Using psychological capital at organizational levels of study

Chalachew Almaw Tefera and William D. Hunsaker

Journal of Advances in Management Research, 2021, vol. 18, issue 4, 548-567

Abstract: Purpose - Since the term's introduction two decades ago, “psychological capital” has been described as an intangible strategic organizational resource. However, there remains a dearth of research regarding its application, especially in the macro-management fields. This paper addresses this gap by elevating the individual-level psychological capital (ILPC) concept to an equivalent organizational-level psychological capital (OLPC) model with appropriate methodological considerations. Design/methodology/approach - The elevation of ILPC to OLPC is conducted using referent shift approach. Then, the proposed OLPC model is tested and validated using the partial least-squares structural equation modeling analysis technique. Findings - Testing the OLPC model adequately validated the basic requirements of reliability, validity, multicollinearity and redundancy analysis. To ensure the practical use of the proposed model, a simulation study was also conducted, and the results confirmed the strength of ILPC being elevated to a model of OLPC. Research limitations/implications - The findings imply a better understanding of psychological capital from a multilevel perspective and present cross-level opportunities to enrich the scholarly corpus. The current paper also provides an insight into psychological capital management efficiency at all organizational levels so that the greatest benefits can be obtained. Originality/value - This paper shows, for the first time, the possibility of borrowing ILPC concepts to help enact OLPC in organizations by means of a survey study. This paves the way for further investigation into the use of psychological capital at strategic and other macromanagement levels. Finally, future studies are encouraged to triangulate and strengthen the main arguments presented here.

Keywords: Competitive advantage; Intangible assets; Partial least squares; Psychological capital; Referent shift approach; Strategic management (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jamrpp:jamr-08-2020-0179

DOI: 10.1108/JAMR-08-2020-0179

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