The Perceptions of the Impact of Social Capital on Expatriate Work Well-Being in the Resources Sector in Indonesia

Abstract

This research explores how social capital is perceived as impacting on expatriate work well-being in the resources sector in Indonesia. Recent research found that work well-being is comprised of cognitive and affective components (e.g., Fisher, 2010). Prior literature has mainly defined job satisfaction as the key aspect of work well-being (e.g., Herzberg, Mausner, & Snyderman, 1959). Yet, from this quantitative extant literature, questions remain with regard to what constitutes and comprises work well-being as affected by factors internal and external to the organisation. Moreover, there is need for research that examines work well-being amongst employees and sectors that have not been previously examined in the work well-being literature. Thus, the current research involves a qualitative study to explore, identify, and provide an understanding of how social capital is perceived as impacting on expatriate work well-being in the resources sector in Indonesia. This is undertaken through examining the perceptions of expatriates, spouses, and HR managers. Though the resources sector is internationally economically significant and a large employer, it has been suggested that levels of work well-being are relatively low for employees working in the resources sector generally (ACRRMH, 2014). However, consideration has not previously been given to how social capital might impact on work well-being of resources sector expatriate employees who often work in a remote area, which is quite distinct from the workplaces of non-expatriate employees who have been studied in previous work well-being research. In the current research, perceptions of work well-being, and the perceptions of the impact of social capital on it, are also examined with respect to whether they differ across expatriate employees in the resources sector in Indonesia amongst differing organisational ownership (local or multinational corporation) employers as well as by organisational position, age, gender, marital status, nationality, years of expatriation, length of stay, prior international experience, and work location. The core theory which is used to examine the overarching research question (RQ): “How is social capital perceived as impacting on expatriate work well-being in the resources sector in Indonesia?” is Social Capital Theory (SCT). This thesis employs social capital theory as utilized by Nahapiet and Ghoshal (1998) because it focuses on the resources embedded in the network of relationships possessed by an individual or social unit that suits the current qualitative research which scope is to examine the individual and social units. Using Indonesia as a case study, this research employed a qualitative, interview-based approach. Fifty-eight semi-structured interviews were conducted with 43 expatriate employees working in the mining and oil and gas industries in Indonesia, as well as 8 spouses and 7 human resource (HR) managers, in order to gain an understanding of the perceptions of the impact of social capital on expatriate work well-being. The findings suggested that social capital, through its three dimensions (structural, relational, and cognitive dimensions), is perceived to significantly impact on expatriate work well-being. The data were analysed with NVivo 11. This research provides theoretical contributions to expatriate/expatriation literature, specifically in relation to expatriates’ use of their social capital, as well as to both work well-being and social capital literature, in several key areas. This research particularly provides insight into a specific context (i.e., the Indonesian resources sector); both Indonesia and the resources sector internationally have been under-researched in the business/management/HRM literature. First, the research is important in focusing on expatriates/expatriation issues in relation to expatriates’ use of their social capital by specifically examining expatriates in the resources sector in Indonesia; a sector and country that have received limited attention in the extant expatriate/expatriation literature. Second, the study extends the existing literature on work well-being by offering a more thorough examination of the components of work well-being through the study of expatriates in the

resources sector in Indonesia. Third, the current study extends the social capital literature in relation to expatriates by providing an understanding of the perceived impact of social capital on expatriate work well-being, particularly by examining three dimensions of social capital; namely, the structural, relational, and cognitive dimensions. This research also offers practical implications for both organisations and individuals.

At an organisational level, this research contributes to practice by suggesting the need for organisations that employ expatriates to have an understanding of bureaucracy in Indonesia, hiring issues in Indonesia, and how to work within the business culture of Indonesia. At an individual level, this study offers expatriates suggestions for how to build trust through embracing family values and ways to socially network and find beneficial networks in Indonesia, as well as to encourage their understanding of the cultural diversity in Indonesia.