Online Organizational Attraction: Influence of Organizational Social Information, Human Resource Policies and Website Characteristics

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1 Online Organizational Attraction: Influence of Organizational Social Information, Human Resource Policies and Website Characteristics XIAO Xiang, XIANG Hui School of Business, Hunan Normal University, P. R. China, Abstract Designing a Web-based simulation experiment, this study used signaling theory to analysis online organization attraction process. The main results of experiment indicated that (1) organizations use internet to present human resource policies and organization social information to applicants, which significantly affects applicant intention. (2) Web characterizes doesn t interact with HR policies, but have interaction effect with organization social information. This study confirmed the organization signaling process, which means organization use HR policies and organizational social information as signals to indicate their competition advantage. Organization should use HRM sub-website to improve organizational attraction effectiveness. Key words Organization Attraction, Human Resource Polices, Website Characteristics 1 Introduction The key of getting organization human resource advantage is attracting the right types of employees[1]. In the WWW era, organizational websites is an important mean to improve organizational attractiveness effectiveness. For organizational websites have become a primary source of information for job seekers, and have dramatically altered the way people search for jobs[2]. The importance of online organizational attraction has long been noticed, but the theory of online organizational attraction has been less established[3]. Although former traditional recruitment research mainly use person-organization fit theory to analysis applicant s behavior, this paper adopt signaling theory to proposes that organizational social information, human resource policies, and organizational website Characteristics could deeply affect apply intention. And explore the interaction pattern of these three kinds of information in online organizational attraction. Organizational website is a leading communication tool between applicants and organization. Some researches have attempted to determine which aspects of organizational website most influences job applicants attraction to an organization[4, 5]. But these researches had framed from the website s characters or applicant s perspective, rather than the organizational characteristics, such as corporate reputation, organization image and HR practices. Drawing on Signaling theory, this paper attempts to propose a theoretical and empirical model (see Fig 1) to explain what kind of characteristics and content of organizational website could effect on attraction of potential applicants. 2 Theoretical model and hypothesis development 2.1 Signaling Theory and Organizational Signaling Signaling theory holds that when it is difficult or impossible for organizations to measure applicant s future productivity, applicants will show their education and professional certifications and previous work experience to signal their future productivity to prospective employers[6]. This process was labeled as applicant signaling by Spence. It is difficult for an applicant to observe the actions of the organization directly. Applicant has imperfect information about organization, and applicant s decision on organization entry is made under uncertainty conditions[6]. Following Spence, we propose that organizations will promote three kind of information to applicants in order to signal their competitive advantage or core competence. We call this process Organization Signaling. In the first stance, organizational social information is about financial soundness, marketing and communications, community and environmental responsibility, innovativeness, quality of management, 529

2 and quality of products/services. We often find this information on website s homepages, organization s introduction and important events links. For example, Fortune 500 s websites often state their good environmental policies and practices (corporate social performance) on their website s home page. Secondly, applicants may be more interested in recruitment materials at organization s sub-site named as organizational employment website. Applicants may search organization s HR practices, such as compensation, career development, work/family policies, and organization culture. Today, most companies utilize organizational websites to disseminate information about HR practices to potential job applicants and as key components of strategic human resources. Thirdly, the website s characteristics such as speed, aesthetics, and usability would affect potential applicants use internet as a tool for application. An organization s HR policies and organizational social information (performance) may attract potential applicants by serving as a signal of working conditions in the organization. More specially, based on Signaling Theory we suggest that HR policies would be the signals as organization have more advantage than other competitors. It could also hypothesize that applicants can percept more organizational attraction because website has high usability which make applicants get more information. In the same way, applicants view those as a signal that the organization does have competence of using technology to get competition advantage. Therefore, we propose: Hypothesis 1: organization social information on the website will positively influence application intention. Hypothesis 2: human resource policies on the website will positively influence application intention. Hypothesis 3: website characteristics will positively influence application intention and 2.2 Moderating Effects of website characteristics Many researchers have notice website characteristics effects on attraction [5, 7-9]. Zusman and Landis demonstrated that applicants preferred jobs posted on web pages of higher quality to those posted on pages of lower quality. In addition, Cober et al suggested that a website s aesthetics and usability influenced applicant attraction. Sinar et al. observed strong links between system speed and organizational attractiveness. Williamson et al. indicated that website usability mediated the influence of website orientation on organizational attractiveness. That is, if an organizational website is beautiful, fast connected, and easy to use, applicants will be more attracted, spend more time to research this organization, and get more information about it, therefore, applicants may form a good impression of the organizational work image. On the other hand, applicants will get a bad impression from a poorly designed website and leave the website quickly. Therefore, we propose: Hypothesis 4a: website characteristics will have interaction effect with organizational social information in predicting application intention. Hypothesis 4b: website characteristics will have interaction effect with HR policies in predicting application intention. 530

3 Organization social information Website characteristics Application intention Human resource policies Fig 1 Online organizational attraction model 3 Method 3.1 Participants 100 undergraduate upperclassmen were invited from a regional university. 41 students actually completed the study for an overall 41% participation rate. Fifty-six students failed to provide complete information and had to be excluded from analyses date. The average age of the sample was 21.4 years old, and 48% of participants were female. 3.2 Website Designs We used Macromedia Dreamveaver to design the experiment website. For simulating online recruitment, we created four quasi-websites which include two pages that were modeled after four real section of local software companies website. The first page constituting companies websites was a home page that conveyed background information about the organization (organizational social information). The second page constituting companies websites contains general information about employment opportunities or human resource policies. And we created four recruitment WebPages that were modeled after four real local software companies job board on job search website. We use two kinds of web-based questionnaires to collect date at different times, one collecting individual information was administered prior to the start of the experiment, and another collecting their applicant intention was administered after participants visit to each web pages. 3.3 Manipulate and Measures The eight companies web pages represented eight treatment conditions (2 2 2) that high and low level of organizational social information, human resource policies and website characteristics (see Table 1). To manipulate high level treatment of organizational social information or human resource policies, we include six and more sentences in webpage to describe organization social performance or human resource practices. Comparatively, low level treatment of organizational social information or human resource policies, we Table experiment design Organizational social information Human resource policies Website characteristics High 2 6 and more sentences 6 and more sentences Home page and recruitment page Low 1 Less than 3 sentences Less than 3 sentences Only a job board page include less than three sentences. All the simulative websites or pages were random linked serially to ensure that participants could visit all eight companies web. To measure application intention, we adapted one items from previous attraction research[10]. The item measured as a self-reported probability, is based on what you know about this company, your 531

4 probability of applying to this organization is %. 3.4 Experiment Procedure Firstly, participants login into the experiment website, and were asked to complete the first questionnaire. Secondly, eight companies web pages were randomly presented to participants. After exploring each company s web pages, participants reported themselves application intention separately. Finally, a gift was sent for participation. 4 Result Data of application intention pass test of normality and test of homogeneity of variance, and application intention is independent and continuum variable. So we used Univariate Analysis of Variance to test hypotheses. Organizational social information have significant effects on application intention (p<.05). Human resource policies have significant effects on application intention (p<.001). Website characteristics have significant effects on application intention (p<.001). Hypothesis 1, 2, 3 were supported. F value of WC * OSI is significant, Hypothesis 4a was supported. But F value of WC *HRP is not significant, Hypothesis 4b was not supported. 5 Discussion Website characteristics have interaction effect with organizational social information in predicting application intention. Specifically, a high level of website characteristics (N=41) was related to greater attraction across all individuals. Website characteristics have no interaction effect with HR policies in predicting application intention. This means applicants focus on organization s human resource practices or policies, and not be confused by website characteristics when consider applying a job. Another possibility is as applicant see bad designed organizational website, they will have no interesting to knowledge any information of the organization. Our research suggested that applicants based on different information (organizational social information, human resource policies and website characteristics) from organizational website to decide application intention. This also proved organizational signaling process which based on signaling theory. In practices, managers possess more information than applicants regarding organization s competence, expected profits, risk exposure, etc. Therefore, managers can signal the information to applicants through organizational websites, e.g., framing a promising introduction on organization, HR practices, and beautiful website design. These actions may be very meaningful and affect the organizational attractiveness when Table 2 Univariate Analysis of Variance Factors F Sig. Organizational social information (OSI) Human resource polices (HRP) Website characteristics (WC) WC * OSI WC *HRP a R Squared =.190 (Adjusted R Squared =.172) asymmetric information prevails. Organizations must be aware of signals that may attract or repel candidates when they develop their recruiting progress. It will be a useful channel not only for big companies but also for small middle entrepreneurs (SMEs) to attract talent online. SMEs should invest more resource to design sophisticated organizational website for competitive advantage. 532

5 Reference [1] Peter Boxall. Achieving competitive advantage through human resource strategy: Towards a theory of industry dynamics. Human Resource Management Review, 1998,8(3):265~288 [2] Peter Cappelli. Making the most of on-line recruiting. Harvard Business Review, 2001,79(3):139~146 [3] Jonathan C. Ziegert and Karen Holcombe Ehrhart, A theoretical framework and guide for future research on applicant attraction, in Proceedings of the Sixty-fourth Annual Meeting of the Academy of Management, New Orleans, LA., [4] Richart T Cober, Douglas J Brown, Lisa M Keeping, and Paul E Levy. Recruitment on the net: How do organizational web site characteristics influence applicant attraction? Journal of Management, 2004,30(5):623~646 [5] Ian O Williamson, David P Lepak, and James King. The effect of company recruitment web site orientation on individuals' perceptions of organizational attractiveness. Journal of Vocational Behavior, 2003,63(2):242~263 [6] A M. Spence. Job market signaling. Quarterly Journal of Economics, 1973,87(3):355~374 [7] Richard T Cober and Douglas J Brown. Organizational web sites: web site content and style as determinants of organizational attraction. International Journal of Selection and Assessment, 2003,11(2/3):158~169 [8] R. R. Zusman and R. S. Landis. Applicant preferences for web-based versus traditional job postings. Computers in Human Behavior, 2002,18(3):285~296 [9] Evan F Sinar, Douglas H Reynolds, and Stephanie L Paquet. Nothing but Net? Corporate image and web-based testing. International Journal of Selection & Assessment, 2003,11(2/3):150~157 [10] Scott Highhouse, Filip Lievens, and Evan F. Sinar. Measuring attraction to organizations. Educational & Psychological Measurement, 2003,63(6):986~

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