Understanding and Reducing Counterproductive Work Behaviours in Organisations

Introduction

On a fundamental level, every company and organisation in the world can be regarded as a constellation of human beings, working together towards a mutually accepted overarching goal. An organisation is truly only as great as the people who embody its mission, those who go above and beyond to see the company succeed and to make customers happy. Henceforth, the most important asset in an organisation is not its facilities or market cap, but the individuals that work in it. We could, therefore, expect companies to pay extreme attention and look after their workers so that they can ensure an encouraging and productive work environment. In reality, however, this is rarely the case. In this day of age, revenue and profit have become the leading corporate targets and key performance indicators, leading to a severe neglect of basic psychological needs of employees. The consequences of this mindset are starting to become increasingly evident. More and more companies in the UK and worldwide experience an increase in dysfunctional and harmful actions from employees towards the organisation (Furnham and Taylor, 2011) - such actions are known as counterproductive work behaviours (CWBs). There are multiple forms of counterproductive work behaviours ranging from theft and property destruction to absenteeism and alcohol abuse, etc. (Gruys, 1999) and their causes lie either in the individual or in the company. Theft is considered to be one of the most common types of CWBs, with up to 75% of all employees reporting to have stolen from their employer at least once (McGurn, 1988). The purpose of this essay will be to briefly introduce the different types of counterproductive work behaviours and to explain their underlying causes. We will be focusing particularly on theft as it has been shown to be the reason for bankruptcy in one-third of the companies (Mishra & Prasad, 2006). Having the fundamental theoretical knowledge, we will then focus our attention on curating a researched- based intervention for reducing theft at work, giving action-based advice both on an individual and an organisational level.

What are counterproductive work behaviours and what causes them?

Counterproductive work behaviour (CWB) is defined as any intentional behaviour that can potentially harm an organisation or its employees. Counterproductivity, on the other hand, is regarded as the tangible outcome of a counterproductive behaviour (Sackett, 2002). The difference being that the former is the behaviour and the latter is the outcome. We will focus solely on the behavioural aspect. It is important to understand that a behaviour regarded as counterproductive with respect to the company, does not necessarily constitute wrongdoing or norm violation (e.g. quitting your job for another position with better career opportunities). At the same time, a behaviour that is regarded as a wrongdoing or norm-violating in the common sense might not be counterproductive for the company (e.g. lying to customers or intentionally recommending more expensive items). These, however, are rare instances as most CWBs are both bad for the company and morally and lawfully wrong. Research has identified a vast array of CWBs, which have been clustered into eleven different categories:

(1) Theft (stealing cash or property, giving away goods or services, misusing employee discount); (2) Property destruction (damaging or destroying property, intentionally sabotaging production); (3) Misuse of information (revealing confidential information, falsifying records); (4) Misuse of time and resources (wasting time, altering time cards, conducting personal business during work time); (5) Unsafe behavior (failure to follow or learn safety procedures); (6) Poor attendance (being absent or misusing sick leave); (7) Poor quality work (intentionally working slowly or badly); (8) Alcohol use on the job; (9) Drug use or sale at work; (10) Inappropriate verbal actions (arguing with customers, verbally harassing co-workers); (11) Inappropriate physical actions (attacking co-workers and sexually harassing them) (Gruys, 1999, as cited in Sackett, 2002). In order to handle them effectively, one must first understand their underlying causes. Research separates the causes for CWBs into two big categories: unethical individuals (akin to a bad apple) and bad organisations (akin to a bad barrel) (Kish-Gephart, Harrison, & Treviño, 2010).

The bad apple, bad barrel metaphor is useful, as it will serve as the fundamental framework for devising an action-based solution later on. According to Kish-Gephart et al. (2010), individual characteristics include cognitive moral development, moral philosophy, Machiavellianism and personal demographics, whereas organisational characteristics include ethical climate, ethical culture, and codes of conduct. Cognitive moral development (Kohlberg, 1969) is a theory which portrays the way individuals develop their moral reasoning as they grow older (Rest, 1986). There are three levels of an individual’s cognitive moral development (pre-conventional, conventional and post-conventional) and with age, people progress through the levels. Level three is the highest attainable, in which people use sophisticated reasoning and arguments to solve complex moral dilemmas. It has been shown that individuals with a lower level of cognitive moral development are more likely to exert CWBs (Treviño, 1992). Moral philosophy represents one’s moral beliefs or preferences. People can be classified as either idealists (moral principles are universal) or relativists (moral principles are dependent on the situation). It has been shown that those who believe ethical choices depend on the situation (i.e. have a relativistic moral philosophy) are more likely to behave counterproductively (Forsyth, 1980). Furthermore, research has shown that Machiavellianism is strongly connected to CWBs (Christie & Geis, 1970). Machiavellianism can be defined as “amoral action, sharp dealing, hidden agendas, and unethical excess” (Nelson & Gilbertson, 1991) and is characterized as deceiving and using others for one’s personal gain. Lastly, we know that personal demographics such as age, sex and education also influence (albeit, to a lower degree) the likelihood of expressing counterproductive work behaviours (O’Fallon & Butterfield, 2005). In short, it has been shown that younger individuals (Lasson & Bass, 1997), males (Borkowski & Ugras, 1998) and less educated people (Tenbrunsel & Smith-Crowe, 2008) have a higher likelihood of exerting CWBs. All of the above findings support the notion that individuals (bad apples) indeed contribute to counterproductive work behaviours in an organisation (Treviño & Youngblood, 1990).

However, individuals constitute only half of the problem. The other half is the organisation itself (bad barrel). Organisations create social environments that influence individual choices either positively or negatively. Ethical climate is shown to be an important determinant of counterproductive work behaviour. It gives employees a feeling of which behavior is right and wrong. Per definition, ethical climate is regarded as “reflecting the organizational procedures, policies, and practices with moral consequences” (Martin & Cullen, 2006). There are three major ethical climates in an organisation: egoistic (employees protect their own interests and every man is for himself), benevolent (employees have mutual, overarching goals such as customer satisfaction and work together towards them) and principled (employees strictly follow a company’s rules and procedures). Victor and Cullen (1988) discovered that companies with an everyone for himself mindset (egoistic climates) have a higher likelihood of experiencing CWBs. At the same time, the opposite was found to be true in an environment where employees focus their attention on the well-being of employees and customers (benevolent climate), or on following the company’s rules (principled climate). Likewise, a company with a robust ethical culture that clearly communicates what behaviour is acceptable and what not (through rewards systems, norms and managerial behaviour) will experience fewer instances of CWBs (Treviño, 1990). Lastly, a well executed code of conduct can have a strong positive influence on reducing CWBs (Trevińo, 1992). Taking all of the above into consideration, we now have a deeper understanding of the different types and causes of counterproductive work behaviours and can move on to explore a more specific form of CWB - theft.

What is theft and what causes it?

Theft, otherwise known as inventory shrinkage, is a problem in many companies worldwide causing massive losses each year. It can be defined as “any unauthorized appropriation of company property by employees either for one’s own use or for sale to another” (Greenberg, 1997). Theft costs $123.4 billion to retailers globally, which constitutes to 1.23% of all retail sales. The main sources of inventory shrinkage are Employee Theft (39%), Shoplifting (38%), Administration losses (16%), and Supplier Fraud (7%) (Global Retail Theft Barometer, 2015). Theft is considered the main reason for bankruptcy in about one-third of all companies (Mishra and Prasad, 2006) and it has been shown that 75% of all employees have stolen at least once (McGurn, 1988). When talking about theft, we often think about money and goods. But theft encompasses an even bigger array of possibilities, including stealing of identity, sensitive information or intellectual property. In respect to the severity of the theft, there are three types: trivial (paperclips), semi-trivial (pens, paper) and non-trivial (laptops). In respect to the form of theft, there are two types: material theft (money, goods) and production theft (poor output, slow work, absenteeism) (Furnham and Taylor, 2011). When examining the causes of theft, we can once more utilize the bad apple (individuals), bad barrel (organisations) metaphor. Dishonest behaviour is caused by a combination of both. A major determinant of theft on an individual level is a person’s stage of cognitive moral development (Kohlberg, 1969). As mentioned earlier, there are three levels - pre- conventional (external rewards or punishments are the sources of morality; right is what is good for oneself), conventional (reasoning goes above and beyond self-interest and includes considerations about fulfilling societal norms and laws) and post-conventional (reasoning goes above societal norms and laws and is based on higher, universal virtues). Employees at a lower stage (pre-conventional) tend to steal significantly more than those at a higher stage (conventional) (Greenberg, 2002). Personal demographics play an important role as well. Criminologists have struggled for decades to create a specific profile for people who are likely to steal (Niehoff & Paul, 2000). Research suggests that younger individuals, emotionally unstable individuals, individuals with financial problems, severe alcohol and drug users and people with gambling addictions have the highest likelihood of engaging in theft. (Hollinger & Clark, 1983).

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