PERCEIVED HUMAN RESOURCE MANAGEMENT

PRACTICES ON ORGANISATIONAL COMMITMENT

MEDIATED BY A PERCEIVED PSYCHOLOGICAL

CONTRACT

BY

MOHAMED THIERNO MAGASSOUBA

A dissertation submitted in fulfilment of the requirements for

the degree of Doctor of Philosophy (Business Administration)

Kulliyyah of Economics and Management Sciences

International Islamic University Malaysia

JUNE 2020

ii

ABSTRACT

Perception of human resource management practices (HRMP) is widely believed to

affect employee’s commitment to their respective organization. Although there are

some extensive evidences to highlight that HRM practices are associated with

organizational level outcomes, it is unclear whether these practices lead to individual

desirable outcome. This study has developed a model of coherence of contingency

theory, institutional theory, and social exchange theory. This study was conducted to

examine the role of psychological contract in examining relationship between

perceived HRM practices and organizational commitment. This study further

examines the role of ethical climate in influencing relationship between perceived

psychological contract and organizational commitment. Data are elicited through

questionnaires from 360 employees working in the banking sector in Republic of

Guinea to understand their perceptions toward HRM practices in the organization they

work for. Survey include measures of (a) perception of HRM practices pertaining to

employee hiring, training and development, performance management, and pay

remuneration; (b) perception of psychological contract; (c) organizational

commitment pertaining to affective commitment and normative commitment; and (d)

ethical climate. Researcher hypothesized that perceived human resource management

practices are positively related to perceived psychological contract, in turn, this will

lead to organizational commitment. Furthermore, the result is consistent with the

hypotheses of the study that organizational commitment is higher when ethical climate

is high, therefore, the study establishes that the association between organizational

commitment and psychological contract was more effective when ethical climate is

higher. Data analysis is performed by using the Statistical Package for the Social

Sciences (SPSS); and structural equation modelling using Analysis of Moment

Structures. Findings from this study clearly support the notion that employees’

perceptions provide a broader view of evaluating HRM practices. From practical point

of view, the study shows some important consideration specially for those who try to

improve individual level outcome via human resource management practices by

creating some form of communication to employees that shows the company valued

them. Findings enable the researcher to unveil lapses inherent in institutional,

contingency, and social exchange theories that can, in turn, lead to create an ideal and

positive organizational climate in terms of HRM practices, thereby enhancing

employees’ commitment in the banking sector.

iii

البحث ُملخَّص

مؤسساهتم، التزام املوظفني حنو يفيؤثر (HRMP) عتقد أن إدراك ممارسات إدارة املوارد البشرية ي على الرغم من بعض األدلة املكثفة اليت تربز ارتباط ممارسات إدارة املوارد البشرية بنتائج املستوى و

من غري الواضح ما إذا كانت هذه املمارسات تؤدي إىل نتائج مرغوبة على املستوى ؛التنظيميلنظرية الطوارئ والنظرية املؤسسية ونظرية التبادل ا مرتابط ا منوذج البحث أ ا طور هذ، وقد الفردي

جري لفحص دور العقد النفسي يف فحص العالقة بني ممارسات إدارة املوارد البشرية أ و ،االجتماعيدور املناخ األخالقي يف التأثري على العالقة بني العقد وحتري ،املتصورة وااللتزامات التنظيمية

عت قد ، و االلتزام التنظيميالنفسي املتصور و ٣٦٠ ة و ز ِّعت علىالبياانت من خالل استبانُج لفهم تصوراهتم جتاه ممارسات إدارة ، وذلكموظف ا يعملون يف القطاع املصريف يف ُجهورية غينيا

: تصور ممارسات إدارة اآلتيةيشمل املسح املقاييس و ،اليت يعملون فيها املؤسساتاملوارد البشرية يف تصور العقد و تعيني املوظفني، والتدريب والتطوير، وإدارة األداء، ومكافأة األجور؛ يف املوارد البشرية

وقد افرتض ،املناخ األخالقي و العاطفي واملعياري؛ ني االلتزاممن حيث االلتزام التنظيمي و النفسي؛ ا ابلعقد النفسي املتصور، رة ترتبط ارتباط ا إجيابي الباحث أن ممارسات إدارة املوارد البشرية املتصو

أن االلتزام التنظيمي يكون يف ة النتيجة مع فرضيواتفقت ،وهذا بدوره سيؤدي إىل االلتزام التنظيميأن االرتباط بني االلتزام البحث أثبت ؛مستوى أعلى عندما يكون املناخ األخالقي مرتفع ا، وعليه

وأ جري ، عندما يكون املناخ األخالقي يف مستوى أعلى كفاءة يكون أكثر التنظيمي والعقد النفسيومنذجة املعادلة ، (SPSS)احلزمة اإلحصائية للعلوم االجتماعيةبرانمج البياانت ابستخدام حتليل

فكرة أن تصورات املوظفني توفر البحث تدعم نتائج و ،اهليكلية ابستخدام حتليل هياكل اللحظةبعض البحث ظهر ي ؛من وجهة نظر عملية، و م ممارسات إدارة املوارد البشريةرؤية أوسع لتقيي

اصة ألولئك الذين حياولون حتسني النتائج الفردية عرب ممارسات إدارة املوارد وخب ،االعتبارات املهمةقد و ،يوضح أن الشركة تقدرهممما ،أشكال التواصل مع املوظفني بعض البشرية من خالل إنشاء

ئج البحث من كشف الغطاء عن الثغرات الكامنة يف نظرايت التبادل املؤسسي ونظرايت مكنت نتااليت ميكن أن تؤدي بدورها إىل خلق مناخ تنظيمي مثايل إجيايب من ؛الطوارئ والتبادل االجتماعي

. تعزيز التزام املوظفني يف القطاع املصريفومن مث؛ حيث ممارسات إدارة املوارد البشرية،

iv

APPROVAL PAGE

The dissertation of Mohamed Thierno Magassouba has been approved by the

following:

_____________________________

Nurita Juhdi

Supervisor

_____________________________

Rodrigue Ancelot Harvey Fontaine

Co-Supervisor

_____________________________

Suhaimi Bin Mhd. Sarif

Internal Examiner

___________________________

Aizzat Mohd Nasurdin

External Examiner

_____________________________

Noormala Dato’ Amir Ishak

External Examiner

________________________

Mohamed Elwathing Saeed

Chairman

v

DECLARATION

I hereby declare that this dissertation is the result of my own investigation, except

where otherwise stated. I also declare that it has not been previously or concurrently

submitted as a whole for any other degrees at IIUM or other institutions.

Mohamed Thierno Magassouba

Signature…………………....………. Date …….……………….

vi

COPYRIGHT

INTERNATIONAL ISLAMIC UNIVERSITY MALAYSIA

DECLARATION OF COPYRIGHT AND AFFIRMATION OF

FAIR USE OF UNPUBLISHED RESEARCH

PERCEIVED HUMAN RESOURCE MANAGEMENT PRACTICES

ON ORGANISATIONAL COMMITMENT MEDIATED BY A

PERCEIVED PSYCHOLOGICAL CONTRACT

I declare that the copyright holder of this dissertation is jointly owned by the student

and IIUM.

Copyright © 2020 Mohamed Thierno Magassouba and International Islamic University Malaysia. All

rights reserved.

No part of this unpublished research may be reproduced, stored in a retrieval system,

or transmitted, in any form or by any means, electronic, mechanical, photocopying,

recording or otherwise without prior written permission of the copyright holder

except as provided below

1. Any material contained in or derived from this unpublished research may be used by others in their writing with due acknowledgement.

2. IIUM or its library will have the right to make and transmit copies (print or electronic) for institutional and academic purposes.

3. The IIUM library will have the right to make, store in a retrieved system and supply copies of this unpublished research if requested by other

universities and research libraries.

By signing this form, I acknowledged that I have read and understand the IIUM

Intellectual Property Right and Commercialization policy.

Affirmed by Mohamed Thierno Magassouba

……..…………………….. ………………………..

Signature Date

vii

DEDICATION

I humbly dedicate this thesis to my father for the greatest sacrifice and patience. May

Allah grant you the highest place in Jannah

viii

ACKNOWLEDGEMENTS

All glory is due to Allah the Lord of universe, the most Beneficent and the most

Merciful. Peace and salutations be upon our beloved prophet Muhammad peace upon

him.

The word is not enough to express my special appreciation and gratitude first

and foremost to my Supervisor Dr. Nurita Juhdi for encouraging me and allowing me

to grow as a researcher. You were always beside me as a mother, a supervisor, and a

mentor throughout this journey. Without you I was almost given up. your advice on

both academic as well as my career have been priceless, May Allah bless you and

reward you abundantly with good health and prosperity.

Secondly to my Co-supervisors Dr. Rodrigue Ancelot Harvey Fortaine and

Prof. Dr. Arif Hassan, thank you for all the valuable advises, feedbacks, and

constantly checking my progress. Your valuable suggestions, ideas, and insightful

comments on the whole work through the entire research have been the utmost

significance in Streeting this study in right direction.

Special gratitude to my family, the words cannot express how grateful I am to

my father may your soul rest in peace for all the investment financially and

emotionally that you have made on me. Your words in my ear, “Do not fear” kept my

head up all the time. To my beloved mother who never stop supporting me, your

prayer tirelessly was what sustained me this far. Special thanks to papa “Elhadj

Abdoulkarim Dioubate” and Elhadj Mousa Magassouba for all your support

financially and emotionally, my gratitude to my family members, brothers, and sisters

for your support and prayers.

Finally, I would like to thank faculty members and administration for their

support with special thanks to Dr. Azura Omar, you were always there for me with

your thoughts whenever I need it the most. I will extend my gratitude and appreciation

to the employees of Guinea banking sector and to all my friends Hasssan Buana Ossif,

Hassan Sacko, Dr. Ahmad Sacko, Dr. Oury Diallo, Dr. Perkins, Dr.Abdulrazak Kaba

the list is endless , who supported me in writing and incented me to strive towards my

goal. I am truly blessed to have you all in my life and I would never have been able to

face all the challenges alone in completing this thesis without your support. May Allah

reward you all abundantly.

.

ix

TABLE OF CONTENTS

Abstract .................................................................................................................... ii

Arabic Abstract ........................................................................................................ iii

Approval Page .......................................................................................................... iv

Declaration ............................................................................................................... v

Copyright ................................................................................................................. vi

Dedication ................................................................................................................ vii

Acknowledgements .................................................................................................. viii

List of Tables ........................................................................................................... xiii

List of Figures .......................................................................................................... xv

Abbreviation Table .................................................................................................. xvi

CHAPTER ONE: INTRODUCTION ................................................................. 1

1.1 Background of the Study ........................................................................ 1 1.2 Overview of the Republic of Guinea (The Research Context) ............... 7 1.3 Problem Statement .................................................................................. 11 1.4 Objectives of the Study ........................................................................... 16

1.5 Research Questions ................................................................................. 16 1.6 Significance of The Study ...................................................................... 17

1.7 Scope of the Study .................................................................................. 19 1.8 Definition of Research Terms and operationalization ............................ 20

1.9 Organisation of Chapters ........................................................................ 22 1.10 Summary of Chapter ............................................................................. 23

CHAPTER TWO: LITERATURE REVIEW AND THEORETICAL

FRAMEWORK ...................................................................................................... 24

2.1 Introduction............................................................................................. 24 2.2 History of Organisational Commitment and HRM Practices ................. 24

2.3 Organisational Commitment ................................................................... 26 2.3.1 Justification for the use of Affective Commitment Normative

commitment in the context of this study ..................................... 31

2.4 HRM Concept and Practice .................................................................... 32

2.4.1 HRM In Africa .............................................................................. 38 2.4.2 HRM Practices .............................................................................. 43

2.4.2.1 Employees Hiring ............................................................. 49

2.4.2.2 Training and Development ............................................... 51 2.4.2.3 Performance Management (PM) ...................................... 53 2.4.2.4 Pay and Remuneration ...................................................... 54

2.5 Perceived Psychological Contract .......................................................... 56 2.6 Ethical Climates ...................................................................................... 59

2.7 Theoretical Framework and Research Hypotheses................................. 62 2.7.1 Institutional Theory, HRM Practices, and Employees

Commitment ................................................................................ 63 2.7.2 Contingency Theory ...................................................................... 65

2.7.3 Social Exchange Theory (SET) ..................................................... 66

x

2.7.4 Social Exchange Theory, HRM Practices and Employees’

Commitment ................................................................................ 69

2.7.5 Influence of HRM Practices on Organizational Commitment ...... 70 2.7.6 HRM Practices and Psychological Contract ................................. 75 2.7.7 Perceived Psychological Contract and Organizational

Commitment ................................................................................ 80 2.7.8 Perceived Psychological Contract as a Mediator Between

HRM Practices and Organizational Commitment ....................... 81 2.7.9 Moderating Effect of Ethical Climate on the Relationship

Between Perceived Psychological Contract and

Organizational Commitment ....................................................... 84 2.7.10 Proposed Conceptual Framework and Hypotheses ..................... 87

2.8 Summary of Literature ............................................................................ 91

CHAPTER THREE: RESEARCH METHODOLOGY ................................... 92 3.1 Introduction............................................................................................. 92 3.2 Research Design ..................................................................................... 92

3.2.1 Quantitative Research ................................................................... 93 3.2.2 Theoretical Perspective and Philosophical Underpinning ............ 96

3.3 Population ............................................................................................... 97 3.4 Sample Size ............................................................................................ 98

3.5 Sampling Technique ............................................................................... 99 3.5.1 Unit of Analysis ............................................................................ 100

3.6 Instrument ............................................................................................... 101

3.6.1 Translation of Questionnaires to French Language ...................... 102

3.6.2 Employee Hiring ........................................................................... 104 3.6.3 Training and Development............................................................ 104

3.6.4 Performance Management ............................................................ 105 3.6.5 Payment and Remuneration .......................................................... 105 3.6.6 Perceived Psychological Contract ................................................. 105

3.6.7 Ethical Climates ............................................................................ 106 3.6.8 Organizational Commitment ......................................................... 106

3.7 Pilot Study .............................................................................................. 107 3.8 Validity ................................................................................................... 108

3.9 Reliability of The Instrument.................................................................. 108 3.10 Data Collection Procedure .................................................................... 109

3.11 Data Analysis ........................................................................................ 110 3.12 Conclusion ............................................................................................ 111

CHAPTER FOUR: DATA ANALYSIS AND RESULTS: DESCRIPTIVE

STATISTICS AND PRINCIPAL COMPONENT ANALYSES ....................... 113 4.1 Introduction............................................................................................. 113 4.2 Missing Data ........................................................................................... 113

4.3 Outliers ................................................................................................... 114 4.4 Response Rate ......................................................................................... 114

4.4.1 Characteristics of Respondents ..................................................... 115 4.5 Descriptive Statistics .............................................................................. 118

4.5.1 Normality Test .............................................................................. 118

4.5.2 Multicollinearity............................................................................ 123

xi

4.5.3 Exploratory Factor Analysis (EFA) .............................................. 124

4.5.4 Reliability ...................................................................................... 131

4.5.5 Confirmatory Factor Analysis (CFA) ........................................... 132 4.5.6 Goodness-of-Fit (GOF) Indicators ................................................ 133

4.5.6.1 Measurement Model of Variables under the Investigation in

This Study ........................................................................ 135 4.5.6.2 Modified Measurement Model of Variables under the

Investigation in This Study .............................................. 137 4.5.7 Confirmatory Factor Analysis (CFA) for Employee Hiring

(EH) ............................................................................................. 138 4.5.7.1 Convergent Validity for Employee Hiring ....................... 140

4.5.8 Confirmatory Factor Analysis (CFA) for Training and

Development (TD) ....................................................................... 140 4.5.8.1 Convergent Validity for Training and Development (TD)

.......................................................................................... 142 4.5.9 Confirmatory Factor Analysis (CFA) for Performance

Management (PM) ....................................................................... 142 4.5.9.1 Convergent Validity for Performance Management (PM)

.......................................................................................... 144 4.5.10 Confirmatory Factor Analysis (CFA) for Pay and

Remuneration (PR) ...................................................................... 144 4.5.10.1 Convergent Validity for Pay and Remuneration (PR) .... 146

4.5.11 Confirmatory Factor Analysis (CFA) for Perceived

Psychological Contract (PPC) ..................................................... 146

4.5.11.1 Convergent Validity for Perceived Psychological Contract

(PPC) ................................................................................ 148 4.5.12 Confirmatory Factor Analysis (CFA) for Ethical Climate

(EC) ............................................................................................. 148 4.5.12.1 Convergent Validity: Ethical Climate ............................ 150

4.5.13 Confirmatory Factor Analysis (CFA) for Affective

Commitment (AC) ....................................................................... 151 4.5.13.1 Convergent Validity for Affective Commitment (AC) .. 152

4.5.13.2 Confirmatory Factor Analysis (CFA) for Normative

Commitment (NC) ............................................................ 152 4.5.13.3 Convergent Validity for Normative Commitment (NC) 154

4.5.14 Mediating Effects of Psychological Contract (PC) and HRM

Practices and Organizational Commitment (OC) ........................ 154 4.5.15 Relationship Between HRM Practices and Organizational

Commitment After Mediation ..................................................... 156

4.5.16 The Mediating Effect of Psychological Contract and

Organizational Commitment using the Sobel Test ...................... 157 4.5.17 Testing the Moderating Effect of Ethical Climate on the

Relationship Between Psychological Contract and

Organizational Commitment ....................................................... 158

4.5.17.1 Comparing the Group Effect for Low and High Ethical

Climate ............................................................................. 161 4.6 Full Structural Model of HRM Practices and Their Effects on

Organisational Commitment .................................................................. 162

4.6.1 Hypothesized Model ..................................................................... 162

xii

4.6.2 Revised Model of HRM Practices and Their Effects on

Organizational Commitment ....................................................... 167

4.7 Summary ................................................................................................. 171

CHAPTER FIVE: DISCUSSION OF FINDINGS AND CONCLUSION ....... 174 5.1 Introduction............................................................................................. 174 5.2 Summary of the Main Finding ................................................................ 174 5.3 Implications for Theory and Practice ..................................................... 183 5.4 Practical Implications for Organisational Perspective Especially for

the Banking Sector of the Republic of Guinea ....................................... 185 5.5 Limitations and future research .............................................................. 186 5.6 Conclusion .............................................................................................. 187

Bibliography .......................................................................................................... 190

Appendix I English Questionnaire ...................................................................... 223

Appendix II French Questionnaire ..................................................................... 228

Appendix III Authorization to Central Bank ..................................................... 234

xiii

LIST OF TABLES

Table 1.1 Key data about Republic of Guinea (CIA World Factbook, 2019) 9

Table 3.1 Grouping of the banks 100

Table 3.2 Estimated number of distributed survey forms 110

Table 4.1 Summary of response rates 115

Table 4.2 Summary of the characteristic of the respondents 117

Table 4.3 Normality Test Result 119

Table 4.4 Correlation matrix 123

Table 4.5 KMO and Bartlett's Test 124

Table 4.6 Total variance explained 125

Table 4.7 Rotated Component Matrix 127

Table 4.8 Summary of the variables by Cronbach’s alpha value 132

Table 4.9 Recommended values for measurement (Hair et al., 2006) 133

Table 4.10 Initial measurement fit indexes 136

Table 4.11 Modified measurement fit indexes 138

Table 4.12 Employee Hiring Fit indexes 140

Table 4.13 Training and Development Fit indexes 142

Table 4.14 Performance Management Fit indexes 144

Table 4.15 Pay and Remuneration Fit indexes 146

Table 4.16 Perceived Psychological Contract Fit indexes 148

Table 4.17 Ethical Climate Fit indexes 150

Table 4.18 Affective Commitment Fit indexes 152

Table 4.19 Normative commitment Fit indexes 153

Table 4.20 Relationship between HRM practices and Organizational Commitment 155

Table 4.21 Relationship between Human Resource Management (HRM)

practices and Organizational Commitment after Mediation 156

xiv

Table 4.22 Direct and mediating effect using sobel calculator 158

Table 4.23 Moderating test for low and high ethical climate 160

Table 4.24 Standardized beta estimation for low ethical climate 161

Table 4.25 Standardized beta estimation for high ethical climate 162

Table 4.26 Hypothesized Model HRM, EC and OC Fit indexes 164

Table 4.27 Hypothesized model path coefficients 165

Table 4.28 Hypothesized model path coefficients 166

Table 4.29 Revised structural model Fit indexes 168

Table 4.30 Revised model path coefficients 168

Table 4.31 Revised model path coefficients 169

Table 4.32 Moderating test for low and high ethical climate 172

xv

LIST OF FIGURES

Figure 1.1. Map of Guinea (Source: CIA World Factbook, 2019) 10

Figure 1.2. Source Hofstede cultural comparison between Nigeria, Senegal, and

Burkina Faso. 13

Figure 2.1. Model of the conceptual framework and all its constituent variables 88

Figure 4.1. Scree plot 126

Figure 4.2. Initial measurement model 135

Figure 4.3. Modified measurement model 137

Figure 4.4. Employee’ Hiring 139

Figure 4.5. Training and development 141

Figure 4.6. Performance Management 143

Figure 4.7. Pay and Remuneration 145

Figure 4.8. Perceived psychological contract 147

Figure 4.9. Ethical climate 149

Figure 4.10. Affective commitment 151

Figure 4.11. Normative commitment 153

Figure 4.12. Relationship between HRM practices and Organisational Commitment 155

Figure 4.13. Relationship between Human Resource Management practices and

Organizational commitment After Mediation 156

Figure 4.14. Integrated model with mediator 157

Figure 4.15. High Level of Ethical Climate Unique Responses 159

Figure 4.16. High level of ethical climate unique responses 160

Figure 4.17. Hypothesized Model HRM, EC and OC 163

Figure 4.18. Revised structural model 167

xvi

ABBREVIATION TABLE

IIUM International Islamic University Malaysia

HRM Human resource management.

HRMP Human resource management practice

HR Human Resources

HRP Human resource practices

PPC Perceived Psychological contract

OC Organizational commitment

EH Employees hiring

EC Ethical climate

PM performance management

PR Pay and remuneration

TD Training and development

EFA Exploratory Factor Analysis

KMO Kaiser-Meyer- Olkin Measure of sampling Adequacy

SD Standard Deviation

CFA Confirmatory Factor Analysis

SPSS Statistical package for Social Sciences

AMOS Analysis of Moment structures

SEM Structural Equation Modeling

RMSEA Root Mean Square Error of Approximation

SRMR Standardized Root Means Square Residual

xvii

CFI Comparative fit Index

DF Degrees of Freedom

CR Critical Ratio

SET Social Exchange Theory

GDP Gross Domestic Product

GNF Guinean Franc

1

CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND OF THE STUDY

Modern global business environment has brought about an increasing significance of

human resource management (HRM) in every aspect of life (Boxall & Purcell, 2003;

& Caligiuri et al., 2010). People are indispensable assets of organizations because

their synergy and commitment create a source of sustainable competitive advantages

for organizations. Such people are saddled with the responsibility of producing further

resources of a firm (Nasurdin et al., 2008). Prior to 1991, Republic of Guinea had a

strict labor code protecting the rights of employees with set guidelines. These

guidelines covered staffing and selection, pay and compensation, holiday and work

schedule, overtime pay, vacation, and sick leave. However, under the 1999 revision of

the labor code, the parliament of Republic of Guinea voted to enlarge employers’

privileges to hire and fire; thus, businesses do not need to go to the employment

bureau anymore to contract or dismiss employees. These revisions eliminated the

requirements to employ only local staffs. Consequently, certain corporations,

including the local government, refused to pay mandatory benefits by employing

people as contractors for years instead of having them as permanent employees

(Global Investment Center, 2015).

The employer and employee relationship, as defined by the provisions of the

employment law in Republic of Guinea, can vary depending on the situation. Foreign

executives cite numerous incidences of theft, inefficiency, and low productivity. As

per World Bank report (2019) shows that 40 percent of labor force in banking sector

2

are unproductive, which explained the lack of development and improvement in

banking sector in the country. Moreover there is lack of human development for

example Republic of Guinea ranked 175 out of 187 countries on the Human

Development Index (2018) this reflected the lack of skilled workers, high informality,

and poor infrastructure (World Bank report 2019). Additionally, corruption become

the prevalent obstacles in Guinean business environment and that the business and

political cultures encourage corruption (Global investment center, 2015). Ccorruption

Perception Index’ ranked Guinea as 138th out of the 180 countries listed

(Transparency International, 2018)

Human resource (HR) practitioners in West Africa states in which Republic of

Guinea is a part of it, have been confronted by both universal convergence factors

such as globalization, technology and deregulation, locally divergent factors such as

nepotism, bribery, corruption, and tribalism with demographic changes which has

resulted into a blend of transplanted and indigenous managerial behavior (Azolukwam

& Perkins, 2009; US State Department, 2014; Horwitz & Budhwar, 2015). These

challenges resulted in less commitment by employees to their respective organization.

Therefore, the capability of companies in such circumstances to willingly revise day-

to-day operational processes and continuing growth targets become vital to company’s

achievement (Bartlett & Ghoshal, 1992). Consequently, to be effective, organizational

leaders must counterattack these obstacles by cultivating a greater competence in

HRM.

HRM is a complex assemblage of techniques, practices, and strategies

(Janssens & Steyaert, 2009). Storey (2001) confirmed the unitary characteristic of

HRM to be the effective management of employees that reaffirm their commitment to

the achievement of their companies’ objectives. Therefore, Storey (2001) defined

3

HRM as “a distinctive approach to employment management which seeks to achieve

competitive advantages through the strategic development of highly committed and

capable workforces by means of an integrated array of cultural, structural and personal

technique” (Storey, 2001:1). Therefore, HRM can be regarded as philosophy about the

way in which people are managed at their workplace with aim to improve

organizational effectiveness through people and it should be concerned with the

ethical dimension on how people should be treated in accordance with a set of moral

values (Armstrong, 2020). However, HRM philosophy, policy, and practice vary

across organizations (Morgan & Milliken, 1992; Peck, 1994). The reasons for this

variation have been traced to internal and external factors. Social structure and

institutional setting have been used to explain these variations in HRM policies and

practices (Bowen et al., 2004; Chiang & Birtch, 2010).

A considerable amount of scholarly research on HRM shows the effects of

HRM practices to the company performances (Wright & Boswell, 2002).

Additionally, current studies of HRM practices have characterized the influence of

such practices on a firm’s outcome. Certain practices include hiring procedures,

training and development, pay and remuneration, and performance management (PM).

HRM practices have been variously labelled in scholarly research as a high

performance work practice system (Huselid, 1995; Becker & Huselid, 1998),

progressive HRM practices (Gelade & Ivery, 2003), supportive employment practices

(Frenkel & Orlitzky, 2005), and innovative HRM practices (Macduffier, 1995;

Agarwala, 2003). Meanwhile, scholars have highlighted that carrying out HRM

practices efficiently may boost company financial outcomes and may lead to the

creation of sustainable strategies and competitive advantages for companies (Arthur,

1994; Delaney & Huselid, 1996; and Huselid et al., 1997).

4

Although a substantial amount of support exists to suggest that innovative

employment practices are correlated with the diversity of a company’s financial and

non-financial outputs, the notion that these HR practices may lead to anticipate that

employees level outcomes need further analysis (Katou, 2015). In addition, Youndt

(2000) discovered that company performance is not directly influenced by HR

activities; relatively, these activities support in building human intellect, which can

assist in enhancing a firm’s value added. Therefore, although the studies anticipated

connections between commitment HRM practices, organizational commitment and

company outcomes, the understanding of the means through which HRM practices

may affect firm outcomes continues to be at an initial phase (Bowen & Ostroff, 2004).

Additionally, relationships between HRM and company relevant outcomes

such as commitment have been anticipated instead of examined (Purcell, 1999).

Similarly, organizational commitment is considered as outcome variables that have

yet to be appropriately examined within the literature from an African organizational

context. Numerous researchers have identified these issues (Gibb, 2001; Gallie et al.,

2001) and believed that the insufficiency of investigation into workers’ responses to

HRM practices must be addressed.

Moreover, Guest (2002) advocated placing employees as ‘center-stage’ in the

analysis of HRM practices. Position of HR practices towards staff attitude

relationships continues to be ambiguous (Latorre et al., 2016) in the sense that

minimal information exists regarding how such HR practices work to carry out

organizational commitment gains and in what way HRM practices employ their

influence on workers and organizational outcomes.

The loophole through which HRM practices create value for the companies has

been denoted as the central point that must be addressed (Becker & Gerhart, 1996).

5

Moreover, Arthur et al. (1995) noted that Western HR practitioners rely upon

scientific knowledge and practices developed and validated in the West. The US is

presumed to have transnational generalizability and despite its cultural supremacy, the

effectiveness and generalization of HRM interventions in other cultures and economic

systems must be explored (Arthur et. al., 1995). For example, in Africa, the HRM

model has been characterized by substantial deference for authority with a quest for

coherence, paternalism, extended family and community, web of relationships, and

mutual obligations.

Kamoche (2011) corroborated that an African HRM system is composed of

commonalities with reference to culture and a certain difference, which reflects the

different national boundaries and ethno-linguistic communities, traditions and

institutions, customs and sociocultural practices in Franco, Anglo, and Lusophone

countries. Furthermore, transferring management practices from the Western world to

less developed countries were the preferred operational approach for most

multinational corporations. Therefore, the work style of many emerging economies is

characterized by foreign alien practices from global companies that may diverge from

their circumstantial beliefs and values or customary methods. These conflicting values

and beliefs between global companies and local employees have contributed to

misperception, inconsistencies, and frustration for the employees in unindustrialized

countries and occasionally failures for companies in developing world nations owing

to these foreign alien practices (Anakwe, 2002).

Researchers would be competent to explain how commitment HRM practice

relationships operate within an organizational context through a meticulous study of

these issues (Ferris et al., 1998). Meanwhile, Grant and Shields (2002) indicated that

staff responses to HRM perhaps can be link through some set of unwritten

6

expectation, which is a characteristic of the traditional link that connects organizations

and employees jointly beyond any prescribed underpinning contract. Schein (1965)

affirmed that the psychological contract is something that undocumented or recorded

contract of expectations between the employer and employees of an organization.

Psychological contract is consider as linking mechanism between HRM practices and

organizational commitment due to the nature that major function of HRM practices is

to foster an appropriate psychological contract since HRM practices such as employee

hiring process, training and development, performance management, and

compensation, which are considered as major determinate of employees believe in

psychological contract which in nature enhance employees commitment (Agarwala,

2003). Furthermore, Schein (1965) defended the idea of a psychological contract,

which implies that an unwritten customary of expectations operating always emerges

in every member of a firm.

Henceforth, the present study addresses this gap by attempting to deliberately

examine the interaction between worker perceptions and HRM practices and outcome

variables. Specifically, this study suggests that including employees’ perceptions of

their unwritten customary of expectations may help in comprehending why HRM

practices may positively or negatively impact their commitment. The nature of

psychological contract whether transactional or relational in nature are subjective,

thus, this study attempts to examine the moderate role of ethical climates between

perceived psychological contract and organizational commitment given by Barnett

and Schubert’s (2002) statement that employees have perceptions and beliefs about

the nature of the employment relationship between themselves and their employer,

which relates to the entitlements and obligations of each party (Morrison & Robinson,

7

1997). These perceptions form ‘psychological contracts’ between employees and their

organization (Cavanaugh & Noe, 1999; Robinson & Rousseau, 1994).

A psychological contract is subjective and possibly one-sided, in that

employees’ perceptions of the mutual rights and responsibilities inherent in the

employment relationship often differ from those of his or her employer (Rousseau,

1989). Nonetheless, employees’ perceptions of the nature of the psychological

contract and its potential violation by employers are likely to affect their job attitudes

and behaviors (Cavanaugh & Noe, 1999; Morrison & Robinson, 1997; Robinson,

1996; Robinson & Rousseau, 1994; Turnley & Feldman, 1999; Van Dyne et al.,

1994).

In short, one's own values are in the African context, such as resilience and

perseverance. Perhaps such values are the reasons why European imprints cannot

permanently erase those values and ideals despite colonialism and Western influence

on the continent over the years (Gbadamosi, 2003). Hence, the present study is

tailored towards investigating the organizational commitment by way of empirical

research, including the perceived HRM practices and how such practices can bring

positive ethical climate for the employees of the Guinean banking sector.

1.2 OVERVIEW OF THE REPUBLIC OF GUINEA (THE RESEARCH CONTEXT)

Guinea is a constitutional republic wherein executive power is executed by the

president (U.S. Department of State, 2011). The country extends through an area of

land that is approximately 245,857 square kilometers and at the borders Mali, Senegal,

and Guinea-Bissau are in the north, Liberia and Sierra Leone in the south, and Côte