Kim, J. (Sunny), Song, H. J., & Lee, C.-K. (2016). Effects of corporate social responsibility and internal marketing on organizational commitment and turnover intentions. International Journal of Hospitality Management

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ContentslistsavailableatScienceDirect

International Journal of Hospitality Management

j ourna l h o m e pa g e :w w w . e l s e v i e r . c o m / l o c a t e / i j h o s m a n

Effects of corporate social responsibility and internal marketing on organizational commitment and turnover intentions

Jungsun (Sunny) Kim

^a,1

, Hak Jun Song

^b,2

, Choong-Ki Lee

^c,∗

aWilliamF.HarrahCollegeofHotelAdministration,UniversityofNevada,LasVegas,4505MarylandParkway,Box456023,LasVegas,NV89154,USA

bDepartmentofHotel&ConventionManagement,CollegeofTourism&Fashion,PaiChaiUniversity,14Yeon-Ja1Gil,Seo-guDaejeon302-735,SouthKorea

cCollegeofHotel&TourismManagement,KyungHeeUniversity,26Kyungheedae-ro,Dongdaemun-gu,Seoul02447,SouthKorea

a r t i c l e i n f o

Articlehistory:

Received11August2015 Receivedinrevisedform 15December2015 Accepted20February2016

Keywords:

Corporatesocialresponsibility Internalmarketing

Casinoemployee

Organizationalcommitment Turnoverintentions

a b s t r a c t

Thisstudyexaminedtheeffectsoffouraspectsofcorporatesocialresponsibility(CSR)(i.e.,economic, legal,ethical,andphilanthropicresponsibility)andﬁveaspectsofinternalmarketing(IM)(i.e.,welfare system,training,compensation,communication,andmanagementsupport)onemployees’organizationalcommitment(OC)andturnoverintentions(TI)inthecasinoindustry.Basedonsurveydatacollected from310employeesworkingforacasinocompany,therelationshipswereexaminedusingconﬁrmatory factoranalysis,second-orderfactoranalysis,andstructuralequationmodeling.Theresultsindicatethat bothemployees’perceptionsofCSRandIMarepositivelyrelatedtotheirOCandnegativelytotheirTI, suggestingthataddingCSRprogramstoexistingIMprogramsislikelytoimprovedesirableemployee workattitudessuchasOC,whichinturncontributestodecreasingTI.Thisstudymakesacontributionto theliteraturebyconceptuallyandempiricallyevaluatingCSRandIMdimensionssimultaneouslyinthe casinoenvironment.

1. Introduction

Corporate Social Responsibility (CSR) programs have spread throughout the hospitality industry including casino operators suchas MGM Resorts International,Las VegasSands, and Cae- sarsEntertainment. Althoughthere aredifferentdefinitions and dimensionsofCSRincurrentuse,Carroll’s(1991,1998)definition withfourCSRdimensionshasbeencommonlyadopted:acompany should(1)makegoodsorservicesforconsumerstoyieldasatis- factoryprofitintheprocess(economicresponsibility),(2)comply withlawsandregulationsstatedbygovernmentsinitsoperations (legal),(3) meet expectationsofstakeholders andprotect them regardlessiftheseactivitiesarenotcodifiedintolaw(ethical),and (4)meetstakeholders’expectationsonthecompany’sengagement toenhancehumanwelfareorgoodwill(philanthropic).

Forexample,casinoresortsandhotelsinLasVegassuchasthe Palazzo,AriaHotel,MandarinOriental,andVdaraCondoHotelwere constructedfollowingtheLeadershipinEnergyandEnvironmental

∗Correspondingauthor.Tel.:+8229619430;fax:+8229642537.

E-mailaddresses:[email protected](J.Kim),[email protected](H.J.Song), [email protected](C.-K.Lee).

1 Tel.:+17028953643.

2 Tel.:+82425205348.

Design(LEED)guidelines.LEEDisanindependent,non-profit,third- partyratingsystemestablishedbytheU.S.GreenBuildingCouncil (USGBC).LEED-certificationprovidesbenefitsfortheenvironment (ethicalresponsibility)andattractsagrowingpopulationofenvi- ronmentallyconsciouscustomers(JohnstonandBreech,2010).Not onlythesewell-knownoperatorsinamaturegamingmarketlike theU.S.,but alsothose inemerging gamingmarketshave been activelyinvolved inCSRprograms.Forinstance,inSouthKorea, thereare16casinosforforeigncustomersandonecasinowhere Koreancitizensarepermittedtogamble.Thelocalcasinowaslegal- izedin2000torevitalizetheeconomyofthedecliningminingareas.

Asaresult,approximately3millionpeoplevisitedthislocalcasino in2014(KoreaCasinoAssociation,2015a),and3570peoplewere employedbythiscasinoby2015(KoreaCasinoAssociation,2015b).

Thiscasinocompanyhasredistributeditsproﬁtstothesocietyby implementingvariousCSRprogramssuchasenvironmentalsus- tainability,responsiblegambling,andscholarshipforlocalstudents fromlow-incomefamilies(Lee,2015).

Inadditiontotheincreasingnumberofhospitalitycompanies implementingCSRprograms,CSRhasbeenconsideredapromi- nentconceptinacademia(Lockettetal.,2006;Walshetal.,2003).

However,themajorityofCSRstudieshavefocusedoncustomers (externalstakeholders),andlessattentionhasbeenpaidtoemploy- ees(internalstakeholders).Asurveyofmorethan1000executives revealedthatleadersbelievetheircompanycanbeneﬁtfromCSR

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byattractingbothpotentialandexistingemployees(Economist, 2008). Especially, the turnover rate in the hospitality industry includingcasinosisexpectedtoincreaseastheeconomybegins to recover (Deloitte, 2012), and previous studies support that employeeswithhighturnover intentionsarelikely tohave low organizationalcommitment(Meyeretal.,1993;TettandMeyer, 1993).Thus,toreduceturnoverrate,itisvitaltounderstandthe impactofemployeeperceptionsofCSRonemployeecommitment levelsinthisindustry.

Moreover,noneof CSRstudiesinthecontextsof hospitality andcasinohasempiricallyexaminedtheeffectsofbothCSRpro- gramsandinternalmarketing(IM)onemployees’workattitudes.

Furthermore,previousstudieshavebeeninconsistentaboutthe relationshipbetweenCSRandorganizationalperformance,finding bothsignificantandinsignificantrelationships(GriffinandMahon, 1997;Heinzeetal.,1999).Therefore,thepurposeofthispaperis toexploretheinfluenceofCSRandIMonemployees’workatti- tudesthroughthelensofsocialidentitytheory(AshforthandMael, 1989; Pratt,1998; Tajfeland Turner, 1985) and Carroll’s social performancemodel(1991,1998).Inparticular,theobjectivesof thisstudyaretoexaminewhether(1)CSRiscomprisedoffour dimensions(i.e.,economic,legal,ethical,andphilanthropic) and IMiscomprised offivedimensions(i.e.,welfaresystems,training,compensation,communication,andmanagementsupport),(2) thesetwohigher-orderfactors(i.e.,CSRandIM)positivelyinfluence employees’organizationalcommitment,and(3)employeeswith strongerorganizationalcommitmenthavelowerturnoverinten- tioninthecasinocontext.

Thisstudy contributes totheliterature by conceptually and empiricallyevaluatingfourCSRdimensionsandfivetraditionalIM dimensionssimultaneouslyinthecasinoenvironment.Italsopro- videsatheoreticalperspectivethroughsocialidentitytheoryfor explainingwhyCSRprogramsimpactcasinoemployees’workatti- tudesandturnoverintentions.Casinooperatorsandothersinthe hospitalityindustrycanbenefitfromtheinsightsofthis study’s findingsregardinghowCSRactivitiescanincreasethecommitment andretentionoftheiremployees.Thisstudyoffersnewavenuesof explorationintheemergingfieldofCSRscholarship.Whileother studieshavetestedtheimpactofCSRactivitiesontheircustomer andemployeeattitudes(Brammeretal.,2007;Lee etal.,2013;

Turker,2009),littleresearchhasinvestigatedboththeimpactof CSRandtraditionalIMonthesespeciﬁcemployees’workattitudes (i.e.,commitmentlevelsandturnoverintentions)incasinoorother hospitalitysettings.

2. Theoreticalbackgroundandhypothesesdevelopment 2.1. Theoreticalbackground

AnimportantconceptualmodeladaptedinthisstudyisCarroll’s socialperformancemodel(1991,1998).HenotedthatCSRcouldbe dividedintofourdimensions:economic,legal,ethical,andphil- anthropicCSR.EconomicCSRreferstoactionsthat makegoods andservicesandcreativelucrativeoutcomesthroughoutthepro- cess.TheeconomicCSRshouldbeachievedwithinlegalboundaries thatthesocietyoutlines.Therefore,obeyinglawsandregulations isconsideredaslegalCSR,theseconddimension.EthicalCSR,the thirddimension,isbeyondthescopeofcodifiedregulationsand laws,anditisdefinedasacompany’sendeavorstofulfillexpec- tationsofthesocietyandtobea moralcompany.Philanthropic CSR,thefourthdimension,isregardedasacompany’svoluntary activitiessuchas endowing money tocharitable organizations, promotingsupportprogramsforalow-incomegroup,andhaving theiremployeesinvolvedinhumanitarianprograms(Carroll,1991, 1998).

Theunderpinningtheoryofthisstudyissocialidentitytheory (SIT)which suggeststhatindividuals reinforcetheirself-esteem and augment their self-image by identifying with groups and organizationsknownfortheirsocialresponsibility(Ashforthand Mael,1989;Pratt,1998;TajfelandTurner,1985).SITcanexplain whyacompany’sCSRprogramscaninﬂuencebothcustomerand employeeattitudestowardsthecompany(e.g.,Bhattacharyaand Sen,2004;MaignanandFerrell,2001;Maignanetal.,1999).For example,hospitalityemployeesarelikelytoidentifywithacom- panywhichimplementsCSRinitiativesespeciallyiftheirvalues arealignedwiththeseinitiatives.CSRinitiativesunveilthecom- pany’scharacterwhich is “notonlyfundamental and relatively enduringbutalsomoredistinctive”(SenandBhattacharya,2001,p.

228)thanothertypesofcorporateinitiatives.Inaddition,socially- responsible companies are more likely tohave positive public reputations(FombrunandShanley,1990)whichcanmakeemploy- eesfeelproudofworkingforthesecompanies.Consequently,CSR initiativescanplayimportantrolesingainingcompetitiveadvan- tagesandsupportingemployeerecruitmentandretention(Park etal.,2014).

Previous studies have empirically tested and supportedthe positiveinﬂuenceofCSRprogramsonemployees’organizational commitment(Maignanet al.,1999; Maignanand Ferrell,2003;

Peterson,2004).AccordingtoO’Reilly(1989),organizationalcommitmentis“anindividual’spsychologicalbondtoanorganization, includinga sense ofjob involvement, loyalty,and belief inthe valueortheorganization”(p.17),andit involvesthree phases:

compliance,identification,andinternalization.Inthefirstphase, employeeswillaccepttheinfluenceofothersinthecompanyfor extrinsicrewards suchas compensations. In the second phase, employeeswillaccepttheothers’influencetokeepaself-defining relationshipwiththecompany.Inthefinalphase,employeeswill findthecompany’svaluesarealignedwiththeirpersonalvalues, whichcanbeintrinsicallyrewardingtotheemployees.

Anotherimportantconceptofthisstudyisinternalmarketing which is useful in developing an organization’s competitive- nessandimprovingcompetenciesthroughmotivatingemployees (Rafiq andAhmed, 2000).Abzarietal. (2011)statedthat inter- nalmarketinghasbeenidentifiedasaneffectivestrategytoequip organizationswithcapabilitiesandcompetencieswhileenjoying environmentalopportunities.Otherresearchersexplainedthatthe mainaimofinternalmarketingisfulfillingemployees’needsor wantsinordertoretainemployeesandencouragethemtodeliver superior customer service (Berry, 1981; Kotler and Armstrong, 1991).CooperandCronin(2000)claimedthatinternalmarketing shouldbeconsideredfortheorganization’sactiveeffortsforedu- cation,reward,andasawaytobettermanagehumanresources,in general.Thus,casinocompaniesshouldtreattheconceptofinter- nalmarketingseriouslybecauseemployeeswillbemorelikelyto deliversuperiorcustomerservicewhen theyareprovided with appropriateinternalmarketingprogramssuchaswelfaresystems, training, compensation, communication, and management support.

2.2. Hypothesesdevelopment

George(2009)assertedthatinternalmarketingprogramsare importantantecedents of businessperformance indicators (e.g., service quality, turnover rate, customer conscious employees, andorganizationalcommitment).Tansuhajetal.(1991)claimed thatthrivinginternalmarketingprogramsarecloselyrelatedto enhanced employee attitudes including organizational commitment, job involvement, work motivation, and job satisfaction.

Among these employee attitudes, organizational commitment refersto anindividual’s psychologicalaffection toan organiza- tionthatmakesemployeesfeelmoreattachedtotheorganization

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(Leong etal.,1996).Such psychologicalconnectionis especially importantinmaintainingagoodrelationshipbetweenemployees andthecompany(Meyerand Allen,1997).Implementing inter- nalmarketingprogramscanbeaneffectivestrategytoincrease employees’ organizational commitment even when traditional internalcommunicationprogramsarenotavailable(Hogg,1996).

AjayandSabir(2009)alsostatedthatemployeesinanorganization offeringhigh-qualityinternalmarketingservicearelikelytohave ahigherleveloforganizationalcommitment.

Inthecasinocontext,astudybyBacketal.(2011)foundinter- nalservice quality (measured by training, communication, and perceivedbeneﬁt)canincreasecasinoemployees’jobsatisfaction which leads to higher organizational commitment. This previ- ousstudyalsorecommendedfuturestudiesshouldincludeother attributessuchasrewardsystems.Thecurrentstudyadaptedthe IMcomponentsfromBacketal.(2011)giventhecontextsimilarity andincludedtwoadditionalconstructsasantecedentsoforganiza- tionalcommitmentbyreviewingotherextantstudies.Forexample, Backetal.(2011)proposedtheperceivedbeneﬁt,“indirectpay totheindividualintheformofpayfortimenotworked,insur- ance,pensions,incomemaintenance,andmiscellaneousservices”

(HenemanandSchwab,1985,p.131),asaninfluentialantecedent andfoundit asthemostsignificantantecedent.Byconsidering theimportanceofperceivedemployeebenefit,thecurrentstudy selectedasimilarbutmorespecificfactor,welfaresystems.Wel- faresystemsaregenerallydefinedasemployeebenefitsinaddition totheirwages,providedbyacompanytoimproveitsemployees’

stability,health,andoveralllivingstandard(Kimetal.,2001).Since improvingwelfaresystemssuchaswelfarefacilitiesandgoodvaca- tionsystemsledtoahigherleveloforganizationalcommitment inotherservicebusinesses(Kimetal.,2001),thisstudyexpectsa similarpositiveeffectofwelfaresystemsinacasinosetting.

AsfoundbyBacketal.(2011),trainingsuchasprovidingregular servicetrainingandtrainingprogramsarelikelytohaveapositive impactoncasinoemployees’organizationalcommitment.Training generallyindicatesacompany’ssystematicandorganizedprocess toofferopportunitiestoitsemployeestoenhancetheirattitudes, adapttheirworkenvironments,andimprovetheirtechnicalknowl- edgeandskills(Backetal.,2011;Kimetal.,2001;Luxetal.,1996).

InBacketal.’sstudy(2011),communicationwasalsosuggestedas aneffectiveinternalmarketingprogramtopositivelyaffectcasino employees’organizationalcommitmentbyallowingemployeesto expresstheiropinionsfreelyandpresentingadequateinformation tothem.Communicationusuallyreferstoacompany’sactivitiesor effortstoshare,deliver,andexchangeinformation,ideas,feelings, andopinionsamongemployeestoachieve thecompany’s goals (Backetal.,2011;ClampittandDowns,1993;Kimetal.,2001).

As recommended by Back et al. (2011), compensation like rewardingemployeeperformanceandestablishingemployee’spay linkedtotheirperformancecanbeanothersigniﬁcantantecedent ofcasinoemployees’organizationalcommitment.Compensation referstoa company’s strategy tomotivate employeestoadopt customer-oriented (or market-oriented) behaviors and reward employees’performancesandeffortsthroughincentives(Foreman and Money, 1995; Jaworski and Kohli, 1993; Lux et al., 1996;

Pooretal.,2013).Lastly,managementsupportsuchasproviding guidancein solvingjob-relatedproblemsand maintainingtwo- wayinformation-flowacrossmanagementlevelsmightbeanother influentialantecedentofcasinoemployees’organizational commitment.Management supportis specificallyassociated witha seniormanagementteam’svariousendeavorsorprocessestohelp employeessolvejob-relatedproblemsandestablishaclimatefor two-wayinformation-flow(CooperandCronin,2000;Jaworskiand Kohli,1993).

Insummary,basedontheaforementionedstudies(e.g.,Back etal.,2011; ClampittandDowns,1993;Conduit andMavondo,

2001;JaworskiandKohli,1993;Kimetal.,2001;Luxetal.,1996), this studyexpectstoﬁndpositiveeffects of internalmarketing components(i.e.,qualityofwelfaresystems,training,compensation,communication,andmanagementsupport)onorganizational commitmentinthehospitalityindustry,particularlyinthecasino context.Thus,wepositthefollowinghypotheses:

Hypothesis1. Casinoemployees’perceptionofinternalmarket- ingiscomposedofﬁvedistinctbutrelatedsubstantivedimensions (i.e.,welfaresystems,training,communication,compensation,and managementsupport).

Hypothesis2. Casinoemployees’perceptionofinternalmarket- ingispositivelyassociatedwiththeirorganizationalcommitment.

CSR programs have been seen as not only social require- ments but also a way to satisfy employees’ needs and wants to work for a more desirable organization (Lee et al., 2013).

Thisphenomenoncanbeexplainedbasedontheperspectiveof social identity theory (SIT) that people are likely to reinforce theirself-conceptand attitudetoward anorganizationdepend- ingontheorganization’sactivityand identity(Peterson,2004).

Smidtsetal.(2001)assertedthatemployeeswhothinkthatthey are employed by a socially responsible company compared to others are likely to have enhanced self-esteem, which in turn positivelyaffecttheirattitudestoward thecompany.It isplau- siblethatCSRis positivelyrelatedtoorganization commitment becauseorganizational commitmentis reinforcedwhen a company satisﬁes employees’needsand wants through itssocially responsibleactivities(VakolaandNikolaou,2005).Brammeretal.

(2007)andTurker(2009)alsosupportedthesigniﬁcantrelation- shipbetweenemployees’perceptions ofCSRandorganizational commitment.

Thecasino,hotel,andrestaurantindustryisknownasalabor intensiveserviceindustrywithlowwagesandlongorinconsistent workinghours(DeeryandShaw,1999;Worcester,1999).Forexam- ple,accordingtoMoody’sAnalytics,theaverageannualpayforall workersinthetraveleraccommodationsindustrywas$32,347in 2013whichis38%lowerthantheaverageof$52,539forallother industries(Langﬁeld,2014).Consideringthisnotoriouscharacteris- tic,Bowen(1953)’sassertionthatCSRperformsanimportantrolein makingacompanymoredesirableshouldbeintriguinginformation forcasinooperators.Similarly,onepreviousstudyindicatesthat casinoemployees’organizationaltrustcanbeenhancedthrough casinocompanies’CSRactivities(Leeetal.,2013).Basedonthe previousstudies,thisstudyhypothesizedthatcasinoemployees’

perceptionofCSRispositivelyassociatedwiththeirorganizational commitment,and CSRis comprisedof fourrelated but distinc- tivedimensions(economic,legal,ethical,andphilanthropicCSR) (Carroll,1979).

Hypothesis3. Casinoemployees’perceptionofCSRiscomposed offourdistinctbutrelatedsubstantivedimensions(i.e.,economic, legal,ethical,andphilanthropicresponsibilities).

Hypothesis4. Casinoemployees’perceptionofCSRispositively associatedwiththeirorganizationalcommitment.

Tansuhajetal.(1991)statedthatinternalmarketingprograms cancontributetoemployees’organizationalcommitmentwhich, inturn,signiﬁcantlyaffectstheirjobsatisfaction,jobperformance, and turnover intentions. In particular, the concept of turnover intentionhasdrawnacademicattentionasanimportantsubject due toits negativeresults, suchas additionalhiring and train- ingcostsandnegativeimpactsoncustomerservice(Cottonand Tuttle,1986).Accordingtopreviousresearch,turnoverintentionis asigniﬁcantconsequenceoforganizationalcommitment(Mathieu and Zajac, 1990; Tett and Meyer, 1993). O’Reilly et al. (1991) claimedthatwhenemployeeshavehighlevelsoforganizational

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commitment,theirturnoverintentionsarelikelytodecrease.Kim et al. (2005) also supported this view by stating that organizational commitment is negatively associated with employees’

turnoverintentionsandpositivelyrelatedtotheirjobsatisfaction levels.Giventhe highturnoverratein thehospitality industry, itiscriticaltoempiricallytestpotentialantecedentsofturnover intentions such as organizational commitment in diverse hospitality settings such as casinos, which leads to the following hypothesis.

Hypothesis5. Casinoemployees’organizationalcommitmentis negativelyassociatedwiththeirturnoverintentions.

3. Method

Apreliminarylistofmeasurementitemswasgeneratedafter areviewoftheliteraturerelatedtoCSR(Carroll,1979;Leeetal., 2013),internalmarketing(Backetal.,2011;ClampittandDowns, 1993;Conduitand Mavondo,2001;Foremanand Money,1995;

JaworskiandKohli,1993;Kimetal.,2001;Luxetal.,1996),organizationalcommitment(Meyeretal.,1993;Jaworski andKohli, 1993),andturnoverintentions(Newmanetal.,2011)(seeTable1).

Allitemsweremeasuredusingaﬁve-pointLikertscale(1=strongly disagreeand5=stronglyagree).Threetourismacademicsandtwo practitionerswithmorethan7yearsofcareerevaluatedthelistof

Table1

Conﬁrmatoryfactoranalysis:Itemsandloadings.

11factorsandscaleitems Standardizedloading^a

F1:EconomicCSR(ECO)(adaptedfromCarroll,1979;Leeetal.,2013)

Thisorganizationtriestosaveoperatingcosts .59

Thisorganizationstrivestoimproveemployees’productivity .84

Thisorganizationestablisheslong-termstrategyforeconomicgrowth .68

F2:LegalCSR(LEG)(adaptedfromCarroll,1979;Leeetal.,2013)

Thisorganizationabidesbybusinessregulations .74

Thisorganizationcomplieswithemployment-relatedlaws(hiringandemployeebeneﬁts) .71

Thisorganizationiscommittedtoalegalcontractassociatedwithbusinessoperation .75

Thisorganizationregulatesthecorrectrulesandmethodsofoperationforcustomers .66

F3:EthicalCSR(ETH)(adaptedfromCarroll,1979;Leeetal.,2013)

Thisorganizationhasethicsguidelinesonbusinessactivities .84

Thisorganizationtriestobecomeanethicallytrustworthycompany .79

F4:PhilanthropicCSR(PHIL)(adaptedfromCarroll,1979;Leeetal.,2013)

Thisorganizationprovidesavarietyofdonations .74

Thisorganizationparticipatesinavarietyofvolunteeractivities .82

ThisorganizationperformsmanypublicservicesviaitsCulturalandWelfareFoundations .76

Thisorganizationiscommittedtobuildabettercommunity .71

F5:WelfareSystems(WEL)(adaptedfromBacketal.,2011;Kimetal.,2001)

Thisorganizationoffersgoodemployeebeneﬁts .85

Thisorganizationhasgoodwelfarefacilities .82

Thisorganizationoffersgoodvacationsystems .65

Thisorganizationhasagoodsystemforemployeestotakealeaveofabsence .65

F6:Training(TR)(adaptedfromBacketal.,2011;Luxetal.,1996)

Thisorganizationprovidesregularservicetraining .73

Thereareenoughtrainingprogramsinthisorganization .83

Trainingsessionsinthisorganizationhelpmetounderstandcustomerneeds .71

F7:Compensation(COMP)(adaptedfromForemanandMoney,1995;Luxetal.,1996)

Thisorganizationfairlyrewardsemployeeperformance .74

Thisorganizationestablishesmypaylinkedtomyperformance .75

Inthisorganization,thoseemployeeswhodevelopacloserelationshipwithcustomersarerewardedfortheirefforts .64 F8:Communication(COM)(adaptedfromBacketal.,2011;ClampittandDowns,1993)

Inthisorganization,Icanexpressmyopinionsfreelyinaliberalatmosphere .83

Theexchangeofinformationinthisorganizationisadequate .89

Thisorganizationprovidesadequateinformationontherequirementsofmyjob .72

F9:ManagementSupports(MS)(adaptedfromJaworskiandKohli,1993)

Themanagementinthisorganizationoffersguidanceinsolvingjob-relatedproblems .81

Two-wayinformationﬂowacrossmanagementlevelsisencouragedbythemanagementinthisorganization .88

Themanagementinthisorganizationencouragesopencommunication .89

F10:OrganizationalCommitment(OC)(adaptedfromJaworskiandKohli,1993;Meyeretal.,1993)

Italkupthisorganizationtoothersasagreatorganizationtoworkfor .81

IamproudthatIamapartofthisorganization .83

Iwouldliketocontinueworkingatthisorganizationbyconsideringthisorganizationasaworkplaceforlife .81

Iampleasedtochoosethisorganizationasaworkplace .86

Eveniftheopportunitytochooseworkagainisgiventome,thisorganizationwillbeconsideredapriority .81

Iacceptthisorganization’sfutureandfateasmine .79

Ithinkthisorganizationisthebestworkplacetome .88

F11:TurnoverIntentions(TI)(adaptedfromNewmanetal.,2011)

Ithoughtaboutquittingmypresentjob .68

Iwouldliketoleavethisorganizationandworkforanotherorganizationinthesameindustry .72 Althoughtheworkingconditionissimilar,Iwanttoleavethisorganizationandworkforanotherorganization .78 Iwanttoleavethisorganizationandworkforanorganizationinadifferentindustry .78 IfIhearaboutjobopportunityatanotherorganizationinthesameindustry,Iwilltrytolookintodetails .76

aAllfactorloadingsaresigniﬁcantatp<.05.

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thesemeasurementitemsforrelevancetotheconstructsofinter- est.Apretest wasalsoperformedwith25 casino employeesto furthercheckthefacevalidityofthesurvey.

Tocollectdata,anon-sitesurveywasconductedwithemploy- eesworkingforoneofthemajorcasinosinSouthKoreaonboth weekdaysandweekendsinOctober2012.Theresearchteamfor this studyaskedthis casino toallowtheteam tointeractwith theiremployeestocompletethisstudy.Specifically,theresearchers explained thepurposeof this study tothe headof the human resourcesdepartmentofthiscasinoandaskedhispermissionto surveyemployeeswhofinishedshiftsorhadabreaktimeinthe employeelounge.Topresentaninformedconsentofthisstudy,a coverletterwasincludedonthefirstpageofeachquestionnaire.

Thequestionnaireswerecompletedundertherigorousmonitor- ingoftheresearchers.Atotalof310completequestionnaireswere collectedfromthison-sitesurveyandusedfordataanalysis.These respondentsrepresent casino employeesfromdifferent depart- mentsincludingoperations(n=190,61.3%),sales(n=48,15.5%), administration(n=40,12.9%),foodandbeverage(n=8,2.6%),secu- rity(n=7,2.3%),andother(n=17,5.5%).

4. Results

4.1. Measurementmodel

Themeasurementmodelwasassessedusingconfirmatoryfac- toranalysis(CFA),andthehypothesizedstructuralmodelswere testedviaEQS6.1statisticalsoftware.Thecomparativefitindex (CFI),Tucker-Lewisindex(TLI),andincrementalfixindex(IFI)val- uesof.90orhigher,andarootmeansquareerrorofapproximation (RMSEA)valueof.08orlesswereusedasindicatorsofgoodmodel fit(Hairetal.,2006).Themeasurementmodeltestdemonstrateda goodfit:²(724)=1,224.976,p<.05,CFI=.931,IFI=.932,TLI=.922, RMSEA=.047.Convergentvaliditywasestablishedsinceallindica- torsloadedontheproposedfactors;thoseloadingsweresignificant andhigherthan.5;andtheaveragevarianceextracted(AVE)values wereallabovetherecommendedvalueof.5(BagozziandYi,1988;

Hairetal.,2006).Thecompositereliabilityofeachfactorexceeded thethreshold(.7)recommendedbyHairetal.(2006),indicating satisfactoryconstructreliability.Satisfactorydiscriminantvalidity wasalsodemonstratedastheAVEforeachconstructwashigher thanallofthesquaredcorrelationsbetweenanypairofconstructs (FornellandLarcker,1981)(seeTables1and2).

4.2. Secondorderfactoranalysis

Theprimary reason for utilizing second-order factormodels istoprovideamoreparsimoniousandinterpretablemodelwith fewer parameters (Gustafsson and Balke, 1993; Rindskopf and

Rose,1988).Thesecond-orderfactormodelofthisstudydemon- strated agood fit:² (762)=1370.5,p<.05,CFI=.916,IFI=.917, TLI=.910,RMSEA=.051. Inaddition,statisticallysignificantpos- itive relationships between the four first-order (lower-order) factors and the second-order (higher-order) factor (i.e., corporate social responsibility, and CSR) exist as evidenced by the followinghighstandardizedfactor loadings:.73 (economic),.88 (legal), .74 (ethical), and .57 (philanthropic) (p<.05). A similar result was found for the five dimensions of internal marketing. Statistically significant positive relationships between the five first-order factors and the second-order factor (i.e., Inter- nal Marketing, and IM) exist as evidenced by the following high standardized factor loadings: .69 (Welfare Systems), .69 (Training),.82(Compensation),80(Communication)and.83(Man- agement Supports) (p<.05). Consequently, the nine proposed first-orderCSRandIMdimensionsaccuratelyrepresenttheunder- lying concept of CSR and IM, supporting Hypothesis 1 (casino employees tend to view CSR as a combination of these four dimensions)andHypothesis3(IMisacombinationofthesefive dimensions).

4.3. Structuralmodeltesting

After evaluating the measurement model, the relationships amongallobserved andlatentvariablesin theproposedmodel weretestedusingstructuralequationmodeling(SEM).Totestthe assumptionthatthedataaremultivariatenormallydistributed,we usedEQSoutputpresentingextremecaseswithrespecttomulti- variatekurtosis.Theprogramautomaticallyprintedoutthefive cases contributingtothe normalizedmultivariatekurtosis esti- mates.Theidentificationofanoutlierwasbasedontheestimate presentedforonecaserelativetotheestimatesforfourothercases (Byrne,2006).Theestimatesoftwocases(2221and1962)weredis- tinctivelyhigherthantheestimatesoftheothercases(982,1037, and1053).Afterremovingthesetwocases,noestimatewasdis- tinctivelydifferentfromthoserepresentingtheothercases(840, 958,985,1083,and1125).TheresultofSEMshowedagoodfitto thedata:²(723)=1,335.48,p<.05,CFI=.921,IFI=.921,TLI=.915, RMSEA=.05.AsshowninFig.1,examinationsofpathestimates revealedthatcasinoemployees’perceptionsofbothIMandCSRhad significantdirecteffectsontheirorganizationalcommitment(OC) (ˇ=.32andˇ=.36,respectively,p<.05),supportingHypotheses2 and4.Furthermore,OChadasignificantnegativedirecteffecton turnoverintentions(TI)(ˇ=−.55;p<.05),supportingHypothesis5.

Lastly,bothIMandCSRdidnothavesigniﬁcantdirecteffectsonTI (p>.05),buttheyhadsigniﬁcantnegativeindirecteffectsonTIvia OC(ˇ=−.18andˇ=−.20,respectively,p<.05),indicatingOCfully mediatestherelationshipsbetweenIMandTIaswellasbetween CSRandTI.

Table2

AVE,compositereliability,andcorrelationmatrix.

Correlationssquared AVE ECO LEG ETH PHIL WEL TR COMP COM MA OC TI

ECO .51 .80^a .45^c .19 .11 .19 .22 .24 .12 .25 .23 .08

LEG .51 .67^b .81 .49 .19 .26 .19 .23 .1 .18 .26 .22

ETH .66 .44 .7 .80 .27 .19 .21 .16 .1 .18 .12 .05

PHIL .77 .33 .44 .52 .84 .11 .14 .13 .11 .19 .14 .04

WEL .56 .44 .51 .44 .33 .83 .29 .35 .25 .22 .27 .08

TR .58 .47 .44 .46 .38 .54 .80 .29 .24 .32 .08 .07

COMP .51 .49 .48 .4 .36 .59 .54 .75 .49 .41 .19 .12

COM .67 .35 .32 .32 .33 .5 .49 .7 .86 .58 .16 .07

MA .74 .5 .43 .42 .44 .47 .57 .64 .76 .90 .17 .08

OC .69 .48 .51 .34 .37 .52 .29 .44 .4 .41 .94 .38

TI .56 −.29 −.47 −.23 −.19 −.29 −.27 −.34 −.27 −.29 −.62 .86

aCompositereliabilitiesarealongthediagonal.

bCorrelationsarebelowthediagonal.

c Squaredcorrelationsareabovethediagonal.

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.82*

.80*

.81*

.68*

.56*

.74*

.88*

-.20* (indirect)

.67*

-.18* (indirect) .72*

Economic

Legal

Ethical

Philanthropic

Welfare Systems

Compensation

CSR

IM

-.55*

.36*

.32*

Training

Communication

OC TI

Management

Support _Goodness_of-fit_stati_stic_s:_χ²_{= 1,335}₍_df_{= 76}_2,_p< .05), RMSEA= .05, CFI = .921, IFI = .921, TLI = .915^*^p^{< .05}

Fig.1. Estimationofstructuralmodel.

5. Discussionandimplications

Higherlevelsoforganizationalcommitmentandlowerlevelsof turnoverarekeyindicatorsofacompany’sorganizationaleffective- ness(Steers,1977).Thus,thecurrentstudyinvestigatedtheeffects ofinternalmarketing(IM)andcorporatesocialresponsibility(CSR) programs on these vital indicators in a casino setting: casino employees’organizational commitment(OC)andtheirturnover intentions(TI).Basedonsocialidentitytheory(SIT),CSR,andIM literature,this study developed a model and foundemployees’

perceptionofCSRprogramsandIMprogramspositivelyinﬂuence employees’organizational commitment, which in turnreduces theirturnoverintentionsinthecasinocontext.

Fromatheoreticalperspective,thesefindingssupportprevious IMstudies(e.g.,ClampittandDowns,1993;ConduitandMavondo, 2001;JaworskiandKohli,1993;Kimetal.,2001;Luxetal.,1996), contributingtothestreamofresearchrelatedtoIMandemploy- ees’workattitudes.Inparticular,theproposedviewofIMinthe casino industry which is composed of five distinct but related substantivedimensionswassupportedinthisstudy.Thisfinding providesevidencethattheproposedfivedimensionsinthisstudy (i.e.,welfaresystems,training,compensation,communication,and managementsupport)accuratelyrepresentthemultidimensional conceptofIMinthecasinoindustry.Inaddition,theresultindi- catesapositiveeffectofIMonorganizationalcommitment,which corroborates findings of previous studies (e.g., Ajay and Sabir, 2009;George,2009;Hogg,1996;Tansuhajetal.,1991).Sincenone ofthesepreviousstudiesempiricallytestedthelinkagebetween IMandorganizational commitmentincasinoenvironments,the currentstudyoffersthefirstempiricalevidenceofapositiverela- tionshipbetweenIMandorganizationalcommitmentinacasino setting.

ThecurrentstudyalsoconﬁrmsthatCSRinthecasinoindustryis composedoffourdistinctbutrelatedsubstantiveCSRdimensions (i.e.,economic,legal, ethical,andphilanthropicresponsibilities).

ThisﬁndingisconsistentwithCarroll’ssocialperformancemodel

(1991, 1998) thatCSR couldbedividedinto thesefourdimen- sions.Furthermore,theﬁndingsupportingthefourthhypothesis indicatesthatapositiverelationshipexistsbetweenCSRandorga- nizationalcommitmentinthecasinoindustry,conﬁrmingprevious CSRstudiesconducted inother contexts(Maignanet al.,1999;

Maignan and Ferrell,2003; Peterson, 2004).The positive effect ofCSRcanbeexplainedbySITwhich suggestsemployeesrein- forcetheirself-esteemandaugmenttheirself-imagebyidentifying themselveswiththeircompanywhen itis knownforits social responsibility(Ashforthand Mael,1989; Pratt,1998;Tajfeland Turner,1985).

Lastly,thisstudysupportsthatahigherlevelofcasinoemploy- ees’organizationalcommitmentreducestheirturnoverintentions.

Furthermore, organizational commitment played a signiﬁcant mediatingrole betweenCSRandturnover intentionsaswellas betweenIMandturnoverintentions.Althoughseveralstudieshave examinedandsupportedthesigniﬁcantroleofemployees’organi- zationalcommitmentinreducing theirturnoverintentions (e.g., Kimetal.,2005;MathieuandZajac,1990;TettandMeyer,1993;

O’Reillyetal.,1991),noneofthemempiricallytestedsuchrelation- shipsbyincludingbothCSRandIMasantecedentsoforganizational commitment.Thus, thisﬁndingthattheeffectsofCSRonorga- nizationalcommitment(direct)andturnoverintentions(indirect) werestrongerthantheeffectsofIMcontributestotheliteraturein thisdomain.Thatis,thisresearchextendsthepreviousliterature inthisareabyillustratingthatCSRinitiativescanplaymorevital rolesthantraditionalIMprogramsinenhancingemployees’com- mitmenttowardthecompanyandsupportingemployeeretention.

Ofpracticalsigniﬁcance,thisstudysuggestscasinooperators canimprovetheiremployees’organizationalcommitmentviawell- executedinternalmarketingand CSRprograms,whichcanlead tolower turnover rates. Theﬁndings alsosuggest some issues thatdeservefurtherdiscussion.Firstofall,casinoemployeeswho participated in this study perceived CSRas comprising allfour dimensions(i.e.,economic,legal,ethical,andphilanthropicresponsibilities).Thatis,casinooperatorsshouldevaluateandimplement

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variousCSRinitiativesinallfourareastomeettheiremployees’

expectations.

Second,itisworthnotingthatcasinoemployees’perceptionof CSRprogramshadastrongerdirecteffectonorganizationalcom- mitmentandanindirecteffectonturnoverintentionsthantheir perceptionofinternalmarketingprogramsdid.Fromapractical perspective,sinceimprovingexistingIMorintroducingnewIM programssuchasofferingwelfarefacilitiescanrequirelong-term effortand highcosts,initiating achievableCSRprogramscanbe relatively effectivestrategies for a casino companyto promote employeecommitment.Forexample,initiatingandpublicizinga company’svolunteeractivitiescanmakeemployeesfeelproudof workingfor a socially responsible company.Casino companies, inparticular,tendtobecriticizedbecauseofperceivednegative impactsof casino operationsuchas ahigher rateof crimeand problemgambling(Chhabra,2007;Eadington,1999;Grinolsand Mustard,2006).It ispossiblethatcasino employeesfeelshame toworkforacompanycausingsuchnegativeimpacts.Thestrong effect of CSRfound in this study, togetherwith social identity theory,suggeststhat CSR programscan help casinoemployees enhancetheirself-esteembybeingidentiﬁedwithcompaniesthat aresociallyresponsibleandvaluable.

Third,thisstudysuggestscasinocompaniesneedtoﬁndways toexecuteCSRandIMprogramssimultaneouslyandincorporate themindailybusiness,sothattheycanbepartofthecompany’s culture.Forexample,thisstudyrevealedthatsatisfactorycommu- nicationandmanagementsupportareimportantIMdimensionsfor employeeretentionasareethicalandphilanthropicCSRdimen- sions. Tomeet theseemployee expectations,a casinocompany canusepre-shiftmeetingsforemployeestosharetheirimpressive experiencesorideasrelatedtoethicalandphilanthropicCSRactiv- itieswithotheremployeesandsupervisors.Thenmanagersand executivescansupportthisstory-tellingapproachbyrecognizing thosewhosharedthemostextraordinarystoriesasrolemodels andrewardingthem(e.g.,volunteerking/queenofthemonthand ethicalemployeeoftheyear).

Inaddition,thelegal andethicalCSRactivities,suchaspro- motingresponsiblegambling,enhancingcapacityinunveilingof corruptioncases,andcomplyingwithregulationsrelatedtowork- place safetyand environment, shouldbe executedwith proper employeetrainingand managementsupport.CaesarsEntertain- mentisagoodexemplarywhichhasactivelytrainedemployees aboutresponsiblegamblingandempoweredemployeestohelp theircustomers.Althoughemployeescannotbeexpectedtodecide whetherornottheircustomershaveseriousgamblingproblems, theycanbeexpectedtolistentoacustomer’scommentsandrec- ognizeifthosecommentsmakethemworryaboutthecustomer’s abilitytogambleinaresponsibleway.Asaresult,employeescan gainasenseofbeingacriticalpartofthecompany’efforttoencour- ageresponsiblegamblingandbeproudoftheircompany(BASIC, 2014).

Furthermore,itseemsthatwelfaresystems,oneofdimensions of IM, can be combinedwith economic and ethical CSRinitia- tives.For instance,whena companydevelopsa welfarefacility foremployees(e.g.,a fitnessorwellnesscenter),itcanbebuilt asagreen-certifiedfacilitywithlowerenergyandwatercostsas thecompany’seconomic andethicalCSRinitiatives.Thefinding ofthisstudyalsosuggeststhereisneedforacompanytoinvolve employeesindevelopingphilanthropicCSRinitiatives.Infact,this approachcanhelp employeesexpresstheiropinionsfreelyin a liberalenvironment,facilitatingimprovedcommunicationwithin thecompany.Forinstance,theMGMResortsFoundationenables MGM’semployeestoassisttheircommunitiesbydonatingtonon- profitorganizationsandprogramsoftheemployees’choice.The employeeswereallowedtoreachouttotheircommunitythrough themultiplecausestheyidentifiedandhostdiversefundraising

eventsandactivitiessuchasemployeetalentshows.Asaresult, notonly42%ofMGMemployeescontributed$4.7milliondisbursed to1074nonproﬁtsand89grantsin2013,butalsoMGMmanage- mentviewedthisfoundationasaneffectivevehicleforemployee engagementandteamcollaboration(MGMResortsInternational, 2014).

Itshouldbenotedthatthisstudyhassomelimitations.First,CSR andIMweremeasuredbasedontheperceptionsofemployeeswho maynotbewell-informedabouttheCSRandIMprogramsoftheir company.Futurestudiesmayattempttoprovideworkshopsabout CSRandIMprogramsofsubjectcompaniesbeforesurveyingtheir employees.Second,thestudysamplewascollectedfromemploy- eesworkingforoneofthemajorcasinocompanieslocatedinSouth Korea.Thatis,commonmethodvarianceisoneofthelimitationsof thisstudy.Sincethedatatomeasurevariableswascollectedfrom thesamesource,itcouldpotentiallyinflatethestatisticalrelation- ships(PodsakoffandOrgan,1986).Thus,thefindingsofthisstudy maynotbegeneralizabletocasinoorhospitalityemployeesinother jurisdictions.Werecommendotherresearcherscollectdatafrom morethanonecasinoandreexaminethemodelproposedinthis study,whichwillincreasethegeneralizabilityoffindingsandthe applicabilityof this CSR/IM-OC-TImodel.Otherresearcherscan alsoextendthismodelbyconductingcross-culturalstudieswith employeesworkingforacasinoorhospitalitycompanylocatedin othercountriesandincludingcultureasamoderator.Lastly,other dimensionsofCSRandIMwhichwerenotconsideredinthecurrent studycanbeincludedinfuturestudies.Forexample,responsible gamblingstrategiescanbeaddedasacasinocompany’suniqueCSR dimension.Ifafuturestudyisconductedusingdatacollectedfrom amatureandcompetitivemarket,benchmarking(i.e.,investigating andanalyzingwhatcompetitorsofferfortheiremployees)couldbe consideredasoneofIMcomponents(Jouetal.,2008).

Inconclusion,itisclearthattherearedifferentcomponentsto IMaswellastoCSR,andthattheseareinfluentialfactorsthathospi- talitymanagersneedtoconsiderinthepursuitofobjectivesrelated toemployeeorganizationalcommitmentandretention.Sincethis studywasconductedinaspecifichospitalitycontext,casinos,these findingsraiseaninterestingquestion:ArebothIMandCSReffec- tiveinallhospitalityorganizations?Toanswerthisquestionand delineateclearlywherethereisrelevanceandnot,weencourage researcherstoexamineIMandCSRsimultaneouslyinvarioushos- pitalitysettings.

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