0.068)
0.004
(0.109)
0.022
(0.017)
0.023
(0.038)
0.005
(0.010)
0.023
(0.015)
Appraisal
t-1
0.155**
(0.080)
0.252**
(0.129)
0.287**
(0.113)
0.633***
(0.162)
0.054**
(0.024)
0.096
(0.068)
-0.017
(0.016)
-0.037
(0.030)
Training
t-1
-0.062
(0.115)
0.261***
(0.086)
0.152
(0.159)
0.850***
(0.163)
-0.002
(0.021)
-0.003
(0.047)
0.011
(0.018)
-0.009
(0.031)
Individual incentive pay
t-1
0.301**
(0.143)
0.568**
(0.220)
0.816***
(0.215)
0.430
(0.334)
0.013
(0.041)
0.033
(0.099)
-0.034
(0.027)
-0.194***
(0.072)
Gain sharing or group bonus
t-1
0.570***
(0.170)
0.511**
(0.200)
1.191***
(0.236)
0.459
(0.300)
-0.030
(0.046)
0.084
(0.102)
-0.022
(0.036)
0.071
(0.062)
Profit Sharing
t-1
0.142**
(0.058)
-0.112
(0.104)
0.177**
(0.090)
-0.128
(0.150)
-0.040
(0.024)
-0.010
(0.044)
0.011
(0.011)
0.031
(0.035)
Niche market
t-1
0.100
(0.090)
-0.119
(0.095)
0.163
(0.148)
-0.037
(0.149)
-0.029
(0.030)
-0.070*
(0.042)
0.019
(0.013)
0.004
(0.027)
Growth of market share
t-1
0.148**
(0.087)
0.143
(0.132)
0.195
(0.132)
0.102
(0.205)
0.025
(0.035)
0.134**
(0.065)
-0.044**
(0.021)
-0.056*
(0.033)
Max. shareholder value
t-1
-0.035
(0.066)
0.151
(0.107)
0.037
(0.095)
0.121
(0.163)
0.013
(0.021)
-0.023
(0.044)
0.014
(0.011)
-0.040
(0.033)
Short-term profit
maximization
t-1
0.028
(0.080)
-0.053
(0.130)
0.146
(0.121)
0.023
(0.175)
-0.043
(0.027)
-0.007
(0.054)
-0.004
(0.015)
0.001
(0.043)
Constant
0.565
(0.930)
-0.787
(1.027)
3.799***
(1.295)
-0.537
(1.779)
0.397*
(0.223)
-0.120
(0.520)
0.008
(0.096)
0.487
(0.266)
Adj. R
2
0.28 0.78 0.31 0.75 0.08 0.27 0.07 0.25
Year and Plant Fixed Effect
No Yes No Yes No Yes No Yes
Number of observations 445 445 445 445 445 445 445 445
Source: Interviews at 51 manufacturing establishments.
Notes: The number of observations is 445 because one year lag values are used (-51 observations), and also several firms were less than 10 years old by the survey year causing the unbalanced panel (the
total number of plant-year observations is 496). The level of EI is the Rasch value of EI for each year. Missing values of Plant Age, Size, Niche Market, Growth of Market Share, and Short-termProfit
Maximization are replaced by their mean value; dummy indicators of missing values for these variables are included in the regression to control for the effect of imputation. The estimates of these
dummy indicators are not reported for brevity. Standard errors are reported in parentheses. *, **, and *** indicate P <0.1, 0.05, and 0.01.
26
Table 7. Markov-Chain average transition matrix for the numbers of programs in year t to year t+1
YEAR t YEAR t+1
0 1 2 3 4 5 6 7 8&9
0 0.821 0.09 0.014 0 0.026 0.038 0.014 0 0
1 0.048 0.698 0.19 0.032 0.016 0 0 0.016 0
2 0 0.034 0.793 0.103 0.034 0.034 0 0 0
3 0 0 0.036 0.881 0.071 0.012 0 0 0
4 0 0 0 0.058 0.788 0.096 0.038 0.019 0
5 0 0 0 0.081 0.054 0.784 0.081 0 0
6 0 0 0 0 0 0.061 0.878 0.042 0.02
7 0 0.059 0 0 0 0.059 0 0.706 0.176
8&9 0 0.05 0 0 0 0 0 0 0.95
SUMMARY STATISTICS FROM MARKOV ANALYSIS
0 1 2 3 4 5 6 7 8&9
The initial vector for 1986 is 0.24 0.22 0.10 0.14 0.10 0.02 0.12 0.04 0.04
The 1995 vector is 0.04 0.04 0.18 0.22 0.14 0.16 0.12 0.02 0.10
The equilibrium vector is 0.02 0.04 0.10 0.26 0.15 0.14 0.14 0.03 0.12
It takes 20 iterations to reach equilibrium.
Source: Interviews at 51 manufacturing establishments.
27
Figure 1. Scatter diagram for numbers of EI policies adopted in establishments and numbers of other HR policies in establishments in 1995
Source: Interviews at 51 manufacturing establishments.
The
number
of EI in
use
Total number of other HR practices
28
Figure 2. The distribution of establishments by number of EI policies in 1986 and 1995
0
0. 05
0. 1
0. 15
0. 2
0. 25
0. 3
0 1 2 3 4 5 6 7 8 9
1986
1995
1995 pr edi ct
Source: Interviews at 51 manufacturing establishments.
Notes: No plants had all 9 EI policies in 1995. The number of plants in 1986 and 1995 is 48 and 51, respectively. 1995 predict denotes the
predicted probability of having 0-9 EI policies from the random draw distribution for 1995.
29
Appendix Table. Descriptive statistics of explanatory variables
Variable name Variable Definition Mean Standard Deviation
Union
=1 if a plant has a union representation; =0 otherwise; 0.54
Age of plant
Age of plant in years 37.32
29.71
Log Plant Size
Log of the Number of Production Workers in a plant 7.011
0.645
Durable Manufacturing
=1 if a plant manufactures durable products; =0 otherwise; 0.645
Restructuring
=1 if a plant has recently been restructured; =0 otherwise; 0.17
Selection
=the total number of selection programs used in a plant including a detailed
screening process, personal interview, aptitude test, physical exam,
reference check, and probationary period; takes a value from 0-6;
4.88
1.23
Appraisal
=the total number of performance appraisal programs used in a plant including
assessment centers, formal review sessions, and a standardized evaluation form;
takes a value from 0-3;
1.52
0.92
Training
=the total number of training programs used in a plant including on-the-job
training, team building training, on-site training, and tuition reimbursement;
takes a value from 0-4;
3.36
0.65
Individual incentive pay
=1 if a plant has adopted the individual incentive pay plan; =0 otherwise; 0.55
Gain sharing or group bonus
=1 if a plant has adopted a gain sharing plan or group bonus program; =0
otherwise;
0.40
Profit sharing
=1 if a plant has adopted an ESOP, cash or deferred profit sharing, or employee
stock purchase plan; =0 otherwise.
0.74
Niche market
The degree of a plants focusing on niche market in the scale of 1-5; 3.20
1.38
Growth of market
Share
The degree of a plants focusing on growth of market shares in the scale of 1-5; 3.63
1.33
Maximizing shareholder value
The degree of a plants focusing on maximizing shareholder value in the scale
of 1-5;
3.67
1.57
Short-term profit maximization
The degree of a plants focusing on short-term profit maximization in the scale
of 1-5;
3.51
1.14