Education, organizational commitment, and rewards within Japanese manufacturing companies in China

Abstract

Purpose: The purpose of this paper is to investigate the relationship between organizational commitment (OC) and extrinsic, intrinsic, and social rewards, among employees who work for Japanese manufacturing companies in China. Design/methodology/approach: Hierarchical regression analysis was utilized to examine survey data obtained from 27, 854 employees, who work for 64 Japanese manufacturing companies in China. Findings: The findings demonstrate that the variables measuring extrinsic, social, and intrinsic rewards were strongly related to OC, suggesting that the antecedents of OC in Japanese companies are different from those in other kinds of corporations in China and the West. A further comparison between university graduates and other employees showed that for graduates, extrinsic and intrinsic rewards had a stronger influence on OC than social rewards, compared to non-graduates. Research limitations/implications: This study used self-report data from individual respondents, which may have resulted in common method bias. Future research might consider including supervisor-rated scales to strengthen the study design and reduce common method bias. Practical implications – As Japanese companies in China have both Western and Chinese characteristics, they often utilize balanced human resources management (HRM) practices. To enhance their employees’ OC, especially those with less formal education, it is most effective to focus not only on some particular rewards but also on more varieties of rewards. However, balanced HRM may not be equally effective for enhancing the OC of university graduates, who prefer to obtain more extrinsic and intrinsic rewards and fewer social rewards. As Japanese companies are sometimes said to be less attractive workplaces, especially for university graduates, the results of this study could help HR professionals revise their HRM strategies and employ workers who can contribute to their Chinese branches on a long-term basis. Originality/value: This research investigates how employees of Japanese companies in China could have higher OC, by focusing on the difference between university graduates and non-graduates and utilizing a large volume of their opinion data.