The Effect of Work Life Balance on Business Results in Industrial

SMEs
David Cegarra Leiva, Meugenia Sánchez Vidal and Juan Gabriel Cegarra-Navarro
Universidad Politécnica de Cartagena, Spain
david.cegarra@upct.es
meugenia.sanchez@upct.es
juan.cegarra@upct.es

Abstract: The topic of work life balance (WLB) has received increasing attention in the scientific literature. However, very
few studies have examined the effect of having a WLB culture on HR outcomes and organizational results in SMEs. This
research fills this gap in the literature by examining the main effects of having a WLB culture on employees’ commitment,
satisfaction, turnover intentions, productivity and firm results in small organizations. To achieve this we conduct an empirical
analysis with two samples (employees and managers) from an industrial sector in Spain. Contributions and implications for
practitioners are explained in last part of the article.

Keywords: work life balance, commitment, job satisfaction, turnover intentions, productivity, organizational results

1. Introduction
A number of authors have highlighted the importance that the topic of Work Life Balance (WLB) is gaining today
(Fleetwood 2007) because men and women find it difficult to harmonise their roles as workers and their family
and personal roles, as a consequence of which they suffer inter-role conflict.

In order to cope with the lack of balance experienced by individuals, organisations and institutions are trying to
promote WLB initiatives. In the literature, authors have considered two different domains regarding WLB: WLB
practices and the existence of an organisational culture that supports WLB for employees. However, several
academics stress that, when organisations formally adopt WLB policies, this has less impact on organisations
and employees than informal organisational support for WLB (Behson 2005). However, scientific research on
WLB culture and its effects have some limitations in the literature. At this time,
 Most studies have been conducted in large companies. More studies should be conducted in these
organisations (Lavoie 2004).
 Despite the rather extensive literature about work life balance culture, the majority of studies have been
conducted in the United States (Lu et al. 2010).
 Research mainly focuses on organisational behaviour outcomes such as job satisfaction, turnover intentions
or workers’ commitment and not on organizational results.
 Academics highlight the need for studies in industrialized sectors (Harrington and Ladge 2009).
 Most of the empirical studies are conducted with only one source of data.
For all the above reasons, this research tries to fill these gaps in the literature.

2. Literature review
WLB practices are those employer-sponsored programmes and policies that are designed to help employees
manage work and personal life demands (Lobel 1999). There are different options of WLB practices such as
flexible work arrangements, child care centres, teleworking, etc.

Legislation in different countries has promoted the implementation of WLB practices in organizations. However,
in some cases, only big companies have the obligation to embrace and implement these policies (for instance,
the Spanish law of Equality Opportunities that is only compulsory for firms over 250 employees). As a
consequence, managers of small and medium enterprises do not formalise the availability of WLB measures in
their companies and its implementation and usually rely on individual negotiation between the employee and
the manager (Harrington and Ladge 2009).

In these circumstances, in SMEs, the existence of an organizational climate that supports WLB values becomes
key. A WLB supportive culture is defined in the literature as the “shared assumptions, beliefs and values

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regarding the extent to which an organization supports and values the integration of employees’ work and
personal lives” (Thompson et al. 1999).

The literature stresses that having a WLB culture has important effects on employees’ organizational behaviours
such as commitment, motivation or talent retention (Hughes and Bozionelos 2007). However, managers would
like to know if supporting employees’ balance might have an effect on their business results. As a consequence,
a complete approach to examine the effect of WLB supportive culture on business results will need data from
both agents in the companies: managers and employees. This will make it possible to analyse the effect of WLB
culture on HR outcomes (with the employees’ sample) and effects on the organizations (with the managers’
sample).

2.1 Perceptions gaps in WLB culture

Experts recommend that all the relevant stakeholders should be included in the design of WLB studies (Hyland
and Jackson 2006). Different stakeholders will provide different insights into the topic of WLB, each from their
own perspective. For example, in the current research, we examine the effects of a WLB culture on employees’
behaviour and the effect this has on their organization. But before moving to that level we examine the extent
to which the views of employees align with those of the managers of their companies. The recognition that there
are different perspectives on this question is an important step for management to take.

In relation to a WLB supportive culture, the differences in perceptions between managers and employees can
lead to two types of mistakes or missed opportunities (Prottas et al. 2007). On the one hand, employees may
think that their employers provide and support certain kinds of arrangements, when in fact they do not. On the
other hand, employees might be unaware of the possibility of using WLB practices in their organizations. To
date, little empirical research has investigated this question, but what literature there is suggests that employees
usually believe there are fewer WLB practices available to them than are reported by HR managers (Budd and
Mumford 2006). In this article we start form the assumption that this might also be the case for the perception
of WLB values in the organization. Therefore we compare the views of managers and employees on the basis of
empirical data.

The existence of different perceptions is expected to have organizational and behavioural consequences
(Birkinshaw et al. 2000). For all the above reasons, we consider there could be also a gap between what
managers say about how they value and support the employees’ WLB and the employees’ opinion on the same
topic. Hence, we propose Hypothesis 1,
H1: Hypothesis 1: Mean values of the existence of a WLB supportive culture from the managers’
point of view and WLB supportive culture perceived by the employees are different.

2.2 The effect of a WLB supportive culture on HR outcomes

Several authors have emphasized the need for having a supportive WLB culture for reducing work/life conflict
of the employees and improving several organizational behavioural outcomes and business results.

In this research we are focusing the examination of the effects of WLB supportive culture on three relevant HR
outcomes: commitment, job satisfaction and turnover intentions. Firstly, commitment to the organization is a
variable that has received a great deal of attention from the scientific world. One of the main dimensions of
commitment is called attitudinal commitment and it has important effects on employees’ behaviours in the
organization (Vandenberghe y Bentein 2009). Attitudinal commitment implies that employees develop a positive
feeling and loyalty towards the organization, they become proud to be part of the company and are ready to
put greater effort into their performance. Secondly, job satisfaction is usually defined as the positive emotional
response to a job situation resulting from attaining what the employee wants and values from the job (Olsen
1993). According to Meyer et al. (2002) employees’ satisfaction needs to be considered in efforts to understand
and manage employee behaviour. Regarding the consequences of job satisfaction in the organisation, it is widely
recognised to influence productivity, absenteeism, performance, turnover intentions, organisational citizen
behaviour and the commitment of employees (Grube et al. 2008). As a consequence, job satisfaction is a
desirable outcome in its own right and, hence, a key measure to evaluate the effectiveness of HR management
in organisations. Finally, turnover intentions are another key variable from the HR management point of view.
The variable turnover intentions is directly related to actual turnover of employees. Although sometimes

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turnover could be considered positive because it will bring new ideas and knowledge to the firm, high turnover
rates can create serious problems in an organization. There are several costs associated with high turnover rates
such as loss of knowledge and experience, tasks unattended, time and costs of recruiting and selecting new
candidates and poor performance of the new employee.

There are different arguments in the literature to explain the positive relationship between having a WLB
supportive culture and employee job satisfaction, job commitment and a negative effect on turnover intentions,
for example, social exchange theory (Blau 1964), the norm of reciprocity (Gouldner, 1960), the perceived
organisational support (Rhoades and Eisenberger 2002) or the psychological contract (Rousseau 1989).
Therefore, we predict that:
H2: Hypothesis 2: The existence of a WLB supportive culture as perceived by the employees will
affect the HR outcomes.
H2a. The existence of a WLB supportive culture as perceived by the employees will increase
employees’ commitment.
H2b. The existence of a WLB supportive culture as perceived by the employees will increase
employees’ job satisfaction.
H2b. The existence of a WLB supportive culture as perceived by the employees will reduce
employees’ turnover intentions.

2.3 The effect of a WLB supportive culture on organizational results

Many researchers examine the link between organizational culture and business performance, but rarely the
relationship between a WLB supportive culture and business organizational results, although a link has been
suggested in the literature. We are only aware of the research conducted by Ngo et al. (2009) that examines the
effect of having a WLB supportive culture on business results.

In the literature, there are a growing number of scholars who suggest that an organizational culture, and
particularly a WLB supportive culture, can enhance organizational competitiveness due to the creation of a
favorable climate that supports employees. Hence, we formulate the following hypothesis:
H3: Hypothesis 3: The existence of a WLB supportive culture as perceived by the employees will
increase organizational results.
H3a. The existence of a WLB supportive culture as perceived by the employees will increase
productivity.
H3b. The existence of a WLB supportive culture as perceived by the employees will increase
perceived organizational results.

3. Methodology
This research uses data from two samples representing the managers’ and the employees’ points of view in a
specific industrial sector of activity in the south-east region of Spain.

3.1 Data collection and sample description

Data collection was conducted in Spain. The metal industry in the Region of Murcia (southeast Spain) was the
subject of our data collection. The total market in the Region of Murcia for the metal industry (including
metallurgy, metalworking and machinery building) represents 28% of the Region of Murcia gross domestic
product (FREMM 2010), and employed 16,496 workers in 2007 (26% of the Region of Murcia’s workers).

We made use of a list of 832 SMEs provided by the Industrial Register of Establishments (http://www.carm.es)
as an initial sampling frame. All companies were invited to participate in the study, and 263 agreed. Six
questionnaires were distributed during personal visits to the companies that agreed. One questionnaire was
directed to the managers of the firms and the other five questionnaires were to be distributed randomly to five
employees. The managers’ questionnaire was collected during a second visit to the firm, but employees sent
their answers in a stamped, addressed envelope to the university, in order to avoid bias in the responses. The
employees’ questionnaires were marked so that they could be linked to their manager’s questionnaire. In total,

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610 visits were carried out and 229 complete surveys were collected from the managers, giving a response rate
of 27.52% of the total number of companies invited to participate (87.07% response rate from the companies
that agreed) with a factor of error of 5.5% for p=q= 50% and a reliability level of 95.5%. 511 questionnaires from
the employees were received at the university. The matched manager–employee sample is composed of 165
cases (as for some companies no employee responses were obtained). Surveying took place over a period of 8
months, from March to October 2009.

Sample 1: Managers’ questionnaire. Managers, as organizational agents, are assumed to represent their firms
in the literature on the employee–organization relationship. All companies in the sample were classified
according to the European Union classification as SMEs1, with a total number of employees under 250. Most of
the firms employ between 10 and 49 individuals: 88.2% of them have fewer than 50 workers and 23.58% fewer
than 10. On average, companies have been operating for 20 years. Managers are on average 49.5 years old and
only 26.2% have studied at university. The percentage of women in the companies is low (in 60% of the
companies lower than 10% and in 90% of the firms lower than 25% of the total workforce). The percentage of
employees with temporary work contracts is also low (77.3% of companies with 10% of temporary employees).
Finally, 70.7% of the firms are family businesses.

Sample 2: employees’ questionnaire. The sample is composed of 58.7% men. The average age of the employees
is 35.6 years. Fifty-seven per cent of the workers have qualifications below degree level and the other 43% have
conducted university (40%) or postgraduate (3%) studies such as a professional masters or doctorate. Regarding
their personal status, 70.9% of the employees are married, 24.6% are single and the other 4.5% are
separated/divorced. 37.9% of the sample do not have children, 22.6% have one child, 31.5% have two children,
8% have three or four children. 56.1% of workers have a partner who also works (dual-career couples).

3.2 Measures
In the following table we include the items, scales and the authors from whom we have taken the variable,
together with the information regarding which questionnaire items we have used each time for the hypothesis
test.

Different statistical analyses are performed to test the hypotheses. In a first step, to examine the perception
gaps between managers and employees, we included in the same database the values for WLB culture from the
managers’ and the employees’ points of view. To do this, employees’ responses were grouped by company and
the mean value of their WLB culture perceptions for each company was calculated. We introduced the
employees’ values in the managers’ database, matched by the company name. The final sample used was 165
cases. To compare mean differences, we used the t-test for dependent samples as it calculates the differences
between the two figures and evaluates whether the value is significantly different from zero.
Table 1: Measures employed in the questionnaire
Variable Questionnaire Measure (7 point scale question): Items and author
distributed to
WLB supportive Managers and “Talking about personal life at work”, “Refusing transfers or promotions
culture employees requiring geographical moves for personal reasons”, “Going home during
the workday to attend to personal responsibilities”, “Setting limits on hours
spent at work”, “Using alternative work designs such as flextime and
flexplace”, “Taking the full vacation entitlement”, ( = 0.79) Kofodimos
(1995).
Commitment Employees “You feel little loyalty to your firm” (reverse score), “You are proud to tell
others that you are part of your organization”, “You talk up the company to
your friends as a great organization to work for”. Items have been taken
from prior research ( = 0.67) (Mowday et al. 1979).
Job satisfaction Employees The 7 items ask the workers about the challenge of the job, relationships
with co-workers, relationships with the job supervisor, autonomy to make
decisions, job security, acknowledgement and promotion opportunities (
= 0.87). Hausknecht et al. (2008)
Turnover Employees “You are actively looking for a job outside your organization”, “As soon as
intentions you find a better job you will leave the company”, “You are seriously
thinking of leaving your organization” and “You consider you will be
working in your company in 5 years” (Wayne et al. 1997) ( = 0.771)

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Variable Questionnaire Measure (7 point scale question): Items and author

distributed to
Productivity Managers Sales / employee (from 2 separate questions) (Gahan et al. 2012)

Organizationalo Managers 1) quality of products, services and programmes; 2) development of new

utcomes products and services; 3) ability to retain essential employees, 4)
satisfaction of customers or clients; 5) relations among employees in
general. Answers were measured on 7 point scale where 1= worse than
competitors and 7 = better than competitors ( = 0.80). Delaine and
Huselid (1996)
In a second step, in order to evaluate the second and the third hypotheses, we conducted a regression analysis.
For Hypothesis 3 we have included the time the company has been established and size measured the number
of employees as control variables, as is frequently found in the literature (Laforet, 2013).

Although the measures were taken from the literature, special attention has been paid to the validity and
reliability of the measures. Table 2 provides information regarding the mean values, standard deviations and
bivariate correlations between the variables for both samples.
Table 2: Mean values, standard deviation and bivariate correlation between variables
Mean SD 1 2 3 4 5 6
1. WLB Culture 4,21 1,02 1
(managers)
2. WLB culture 3,73 0,71 0,348 1
(employees)
3. Productivity 74034,9 6128913 0,052 0,272** 1
4. Commitment 5,01 1,15 0,204** 0,397** 0,030 1
5. Job satisfaction 5,15 0,81 0,221** 0,460** 0,022 0,710** 1
6. Turnover 2,67 1,22 -0,083 -0,22** -0,094 -0,43** -0,112 1
intentions
7.Organizational 4,99 1,03 0,356** 0,146 -0,019 0,154* 0,052 -0,16*
outcomes
The software employed in this research was SPSS 15.0. In the following section, we provide the results obtained
from this research.

4. Results
In Table 3, t-test analyses show that perception gaps exist between managers and employees regarding the
existence of WLB supportive culture. According to our data, managers indicate a higher level of a WLB supportive
culture than employees, who evaluate it as significantly lower. Hence, the data confirm Hypothesis 1.
Table 3: The t-test for differences in variables WLB practices (n=165)
Dependent differences
Mean SD t
WLB CULTURE (employees)- WLB CULTURE (managers) -0.476 1.02 -5.953***
Note: ***p ,0.01, **p , 0.05, *p , 0.1.

Second, we present the findings obtained for testing Hypothesis 2. The three statistical models for examining
the effect of having a WLB supportive culture on employees’ commitment (H2a), job satisfaction (H2b) and
turnover intentions (H2c) show support for all the hypotheses. Hence, we provide evidence that having a WLB
culture in organizations has an impact on key HR outcomes.
Table 4: Hypothesis 2: The analysis of the effect of WLB supportive culture on HR outcomes (n=511)
Commitment Job satisfaction Turnover intentions
Standarized Standarized Standarized
t t t
B B B
Constant 7.801*** 14.457*** 12.225***
WLB culture
0.508 12.283*** 0.508 12.454*** -0.336 -7.450***
(employees)

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Commitment Job satisfaction Turnover intentions

Gender 0.021 0.493 -0.011 -0.259 0.041 0.904
Years in the
0.045 1.073 0.059 1.414 -0.069 -1.492
company
Job category -0.074 -1.786* -0.132 -3.215*** 0.073 1.614
Adjusted R2 0.262 0.279 0.120
F 39.501*** 43.108*** 15.728***
Finally, we show in Tables 5 and 6 the results of analysing Hypotheses 3a and 3b. As can be observed, both
hypotheses are supported by the data.
Table 5: Hypothesis 3a: The analysis of the effect of WLB supportive culture on productivity (n= 165)
Standarized Beta T
Constant -2.890**
WLB culture (employees) 0.272 3.252***
Time of the company 0.034 0.411
2
R = 0.061 F= 5.379**

Table 6: Hypothesis 3b: The analysis of the effect of WLB supportive culture on perceived organizational results
(n= 165)
Standarized Beta T
Constant 13.226***
WLB culture (employees) 0.155 1.955**

Size (number employees) 0.095 1.188

Time of the company -0.209 -2.651***

R2=0.051 F= 3.767**

In the next section we discuss our results.

5. Discussion
This research makes several contributions for academics and practitioners. First, an important contribution of
this study is the identification of a perception gap between managers and employees obtained from the study
of two samples representing different stakeholders in firms, as the existence of this gap has been suggested
previously (Hyland and Jackson 2006). The existence of a knowledge gap between different stakeholders in
organizations has previously been found by other authors in relation to WLB practice availability (Budd and
Mumford 2006). However, as far as we are aware, no research has examined this gap in terms of WLB supportive
culture.

This research improves on previous studies by providing a more complete analysis of the consequences of having
a WLB supportive culture on different outcomes, using two samples. Hypotheses 2a, 2b and 2c analyse the effect
of a WLB supportive culture on specific HR outcomes. Our results are in accordance with previous investigations
found in the literature conducted by scholars. Nevertheless, our research provides unique data by examining 3
different behavioural outcomes of key importance from an HRM point of view: commitment, satisfaction and
retention in SMEs. As far as we are aware, no previous research has done this before.

On the other hand, the examination of the influence of a WLB supportive culture on organizational results in
SMEs is another key finding of this research. By providing evidence that having a WLB culture enhances
productivity in firms we offer the managers a good reason to aim at implementing and developing a WLB
supportive culture.

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6. Contributions, limitations and future lines of research

This research sheds new light on this issue by overcoming the main limitations found in the WLB literature
highlighted in the introduction section.

Despite the contributions, it also has a number of limitations. One limitation is the cross-sectional design of the
data collection. Secondly, as we collected data from Spanish SMEs of a specific industrial sector. Moreover, the
effect of a WLB supportive culture on organizational results is weak.

This research makes it possible to identify some possible lines for future research. The first one would be to
investigate how to create and maintain a WLB supportive culture in organizations. By examining this step we
should be able to provide a complete analysis of the topic and give specific suggestions to managers and
founders of SMEs.

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