RESEARCH
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Executive
Summary
KEY WORDS
Perceived Organizational
Support
Person-Organization Fit
Employee Engagement
Attitudinal Outcomes
Mediator Analysis
SEM
VIKALPA • VOLUME 38 • NO 1 • JANUARY - MARCH 2013
Mediator Analysis of Employee
Engagement: Role of Perceived
Organizational Support, P-O Fit,
Organizational Commitment and Job
Satisfaction
Soumendu Biswas and Jyotsna Bhatnagar
Given the multi-determinability of individual affect and attitudes, this paper seeks to
explicate their display through some construct that captures the cognitive, emotional,
and behavioural components of work-related roles. Employee engagement is found to
be one such explanatory variable.
This paper assesses the mediating role of employee engagement between perceived
organizational support (POS) and person-organization fit (P-O fit) as the antecedents
and organizational commitment and job satisfaction as the consequences. It tests the
path model by using data from six Indian organizations and a sample of 246 Indian
managers. The findings help find a direct effect of P-O fit and POS, which affects
employee engagement and leads to variance in organizational commitment and job
satisfaction.
Further, the paper attempts to establish discriminant validity between employee en-
gagement and organizational commitment. Yet, because of the similarity of wordings
of the items measuring the employees’ ratings of the two constructs, the authors con-
ducted a confirmatory factor analysis leading to discriminant validity establishment
to examine whether employee engagement and organizational commitment were dis-
tinct. AMOS software (version 17.0) was used to compare the fit of two nested models:
(a) a one-factor model incorporating both the constructs and (b) a two-factor model
distinguishing employee engagement and organizational commitment. It also pro-
vides empirical support to job satisfaction and its linkage with employee engagement.
The findings suggest that when individuals perceive positive levels of organizational
collaboration, they are intrinsically encouraged towards exerting considerably higher
levels of effort. The notion that P-O fit deals with the congruence between employees’
personal values and those of the organization makes for greater meaningfulness and
psychological safety leading to higher levels of employee engagement. Furthermore,
when individual values are perceived to fit organizational norms, the former are en-
trusted with greater responsibilities and are made to feel more empowered. A high
level of employee engagement reflects a greater trust and loyal relationship between
the individual and the organization. This suggests the building up of higher degree of
commitment by the employee towards their employing organization.
The paper contributes to theory building in the employee engagement and organiza-
tional commitment domains.
27
I
n the recent past, a maxim which most human re-
source (HR) managers adhered to was that ‘happy
employees are productive employees’. On the face of
it, it was assumed that if the index of workplace happi-
ness, measured mostly as a composite of positive levels of
employees’ job satisfaction and organizational commit-
ment and negative levels of their intention to quit, was
tolerably high, it would result in successful levels of indi-
vidual performance and, by summation, organizational
performance. While this is a rather unambiguous line of
reasoning, it has its own lacunae namely,
a) it attributes individual and organizational perform-
ance to a few attitudinal variables;
b) it does not take into account several contingent fac-
tors which are responsible for individual and organi-
zation related criteria; and,
c) it fails to provide clarifications regarding the origin of
the expounding variables such as commitment and
satisfaction.
As a result, along with the growing complexity, dyna-
mism, and uncertainty of the contemporary business en-
vironment, the traditional approaches to explain
individual and organizational outcomes have been called
into question (Pasmore & Khalsa, 1993). Evidently, while
the link between high levels of satisfaction and commit-
ment and low levels of intention to quit on the one hand
and individual and organizational performance on the
other is fairly straightforward, we believe that there ex-
ists a need to consider these hitherto exogenous variables
as endogenous and inquire about their causations.
We start our investigation by assuming that there exists a
particular motivational course of action which is mani-
fested in the display of individuals’ affect and attitudes
at the workplace (Griffin, Parker & Neal, 2008; Rotundo
& Sackett, 2002). Given the multi-determinability of indi-
vidual affect and attitudes, we seek to explicate their dis-
play through some construct that captures the cognitive,
emotional, and behavioural components of work-related
roles. We find employee engagement to be one such ex-
planatory factor which focuses on employees’ perceptions
of psychological availability, safety, and meaningfulness
in discharging their formal role requirements (Kahn, 1990;
May, Gilson & Harter, 2004; Saks, 2006; Bhatnagar, 2007;
Bhatnagar, 2009). Moreover, within the ambits of the so-
cial exchange theory (SET), employee engagement appears
to mediate the norms of reciprocity by pledging individual
28 MEDIATOR ANALYSIS OF EMPLOYEE ENGAGEMENT: ROLE OF PERCEIVED ...
loyalty and attachment for organizational support and
sustenance. Further research indicates that employees
tend to display positive affect and involvement, when
they feel a fitment of temperament between themselves
and their organizations (Kahn, 1992; Schneider, 1997).
Tying the threads of research together, in the current
study, we investigate perceived organizational support
(POS), and person-organization fit (P-O fit), as the ante-
cedents to organizational commitment and job satisfac-
tion, mediated by employee engagement.
CHANGING HRM PERSPECTIVE:
THE NEED FOR THE STUDY
Bhatnagar and Sharma (2009) stated that, both, in West-
ern and Indian literature, there was a spate of studies on
honing high commitment work systems (Parkes et al, 2007;
Nazir, 2005; Agrawala, 2003) amongst HR managers and
consultants, since the work on Talent Management pub-
lished by McKinsey Quarterly in 1998 (see, Elizabeth, et al,
1998). However, with liberalization, the organizations
faced the challenges of globalization, diversification, tech-
nology acquisition, introduction to new systems and pro-
fessional culture, greater power sharing and participative
management (Bhatnagar, 2006). There was a change in
the landscape of people management practices across all
sectors of the Indian industry with the focus on upcom-
ing themes of strategic innovative HR, talent management,
six-sigma in HR function, and commitment-based HR
which, the ‘best-place-to-work-in’ organizations imple-
mented (Bhatnagar, 2009). Talent, one of the most impor-
tant assets needed for an organization to run smoothly,
witnessed a flow towards the MNCs, which offered not
only better compensation packages but also a good-place-
to-work-in culture (Bhatnagar & Som, 2010).
Recently, Nair & Vohra (2010), in a study on 1,142 knowl-
edge workers, found lack of meaningful work, inability of
work to allow for self-expression, and poor quality work
relationships, to be the predictors of work alienation in
the Indian IT sector. The study indicates that one in every
five knowledge workers is likely to be alienated. It sug-
gests practitioners and organizations to take preventive
measures against workforce alienation, in order to en-
sure an enthused workforce. The current study findings
will help find a direct effect of person-organization fit
and perceived organizational support, which may affect
employee engagement and lead to variance in organiza-
tional commitment and job satisfaction. This may lead to
a better adjusted, more enthused, and less alienated
workforce.
Within this context, the Line and HR Managers in India
need to focus on issues of harnessing talent towards low
work alienation and high commitment, and identify who
are more job-satisfied and engaged in meaningful work.
Further, a stronger person-organization fit may lead to
merging of identities with the organization and hence
may have higher engagement. In a recent study, Nair
(2010) reported a paper which demonstrated the manner
in which individual identity got fused with organiza-
tional identity to strengthen employee identification with
the organization. These nuances have practical implica-
tions and need to be investigated in detail at the ground
level.
Perceived Organizational Support (POS) and
Person-Organization (P-O) Fit
Today, business environments in most of the advanced
as well as emergent economies are experiencing the char-
acteristics of the post-industrial society. Accordingly,
their social ecology is underscored by an interdependence
of personal and social development (Bell, 1973; Emery
&Trist, 1973). To explain this situation, we have to fall
back on the organizational support theory which conjec-
tures that in order to encourage augmented levels of per-
formance, diminished absenteeism, and such other
affirmative behaviours, organizations must acquire an-
thropomorphic qualities which respect employees’ over-
all beliefs regarding their intent to meet the latter’s
socio-emotional needs through appropriate support sys-
tems (Eisenberger, Huntington, Hutchison & Sowa, 1986;
Rhoades & Eisenberger, 2002; Shore & Shore, 1995). This
perception of organizational support enables employees
to develop adaptive and innovative ways of coping with
environmental exigencies (Macey & Schneider, 2008).
In this connection, prior research (Byrne & Hochwarter,
2008; Erdogan & Enders, 2007; Ristig, 2009) has indi-
cated that when an employee perceives organizational
support, it strengthens his/her cognitive and emotional
evaluation of his/her job and organization. Indeed, POS
not only assures employees of extrinsic resources such as
pay and fringe benefits but also ensures organizational
endorsement, faith, regard, and status (Blau, 1964; Fuller,
Barnett, Hester & Relyea, 2006). In view of this dyadic
interaction between employees and their organization, it
VIKALPA • VOLUME 38 • NO 1 • JANUARY - MARCH 2013
may be posited that higher levels of POS allow employees
to exploit their abilities without any threat to their self-
esteem, social standing, or occupation. When employees
perceive such psychological safety, they are also able to
make better sense of their job and experience healthier
interpersonal interactions. Clearly, POS inculcates a be-
lief in the incumbents that they have the necessary physi-
cal, cognitive, and emotional reserves to fulfill their
role-related responsibilities and is in consonance with
nearly all aspects of their work conditions (Saks, 2006).
Consequently, employees feel excited to be a member of
the organization and ‘throw’ themselves into their job.
Based on this discussion, we present our first study hy-
pothesis:
Hypothesis 1: POS will be positively related to em-
ployee engagement.
Contemporary managerial philosophies provide greater
empowerment to employees to make decisions and dis-
charge their duties (Biswas & Varma, 2007); and, Indian
managers in performing a strategic role in HR, provide a
sense of psychological empowerment (see Bhatnagar &
Sharma, 2005, Bhatnagar, 2007). However, as research
suggests, employees utilize such autonomy to fulfill their
role-related responsibilities when they perceive a ‘fit’ be-
tween themselves and their employing organizations
(Arthur, Bell, Villado & Doverspike, 2006). Conversely,
organizations on their part recruit, retain, and develop
those employees who they feel conform to their norms
(Adams, Elacqua & Collarelli, 1994; Bowen, Ledford &
Nathan, 1991; Rynes, Brown & Colbert, 2002).
Conceptually, the association between person and orga-
nization, labeled as P-O fit in organizational behaviour
literature, can be looked at both from the point of view of
being ‘complementary’ as well as ‘supplementary’.
Complementary fit occurs as a result of fulfilling the needs-
supplies and the demands-abilities criteria, whereas
supplementary fit arises when there is an actual (indi-
rect) and a perceived (direct) congruence of values be-
tween the person and the organization (Cable & DeRue,
2002; Cable & Judge, 1996; Kristof, 1996; Ostroff, Shin &
Kinicki, 2005). Consequently, we find that employees dis-
playing positive affect and attitudes, are more involved
and attached with their job and their organization, and
overtly look forward to in-role and extra-role obligations
when they anticipate a similar temperament between them-
selves and their employing organizations, which is a
29
supplementary fit (Kahn, 1996; Schneider, 1997). Thus,
we may infer that while supplementary fit assembles and
strengthens the relation between a person and his orga-
nization within the domains of SET, complementary fit is
responsible for operationalizing the outcomes of this re-
lationship. If we examine Kristofs interpretation (1996),
‘complimentary fit occurs when the individual and the situa-
tion meet each other’s needs’ (cf., Carless, 2005). Further, in
this connection, relevant literature shows that employees
intend to be positively associated with their job and their
employing organizations and this intention is further re-
inforced when there is an alignment between the indi-
vidual and the organizational values and expectations
(Cooper-Thomas, Vianen &Anderson, 2004; Ostroff &
Kozlowski, 1992). We observe that a strong P-O fit has an
important bearing on the behaviour and well-being of the
former in terms of organizational identification, organi-
zational commitment, and job performance (Lauver &
Kristof-Brown, 2001; Meglino, Ravlin & Adkins, 1989;
Meyer & Herscovitch, 2001; O’Reilly, Chatman &
Caldwell, 1991; Saks & Ashforth, 1996). As a result, we
find that the construct of P-O fit has been widely employed
in the context of a variety of organizational research such
as marketing, corporate branding, recruitment and selec-
tion, job satisfaction, and group behaviour (Adkins,
Russel & Werbel, 2006 ; Ng & Burke, 2005; Kirkman,
Tesluk & Rosen, 2004; Richins, 1994; Tarique, Schuler &
Gong, 2006; Taris, Feij & Van Vianenm 2008; Yaniv &
Farkas, 2005). Van Vuuren, Veldkamp, Jong & Seydel
(2007) suggest that the importance of studying the con-
cept of P-O fit lies in the fact that it indicates the way in
which employees develop a sense of communality of pur-
pose with their employing organization. This ultimately
leads to a clarity for the individual regarding the purpose
of their job and increases the intensity of their focus on
their work assignments. Further, it inculcates a sense of
in-group belongingness among employees which height-
ens their sense of psychological safety. On the basis of the
discussion above, we propose,
Hypothesis 2: Employees who experience stronger
P-O fit vis-à-vis their organization will display
higher levels of engagement.
Organizational Commitment
Employee engagement entails a notion of ‘flow’. Accord-
ing to Csikszantmihalyi (1975), the notion of ‘flow’ im-
plies a balanced impression of the environment and this
30 MEDIATOR ANALYSIS OF EMPLOYEE ENGAGEMENT: ROLE OF PERCEIVED ...
occurs when individuals are in absolute consonance with
their surroundings. People who are in the state of ‘flow’
experience oneness between self and the environment.
However, May et al., (2004) provide a caveat in interpret-
ing employee engagement as a ‘flow’. They say that the
notion of ‘flow’ is primarily concerned with the cognitive
involvement of the employee whereas employee engage-
ment comprises cognitive, emotional, and behavioural
components. Thus, engagement at work not only facili-
tates cognitive interpretation of in-role activities, but also
paves way for affective and psychological attachment to
one’s job and organization (May et al., 2004; Kahn, 2004;
Saks, 2006). So much so that when there is a disconnect
between one’s felt emotion and emotions as desired
by one’s organization, individuals are put under emo-
tional labour; they suffer from stress as a result of which
they shy away from their work and their workplace
(Hochschild, 1983; Morris & Feldman, 1996).
Still, within the boundaries of SET, we may surmise that
engaged employees feel an intrinsic obligation to be socio-
emotionally attached to the source of such engagement
namely, their work and their employing organization.
Thus, employees who perceive themselves to be engaged
append a lot of personal meaning to their affiliation with
their job and their organization. Ergo, they are willing to
prolong their vocational as well as organizational mem-
bership. This line of reasoning corroborates with find-
ings of prior research (cf. Cropanzano & Mitchell, 2005;
Maslach, Schaufeli & Leiter, 2001; Saks, 2006; Schaufeli
& Bakker, 2004). Accordingly, we propose our third study
hypothesis.
Hypothesis 3: Employees who are effectively en-
gaged will exhibit a higher level of commitment
towards their organization.
Job Satisfaction
In connection to the discussion above, employee engage-
ment may be identified as a construct which is primarily
concerned with those psychological incidents at the work-
place that adds greater linkage between them, their job,
and their organization (Buckingham & Coffman, 1999;
Kahn, 1992; Luthans & Peterson, 2004). Research shows
that employees who are not engaged display apathy, dis-
enchantment, and social aloofness (Hochschild, 1980).
This is contrary to engaged employees, who experience a
pleasurable emotional state at work, indicating high level
of job satisfaction.
Additionally, employee engagement which is connected
to self-efficacy, leads employees to better mobilize their
cognitive and emotional faculty in order to undertake
work-related courses of action (Stajkovic & Luthans,
1998). We may further construe that since employee en-
gagement is an affective-motivational construct, employ-
ees experiencing it get a sense of fulfillment in discharg-
ing their duties and responsibilities (Xanthopoulou,
Bakker, Demerouti & Schaufeli, 2009). Besides, engaged
employees are found to be brisk and ardent about their
tasks, and are wholly engrossed in their vocation
(Schaufeli, Taris & Van Rhenen, 2008; Macey & Schneider,
2008; May, Gilson & Harter, 2004). Under the circum-
stance, we may recall Hobfoll (1989) and others’ (cf.
DeLange, Taris, Kompier, Houtman & Bongers, 2004;
Demerouti, Bakker, Nachreiner & Schaufeli, 2001) argu-
ment that since engaged employees are highly absorbed
with respect to their role responsibilities, they shall in-
voke all possible means to get their work done and in the
process attain their work goals. We may extend this
premise and assert that as work objectives are attained,
individuals may encounter a feeling of inherent well-be-
ing and gratification. Thus, we may put forth our fourth
hypothesis as follows:
Hypothesis 4: Employee engagement shall have a
significantly positive influence on an employee’s
level of job satisfaction.
Evidently, our discussion above juxtaposes our study
variables namely, POS, P-O fit, employee engagement,
organizational commitment, and job satisfaction through
the four hypotheses which we intend to test empirically.
However, merely hypothesizing as the outcome of POS
and P-O fit or as the predictor of organizational commit-
ment and job satisfaction does not preclude employee
engagement as a mediator between these variables. For
the purpose of assessing the mediating role of employee
engagement between POS and P-O fit as the antecedents
and organizational commitment and job satisfaction as
the consequences, we propose to test the path model pre-
sented in Figure 1. Further, we put forward Hypothesis 5
which we conjecture as the representative of the entire
path model.
Hypothesis 5: Employee engagement will mediate
positive relationships of POS and P-O fit with or-
ganizational commitment and job satisfaction.
VIKALPA • VOLUME 38 • NO 1 • JANUARY - MARCH 2013
Figure 1: The Path Model Associating the Latent Constructs
POS Organizational
Commitment
H1 H3
Employee
Engagement
H2 H4
P-O Fit Job
Satisfaction
METHOD
Sample and Procedure
We surveyed three hundred full-time employees belong-
ing to organizations located in north-central India. The
employees completed the survey of their own accord dur-
ing their regular scheduled work hours at their respec-
tive work sites. To encourage employees to share free and
frank opinion, we assured them of anonymity through
both verbal and written means. We further guaranteed
that only group data will be communicated to the organi-
zations. Survey questionnaires were distributed and re-
trieved by the researchers in sealed envelopes. Eighty-two
percent (N = 246) of the participants returned the ques-
tionnaires.
Based on the survey participants’ responses, we found
that their average age was 33.33 years. Of the 221 respon-
dents, 87.10 percent were males and 12.90 percent were
females. On an average, the employees had 12.28 years of
work experience.
Measures
POS. Previous studies involving diverse occupations and
organizations indicated a high reliability and unidimen-
sionality of the POS Survey (Rhoades & Eisenberger, 2002;
Shanock & Eisenberger, 2006; Shore & Tetrick, 1991). Re-
spondents rated their POS using the eight items compris-
ing the short form of the POS Survey (Items A, B, C, D, E, F,
G and H; Eisenberger et al., 1986). In keeping with the
suggestions of Rhoades and Eisenberger (2002), we in-
cluded those items which we felt covered the aspects of
the definition of POS (i.e., estimation of employees’ role
and concern about employees’ welfare). Sample items
included “My organization really cares about my well-
31
being” and “My organization is willing to help me if I
need a special favour”. Respondents indicated the extent
of agreement with each statement on a 4-point scale (1 =
Strongly disagree to 4 = Agree).
P-O Fit. The variable P-O fit was measured using the
three items developed by Cable and Judge (1996). The
responses to these scales were measured on a 4-point scale
(1 = Strongly disagree to 4 = Agree). A sample item of the
scale was “My values match those of the current employ-
ees in this organization”.
Employee Engagement. Employee engagement was mea-
sured using 11 items of the scale developed by Saks (2006).
This measure took into consideration two factors of em-
ployee engagement, that is, job engagement and organi-
zational engagement comprising five and six items
respectively. Items were measured on a 4-point scale (1 =
Strongly disagree to 4 = Agree) and included statements
such as “I am highly engaged in this job” and “One of the
most exciting things for me is getting involved with things
happening in this organization”.
Organizational Commitment. The construct of organiza-
tional commitment was measured using the scale devel-
oped by Rhoades, Eisenberger & Armelli (2001). The scale
comprised six items which were exacted on a 4-point scale
(1 = Strongly disagree to 4 = Agree). “Working at my orga-
nization has a great deal of personal meaning to me” is a
sample of the questionnaire items.
Job Satisfaction. Job satisfaction was measured with
Camman, Fichman, Jenkins & Klesh’s (1983) three-item
scale. Respondents indicated the extent of agreement with
each statement being measured on a 4-point scale (1 =
Strongly disagree to 4 = Agree).
Control Variables: In keeping with prior studies (Ang,
Dyne & Begley, 2003; Avolio, Zhu, Koh & Bhatia, 2004),
age, tenure, amount of time spent with immediate super-
visor, and educational level of respondents were treated
as control variables for all statistical analyses.
Common Method Bias
We noted that since the respondents providing the mea-
sures for the variables were the same, our study could
potentially suffer from the problem of common method
bias (Podsakoff, MacKenzie, Lee & Podsakoff, 2003). We
therefore conducted Harman’s single-factor test to address
the concern. The procedure required that an unrotated
32 MEDIATOR ANALYSIS OF EMPLOYEE ENGAGEMENT: ROLE OF PERCEIVED ...
factor analysis be performed on all of the variables stud-
ied. In case a single factor emerged or one general factor
explained most of the covariance in the independent and
dependent variables, it would be reasonable to conclude
that a significant CMV is present. Accordingly, we in-
cluded all the indicators of all the latent constructs in the
study into a factor analysis to determine whether a single
factor claimed a disproportionately large variance. We
thus conclude that common method bias is not present in
our study.
RESULTS
Discriminant Validity of the Employee Engagement
and Organizational Commitment Constructs
While every effort was made to conceptually differentiate
near-identical or overlapping constructs, it was essential
to make the same discrimination operationally as well. It
was for this purpose that discrminant validity tests were
carried out such that the operationalization of one con-
struct was different from that of another construct. In so-
cial science research in general, and OB/HR research in
specific, there are quite a few constructs that would ap-
pear synonymous in lay terms. To establish construct dif-
ference definitionally, it is therefore practically advisable
to carry out a discriminant validity analysis and ascer-
tain the precise connotation of that construct – both, con-
ceptually as well as mathematically. Prior research
provides evidence of the distinctiveness of employee en-
gagement and organizational commitment. Yet, because
of the similarity of wordings of the items measuring the
employees’ ratings of the constructs, we conducted a con-
firmatory factor analysis leading to discriminant validity
establishment to examine whether employee engagement
and organizational commitment were distinct. We used
AMOS software (version 17.0; Arbuckle & Wothke, 1999)
to compare the fit of two nested models: (a) a one-factor
model incorporating both the constructs and (b) a two-
factor model distinguishing employee engagement and
organizational commitment. Based on the sequential chi-
square difference test (James, Mulaik, & Brett, 1982), the
two-factor model, χ2 (19, N = 246) = 166.04, fitted the data
significantly better than the one-factor model, χ2 (20, N =
246) = 198.06; χ2diff (1, N = 246) = 32.02, p < 0.01. The two-
factor model also showed better fit to the data according
to the comparative fit index (two-factor model = 0.83, one-
factor model = 0.80), the goodness-of-fit index (two-factor
model = 0.84, one-factor model = 0.81), and the Tucker-
Lewis index (two-factor model = 0.75, one-factor model =
0.72). Therefore, we treated the two constructs separately
in subsequent statistical analyses.
Descriptive Statistics and Correlation
The means, standard deviations, internal reliabilities, and
intercorrelations among the variables are reported in Table
1. All measures show high internal reliabilities, with co-
efficient alphas ranging from 0.55 to 0.84. The pattern of
correlation is consistent with the hypothesized relation-
ships. That is, POS and P-O fit has a statistically positive
relationship with the potential mediator namely, em-
ployee engagement, and with the outcome variables of
organizational commitment and job satisfaction. Addi-
tionally, employee engagement has statistically signifi-
cant positive relationships with organizational commit-
ment and job satisfaction respectively.
Relationships of POS and P-O Fit with Employee
Engagement, Organizational Commitment, and Job
Satisfaction
We used AMOS (version 17.0; Arbuckle & Wothke, 1999)
to assess the degree to which POS and P-O fit were re-
lated to employee engagement, organizational commit-
ment, and job satisfaction, and to see whether employee
engagement mediated the relationship of POS and P-O fit
with organizational commitment and job satisfaction.
The standardized regression estimates presented in Table
2 allowed us to examine the direct association between
the study constructs. We note that the level of significance
is based on the critical ratio (CR) of the regression esti-
mate (Biswas, Giri & Srivastava, 2006; Byrne, 2001). Thus,
when CR values are greater than or equal to 2.58, it indi-
cates a 99 percent level of significance. However, when
CR values are greater than or equal to 1.96 but less than
2.58, it indicates a 95 percent level of significance. Ac-
cordingly, we report that employee engagement regress
significantly and positively on POS (standardized β =
0.36, C.R. = 3.70) and P-O fit (standardized β = 0.48, CR =
4.67). This is consistent with Hypotheses 1 and 2. The
standardized regression coefficients for the relationships
are designated by β. Further, organizational commitment
(standardized β = 0.82, CR = 6.72) and job satisfaction
(standardized β = 0.85, CR = 4.22) are significantly and
positively associated with employee engagement. Conse-
quently, we accept Hypotheses 3 and 4.
A mediator is instrumental in accounting for the influ-
ence of the independent variable on the dependent vari-
able (Cohen, Cohen, West & Aiken, 2003). To test the
mediation of employee engagement, we followed the sug-
gestion of Wood, Goodman, Beckmann and Cook (2008)

Table 1: Means, Standard Deviations, Alpha Reliabilities, and Intercorrelations Among Variables
Variable M SD 1 2 3 4 5
1. POS 3.16 0.43 (0.73)
2. P-O Fit 3.32 0.61 0.50 (0.80)
3. Employee engagement 3.37 0.36 0.23 0.33 (0.74)
4. Organizational commitment 3.47 0.51 0.52 0.54 0.47 (0.84)
5. Job satisfaction 3.53 0.51 0.48 0.47 0.32 0.55 (0.55)
Note: N = 246. Alpha reliabilities are reported on the diagonal.
** p < 0.01.

Table 2: Regression Estimates

Model Unstandardized Standardized Remarks

Coefficients Coefficients
B Standard Error β CR
POS → Employee engagement 0.18 0.05 0.36 3.70 H1 accepted
P-O fit → Employee engagement 0.23 0.05 0.48 4.67 H2 accepted
Employee engagement → Organizational commitment 1.51 0.22 0.82 6.72 H3 accepted
Employee engagement → Job satisfaction 1.07 0.25 0.85 4.22 H4 accepted
Note: N=246; The C R (Critical Ratio) is the commonly recommended basis for testing statistical significance of SEM components with C R
values beyond ±2.58 establishing significance at p <0 .01 level.

VIKALPA • VOLUME 38 • NO 1 • JANUARY - MARCH 2013 33

and applied structural modeling equation (SEM) proce- 5 which stated that employee engagement will mediate
dures using the maximum likelihood estimation (MLE) the positive relationship of POS and P-O fit with organi-
algorithm. It has been previously argued that in the area zational commitment and job satisfaction. Even though
of mediation analysis, when variables with multiple in- one might reasonably object that the actuality of a causal
dicators are taken into account (Iacobucci, Saldanah, & model cannot be established by non-experimental data
Deng, 2007), or conditions of confirmatory analyses are and accept that there may be other causal models that
met (James & Brett, 1984), or when models incorporate might fit the data equally well, we maintain that given
latent variables (Kenny, Kashy, & Bolger, 1998), SEM of- the theoretical premises of our present study, model 1 is
fers a better alternative to traditional multiple regression the best-fitting model.
tests of mediation. However, conceptually, our procedure
Although the use of SEM establishes employee engage-
of testing mediation using SEM is akin to Baron and
ment as a mediator and precludes problem of correlated
Kenny’s (1986) approach. We consider two competing
measurement error, we further conducted the Sobel’s
models namely, model 1 and model 2, where model 1
(1982) test, the Aroian’s (1944) test, and the Goodman’s
includes the potential mediator, that is, employee engage-
(1960) test. These tests were conducted in line with the z-
ment in this case, whereas model 2 constrains the poten-
prime method (MacKinnon, Lockwood, Hoffman, West
tial mediator and examines the direct relation between
& Sheetes, 2002) to check for the statistical power of our
the predictor and the criterion variables.
models and discount the possibility of Type I error while
Although, as per literature (Byrne, 2001), values of GFI ≥ exploring the strength of mediation. Results of these tests
0.90 are considered to be representative of a well-fitting are provided in Table 4.
model, we considered the advised cut-off of 0.95 as sug-
Finally, we also performed the two-step procedure sug-
gested by Hu and Bentler (1995). Furthermore, in order to
gested by MacKinnon, Warsi and Dwyer (1995) to cat-
compare model 1 and model 2, we calculated the com-
egorize the status of employee engagement as a full- or a
parative-fit-index (CFI), the normed-fit-index (NFI), the
quasi-mediator and to find out the corresponding per-
relative-fit-index (RFI), and the Tucker-Lewis index (TLI).
cent of mediation caused by it. Considering employee
According to Hair, Andersen, Tatham, and Black (1998),
engagement as the mediator variable, we tested the fol-
the recommended fit values for CFI, NFI, RFI, and TLI, are
lowing two conditions: (i) whether the direct paths from
≥.90. A model, which has a higher value of the propor-
the antecedent to the consequents were greater than the
tionate fit indices, is accepted as a better fitting model. We
paths under the condition of mediation, and, (ii) whether
also considered the parsimony of model 1 and model 2 by
the direct path from the predictors to the criteria under
calculating the respective root mean square of approxi-
the mediated condition was significant. As we see from
mation (RMSEA) values. A lower RMSEA indicates a bet-
Table 4, condition (i) is negative and condition (ii) is posi-
ter model with the suggested maximum being 0.06
tive; we therefore conclude that employee engagement is
(Biswas & Varma, 2007). Finally, we also used the Akaike
a full-mediator between the predictors, i.e., POS and P-O
Information Criteria (AIC) (Akaike, 1974) for model selec-
fit and the criterion variables, i.e., organizational com-
tion and buttressed our claims by using the Browne-
mitment and job satisfaction.
Cudeck (1989) Criteria. Based on the SEM analysis, results
of which are presented in Table 3, we accept Hypothesis

Table 3: Fit Indices

Fit Indices
Normed χ2 GFI CFI NFI RFI TLI RMSEA IC Browne-Cudeck Criteria
Model 1 1.20 0.94 0.99 0.93 0.88 0.98 0.03 386.38 407.73
Model 2 3.67 0.79 0.78 0.73 0.68 0.75 0.10 695.52 703.96
Note: GFI = Goodness-of-Fit Index; CFI = Comparative Fit Index; NFI = Normed Fit Index; RFI = Relative Fit Index; TLI = Tucker-Lewis Index;
RMSEA = Root Mean Square Error of Approximation; AIC = Akaike Information Criteria

34 MEDIATOR ANALYSIS OF EMPLOYEE ENGAGEMENT: ROLE OF PERCEIVED ...

Table 4: Analysis of Employee Engagement as a Mediator

Whether Whether Results Sobel’s Aroian’s Goodman’s % of

direct path > direct path of the Test Test Test Explained
direct path under Mediator Mediation
under mediated Analysis
mediated condition is
condition significant?
POS →
Employee engagement → 3.19** 3.16** 3.22** 50.44
Organizational commitment
p-o Fit →
Employee engagement → NO YES Employee 3.82** 3.79** 3.85** 50.23
Organizational commitment engagement
is a full
POS →
mediator
Employee engagement → 2.76** 2.71** 2.80** 37.50
Job satisfaction
P-O Fit →
Employee engagement → 3.13** 3.10** 3.17** 55.28
Job satisfaction
** p ≤ 0.01.

DISCUSSION
The results of the present study provide ample support
for the proposed theoretical model (Figure 1). In this sec-
tion, we discuss the implications of each of the hypoth-
eses as well as those of the overall model vis-à-vis the
empirical outcomes as detailed above.
Our first hypothesis postulated a positive relationship
between POS and employee engagement. The results of
the data analysis support such a postulation. Organiza-
tions need to go beyond the specified contractual rela-
tionships and provide individuals with economic and
psychological backings in order to extract optimum ef-
forts. A positive evaluation of affective experiences ex-
pounded by a favourable organizational stance is an
essential prerequisite to enhance cognitive and
behavioural evaluation by an employee vis-à-vis his or
her situation at work. Thus the acceptance of our first
hypothesis suggests that when individuals perceive posi-
tive levels of organizational collaboration, they are in-
trinsically encouraged towards exerting considerably
higher levels of effort.
The second hypothesis of our study stated that P-O fit
would be a significant correlate of employee engagement.
This is borne out by the study results. Conceptually, P-O
fit is the alignment between organizational and indi-
vidual norms and values. Prior research (O’Reilly III,
Chatman & Caldwell, 1991; Posner, 1992; Vancouver &
Schmitt, 1991) has reported that P-O fit leads to positive
attitudinal outcomes, reduces anxiety, and increases in-
dividual commitment and involvement. The notion that
P-O fit deals with the congruence between employees’
personal values and those of the organization makes for
greater meaningfulness and psychological safety lead-
ing to higher levels of employee engagement. Furthermore,
when individual values are perceived to fit organizational
norms, the former are entrusted with greater responsibili-
ties and are made to feel more empowered. Laschinger
and Finegan (2005) have described these conditions as
apt to make employees more engaged. As such, the accep-
tance of our second hypothesis corroborates previous re-
search in that, high levels of P-O fit serve as strong
antecedent to foster high levels of employee engagement.
Additionally, such an affirmative appraisal of organiza-
tional approaches confirms the individual’s belief that
their employing organization appreciates their contribu-
tion and thinks about their well-being. Consequently, in-
dividuals reciprocate to these organizational efforts
through superior discretionary and non-discretionary
performances. Furthermore, perceptions of organizational
support by the individuals improve their job-related atti-
tudes such as intrinsic motivation and perceived job se-
curity. As a result, a larger share of their job efforts are
now devoted towards performance enhancing endeavours
manifested through higher levels of job involvement and
employee engagement. Moreover, within the boundaries

VIKALPA • VOLUME 38 • NO 1 • JANUARY - MARCH 2013 35

of the social exchange theory and with employees ascrib-
ing anthropomorphic traits to their organizations
(Gouldner, 1960; Levinson, 1965), POS creates a sense of
felt obligation among employees which the latter exhibit
through a greater degree of emotional as well as transac-
tional engagement.
In the third hypothesis, it was postulated that an
employee’s engagement with his or her job and organiza-
tion would have a positive association with his or her job
satisfaction level. Our results are consistent with this
hypothesization. This implies that when individuals ex-
perience a certain level of engagement, they find their work
to be more fulfilling and motivating. As a result, they per-
ceive their work and workplace to provide them a pleas-
ant environment. Consequently, they are more satisfied
with their job. This line of reasoning is corroborated by
previous research (Schaufeli & Bakker, 2004; Sonnentag,
2003)
Our fourth hypothesis stated that employee engagement
and organizational commitment would be positively re-
lated. The acceptance of this hypothesis indicates that a
high level of employee engagement reflects a greater trust
and loyal relationship between the individual and the
organization. This suggests the building up of higher
degree of commitment by the employee towards their
employing organization.
Our study provides theoretical implications and builds
on the theoretical conjecture provided by Macey &
Schneider (2008). Further, the study builds on the impor-
tance of employee engagement as an important mediator
between the reported antecedents and outcomes. It also
provides empirical support to job satisfaction and its link-
age with employee engagement. This study supports ear-
lier work carried out in the Western context, on the
emerging importance of employee engagement in the In-
dian context. It corroborates the findings of Aryee, Chen
and Budhwar (2004) that Indian organizations empha-
size stimulating personal growth and development, some-
times ahead of organizational performance. In return,
employees reciprocate with increased commitment and
lower levels of absenteeism and turnover. Aligned with
employee engagement and job satisfaction literature (Saks,
2006), our study finds both as important predictors of
employee engagement, which, to our knowledge, no other
Indian research study has explored.
36 MEDIATOR ANALYSIS OF EMPLOYEE ENGAGEMENT: ROLE OF PERCEIVED ...
For practitioners, this study gives insight into the impor-
tance of employee engagement, its antecedents and out-
comes in the Indian context. HR practitioners need to
provide organizational support and person-organization
fitment which would lead to a highly engaged workforce.
They need to pay attention to the person-organization fit,
and how it dynamically affects employee engagement,
organizational commitment, and job satisfaction. Person-
organization fit may be checked/tested at the recruitment
stage and later at the project/team formation stage to be
able to garner the maximum advantage from the process.
Dynamic perceived organization support may be evident
through more understanding, empathic and emotional
intelligent coaching behaviour, from the senior leader-
ship. Coaching and mentoring process sensitivity needs
to be built into the organization through customized OD
interventions at the individual level. Senior management
may be sensitized towards the coaching behaviour which
may lead to higher engagement and commitment from
the employee perspective. HR practitioners may experi-
ment with tools such as workplace alienation scale (Nair
& Vohra, 2009) to zero in on the exact remedial measures
and customized OD interventions. Workplace alienation
scale provides a robust measure for its use in testing
worker alienation and facilitating any required correc-
tion to ensure enhanced employee well-being. Those or-
ganizations which trigger engagement, commitment, and
satisfaction levels, are more likely to have a happier work
force.
Limitations and Areas for Future Research
The study deals with cross-sectional data. Though the
researchers have found through supporting analysis that
there is no effect of common method factor, yet the model
fit appears to be meaningful. However, a mixed method
approach, employing case studies and empirical data
could have given better results. The sample size for this
study is 276. Increasing the sample size and pursuing
industry specific studies may give interesting generaliz-
able results.. Further, besides mediator analyses, a mod-
erator analysis could have given richer insights, which
future studies can look into. Future research studies may
also examine how employee engagement triggers inno-
vation at the firm level. A cross-level research design may
give interesting results.
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Acknowledgment. The authors would like to acknowledge
and thank Management Development Institute, India for the
Soumendu Biswas received his Ph.D degree in Organiza-
tional/Industrial Psychology from the Indian Institute of
Technology¸ Kharagpur. His experience includes teaching
Organizational Behaviour¸ Research Methodology¸ and Hu-
man Resource Management at the Xavier Institute of Social
Services¸ Ranchi. Prior to joining IIT Kharagpur as a research
scholar¸ he was associated with XLRI Jamshedpur as a Re-
search Assistant in the OB/HR Area. He has published ar-
ticles in quite a few national and international journals and
has also presented papers in several international conferences
such as the annual conference of the Academy of Manage-
ment¸ the European Academy of Management¸ the Asian
Academy of Management¸ the Australia-New Zealand Acad-
emy of Management¸ the American Society of Training and
Development¸ the National Academy of Psychology¸ and the
Indian Congress of Social Science Research. He received the
Award for Excellence in Research¸at MDI Gurgaon in 2009-
10.
e-mail: sbiswas@mdi.ac.in
40 MEDIATOR ANALYSIS OF EMPLOYEE ENGAGEMENT: ROLE OF PERCEIVED ...
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461.
Seed Research Grant to carry out this research.
Jyotsna Bhatnagar, received her Ph.D from IIT Delhi and is
an Associate Professor and Chairperson PGP-HRM at MDI.
She has co-edited three books namely: Future of Work(2006),
Changing Face of People Management in India (published in UK,
2009) and Innovations in People Management: Cases in OB/HR/
Communication (2012). Recently, she was awarded the Best Prac-
tical Research Award 2009 Emerald Literati , U.K., presented at
Academy of Management Conference, 2010, Montreal Canada.
She is associated with the Harvard Business School as an af-
filiate and has published in international and national Jour-
nals of repute on areas such as psychological empowerment,
psychological contract, organizational learning and employee
engagement, and strategic HR roles.
e-mail: jyotsnab@mdi.ac.in.