The Mediating Effect Of Psychological Ownership On Person-Organization Fit & Turnover Intention

Abstract

This research clarifies the mediating effect of psychological ownership on person-organization fit and turnover intention. The private sector companies have significant problems in ensuring their employees to stay in the company and therefore it is urgent to clear the related psychological constructs that influence turnover intention among private sector employees. Lack of person-organization fit may lead to employee turnover. Moreover, little is known about the mediating effects of the psychological ownership on person-organization fit and turnover intention. A cross-sectional survey and a correlation analysis were used to clarify the relationships among constructs. Following the cross-sectional survey and correlation analysis, a multi-linear regression technique was dwelled in order to find out the mediation model. The findings of this research indicate that psychological ownership is a mediator on the relationship between person-organization fit. The research findings also determine that turnover intention and person-organization fit has a negative significant effect on turnover intention.

Keywords: Person-Organization FitPsychological OwnershipTurnover IntentionTurkey Private Sector

Introduction

Things are changing fast in today’s hectic business world. Companies need to gain and retain competitive advantage among their competitors in the marketplace. New trends including technological developments, intensifying global competition and shifts in the workplace are shaping all management processes especially human resource management. In contemporary business world employees are regarded not just people who are being paid for their jobs but also individuals who add value to the organizations. Companies emphasize the satisfaction of their employees just like their customers. That’s why nowadays employees are defined as internal customers whose satisfaction and retention is as crucial as the external customers. Keeping their employees satisfied and motivated is not just a possibility but also a necessity for the organizations in order to utilise the human resource as much as possible and sustain their competitive advantage. Employers realize the anticipated effects of managing the company’s most important resource, the human capital. Motivated, willing and committed employees pave the way for achievement of strategic goals.

Theoretical and empirical studies confirm that positive employee attitudes promote positive outcomes for the company like business performance as well as financial outcomes. Employers implement several strategies including employee engagement, empowerment, retention etc. for creating those positive employee attitudes. According to Dessler’s (2017) definition employee engagement refers to “being psychologically involved in, connected to, and committed to getting one’s jobs done”. Goetsch (2016) adds another dimension to the employee empowerment by defining empowerment as “engaging employees in the thinking processes of an organization in ways that matter and having input that is heard and used. According to Goetsch (2016), this engaging process gives employees ownership of their jobs. Employees who are psychologically involved in their jobs are not just physically present in their work place but they also put their hearts and minds in the realization of their jobs. They are a part of the decision making and problem-solving processes. Employees who own their jobs see the bigger picture and understand their job’s value within that framework. Person-job and person-organization fit come next for an employee to be able to psychologically own his/her job.

Person-job fit means matching the knowledge, skills, abilities, and other competencies (KSACs) that are required for performing the job with the employee’s KSACs (Dessler, 2017). Unfortunately, even if an employee complies with the job requirements and fits in the job may not fit in the organization. This means person-organization fit is as crucial as person-job fit both for the employee and the organization like two pillars supporting each other. That’s why person-job fit will not be sufficient by itself if there is no person-organization fit.

Since individuals and organizations apply their knowledge and skills most willingly to efforts in which they believe (Goetsch, 2016), employees who establish a bond with their organization tend to work more committed. This is why person-organization fit is key for commitment. Employees who own their jobs psychologically and fits in their organization are expected to be committed to their organizations and have less intention to leave. In this context, the study starts with a literature review.

Literature Review and Theoretical Framework

Person-Organization Fit

Kristof (1996), defines the P-O fit as the compatibility between people and the organizations. Kristof-Brown, Zimmerman and Johnson (2005) enhances the definition of the P-O fit and explain it as “the compatibility between people and organizations that occurs when at least one entity provides what the other needs or they share similar fundamental characteristics or both”. P-O fit occurs when an employee has the specific competencies to meet or exceed the requirements of the organization such as experience, education etc. and the organization fulfils the needs of the employee such as goals, values, interests etc. (Kristof, 1996). P-O fit includes the fulfilment of the employee and organizational needs and demands mutually. This two-way compatibility provides reciprocal outcomes for both the employee and the organization.

Organizations want to hire the best possible candidate for a specific job which needs to be fulfilled. The job’s specifications and its tasks are important factors for selecting an employee who will accomplish those tasks according to his/her qualifications including skills, abilities, competencies, education, experience etc. As companies prefer a candidate whose competencies match the requirements of the job, they also want someone who has attributes that are in harmony with the organization’s characteristics. Pursuit of the best candidate would be completed when there is congruence between the person and the job as well as the person and the organization. An employee with the best profile for the job would not be a good match if his/her values are incompatible with the organizational values.

Chatman (1989) defines the P-O fit as the congruence between the values and norms of an organization and an employee. According to him, personal and organizational values and norms should be compatible so that there can be person-organization fit. According to human resources studies person-organization fit is as crucial as the person-job fit which can be ignored sometimes because the latter is usually the main consideration. Employers should consider not just the person-job fit but also the person-organization fit while they’re selecting an employee among the candidates. A selection process which does not evaluate the candidate’s fit for the organization would be incomplete.

Dessler (2017) suggests that a candidate might be right for the job but wrong for the organization. This state of incompatibility for the organization would cause several costs for the company including recruiting, hiring, training etc. However, a right candidate both for the job and the organization would perform better, since individuals and organizations apply their knowledge and skills most willingly to efforts in which they believe (Goetsch, 2016). An employee’s fit in the organization will also have effects over all employees and the organization, since employees are like rings of the chain that an employee’s work depends on and effects the other employees whose work precedes his or hers.

Studies suggest that it is crucial for employers to understand the influence of the PO and act accordingly (Cable & Judge, 1995). Another research confirms that; P-O fit effects employee’s job satisfaction and organizational commitment. (O'Reilly et al., 1991) Individuals and organizations apply their knowledge and skills most willingly to efforts in which they believe (Goetsch, 2016). That’s why employees, whose values and norms are compatible with their organizations, tend to work more committed since they see themselves as a part of a bigger structure guided by the same values. This feeling of cohesion brings more commitment towards the organization which adds value to the company by boosting the employee performance hence the overall performance of the organization.

Psychological Ownership

People possess many things both physical and nonphysical entities like cars, houses, ideas, philosophies etc. Individuals develop a feeling of attachment towards something they possess which cannot be explained only with physical or legal ownership. According to Belk (1988), all kinds of possessions whether they are material or immaterial, develop psychological attachment and they create a feeling of continuation of selves (Asatryan, 2006). PO can be explained with identification, control, responsibility, and the desire to belong (Pickford, Joy, & Roll, 2016). Etzioni (1991) suggests that ownership is a dual creation which is “part attitude, part object, part in the mind, part real" As the feeling of ownership cannot be explained with just one part, defining the term relying on one discipline may be incomplete. For instance, psychology, sociology and social biology are some of the several disciplines that are interested in the psychological ownership (PO). PO is also tried to be explained with a wide range of concepts such as consumer behaviour (Belk, 1988).

Since PO is a core feeling for the employees in their work experience, it can be experienced within organizations, jobs and the work context. (Brown et al., 2014). Bernhard and O’Driscoll (2011) states that employees can develop a sense of PO towards their organizations or their jobs (Pickford et al., 2016). Even if PO was originally used out of the context of management, it became a widely used concept in the management literature through its implementations in the workplace. This study focuses on psychological ownership of employees towards their organizations within the management and organization literature and builds the research on this perspective.

Psychological ownership is defined as the feeling of possession over a target which can be an object, concept, organization, or other person. This feeling of possession over a target may or may not be supported by formal ownership. This ownership defines the owner as well as the target (Pickford et al., 2016). PO is also defined as “it reflects a state in which individuals feel as though the target of ownership (e.g., job or organization) is theirs” (Dawkins et al., 2017). According to Pierce et al. (2001); the target’s performance reflects the identity of its owner which also creates a mental attachment to the target. PO of an employee towards a job or organization is a “feeling of having a stake in it as a result of commitment and contribution” (Pickford et al., 2016). Researches show that PO has relations with organizational commitment and employee behaviors (Pierce et al., 2001; Vandewalle et al., 1995). According to Pierce et al. (2001) human beings have the desire to belong which can be satisfied through ownership. He suggests that an employee will develop PO if he/she feels a sense of belonging towards an organization Pierce et al. (2001). This is why PO is utilised as an effective tool of management. Managers use this tool to create positive outcomes that both employees and the organization can benefit from.

As PO is associated with positive outcomes both for the organization and the employee, it can also have negative outcomes. Increased motivation, loyalty, etc. are the positives while territoriality and reluctance to share are examples for the negative outcomes (Pickford et al., 2016). Researches show that there are positive relations between PO for the organization and desirable employee attitudes like organizational commitment, job satisfaction, organization-based self-esteem etc. and work behaviour such as performance and organizational citizenship (Dyne & Pierce, 2004). Employees who understand the influence of PO on the organization, use it as a tool to develop a connection between the employee and the company. This connection is intensified as much as the employee’s desire to belong is satisfied. The connection between the employee and the company enhances as much as the sense of ownership grows. PO is an effective way to increase the competitiveness of an organization and it is also used as a tool for motivation. Employees who have a sense of psychological ownership towards their organizations, feel responsible for failures, work for solving problems and helps the others even if it is not their job in question. They also share the credit, pitch in and help the others and volunteer for the decision-making processes. They see themselves as a part of the organization that adds value to the entire structure.

Turnover Intention

Organizations aim to hire the best possible candidate for the job however this is just the beginning for the employers. They work hard to implement retention strategies for their employees in order to retain the talent within the borders of the organization and utilize it in the best possible way (Kaur, Mohindru, & Pankaj, 2013) Since employees are among the most valuable assets, organizations try to lower the turnover rates. Employee turnover is defined as “the change in the workforce during a definite time period”. Employee Turnover displays “the extent to which old employees leave and new employees enter the organization in a given period” (Kaur et al., 2013). Turnover Intention is defined as “the intention of employees to quit the organization which is the most direct predictor of actual turnover” (Kaur et al., 2013). It is also defined as ‘a conscious and deliberate wilfulness to leave the organization’ (Tett & Meyer, 1993). Turnover intention is a major indicator that an employee plans to leave his/her job voluntarily.

There are two types of turnover; voluntary and involuntary. It is called voluntary turnover when an employee intends to quit his/her job. However, it is called involuntary turnover if an employee has to leave his/her job upon the decision of the organization (Price & Mueller, 1981). While involuntary turnover is regarded as healthy in some cases, voluntary turnover is an important concern for organizations(Kaur et al., 2013). The reason behind this concern is that the voluntary turnover has negative effects on organizational effectiveness and productivity as well as its cost like cost of replacement, recruitment, selection, training etc. (Shaw et al., 2005).

There are several reasons for voluntary turnover. Employees leave their jobs because of job stress, low quality of work life, low satisfaction of jobs/employer/organization, a new and satisfying job opportunity, limited career or promotion options, disapproval of organizational structure or changes which is also a reason behind organizational unfit for the employee. Since companies want to keep their skilled, trained, experienced employees in the organization they need to improve the factors behind the employee’s turnover intention which effects not only the performance of the employee but also overall performance of the organization.

Theoretical and empirical researches suggest that turnover intention would be low when an employee has a sense of connection with the organization and ownership towards his/her job (Belk, 1988; Bernhard & O'Driscoll, 2011; Chatman, 1991; Dawkins et al., 2017; Netemeyer et al., 1997). This information confirms that person-organization fit and psychological ownership decrease the levels of turnover intention. Since person-organization fit and psychological ownership have positive effects on employees’ connectivity, psychological involvement and engagement; psychological ownership is expected to increase the effects of the person-organization on turnover intention.

Hypotheses

H1: Psychological ownership mediates the effect of person-organization fit and turnover intention;

H2: Person-organization fit has a statistically significant negative effect on turnover intention.

H3: Person-organization fit has a statistically significant positive effect on psychological ownership.

H4: Psychological ownership has a statistically significant negative effect on turnover intention;

Figure 1: Hypotheses models
Hypotheses models
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Methods

Design and participants

For this research 431 of 498 private sector employees have been completed and returned the questionnaires which were sampled in random from Marmara, Aegean and Central Anatolia Region. More over the research employed a cross-sectional questionnaire survey.

Instruments

A self-administered and self-constituted questionnaire was used to collect data for this research. The questionnaire had four main scales and had open-ended and closed-ended questions for demographic info.

Demographic characteristics scale

The questionnaire demanded information about age, sex, education level, tenure, work time in the company, headcount of the company, supervisor gender, supervisor title, work time with the supervisor, main industry of the company and department for which the employee is responsible.

Person-Organization Fit scale

Item 1,2 and 3 were developed by Cable & DeRue ( 2002) and the 4. item has been developed by Netemeyer et al. ( 1997). All items were adapted in Turkish by the author Ahmet Cengiz Uçar. The scores are measured with 5-point Likert type scale (1 for Definitely Disagree, 5 for Definitely Agree). The higher the average score of all items, the higher the person-organization fit perceived by employees in the organization. The 4-item questionnaire is composed only in one factor as seen in Table 1 . In addition, the internal consistency Cronbach alpha of the scale is 0,919.

1. The things that I value in my life are very similar to the things that my organization values.

2. My personal values match my organization’s values and culture.

3. My organization’s values and culture provide a good fit with the things that I value in life.

4. This organization has the same values as I do with regard to concern for others.

Turkish language adaptation of person-organization scale can be found in appendix.

Psychological Ownership scale

Organization based psychological ownership scale was originally developed by Van Dyne and Pierce ( 2004) and adapted in Turkish by the author Ahmet Cengiz Uçar. The adapted scale is used to measure psychological ownership of employees in private sector companies. The 5-item questionnaire is composed only in one factor as seen in Table 1 . The average score of all items was used for the construct and that assess the degree of psychological ownership. Employees answered each item on a 5-point Likert scale as usual from 1 for Definitely Disagree to 5 for Definitely Agree. The internal consistency Cronbach alpha of the scale is 0,913.

2. It is hard for me to think about this organization as MINE.

3. This is OUR company.

4. I feel a very high degree of personal ownership for this organization.

5. I sense that this organization is MY company.

6. This is MY organization.

Turkish language adaptation of psychological ownership scale can be found in appendix.

Turnover Intention scale

This scale was developed by Ganesan & Weitz ( 1996) except item 1. Item 1 was developed by Walsh, Ashford and Hill ( 1985) and all items were adapted in Turkish by the author Ahmet Cengiz Uçar. The 5-item questionnaire included;

1. As soon as I find a better job, I will leave this organization

3. I intend to leave this organization within a short period of time.

4. I have decided to quit this organization

5. I am looking at some other jobs now.

6. If I do not get promoted soon, I will look for a job elsewhere.

Each item was rated using 5-point Likert type scale as usual from 1 for Definitely Disagree to 5 for Definitely Agree. The 5-item questionnaire was composed only in one factor as seen in Table 1 . Cronbach alpha coefficient for this scale was determined to be 0,918.

Turkish language adaptation of turnover intention scale can be found in appendix.

Table 1 -
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Data Collection

The majority of the questionnaires were obtained by the service and manufacturing industry employees in Marmara, Eagean and Central Anatolia region. Using snowball technique totally 498 questionnaires were collected but 67 out of 498 were not accepted because of bias, incompleteness or sloppiness and thus removed from the sample. The data were collected and analyzed by statistical software named IBM SPSS between the time interval March 2016 and July 2017.

Data Analysis

IBM SPSS was used to interpret the data. Multi-linear regression technique was conducted to determine the model (Figure 1 ). For this study, statistical significance was limited to p < 0.001. The Sobel significance test (1982) was used to test whether a mediator carries the influence of an independent variable to a dependent variable and to estimate the indirect effect and its significance.

This testing is understandable with the help of a simple mediation model (Figure 1 ). The first step tested the association between the independent variable person-organization fit and the dependent variable turnover intention (Path c, H1). The second step tested the association between the independent variable person-organization fit and the mediator psychological ownership (Path a, H2). The third step tested the mediator predicting the dependent variable, demonstrating that the mediator was associated with the dependent variable (path b, H3) in this multiple regression model. The path between the independent variable and the dependent variable (Path c’, H4) was also tested to determine whether this was reduced to zero (total mediation) or reduced by a significant amount (partial mediation) (Dudley et al., 2004).

Results

Demographic info

Totally 431 employees engaged in this research (response rate 86,5 %). 252 (58.5 %) were male and 141 (32.7 %) were female, 38 (8.8 %) are unknown. The ages were between 20-55 years (mean = 32.59, N=375). Over three quarter of employees were undergraduates and graduates (310 employees). The majority of employees had male supervisors (359 employees, 83.3 %). Companies with 251-1000 employees account for 40.1 % (N=173) and companies with 50-250 employees account for 28.5 % (N=123) of total in this research. The mean of total tenure in work life was ca. 5 years.

The relationship among person-organization fit, psychological ownership and turnover intention

Table 2 -
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Regression Analysis

Table 3 -
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The results proved (Table 3 ) that person-organization fit significantly predicted psychological ownership (β= .593, p< 0.001). In Step 1, the results showed that person-organization fit significantly but negatively predicted turnover intentions (β= -.426, p< 0.001). In step 2, the results showed that psychological ownership significantly but negatively predicted turnover intentions (β= -.485, p< 0.001). When psychological ownership was included in the model, there was a significant reduction in the relationship between person-organization fit and turnover intention (β= -.213 p< 0.001). The results of the Sobel test showed that psychological ownership mediated the effects of person-organization fit on turnover intention (Percent Mediation = 67.5 %; Sobel test statistic = -9.08; SE= 0.039; p < 0.001). The role of psychological ownership as a mediator between person-organization fit and turnover intention indicated a partial effect of person-organization fit related to turnover intention and suggested that psychological ownership partially mediated the relationship between person-organization fit and turnover intention. In summary psychological ownership seemed to decrease the effect of person-organization fit on turnover intention.

Figure 2: Mediation Model
Mediation Model
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The average score of employees’ Turnover Intentions was moderate (mean = 2.33, SD = 1.12). Person-Organization Fit was moderately but negatively related to Turnover Intention (r = -.426, p < 0.01) and positively related to Psychological Ownership (r = -.593, p < 0.01). Psychological Ownership was moderately but negatively correlated to employees’ turnover intentions (r = -.485, p < 0.01). The results indicated that employees with higher person-organization fit had a lower level of turnover intention. Also, the higher the psychological ownership of employees, the more unlikely their intention to leave.

In other words, Hypotheses 1, 2, 3 and 4 have been supported.

Conclusion and Discussion

Employers know that they should hire employees who are unlikely to quit the organization (McCulloch & Turban, 2007) Hiring the best possible employee is still not enough that retaining the talent is another accomplishment. Organizations implement retention strategies for their employees so that the talent can be retain in the organization and can be utilized in the best possible way (Kaur et al., 2013). Studies show that; a person’s fit with job and organization relates to attachments to the organization (Mitchell et al., 2001). According to Chatman (1991) when there is poor person-organization fit employees are likely to quit their jobs and leave the organization. (Chatman, 1991) Researches confirm that person-organization fit predicts organizational commitment (O'Reilly et al., 1991) and lack of compatibility between an employee and the organization causes turnover (Villanova et al., 1994). According to Awang et al. (2013), P-O fit significantly affects turnover intention of employees. This means when P-O fit is high, the level of turnover intention decreases. An employee’s turnover intention will be higher when she/he is not satisfied with the organization (Pfeffer, 2007). Previous research confirms the role of P-O misfit as an antecedent to turnover intention and the strong negative relationship between P-O fit and turnover intention (El-Sakka, 2016). In order to reduce the turnover rate; person-organization fit should be considered even at the very beginning of the recruiting process. Since human resources is the most important key in maximizing competitiveness; reducing the turnover rate and retention of the talent would provide competitive advantage for a company among its competitors.

Employees’ intentions to quit their jobs also decrease when there are positive work-related attitudes in the workplace (Lu et al., 2017) These attitudes can be realized through psychological ownership which can inspire positive attitudes towards the organization and in turn reduce intentions to leave (Avey et al., 2009; Van Dyne & Pierce, 2004; Vandewalle et al., 1995). Bernhard and O’Driscoll (2011) confirmed this by claiming that employees with high organizational PO are less likely to intend to quit. PO also has positive effects on employee motivation, psychological involvement and engagement. Engaged employees “experience a high level of connectivity with their work tasks and therefore they work hard to accomplish their task-related goals” (Dessler, 2017). That’s why PO drives performance and add value to the organization by boosting performance.

Theoretical and empirical research suggests that individuals put their efforts voluntarily and work hard to accomplish their goals when they feel a sense of belonging and a connection towards their jobs and organization. This high level of connectivity is achieved when they are involved in, connected to and committed to their jobs and when they feel that their values, needs and interests are aligned with their organizations. This kind of commitment and alignment brings psychological ownership and person-organization fit including organizational performance (Govindarajan, 1989; Meglino et al., 1989) employee engagement, commitment, satisfaction, and retention (Chatman, 1991; Meglino, Ravlin, & Adkins, 1989; O’Reilly et al., 1991; Sheridan, 1992), which would directly affect the turnover intention of an employee. These findings reveal the effect of PO and P-O fit on turnover intention. This research supports the findings and provides empirical evidence for the negative influence of psychological ownership and P-O fit on turnover intention.

This study highlights the relation between PO and P-O fit on turnover intention. The research is conducted in Turkish private sector among the service and manufacturing industry employees in Marmara, Eagean and Central Anatolia regions. Although previous researchers have proposed that PO and P-O fit may reduce the likelihood of employees’ turnover intention, empirical evidence still remains limited (Lu et al., 2017) . Employees who have high level of psychological ownership are more likely to experience P-O fit and in turn decreases turnover intent.

The findings of this research confirmed that person-organization fit has a significant effect on psychological ownership. According to the results; person-organization fit has a statistically significant negative effect on turnover intentions and psychological ownership has a negative impact on turnover intentions. When psychological ownership is added to the model, the effect of P-O fit on turnover intention is significantly decreased. Psychological ownership mediated the effects of person-organization fit on turnover intention. The role of psychological ownership as a mediator between person-organization fit and turnover intention indicated a partial effect of person-organization fit related to turnover intention and suggested that psychological ownership partially mediated the relationship between person-organization fit and turnover intention. In summary, it is confirmed that psychological ownership increases the negative effect of person-organization fit on turnover intention. In conclusion, hypotheses 1, 2, 3 and 4 have been accepted.

The workplace atmosphere is an important factor that retain employees in their jobs. According to the research findings, high levels of person-organization fit and psychological ownership reduce the intention to leave and psychological ownership and person-organization fit are significant predictors for employee turnover intention. In addition, the results demonstrate that psychological ownership is a significant mediator between person-organization fit and turnover intention. Employers should implement strategies in order to increase psychological ownership and person-organization fit to be able to decrease the levels of turnover intention of their employees. According to the findings of this research, the role of psychological ownership as a mediator between person-organization fit and turnover intention indicated a partial effect of psychological ownership and suggested that psychological ownership partially mediated the relationship between person-organization fit and turnover intention. In other words, psychological ownership seems to increase the effect of person-organization fit on turnover int.

Study limitation

Limitations to generalizing of these results are dependent on the industry type, sample size, sampling technique and location where the sampling came from.

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Publication Date

21 January 2020

eBook ISBN

978-1-80296-074-7

Publisher

Future Academy

Volume

75

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Edition Number

1st Edition

Pages

1-399

Subjects

Management, leadership, motivation, business, innovation, organizational theory, organizational behaviour

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Uçar*, A. C., Elçi, M., & Özdemir, E. E. (2020). The Mediating Effect Of Psychological Ownership On Person-Organization Fit & Turnover Intention. In C. Zehir, & E. Erzengin (Eds.), Leadership, Technology, Innovation and Business Management, vol 75. European Proceedings of Social and Behavioural Sciences (pp. 297-310). Future Academy. https://doi.org/10.15405/epsbs.2019.12.03.25