The impact of fairness on user's satisfaction with the is department.

Kwun, Obyung ; Alshare, Khaled A.

ABSTRACT

This study utilized the justice theory to study the effect of fairness of information systems development process on user satisfaction with the IS department. To validate the research model, partial least square (PLS) analysis was used to analyze the data that were collected from 123 middle-level managers who have participated in the IS development. The findings showed that interactional justice and distributive justice, but not procedural justice, had positive impacts on user satisfaction with IS department. Additionally, interactional justice had the strongest impact on user satisfaction with the IS department.

INTRODUCTION

Information Systems (IS) development has been seen as a decision-making process where social processes play an important role in determining the outcome and the reactions to that outcome (Guimaraes & Igbaria, 1997; Ives & Olson, 1984; Yoon et al., 1995). Previous studies (Garrity & Sanders, 1998; Markus & Keil, 1994; Franklin et al., 1992) suggest that most systems will fail if psychological and organizational issues are not properly addressed during the development, implementation, and use of the system. With this socio-technical perspective, user satisfaction with IS has been one of the most frequently used measures for IS success (Khalifa & Liu, 2004; DeLone & McLean, 1992).

Numerous studies have focused on factors that influence IS success. User involvement has been a major factor that contributed to IS success (Doll & Torkzadeh, 1991; Igbaria & Guimaraes, 1994, Kohli & Gupta, 2002; Lehaney, et. al., 1999; Schwalbe, 2006; The Standish Group, 2002; Tait & Vessey, 1988). Some studies (e.g., Hunton, 1996; Hunton & Price, 1997; Kwun & Alshare, 2005), based on justice theory, have successfully demonstrated the importance of the user's overall perception of fairness in improving the satisfaction with IS, but they have not considered user satisfaction with the IS department, which may be one of the important factors in IS success. According to justice theory research, fairness of decision-making influences satisfaction with organizations and its authorities as well as the outcomes (Folger & Konovsky, 1989). Fairness of the decision-making facilitated the positive attitudes necessary for cooperative relations in decisionmaking teams ( Korsgaard et al., 1995)

Though previous IS development research has noted the impact of user attitudes toward personnel in the IS department (i.e., systems developer) on system success (Hartwick & Barki, 1994; Hirchheim & Newman, 1991), user satisfaction with the IS department (systems developer) has not been explicitly tested in the IS literature. The relationship between the IS department and the user is central to the success of IS development (Beath & Orlikowski, 1994; Mallalieu et al., 1999). This is especially important when IS development is a continuous process during an organization's life. This study attempts to investigate the effect of fairness of IS development process on user satisfaction with the IS department.

LITERATURE REVIEW

Designing information systems is a complex and demanding process. It is an evolutionary process that involves constant learning, as new or changing needs are identified. Participation by users in the process of analysis, design evaluation, and implementation is useful since it increases the knowledge and skill of users. Land and Hirschheim (1983) reported benefits of user participation in IS development process. Participation provides users opportunities to protect their interests, and facilitates user's compliance with the outputs of decision-making during system development. Participation of users acts as a motivator that makes them accept the new system without much resistance to change. Finally, participation permits various skills and knowledge of users to be incorporated in the process of developing the system.

A close relationship between the developer and users is a prerequisite for building effective systems (Beath & Orlikowski, 1994). The ability of the system developer to use his or her people skills to minimize conflicts with the end users directly affects the user's satisfaction with the IS (Guimaraes & Igbaria, 1997). Despite the difference between the user and the system developer, effective communication between them facilitates conflict identification and its subsequent resolution, which improves user satisfaction (Mckeen et al., 1994). As indicated by Ajzen & Fishbein (1980), a positive attitude toward the IS department may increase the user's intention to cooperate with the department.

Researchers have utilized the three dimensions of the justice theory (procedural, interactional, and distributive justice) in examining the relationship between fairness of the IS development process and IS success (Kwun & Alshare, 2005; Joshi, 1989; Joshi, 1990; Hunton, 1996; Hunton & Price, 1997). Procedural justice refers to the fairness of the formal procedures through which outcomes are achieved (Greenberg, 1987). Interactional justice deals with the interpersonal treatment people receive from the decision maker and the adequacy with which formal decision making procedures are explained (Tyler & Bies, 1989). Distributive justice refers to the perceived fairness of the resulting distribution of outcomes of decision making. The fairness of outcomes is evaluated based on some distributive rules that include equity (the ratio of outcomes received to the inputs provided), equality (equal receipt by all parties), and needs (receipt of resources according to the extent to which they are required by the recipients). However, equity, in general, is the dominant rule in fairness judgments (Cohen, 1987).

The three dimensions of the justice theory have been adequately representing individual perception of fairness. As measures of perception of fairness for the decision making process and decision outcomes, these dimensions of justice have been shown to influence attitudes (e.g., satisfaction) and behavior (e.g., turnover) (Greenberg, 1990). For example, perception of fairness improves level of organizational citizenship behaviors which promote effective functioning of the organization (Moore & Love, 2005). Justice research also has recognized that perception of fairness has impact on organizational outcomes such as satisfactions with employing organization, and its decision-making authorities as well as satisfaction with outcome itself (Barling & Phillips, 1992; Folger & Konovsky, 1989; Korsgaard, et al., 1995). In IS development context, procedural justice has been used to explain the effects of user participation on satisfaction with IS (Hunton & Price, 1997). Joshi (1989, 1990) recognized the importance of fairness in systems development and created an instrument to measure fairness in IS based on both distributive and procedural justice. Additionally, Kwun and Alshare (2005) studied the effects of the justice dimensions on user's satisfaction with IS. They found that interactional justice and distributive justice, but not procedural justice, had significant positive impacts on users' satisfaction with IS. However, the impact of fairness on organizational outcomes such as satisfaction with IS department has been ignored. Thus, this study attempts to find the effect of three dimensions of justice on user satisfaction with the IS department. Based on the above discussion of the three dimensions of justice, the following hypotheses were proposed:

H1: Procedural justice has a positive effect on the user satisfaction with the IS Department.

H2: Interactional justice has a positive effect on the user satisfaction with the IS Department.

H3: Distributive justice has a positive effect on the user satisfaction with the IS Department.

RESEARCH METHODS AND DATA COLLECTION

Research Model

The relationship between user perception of fairness and their reactions is directly derived from justice theory. Therefore, the user perception of fairness of the IS development process was expected to influence satisfaction with the IS department (i.e., systems developer). As shown in Figure 1, the main constructs in the research model include: (1) procedural justice, (2) interactional justice, (3) distributive justice, and (4) satisfaction with the IS department (i.e., systems developer).

[FIGURE 1 OMITTED]

Measures

Procedural Justice: The items to measure procedural justice were developed based on the elements of procedural justice suggested by Leventhal (1980) (e.g., consistency, bias suppression, accuracy, and correctability) and Thibaut and Walker (1975) (e.g., control over process and control over outcome decision). These items were designed to measure the degree to which the formal procedures used in the IS development process were fair. An example would be "Procedures were designed to collect accurate information necessary for the system development." A five-point Likert scale was used for the response, ranging from strongly disagree (1) to strongly agree (5).

Interactional Justice: The items for this dimension of interactional justice focused on the interpersonal behavior of the IS developers. Based on the previous studies on interactional justice (Bies, 1987; Bies & Moag, 1986; Tyler & Bies, 1989), the items reflected the degree to which the IS developer treated users with trustfulness, kindness, justification, and respect. An example would be "The IS developer treats you with kindness and consideration." The response scale was a five-point Likert scale, ranging from strongly disagree (1) to strongly agree (5).

Distributive Justice: Distributive justice was measured in terms of the degree to which respondents believe that they are fairly rewarded when they consider their input. The items for the study were developed based on the items used in a study done by Joshi (1990). However, the other elements of distributive justice (equality and needs) were also considered. An example would be "Information resources are fairly allocated based on the user's needs." The response scale was a five-point Likert scale, ranging from strongly disagree (1) to strongly agree (5).

Satisfaction with IS Department: These items were developed to measure the user's satisfaction with the IS department. The items measure the user's satisfaction with the system developer's skills and abilities such as people, model, system, computer, organizational, and societal skills. An example would be "How would you rate the IS department's ability to meet the requirements of all the users?" The response scale was a five-point Likert scale, ranging from very dissatisfied (1) to very satisfied (5).

Statistical Procedures

Partial Least Squares (PLS) analysis was used to test the proposed research model. PLS is a multiple regression-based technique for testing a research model with multiple-item constructs and direct and indirect paths. It has been considered appropriate for exploratory study and testing predictive models. PLS is especially useful in situations where sample size is small; missing data is common; and there are high correlations between the predictor variables. In addition, PLS does not require assumptions about distributional characteristics of the raw data.

PLS, as a structural equation modeling, recognizes two parts of model testing: measurement and structural models (e.g., Barclay et al., 1995; Fornell & Larcker, 1981). In order to test a research model, the measurement model has to be evaluated first, and then the structural model has to be tested. The assessment of both models was conducted using PLS-GUI 2.0, which is LVPLS 1.8 with a graphical user interface.

The Measurement Model

There can be two types of relationships between constructs and their measures (items): formative and reflective (Fornell & Larcker, 1981). Formative items are considered to be causes of the construct. Reflective items are considered to be effects of the construct. In PLS, the relationship between constructs and items used to measure them must be specified. In order to specify the relationship, theoretical knowledge must be applied as much as possible (Lohmoller, 1981). Lohmoller also suggests that exogenous constructs (independent variables) should be modeled with formative items, and endogenous constructs (dependent variables) should be modeled with reflective items when theoretical knowledge about the construct does not exist. For our model, as shown in Table 1, the items measuring all of exogenous constructs were considered formative as indicated in justice theory, whereas the items measuring the endogenous construct were considered reflective, since there is no theory that clearly describes the relationship between items and constructs they measure.

The Structural Model

The test of the structural model consists of estimating the path coefficients between constructs in the research model, which indicates the strength of the relationships and the [R.sup.2] value of the dependant variable, which shows the amount of variance explained by the model. Although other techniques such as jackknifing and bootstrapping have been used to test the significance of the path coefficients, t-test of ordinary least square (OLS) regression was used as recommended by Chatelin et al. (2002). Using the construct values generated by PLS analysis, a multi-regression analysis was performed. The hypotheses were tested by assessing the significance of the relationship between the constructs.

Samples and Data Collection

The data were collected using a commercial research website (www.zoomerang.com). After the questionnaire was posted, the web page address for the questionnaires was sent to a list of randomly selected 2500 middle-level managers. Middle-level managers have been used in IS development research as subjects, since they are the best representatives of the user community and are more likely to participate in the IS development process. Researches in user participation within the justice framework also involved middle-level managers as subjects (Joshi, 1990). Since informal word-of-mouth communication, rather than direct experience, has proven to influence user attitude and behavior (Gallettta et al., 1995), it has been assumed that the middle mangers' perceptions of justice in IS also influences the individual user perception of justice (Joshi, 1989).

DATA ANALYSIS

Two Hundred twelve managers completed the survey, which represented 8.4 percent response rate. Seventy-eight of the 201 usable responses indicated that they had never participated in the system development process; therefore, they were excluded from the analysis.

Profiles of the Sample

As shown in Table 2, the sample group consisted of 36.6 percent (45) females and 63.4 percent (78) males, with average age of 44.1 years. Over 98 percent of the respondents were familiar with computer technology. This may be because most middle-level managers have to use computer-based information systems to perform their daily work and are aware of their investments in computer technology. These managers represent different industries: 16.5 percent were from manufacturing, 35 percent were from Service, 8.1 percent were from merchandising, and 35.8 percent were from other industries that include government, health care, and education. In terms of the number of employees and revenue, the majority of the managers were from relatively large organizations. Also, the majority of the managers had been in the managerial position in the organization for more than four years. Their job titles varied, but the typical titles included manager, supervisor, and director.

RESULTS

The results of the study are divided into two sections. The first section discusses reliability and validity of the research model. The second section provides answers for hypotheses H1-H3; that is the effects of justice dimensions on user satisfaction with the IS department.

Assessing the Measurement Model

The measurement model addressed the relationship between the constructs and the items used to measure them. The test of the measurement model involved estimation of the convergent and discriminant validity of the measurement instrument. Convergent validity, which examined the extent to which alternative measures of the same construct were related to each other, and the discriminant validity, which considered the degree to which measures of a construct were not related to measures of other constructs, were used to validate the research instrument.

As shown in Table 3, the reliability (Cronbach's Alpha) of items on all constructs ranged from 0.79 to 0.92. These values were greater than 0.7, the acceptable value that was suggested by Nunnally (1978); thus, the reliability measure was satisfactory. With respect to individual items, all items for formative constructs (independent variables) showed positive weight except PJ3 and IJ1. Also, all items in the reflective construct (the dependent variable) had loading of 0.60 or above, which was recommended as acceptable values by Hair et. al., (2006). With respect to the AVE criterion, the reflective construct (SD) had 0.61 which was greater than 0.5 as suggested as acceptable value by Fornell & Larcker (1981). In order to achieve discriminant validity, no item should be loaded higher on another construct than it is on the construct it intends to measure. All items loaded highest on their target constructs

In order to improve the validity of the results, the formative items with negative weight were removed when the structural model was tested. As a result, PJ3 and IJ1 were dropped to estimate the structural model. Overall, the analysis of convergent and discriminant validities, along with the examination of the individual items imply that the measurement model considered satisfactory. The list of items for each construct is reported in Appendix A.

Estimating the Structural Model

The significance and the strength of the relationships among the constructs are shown in Figure 2. Although procedural justice had a positive effect on satisfaction with the IS department, the coefficient was small (0.07) and the relationships was not significant (H1 was not supported). This may be due the lack of end-users' interests in knowing details about the formal procedure for a particular project, since such projects usually have a short development life cycle. Additionally, the IS development project team involved an adhocracy where members consisted of people with different specialties organized into a short-lived team without strong central management and well established formal procedures (Mintzberg, 1979). Because of the lack of formal procedures in IS development, managers might have had difficulties forming perceptions of the procedures. Moreover, since middle-level managers, regardless of their participations of the systems development process, usually involved in informal meetings with the IS development teams, they were aware of such procedures, if there was any, and they had already developed attitudes toward such procedures.

Interactional justice had significant positive impacts on satisfaction with the IS department. Thus, the hypothesis H2 was supported. Additionally, it had a stronger positive impact on satisfactions with the IS department with path coefficients of 0.41 than the other justice dimensions. Finally, distributive justice had significant and positive impacts on satisfactions with the IS department. Therefore, the hypothesis H3 was supported. The path coefficient was 0.37. As shown in Figure 2, the three variables together (procedural justice, interactional justice, and distributive justice) explained 64 percent ([R.sub.2]) of variance of satisfactions with the IS department.

[FIGURE 2 OMITTED]

CONCLUSIONS AND IMPLICATIONS

This study utilized justice theory in investigating the impact of user perceptions of fairness of the IS development process on their satisfactions with the IS department. The results indicated that interactional justice and distributive justice had positive effects on satisfaction with the IS department. However, Interactional justice, compared to distributive justice, had a stronger effect on the user's satisfactions. Additionally, results revealed that procedural justice did not have a significant impact on users' satisfactions with the IS department.

Implications for Practitioners

This study has many implications for practitioners. System development is not only a technical process, but it is also a social and interpersonal process. This implies that system development must address social and interpersonal aspects of the system development to improve users' satisfactions with the IS department. One way to improve these satisfactions will be improving perceptions of fairness in the system development process. In order to improve perceptions of fairness, IS developers must adopt formal procedures that promote accuracy, provide opportunity to appeal, illustrate consistency, give opportunity for clarification, show concern for users, and guarantee fair allocation of resources and benefits of the resulting system. Also, since IS development requires user participations, the IS developer's interpersonal treatment and communication skills become equally, if not more important than other skills (e.g., technical skills). Interactional justice deals with issues beyond formal procedures. In order to improve fairness of interpersonal treatment during IS development, IS developers must consider users' opinions, avoid personal bias, provide timely feedback, treat users with kindness and consideration, show concern about users' rights, and be truthful.

The results of this study confirmed that interpersonal skills are among the most important factors that affect satisfactions. One way to improve perceptions of these interpersonal treatments could be by applying impression management (Bies, 1987), which is a way to influence people's subjective judgment about social and political interaction (Bolino & Turnley, 1999; Rao, et al, 1995). Therefore, impression management skill of IS developers may play a major role in influencing users' perceptions of fairness.

It is worth of mentioning that the majority of users generally do not have a chance to participate in IS development process. Their perceptions of fairness may heavily rely on the distribution of outcomes, although they may be aware of procedural and interactional fairness through their representatives in IS development process. Also, their satisfaction with the IS may affect their perceptions of procedural and interactional fairness. Thus, to improve user satisfaction with the IS department, information resources should be properly distributed by considering factors such as equity, equality, and needs.

Implications for Researchers:

While the study provided strong support for relationships between the constructs and user satisfaction with IS department, there were still several limitations in generalizing the results. First, there may be biases attributable to common-method variance. Since people tend to claim credit for positive events and avoid blame for failures, the results of the study may be exaggerated for data collected through the ex post facto self-report on both independent and dependent measures (Hawk & Aldag, 1990). This study relied on self-reports from users on both perceptions of fairness & satisfaction. Thus, relationships among the constructs might be inflated. Second, a sample of middle-level managers was used in this study. These middle-level managers, such as supervisors or directors of departments were most likely to represent users who participated in the system development and understand departmental issues. However, they may have different interests from those of general users. Therefore, future research might use pre- and post-data collection so the results would not be based on self-reported data, and involve direct users of systems as the target population. Another future research might be to include other factors that may produce new relationships among the constructs, since the factors that affect perceptions of fairness could vary across different settings. Another plausible direction for future research might be adding factors that take in account individual differences, since justice is subjective in nature. Appendix A: The list of Items Construct Item Description Procedural Justice PJ1 The IS development process is designed to collect accurate information necessary for making decisions. PJ2 The IS development process is designed to provide opportunities to appeal or challenge the decision made. PJ3 The IS development process is designed to generate standards so that decisions can be made with consistency. PJ4 The IS development process is designed to hear the concerns of all those affected by the decision. PJ5 The IS development process is designed to provide useful feedback regarding the decision and its implementation. PJ6 The IS development process is designed to allow for requests for clarification or additional information about the decision. Interactional Justice IJ1 The IS department considered your view point IJ2 The IS department was able to avoid any personal bias. IJ3 The IS department provided you with timely feedback about the decision and its implications. IJ4 The IS department treated you with kindness and consideration. IJ5 The IS department showed concern for your rights as a user. IJ6 The IS department took steps to deal with users in a truthful manner. Distributive Justice DJ1 Information resources (e.g., hardware, software, the database, and IS staffs who provide support service) are allocated fairly based on user's time and effort during the development process. DJ2 Information resources are allocated fairly based on user's need. DJ3 Information resources are allocated fairly to all users. DJ4 The benefits from the system are allocated fairly based on user's efforts during the development process. DJ5 The benefits from the system are allocated fairly based on user's need. DJ6 The benefits from the system are allocated fairly to all users regardless of their effort during the development process and their need Satisfaction with IS SD1 How would you rate the IS department's Department ability to meet the requirements of all the users? SD2 How would you rate the IS department's ability to meet the information needs of your area of responsibility? SD3 How would you rate the IS department's communication and interpersonal skills? SD4 How would you rate the IS department's ability to specify components, scopes, and functions of the system? Satisfaction with IS SD5 How would you rate the IS department's Department knowledge of hardware/software, programming language? SD6 How would you rate the IS department's ability to finish IS development within budget? SD7 How would you rate the IS department's ability to finish IS development within time? SD8 How would you rate the IS department's knowledge of your functional area and its organizational condition? SD9 How would you rate the IS department's ability to articulate and defend its position on important issues about information technology's impact on society?

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Obyung Kwun, Southern University at New Orleans

Khaled A. Alshare, Emporia State University Table 1: The Measurement Model Constructs Model Relationship Procedural Justice Exogenous Formative Interactive Justice Exogenous Formative Distributive Justice Exogenous Formative Satisfaction with IS Department Endogenous Reflective Table 2: Frequency Distributions of Key Variables (N=123) Variable Responses Percent Gender: Male 78 63.4 Female 45 36.6 Computer knowledge: Very high 43 34.15 High 48 39 Average 30 23.6 Low 2 1.6 Very low 0 0 Tenure: <1 year 5 4.1 1-3 33 26.8 4-9 55 44.7 10-15 16 13 >16 14 11.4 Industry: Manufacturing 21 16.3 Services 45 35.8 Merchandising 11 8.1 Other 46 35.8 Company Size: <500 F. emp. 23 17.9 500-2000 30 24.4 2001-10000 28 22.8 >10000 42 34.1 Revenue: <200 mi. 28 20.3 200-500 26 18.7 >500 69 54.5 Table 3: Reliability Analysis (Cronbach's Alpha and AVE) Construct Cronbach's alpha Aveg. Variance Extracted PJ (5 items) 0.79 .043 IJ (5 items) 0.87 0.50 DJ (6 items) 0.87 0.54 SD (9 items) 0.92 0.61