Tag Archives: PO

What Business Leaders can learn from the Psychology of Ownership

Posted on by

A GUEST COMMENTARY BY FABIAN BERNHARD, ASSOCIATE PROFESSOR OF MANAGEMENT AT EDHEC BUSINESS SCHOOL IN FRANCE

TSOO: You have been doing research  in the field of ownership, could you please tell us the main insights?

Our constitution* states that „Property entails obligations.” Accordingly, owners of an object have certain rights and duties how to act with their possessions. Most people are very much familiar with this legal aspect of ownership. Less known, however, are the psychological aspects of the feeling of ownership. Research during the past decade has started looking into this phenomenon referred to as “psychological ownership”.

Psychological ownership influences human thinking and acting. And indeed latest research in the field of neuroscience confirms what philosophers, psychologists, sociologists, and business scholars have suspected and theorized for a long time. Ownership about material and immaterial objects has a strong motivational force on the way we act and our attitude towards things. Once we call an object “ours” and feel like having the right to possess it we tend to taking better care of it. We are motivated to closely paying attention to the owned object, supporting it, improving it, and also have difficulties relinquishing it.

While the psychological effects of ownership are present in all aspects of our daily lives, it is particularly the business world that has become interested in using psychological ownership as a motivational tool managing their workforce. The idea is to make employees feel and act like owners. When they feel like the organization is ‘theirs’ they potentially put more effort into it. However, rather than giving out shares and making employees factual and “legal” owners, it has been shown that the mere ownership feeling can increase individual commitment and performance.

Given these desirable outcomes the question arises how to actively influence employees’ psychological ownership. Together with a psychologist we looked deeper into this phenomenon. In a quantitative study of 50 companies we examined the ownership feelings of over 200 employees. We found that psychological ownership can depend on the business owners’ leadership style. Certain business owners in our study were more transformational in their leadership to their employees than others. They acted as role-models, provided their workforce a general vision but left enough autonomy for their followers to find their own ways to fulfill goals. Employees under such leadership were more likely to develop ownership feelings. On the other side, results showed that transactional leaders, meaning those that put emphasis on extrinsic rewards and control created them to a lesser degree. While transactional leaders were still effective, a third group of leaders, those who followed a “laissez-faire” approach, meaning not giving enough guidance to employees, blocked the emergence of ownership feelings.

In line with these findings, the study also showed that those employees with higher degrees of psychological ownership demonstrated more positive attitudes and behaviors. For example, the psychological owners displayed higher levels of performance and were more willing to go the extra mile. They helped their colleagues more often, were more committed, and more satisfied in their jobs. As a consequence psychological ownership also created more loyalty towards the company and among the workforce.

In a second series of more recent studies with colleagues from the universities of Mannheim and Rostock, we investigated in more depth how some leaders exert their influence on psychological ownership. For example, we examined the effects of emotional exhaustion of service workers and customer appreciation of their work. Similarly, we could show a relationship of certain leadership styles on employee welfare and an organizational climate of initiative taking.

Overall, the studies illustrated the potential power of ownership feelings in organizational settings and the difference well-suited leadership can make. Psychological ownership also plays a particularly relevant role in closely-held companies in several ways. First, it has been argued that founders of businesses work harder and longer hours than most employees. This may have to do with ownership feelings. When we work for our “own” ideas or projects our motivation is usually highest. We regularly observe such effect in enthusiastic start-up entrepreneurs working long hours to make their business “fly”. So, ownership feelings may be the motivational fire in entrepreneurial business endeavors.

Second, many business founders would like to see that the entrepreneurial spirit and commitment to the business transfers to the next generation. Accordingly, they ask how to convey ownership feelings to their future successors. In a research project with American colleagues we tackled this issue and investigated several teaching approaches to stimulate emotional attachment and psychological ownership in the next generation of young family business members.

And lastly, it is also of interest for family-owned businesses to find ways to include and keep those motivated who are not part of the family, namely the nonfamily employees and external managers. Together with two colleagues from the University of St. Gallen we found that justice and fairness perceptions play an essential role for the development of ownership feelings in the nonfamily personnel. By means of creating a fair environment family-owners could create a motivated and committed team.

Prof. Dr. Fabian Bernhard is an Associate Professor of Management and a member of the Family Business Center at EDHEC Business School in France. He is also a research fellow at the University of Mannheim in Germany, where he also had studied business administration. A scholarship led him to the University of Oregon from where he graduated with an MBA. After working several years at a large, international consulting company in New York, he returned to academia in 2007. During the following years as a PhD student at the European Business School (EBS) and the WHU Otto Beisheim School of Management in Germany, he developed the ideas of his book on “Psychological Ownership in Family Businesses”. After having completed his doctoral degree in 2011, he was a research professor at INSEEC Business School in Paris and an adjunct professor at the Family Enterprise Center (FEC) at Stetson University of Florida in the US.

Fabian Bernhard’s current topics of interest revolve around the intersection of organizational behavior, organizational psychology, and family business research. In particular, Fabian is interested in the emotional dynamics in family businesses, moral emotions (such as shame and guilt), the education and preparation of next generational family business leaders, as well as all kinds of  attachment to the family business, such as psychological ownership, commitment, social identity, and their influence on the decision-making process in family businesses. If you want to know more about Fabian, feel free to visit his profile at EDHEC [CLICK HERE].

This article was originally published in transfer – Werbeforschung & Praxis, (03/ 2017) 

Update: The Future of Ownership Research – Insights from the Opening & Closing Forums

Posted on by

The collaboratively discussed insights from the Opening and Closing Forums, which where held within the scope of “The Future of Ownership Research” workshop this July 2017, are now readily available to download.

You can either click [HERE] to download the full summary or go to the event’s page to do so.

A visual summary of the Closing Forum is provided below.

The_Future_of_Ownership_Research_short

On this note we would like to thank all participants for collaborating so effortfully with us on this! We believe that the questions that were raised will guide us towards a prosperous future in ownership research!

THE DEVELOPMENT OF JOB-BASED PSYCHOLOGICAL OWNERSHIP

Posted on by

A GUEST COMMENTARY BY BOBBY BULLOCK, CONSULTANT & RESEARCHER

The concept of psychological ownership (PO) as we know and understand today has originated from the field of organizational behavior and psychology. More precisely, Pierce, Kostova & Dirks (2001, 2003) were the first ones to coin the term and establish a theory of PO in organizations. Defined as “the state in which individuals feel as though the target of ownership (material or immaterial in nature) or a piece of it is “theirs”, they were able to show that PO develops through three distinct routes: control over, self-investment in, and intimate knowledge of the target of ownership (Pierce et al. 2003). In addition to these three routes, many scholars have argued that personality and disposition may also matter for the emergence of PO, yet this has never been properly tested.

In his PhD thesis, our current guest author Bobby Bullock, has explored this gap in the literature and has taken a closer look at the relationship between personality, job autonomy and psychological ownership. Moreover, he has looked at how the well-established routes through which PO is said to emerge come into play in the context of organizational employment.

But read for yourself what Bobby Bullock has to say:

Psychological ownership has come to light as an important state with strong implications on employee attitudes and behaviors.  However, relatively little attention has been paid towards the process by which employees come to develop feelings of psychological ownership towards their work, particularly regarding the role played by individual traits in this process.  Ownership theorists claim that personality and disposition should matter (Mayhew, Ashkanasy, Bramble, & Gardner, 2007; Pierce & Jussila, 2011), yet these claims remain largely untested.

The purpose of the current investigation is to address these gaps by exploring how employee disposition and job design contribute to the development of job-based psychological ownership.  Employing a cross-sectional approach, data were collected using an online survey where participants were asked to complete measures of trait positive affectivity (PA), job characteristics, work experiences, and job-based psychological ownership.  Because the study focused on job-related phenomena, participants were required to work full-time in a location other than their home to be considered for this study.  The final 426 participants (60.4% male, 39.6% female) had an average tenure of 5.04 years (SD = 5.03) and represented a wide range of industries and job levels (23.7% entry-level, 31.0% individual contributor, 17.8% supervisory, 10.8% mid-level manager, 2.8% senior manager, 13.8% technical or professional).  Hypotheses were tested using bootstrapped regression analyses and structural equation modeling.

Results indicated that job autonomy has a positive effect on job-based psychological ownership (B = 0.501, CI 0.415 to 0.594) through three mediated paths:  investment of ideas, effort, and self into one’s work (B = 0.252, CI 0.178 to 0.349), experienced control and influence over one’s work (B = 0.214, CI 0.137 to 0.293), and intimate knowledge and understanding of one’s job (B = 0.036, CI 0.003 to 0.082).  Employee PA significantly moderated the mediated path from autonomy to ownership through experienced control (Index of ModMed = 0.017, CI 0.000 to 0.045), such that control mattered more for high-PA employees.  Exploratory analyses suggest that PA may play a dual role – as a moderator of autonomy’s effects on control (B = 0.052, CI 0.009 to 0.100), and as an indirect effect on ownership itself.  For example, high-PA employees reported greater investment of self in their work, which in turn predicted job-based psychological ownership (B = 0.255, CI 0.177 to 0.361).

Ultimately, job autonomy stood out as having a particularly strong and consistent positive effect on job-based psychological ownership.  Results suggest that all employees, from the most enthusiastic to the most apathetic can experience this positive psychological state.  That is, as long as they are afforded a high level of autonomy in deciding how to plan and carry out their work.

If you are interested in reading the full paper including more detailed results, please click here.

About Bobby:

Dr. Robert Bullock is a management consultant with a background in industrial-organizational (I-O) psychology. Since 2010 he has been a staff consultant at Scontrino–Powell, Inc., a Seattle-based I-O consulting firm. As a consultant Robert specializes in qualitative and quantitative assessment (i.e., employee surveys, leadership evaluations, developmental needs assessments, organizational assessments, validation studies), learning and development (i.e., training workshops, on-the-job learning, leadership coaching, training evaluation), and continuous improvement (i.e., Lean workshops, continuous process improvement, culture change). He has provided those services to dozens of clients across a diverse range of sectors and industries, including Fortune 500 companies, state agencies, and the high-tech, education, health care, and non-profit sectors. As a scientist Robert has published and presented research on the psychology of ownership, organizational citizenship behaviors, and job design. He enjoys writing and has had articles published in several outlets including Forbes, Bloomberg, Profiles International, and more.

For more about Bobby, please click here.

Editor’s note: All references can be found in the whitepaper, which you can download here.