This study examined how entrepreneur action strategies influence employee job characteristics in small and medium enterprises (SMEs). The researchers surveyed 550 employees across 47 SMEs, measuring job demands, control, and the entrepreneurs' proactive planning and opportunistic strategies. Multi-level analyses found that job characteristics varied significantly across firms and that proactive planning was linked to "active jobs" with high demands and control, while opportunistic strategies predicted "high strain jobs" with high demands and low control. Thus, entrepreneur strategies have a meaningful impact on employee work experiences, and educating entrepreneurs could help build healthier organizations.

1. Entrepreneur action strategies influence employee job characteristics: A multi-level study in SMEsUte Stephan1, Dominika Dej2 & Marjan Gorgievski31Catholic University Leuven2Dresden University of Technology3ErasmusUniversity Rotterdam 27th International Congress of Applied Psychology, Melbourne, Australia July 11th-16th, 2010

2. Overview Goals of the study Theoretical background Methods & Sample Results Conclusion

3. 1. Goals of our study Entrepreneurs in small and medium-sized enterprises (SMEs) are often understood to create and influence the work environment of their employees both directly and indirectly through adopting certain organizational structures. However, this notion is largely untested. If true then we should find systematic variation in job characteristics across different SMEs (controlling for alternative explanations such as industry branch, firm age, size etc.). We will, furthermore, elaborate which characteristics of the entrepreneur him-/herself might be systematically related to such variation in job characteristics across firms. Particular attention to action strategies, which capture how entrepreneurs typically go about reaching goals.

4. Why is this a relevant question? Job characteristics linked to employee health, well-being, learning and motivation If entrepreneur action strategies were to influence employee job characteristics then one route of creating better jobs in SMEs might be through educating entrepreneurs (cf. Theorell, Emdad, Arnetz, & Weingarten, 2001) such as training them in how to efficiently plan and organize their work, i.e. train their action strategies,

6. Negative consequences of job demands and high strain jobs on employee health, well-being and motivation (e.g. Amick et al.,2002, Belkic et al., 2004; de Lange et al., 2003; Rosvall et al., 2002; Stephan & Roesler, 2009; Tsutsumi et al, 2006, van derDoef & Maes, 1999; Wall et al, 1996) 2. Theoretical Background: Job Demand Control Model (e.g. Karasek & Theorell, 1990) high low Low Strain Job Active Job Job Control High Strain Job Passive Job low JobDemands high

7. Action strategies = process strategies: describe the how a person/an entrepreneur typically plans his actions to achieve goals Past research finds entrepreneurs’ action strategies to relate to firm success (e.g., Escher et al., 2002; Frese et al, 2000, 2007; van Gelderen et al., 2000; also Brinckmann et al., 2010) Current research relates entrepreneur action strategies to employee job characteristics in a multi-level study, two action strategy dimensions likely of particular relevance for employee job characteristics: Proactive, elaborate planning Opportunistic planning 2. Theoretical Background: Entrepreneurs’ Action Strategies (e.g. Frese et al., 2000)

8. Proactive, Elaborate planning is a systematic approach to work in which plans are devised based on a thorough analysis of the work situation and in anticipation of future developments. Due to their structured approach to work, proactively planning entrepreneurs are likely to be able to delegate entire tasks to employees in line with their skills thereby enhancing employees’ job control. At the same time, proactively planning entrepreneurs are also likely to monitor task fulfilment by employees (to update goal progress), i.e. giving employees little time to devote to other task such as dealing with unplanned interruptions in employees work or also non-work activities, thereby leading to moderate (to high) job demands. In other words, proactive planning is likely associated with active jobs (high demands x high control). 2. Theoretical Background: Entrepreneurs’ Action Strategies (e.g. Frese et al., 2000)

9. Opportunistic strategyis characterized by high situational responsiveness as the entrepreneur continuously interrupts his plans to take advantage of potential situational opportunities. These frequent changes of plans are likely to result in shifting and demanding requests upon the employees. Hence, an opportunistic strategy will lead to increased job demands. At the same time, these frequent changes are also likely to diminish the predictability of work tasks thereby diminishing employees’ job control. In other words, opportunistic strategy is likely associated with high strain jobs (high demands/low control). 2. Theoretical Background: Entrepreneurs’ Action Strategies (e.g. Frese et al., 2000)

10. 3. MethodsSample, Predictor & Criterion Variables Sample N=550 employees of 47 small and medium-sized enterprises in Germany N=47 Entrepreneurs (=founders, owners, and managers, Rauch & Frese, 2000) On average 11.7 employees per firm participated (SD 9.6) Predictor Entrepreneur reported action strategies (Zempel, 2002): elaborate planning Cronbach’s Alpha .76 (4-items) opportunistic planning Cronbach’s Alpha .60 (2-items) Criterion Employee assessed job characteristics (Job Content Questionnaire, Karasek et al., 1985, 1998) Job control Cronbach’s Alpha .85 (9 items) Job demands Cronbach’s Alpha .72 (8 items)

12. 4. Results multi-level analyses (Mlwin) H1: Job Characteristics vary across different firms (SME) supported: job characteristics vary significantly across firms

13. 4. Results multi-level analyses (Mlwin) H2: Entrepreneurs action strategies are related to employees job characteristics –supported The more entrepreneurs engage in proactive planning, the more do their employees perceive their job characteristics as active jobs. The more entrepreneurs engage in opportunistic planning, the more do their employees perceive their job characteristics as high strain jobs.

14. 5. Conclusion Evidence that job characteristics vary significantly across small and medium sized firms. Apart from personal characteristics of entrepreneurs, the firm environment also plays a significant role for employee job characteristics. Entrepreneurs’ action strategies are significantly related to employees’ perception of job characteristics. Specifically, as hypothesized entrepreneurs’ proactive planning is associated with an active job situation for employees; and an opportunistic strategy with job strain for employees. Together with past research that finds action strategies to relate to firm success, the present research suggests that educating and training entrepreneurs in efficient self-management and planning might well be a lever to build high-performance organizations characterized by employee well-being.

15. Thank you! Ute.Stephan@econ.kuleuven.be Dominikadej@psychomail.tu-dresden.de Gorgievski@fsw.eur.nl