INSTITUTIONAL PRESSURES PREDICTING WORK-FAMILY PRACTICE ADOPTION: THE MODERATING EFFECTS OF MARKET PERFORMANCE

Transcription

1 INSTITUTIONAL PRESSURES PREDICTING WORK-FAMILY PRACTICE ADOPTION: THE MODERATING EFFECTS OF MARKET PERFORMANCE Jarrod M. Haar Department of Strategy & Human Resource Management University of Waikato Private Bag 3105 Hamilton New Zealand Phone: Fax: haar@waikato.ac.nz Nick Batkin Department of Strategy & Human Resource Management University of Waikato Private Bag 3105 Hamilton New Zealand

2 1 INSTITUTIONAL PRESSURES AND WORK-FAMILY PRACTICE BUNDLE ADOPTION: THE MODERATING EFFECTS OF FIRM REPUTATION Jarrod M. Haar* Department of Strategy & Human Resource Management University of Waikato Private Bag 3105 Hamilton New Zealand Phone: Fax: haar@waikato.ac.nz Nick Batkin Department of Strategy & Human Resource Management University of Waikato Private Bag 3105 Hamilton New Zealand ABSTRACT: This study of 161 New Zealand firms explored the institutional pressures firms on work-family practice bundle adoption. Two types of institutional pressures were found: external and internal stakeholders, while three distinct sets of work-family practice bundles were found: health, flexibility, and dependent care. Market performance was also tested as a potential moderator as a proxy for firm reputation and stakeholder awareness. Both institutional pressures predicted health and dependent care bundles, while internal stakeholder pressures predicted the flexibility bundle. Market performance had significant moderation effects on both institutional pressures towards health and dependent care bundles. Overall, firms with greater market performance were more likely to adopt practices when institutional pressures increased.

3 2 The proliferation of work family policies has been widespread in recent years, with increasing pressure being placed on organizations due to a number of social, economic and political changes (Batt & Valcour, 2003). Given the pervasiveness of the institutional pressures placed on the organization, it is surprising that there has been little empirical research carried out to understand the strategic responses of the organizations (Goodstein, 1994). Perry-Smith and Blum (2000) defined work-family bundles as a group of human resource policies enacted to help employees manage a range of non-work roles. The rationale behind organizations adopting these work family bundles, such as childcare assistance and flexible working hours, has been to temperate the pressures faced by employees who are juggling work and family responsibilities (Goodstein, 1994; Judge, Boudreau, & Bretz, 1994; Osterman, 1995). However, the literature is beginning to question whether these policies in fact facilitate the balancing of these competing roles (Kossek & Ozeki, 1998; Thompson, Beauvais, & Lyness, 1999). Behson (2005) showed that organizations need to be truly supportive of formal work-family practices and spend a considerable amount of time and energy to create a supportive culture in order to benefit from work family practices. The present study seeks to explore firm reactions to institutional pressures towards adopting work-family practices. For example, are firm reacting to employee pressure for greater work-family balance, or is their adoption due more to external pressures to being seen to be caring and modern. Work-family bundles require further attention due to their reported importance in employee retention. For example, there is a major worldwide skill shortage, with the New Zealand workforce needing another 67% of industrial workers to satisfy demand (New Zealand Department of Labour, 2008). WORK-FAMILY PRACTICE BUNDLES Today, organizations are starting to see the chance to gain legitimacy through the proliferation of work family practices and bundles. Goodstein (1994) suggested that organizations no longer act to swallow the family and take over its functions (p.354), but rather views them as a competing loyalty that needs to be moved aside and excluded from the business sphere (Kanter, 1977). This change of view has been brought about by the rapidly increasing amounts of pressure exerted on employers to introduce work family bundles and acknowledge that work life and family life are no longer mutually exclusive spheres (Goodstein, 1994). The earliest experimentation with work family practices can be

4 3 traced back to the American civil war when the first onsite childcare centre was opened by a firm manufacturing soldier s uniforms. Though the benefits of this were considerable, serious activity did not start to occur in this area until the 1980s (Friedman, 1990). The literature has suggested that the proliferation of work family practices may have occurred in response to concerns of unionisation and government regulation or in order benefit from social exchange theory. The basis behind this is that by supporting employees through work family policies, the employees will feel obliged to reciprocate through greater initiative and participation (Glass & Estes, 1997; Lambert, 2000). The OECD (2004) described work-family bundles as policies that facilitate the reconciliation of work and family life by fostering adequacy of family resources and child development, facilitate parental choice about work and care, and promote gender equality in employment opportunities (p.10). These practices typically consist of providing a range of childcare options including onsite childcare or directly financing off-site childcare, as well as a number of work place options including, flexitime, job sharing, and voluntary shifts (Goodstein, 1994). Hence, bundles or groups of these work-family practices are utilised by organizations to signal to current and potential employees that they take care of their employees and have a strong value system in place (Grover and Crooker, 1995). Stavrou (2005) tested work-family bundles in the European Union and found bundles helped decrease turnover, improve performance and reduce absenteeism. Hence, work-family practice bundles can be of strategic importance to a firm. The New Zealand Setting The proliferation of childcare services is of particular interest in New Zealand as childcare is seen as a considerable cost. Women in families with only one child receive a mean income of $16,300, reducing to $12,900 for women with five children, significantly reducing the financial rewards of those who choose to return to work force (Statistics New Zealand, 2005). Amongst New Zealand parents there is a relatively high rate of unemployment and utilization of the domestic purpose benefits (state support for single parents), the employment rate of sole parents is only around 50% compared with up to 80% in other countries (OECD, 2004). Hence, the ability of work-family practice bundles to aid working mothers seems particularly challenging, given the low participation rates within New Zealand. As such, understanding why New Zealand firms might seek to adopt such practices becomes

5 4 an even more interesting proposition, as firm behaviour towards work-family practices might be in reaction to poorly understood drivers. INSTITUTIONAL THEORY & HYPOTHESES When looking into the pressures influencing the decision to adopt work-family practices the literature presents two differing arguments. The first being rational choice theory whereby the decision is based on efficiency and the other being institutional theory (Glass & Estes, 1997). This article will focus on the institutional theory argument, which implies that expectations regarding organizational behavior and form are gained from the wider social environment, and that the organization must conform to these rules and requirements in order to receive support and legitimacy from external constituents (Kondra & Hinings, 1998; Gupta, Dirsmith & Fogarty, 1994). Using this definition a legitimate organization can be defined as one whose values and actions are congruent with that social actor s values and expectations for action (Deephouse 1996, p.1025). DiMaggio and Powell (1983) noted that institutional theory is particularly useful for examining the reasons firms display significant differences in the initial stages of their life cycle and then converge towards homogenization in the latter stages (called isomorphism). A more in-depth definition of this phenomenon is that isomorphism is a constraining process whereby one member of a population is forced to resemble other members who face the same set of environmental conditions. Critical constituents have also been identified as a driving force in the adoption of work family practices (Goodstein, 1994). A major component of this is the dramatic change in the composition of the workforce. Woman now make up a significant portion of the workforce, as do duel career and single parent families (Goodstein, 1995). Goodstein (1994) found that organizations that employ a high proportion of women are more likely to enact a compromise strategy and thus introduce work family practices, and New Zealand fits this context. Another issue of growing importance has been shown to be eldercare due to the aging population. A factor critical to the recognition of these work family issues was found to be the external visibility of the organization. Goodstein (1995) found that when external visibility was high due to factors such as enhanced media coverage there is a greater likelihood of identifying potential work family issues.

6 5 According to Gupta et al. (1994), institutional theory illustrates how firms are required to demonstrate a level of conformity to institutionalised expectations of performance, which then leads to specific behaviors that see firms converge towards a homogeneous organizational form. For example, a firm wishing to be observed as an equal opportunity employer and who wants to appear mindful of their employees needs may adopt a bundle of work-family practices. Traditionally the literature on institutional theory focused on a number of environmental elements such as the market, competitor firms, availability or resources, and location of customers (Scott, 1987). There was a change of focus after the release of the framework set out by DiMaggio and Powell (1983) towards the increasing roles of professional organizations and the state. The literature now defines three distinct mechanisms of institutional pressure: (1) Coercive isomorphism, where coercive pressure (often political) is applied to enforce compliance with organizational norms (Kondra & Hinings, 1998) such as the New Zealand Health and Safety in Employment Amendment Act 2002 which sought to draw attention to employee stress and fatigue; (2) Mimetic isomorphism, where firms mimic alternative organizational routines or forms that they perceive to be more legitimate (Kondra & Hinings, 1998; DiMaggio & Powell, 1983) and; (3) normative isomorphism, stems from professionalization, whereby firms bring in more professionals in order to establish a cognitive base and gain more legitimacy for their occupational autonomy (DiMaggio & Powell, 1983). Scott (1987) postulated that mimetic changes are likely to be less superficial than coercive or normative changes as organizational managers will be more committed to adoption, implementation and enforcement of the changes than external agents. Deephouse (1996) showed that there are two distinct types of legitimacy gained by firms. These are regulatory endorsement whereby the organization is accepted by the state agencies that regulate it and public endorsement whereby the organization is accepted by the general public. One ongoing criticism of institutional theory is that it has tended to focus on the effects of the institutional environment on structural conformity and isomorphism while overlooking the role of active agency and resistance to environmental pressures (Oliver, 1991). Organizations have been shown to act in a number of ways ranging from conforming to unequivocal resistance, from passive compliance to direct influence depending on the strength and origin of the pressure exerted (Oliver, 1991). Institutional theory can be utilised to explore the likelihood that firms will adopt work-family

7 6 practices. Mimetic pressures may influence firms to either consciously or unconsciously adopt workfamily practices, while normative pressures may stem from first mover organizations who have gained significant benefits from implementing particular work family practices. The OECD (2004) made a number of recommendations for New Zealand that would see firms facing coercive isomorphism in order to implement work-family practice bundles. The recommendations consisted of enacting subsidies to entice employers to provide workplaces with tailored advice on work-family practices and to ensure a long term commitment to work family practices. Consequently, the purpose of this article is to determine what effect institutional pressures have on work-family practice bundle adoption in New Zealand, and whether this pressure is more pronounced from within the organization (employee and management pressures) or from external stakeholders (e.g. shareholders and customers). Haar and Spell (2007) operationalised compliance towards institutional pressures as a way of measuring New Zealand firm responses to institutional pressures towards employee drug testing adoption. In a similar vein, it is suggested that New Zealand firms that perceive greater institutional pressures from various stakeholders will be more likely to adopt work-family practice bundles. This leads to our first set of hypotheses. Hypothesis: Firms with greater pressures from (1) internal and (2) external stakeholders will have greater work-family practice bundles. THE MODERATING EFFECTS OF MARKET PERFORMANCE An important aspect of institutional theory is the public profile and appearance of firms towards their various stakeholders. Part of the institutional pressures firms face is about being seen to be more innovative and cutting edge than their competitors. For example, organizations may adopt similar work-family practice bundles as competitors (Deephouse, 1996) in response to institutional pressures, while firms wishing to be seen as progressive and mindful of employee behaviour (Haar & Spell, 2007, p. 202), may adopt practices as a way of demonstrating this. Given that work-family issues are now globally established and accepted, it is expected that organizations will demonstrate conformity to institutionalised expectations of rational practice by adopting work-family practice bundles (Gupta, Dirsith, & Fogarty, 1994). However, it is also of interest whether some firms have greater exposure to institutional pressures than others. This paper suggests that firms with greater reputation and stronger

8 7 market leader positions will be more scrutinised and more closely followed by stakeholders than competitors lagging in market performance. Further, it is expected that firms at the forefront of their industries and markets to be more likely to engage and respond to institutional pressures than firms who are less successful. Consequently, it is also expected that firms with greater market performance will feel additional pressures and thus respond by adopting larger work-family practice bundles. Hypothesis: A firms reputation will strengthen the relationship between pressures from (3) internal and (4) external stakeholders and greater work-family practice bundles adoption, with firms with a stronger reputation having larger bundles. METHOD Sample and Procedures Data was collected from a mail survey of 1000 New Zealand companies with a minimum of 50 employees in 2006, as part of a larger study into New Zealand firms. This was a random sample of New Zealand organizations drawn from the New Zealand Post list of company addresses. Letters were specifically addressed to CEOs or Senior Managers supplied from the database, and their opinions were sought on their firm s level of volume and involvement in work-family practices, their understanding of the types of pressures from stakeholders they perceive, and their firm s current market performance. In addition, organizational data was collected (e.g. female workforce, number of sites etc.). In total, 161 usable responses were returned for a response rate of 17.5%. On average, firms had been in business 56 years, employed 443 employees, 41% of whom were female, and 41% having some tertiary training/qualification. Thirty two percent of respondent firms were in the manufacturing sector, 11% finance, insurance, and real estate sector, 16% retail and 17% community. Measures Work-Family Practice Bundles were measured with 12-items based on the work of Perry-Smith and Blum (2000). Twelve work-family practices common to the work-family literature were tested; however the measure of each practice was extended beyond simply having a practice and not having a practice (coded 1 and 0 respectively in the Perry-Smith & Blum, 2000). The rationale for this is that institutional theory implies that many organizational practices may attain legitimacy through the social construction of reality (Wright & McMahan, 1992), and because organizations are embedded in

9 8 institutional environments, these might influence what practices are adopted (DiMaggio & Powell, 1983). Thus, adoption of work-family practices might be due to a desire to demonstrate conformity (Gupta, Dirsmith & Fogarty, 1994) rather than to seek actual employee benefits like employee retention. As such, CEOs and HR Managers were asked to rate their involvement in each work-family practice as a way to gather a clearer indication of a firm s involvement and commitment (e.g. financial resources) towards each work-family practice, coded 1=no involvement, 3=some involvement, and 5=full involvement (money, time, resources). An exploratory factor analysis (principal components, varimax rotation) was run to explore the nature of the measures. Similar to Perry-Smith and Blum (2000), the initial factor analysis resulted in three factors but with some cross-loadings. As with Perry- Smith and Blum (2000), the factor extraction was forced into three factors. See Table 1. Institutional Pressures was measured with five-items created for this study, coded 1=no pressure, 5=lots of pressure. An exploratory factor analysis (principal components, varimax rotation) was run to explore the nature of the measure. See Table 2. Market Performance was measured using 4-items from Spanos and Lioukas (2001), coded 1=much below average, 5=much above average. This measure had a Cronbach s alpha of.84. Analysis To examine the direct effects of institutional pressures on work-family practice bundles (Hypotheses 1 to 3), and the potential moderating effects of market performance on these relationships (Hypotheses 4 to 6), hierarchical regression analyses were computed with the three work-family practice bundles as the dependent variables. Control variables (workforce gender, competitive rivalry, business sector, and total number of sites) were entered in Step 1. The independent variables (institutional pressures (external stakeholders and internal stakeholders)) were entered together in Step 2. The potential moderator variable (market performance) was entered in Step 3. Lastly, the interaction variables (institutional pressures (external stakeholders and internal stakeholders) x market performance) were both entered in Step 4. The centering procedure (Aiken & West, 1991) was followed where interaction effect variables were z-scored. Institutional pressures from both sources and their interactions were observed in each model at the same time to test the effects of institutional pressures together rather than in isolation.

10 9 RESULTS Results of the regressions for Hypotheses 1 to 4 are shown in Tables 4, 5 and 6. Institutional pressures (external stakeholders) was significantly related to work-family practice bundle (health) (ß=.11, p<.1), as was institutional pressures (internal stakeholders) (ß=.38, p<.001). From Step 2, it can be seen that these two dimensions of institutional pressures accounted for 15% (p<.001) of the variance for health related work-family practice bundles. Marketing performance had a significant interaction effect on institutional pressures and work-family practice bundle (health), for both external stakeholders (ß= -.16, p<.05) and internal stakeholders (ß=.20, p<.05). For the workfamily practice bundle related to flexibility, institutional pressures (external stakeholders) held no significant direct effects, but institutional pressures (internal stakeholders) was significantly related (ß=.27, p<.01). From Step 2, it can again be seen that these two dimensions of institutional pressures accounted for a more modest 7% (p<.01) of the variance for flexibility related work-family practice bundles. However, there were no significant interaction effects from either dimension of institutional pressures. Finally, institutional pressures (external stakeholders) was significantly related to workfamily practice bundle (dependent care) (ß=.21, p<.01), as was institutional pressures (internal stakeholders) (ß=.21, p<.05). From Step 2, it can be shown that these two dimensions of institutional pressures accounted for 10% (p<.001) of the variance for dependent care related work-family practice bundles. Marketing performance also had a significant interaction effect on institutional pressures and work-family practice bundle (dependent care), for both external stakeholders (ß= -.17, p<.05) and internal stakeholders (ß=.29, p<.01). To facilitate interpretation of the significant moderator effects on the work-family practice bundles, plots of the interactions for work-family practice bundle (health) are presented in Figure 1 (institutional pressures external stakeholders market performance) and Figure 2 (institutional pressures internal stakeholders), while plots of the interactions for work-family practice bundle (dependent care) are presented in Figure 3 (institutional pressures external stakeholders market performance) and Figure 4 (institutional pressures internal stakeholders). Plotting the interaction terms illustrates that when institutional pressures (external stakeholder) is low, there is a significant difference between firms reporting higher or lower market performance, with

11 10 firms with higher market performance reporting greater work-family practice bundle (health). When institutional pressures (external stakeholder) increase to high, all firms report higher work-family practice bundle (health), although firms with higher market performance report higher levels of health bundles. Plotting the interaction terms shows that when institutional pressures (internal stakeholder) is low, there is little difference between firms reporting higher or lower market performance and adopting work-family practice bundle (health). However, when institutional pressures (internal stakeholder) increase to high, firms with higher market performance report significantly higher workfamily practice bundle (health) than firms with low market performance. Plotting the interaction terms illustrates that when institutional pressures (external stakeholder) is low, there is a significant difference between firms reporting higher or lower market performance, with firms with higher market performance reporting greater work-family practice bundle (dependent care). When institutional pressures (external stakeholder) increase to high, all firms report slightly higher work-family practice bundle (health), although firms with higher market performance maintain a much higher level of dependent care bundles. Plotting the interaction terms illustrates that when institutional pressures (internal stakeholder) is low, there is a significant difference between firms reporting higher or lower market performance, with firms with lower market performance reporting greater work-family practice bundle (dependent care). However, when institutional pressures (internal stakeholder) increase to high, firms with high market performance report much increased adoption of work-family practice bundle (dependent care), while firms with low market performance maintain stabilised levels of dependent care bundles even when internal stakeholder pressure increases. The overall strength of the work-family practice bundle models are significant and substantial for health (R 2 =.27, F = 5.174, p<.001), flexibility (R 2 =.21, F = 3.756, p<.001), and dependent care (R 2 =.20, F = 3.362, p<.01). Finally, the variance inflation factors (VIF) were examined for evidence of multicollinearity. Experts suggest multicollinearity can be detected when the VIF values equal 10 or higher (Neter, Kutner, Nachtsheim, & Wasserman, 1996; Ryan, 1997). However, all the scores for the regressions were below 2.0, indicating no evidence of multicollinearity unduly influencing the regression estimates.

12 11 DISCUSSION The present study sought to test two major aspects. Firstly, whether firms that feel they receive strong pressure from institutional stakeholders towards adopting work-family practice bundles do respond with greater practice adoption, and secondly, whether firms with greater market positions respond to this pressure with intensified practice adoption due to heightened public profiles. Deephouse (1996) noted that there are a number of gaps present in the current body of literature on institutional pressures. This study has helped to alleviate some of these criticisms by illustrating that firms who felt greater pressures from both internal and external sources were significantly more likely to implement work family bundles such as flexibility, health and dependent care than firms facing lesser pressures. Importantly, it was found that stakeholder pressure was statistically separated into external and internal pressures which indicate that pressures from within a firm, especially employee pressures in a tight labour market, may be a strong force for firm reactions to institutional pressures. It was found that these internal pressures are in fact the main driver in this process. While both internal and external pressures were significantly correlated with all three work-family practice bundles, in the regression models, internal pressures were significantly related to all three bundles, while external pressures were also shown to play a significant role particularly towards dependent care bundles. Evidence was also discovered showing that external pressures can force a decision to adopt work family practices but these were not as strong as the pressures stemming from the internal environment. This study identified three key work family bundles: (1) Flexibility, (2) Health, and (3) Dependent Care. When market performance is found to be high the likelihood that these bundles will be adopted increases. This holds for all of the cases except for the dependent care bundle whereby, with low levels of internal pressure the likelihood of adoption is lower though the organization may be experiencing high levels of market performance. When examining the dependent care bundle is becomes apparent that the main driver behind the adoption of these policies is in fact external pressures. This can be observed in figure 3 whereby there is a large gap between the graphs for firms with high and low market performance. There is mixed support for these findings within the body of literature on this topic. The majority of the institutional theory literature has found that the external environment exerts significant

13 12 pressures on the organization and is a major driver of change. Authors such as Goodstein (1994) have found that the internal environment can also become a major driver, as changes in demographics can lead to increasing dissatisfaction with the current work family policies. The set of findings presented here supports the argument that internal pressures can be a major driver for change. As employees and internal stakeholders are most affected by work-family bundles it holds that the greatest pressures should stem from this group, especially given the tight labour market. Firms facing institutional pressures both from the internal and external realm have been shown to act in a number of ways. For example, firms may take an avoidance approach as internal pressures mount due to tight labour market conditions because the firm may soften their approach and begin to compromise in order to recruit and retain employees (Oliver, 1991). Gordon and Whelan (1998) have demonstrated that firms offering work family practices are in a better position to retain talented staff members, substantially reducing the costs incurred in the recruitment and training process. The current record low unemployment levels present in the New Zealand economy are making it increasingly difficult for firms to find and retain suitable staff. These pressures are forcing companies to work harder to maintain their current staff members who may also be making increasing demands as they suddenly find themselves in a position of power. Consequently, pressures are being levelled at organizations from both internal and external stakeholders, and therefore, organizations are increasingly responding to these pressures as they may find they simply cannot avoid them. As such, firms are faced with the stark reality that if they do not offer better working conditions (and consequently work-family practices), than their competitors who do might take their skilled employee base. Future research is needed to see if these pressures subside when the labour market begins to cool off as the economy slows down and hence the unemployment rate increases, and consequently, whether firms respond my reducing their commitment to work-family practices. In addition to the direct effects, the moderating effect of market performance as a proxy for firm reputation and awareness in the marketplace was tested as this approach has not been utilised in the literature. Our findings suggest that a firm that has higher market performance will react to institutional pressures much more than under performers, because they are more in the public eye. While market performance had no effect on work-family practice bundles related to flexibility, there

14 13 were consistent findings towards health bundles. When pressures increased from both internal and external pressures, firms reacted with higher work-family practice bundles (health) when they reported greater market performance. Hence, these firms are probably facing greater public scrutiny, and hence react more strongly to institutional pressures. There are similar effects for bundles focused on dependent care. For internal pressures, there is a heightened sense of adoption for dependent care practices when market performance is higher, with a clear distinction between higher and low market performers. The effects for external pressures are slightly different, with significant changes occurring as pressures increase. When external pressures are low, dependent care practices are more numerous in firms with lower market performance. However, as external pressures increase, firms with higher market performance respond strongly adopting significantly more work-family practice bundles (dependent care) than their competitors with less market scrutiny. Overall, the sample utilized for this study is a fair representation of the New Zealand population, with a good mix of firms from a number of sectors, with a variety of employee compositions regarding age, gender and education levels. This study however is limited by the sample size of only 168 firms. A second limitation present is that the results are self reported and therefore may include self-reporting bias. However, the sample is broad with a wide range of industries and firm sizes. A further limitation related to the data being collected at a single point in time is common method variance concerns. As such, a Harman s One Factor Test was conducted for common method variance as this approach is seen as a useful rudimentary check (e.g. Major, Klein, & Ehrhart, 2002). The resulting factor analysis (unrotated) resulted in ten factors, the largest accounting for 18.4% of the variance. Given that a single dominant factor did not emerge, this test indicated little evidence of common method variance (Podsakoff & Organ, 1986). There are also implications for managers. Clearly, some adoption of work-family practices is in response to the internal pressures of stakeholders, most likely skilled employees who are struggling with the issue of work-family balance. Stavrou (2005) found work-family bundles helped decreased turnover, improved performance and reduced absenteeism. The implications are that work-family practice bundle adoption might be in response to pressures that can still have a positive influence on firms and ultimately, their bottom line. Perhaps firms adopting these practice bundles are exercising

15 14 greater concern for their employee issues and are possibly in return gaining performance benefits. Consequently, firms might examine where and why such pressures are being projected towards the firm and its HR department, and if potential benefits can be enjoyed by all stakeholders (organization and employees), then the adoption of such bundles might be a win-win situation for all. CONCLUSION A key strength of this study is that it looks at the internal and external pressures exerted on organizations with the moderating effect of market performance. This provides a unique perspective that has not been presented before in the literature on institutional pressures. This paper has shown that firms who enjoy higher levels of market performance typically experience higher levels of pressure from both internal and external stakeholders. These pressures may stem from the current tight labour market conditions present in New Zealand. Future research is needed to ascertain if these pressures will continue as the labour market conditions begin to ease.

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20 19 Table 1. Exploratory Factor Analysis of Work-Family Practices Bundle Indicate the extent to which your company engages in the following activities related to employee work-family balance. For each activity, indicate your engagement from (1)=no involvement, (3) some involvement, (5)=full involvement (money, time, resources). Factor Loadings: Work-family Practice Bundles Health Flexibility Dependent Care Stress Issues (e.g. leave) Work-family policy Health/wellness initiative Employee assistance program Paid parental leave (above legislated minimum) Redeployment after childbirth (restarting part-time etc.) Flexitime Job sharing/part-time work On-site childcare Financial assistance for childcare Childcare information Eldercare information Eigenvalues Percentage variance 21.9% 20.2% 19.7% Number of items in measures 4-items 4-items 4-items Cronbach s Alpha Table 2. Exploratory Factor Analysis of Institutional Pressures Regarding Work-Family

21 20 The following questions relate to the amount of pressure from various sources, your firm is under to respond to work-family programs. For each source, indicate the extent to which you receive (1)=no pressure, (5)=lots of pressure. Institutional Pressures (External Stakeholders) Factor Loadings Institutional Pressures (Internal Stakeholders) Shareholders Customers Competitors Employees Personal values, beliefs and/or commitments of management Eigenvalues Percentage variance 39.7% 35.9% Number of items in measures 3-items 2-items Cronbach s Alpha.77.78

22 21 Table 3. Correlations and Descriptive Statistics of Study Variables M SD Business Sector Competitive Rivalry Market Performance Institutional Pressures 4. External Stakeholders Internal Stakeholders * ** -- Work-family Bundles 6. Health * -.20*.08.28**.42** Flexibility ** **.30**.62** Dependent Care **.31**.38**.38** -- N=161, *p<.05, **p<.01

23 22 Table 4. Hierarchical Regression Analysis for Moderator Effects of Marketing Strategy and Institutional Pressures on Firm Adoption of Work- Family Practice Bundle (Health) Work-Family Practice Bundle (Health) Variables Step 1 Controls Only Step 2 Direct Effects Step 3 Moderator Effects Step 4 Interaction Effects Workforce Gender Competitive Rivalry -.18* Business Sector Number of Sites Institutional Pressures (External Stakeholders) Institutional Pressures (Internal Stakeholders).38***.37***.34*** Marketing Performance Institutional Pressures (External Stakeholders) x Marketing Performance Institutional Pressures (Internal Stakeholders) x Marketing Performance -.16*.20* R 2 change.08*.15*** Total R Adjusted R F Statistic 2.769* 6.566*** 5.815*** 5.174*** p<.1, * p<.05, ** p<.01, *** p<.001, Standardized regression coefficients. All significance tests were single-tailed.

24 23 Table 5. Hierarchical Regression Analysis for Moderator Effects of Marketing Strategy and Institutional Pressures on Firm Adoption of Work- Family Practice Bundle (Flexibility) Work-Family Practice Bundle (Flexibility) Variables Step 1 Controls Only Step 2 Direct Effects Step 3 Moderator Effects Step 4 Interaction Effects Workforce Gender Competitive Rivalry Business Sector.29**.22**.23**.23** Number of Sites Institutional Pressures (External Stakeholders) Institutional Pressures (Internal Stakeholders).27**.27**.24** Marketing Performance Institutional Pressures (External Stakeholders) x Marketing Performance Institutional Pressures (Internal Stakeholders) x Marketing Performance R 2 change.13*.07** Total R Adjusted R F Statistic 4.729** 5.212*** 4.536*** 3.756*** p<.1, * p<.05, ** p<.01, *** p<.001, Standardized regression coefficients. All significance tests were single-tailed.

25 24 Table 6. Hierarchical Regression Analysis for Moderator Effects of Marketing Strategy and Institutional Pressures on Firm Adoption of Work- Family Practice Bundle (Dependent Care) Work-Family Practice Bundle (Dependent Care) Variables Step 1 Controls Only Step 2 Direct Effects Step 3 Moderator Effects Step 4 Interaction Effects Workforce Gender.20* Competitive Rivalry Business Sector Number of Sites Institutional Pressures (External Stakeholders).21**.21*.23** Institutional Pressures (Internal Stakeholders).21*.21*.16 Marketing Performance Institutional Pressures (External Stakeholders) x Marketing Performance Institutional Pressures (Internal Stakeholders) x Marketing Performance -.17*.29** R 2 change.04.10**.00.05* Total R Adjusted R F Statistic ** 3.073** 3.362** p<.1, * p<.05, ** p<.01, *** p<.001, Standardized regression coefficients. All significance tests were single-tailed.

26 25 Figure 1. Interaction Effects of Market Performance towards Institutional Pressures (External Stakeholders) Work-Family Practice Bundle (Health) Work-Family Practice Bundle (Health) Institutional Pressures (External Stakeholder) Low Market Performance Low Market Performance High Market Performance Low Institutional Pressures (External Stakeholder) High Market Performance High Figure 2. Interaction Effects of Market Performance towards Institutional Pressures (Internal Stakeholders) Work-Family Practice Bundle (Health)

27 26 Work-Family Practice Bundle (Health) Institutional Pressures (Internal Stakeholder) Low Market Performance Low Market Performance High Market Performance Low Institutional Pressures (Internal Stakeholder) High Market Performance High Figure 3. Interaction Effects of Market Performance towards Institutional Pressures (External Stakeholders) Work-Family Practice Bundle (Dependent Care)

28 27 Work-Family Practice Bundle (Dependent Care) Institutional Pressures (External Stakeholders) Low Market Performance Low Marketing Performance High Marketing Performance Low Institutional Pressures (External Stakeholders) High Market Performance High Figure 4. Interaction Effects of Market Performance towards Institutional Pressures (Internal Stakeholders) Work-Family Practice Bundle (Dependent Care)

29 28 Work-Family Practice Bundle (Dependent Care) Institutional Pressures (Internal Stakeholders) Low Market Performance Low Marketing Performance High Marketing Performance Low Institutional Pressures (Internal Stakeholders) High Market Performance High