Use of financial indicators to evaluate the impact of High Involvement Work Practices

Amable Juárez Tárraga

doi:10.4995/wpom.v2i2.847

Authors

Amable Juárez Tárraga Universitat Politècnica de València

DOI:

https://doi.org/10.4995/wpom.v2i2.847

Keywords:

High Performance Work Practices, High Involvement Work Practices, Financial indicators, business performance

Abstract

The High Involvement Work Practices (or High Performance Work Practices) are a set of human resource management practices that act synergistically to improve organizational efficiency, creating work conditions that increase the satisfaction of the employee, encourage them to link with the Organization and to better carry out its tasks (Huselid, 1995). On the basis of this approach, and applying a purely instrumental point of view, many researchers have raised the following question: There is relationship between the implementation of the High Involvement Work Practices and firm performance?. The meta-analysis done by Combs (2006) provides consistent evidence of this relationship, after evaluating the results of 92 researches in this regard. Framed in this approach, the aim of this paper is double:

To identify what indicators have been used in the last decade to evaluate the relationship between the High Involvement Work Practices and firm performance.
To identify, in the case of the use of financial indicators, which are the most commonly used.

Downloads

Download data is not yet available.

Author Biography

Amable Juárez Tárraga, Universitat Politècnica de València

DOE-Departamento de Organización de Empresas

References

Arthur, J. B. (1994). Effects of human resource systems on manufacturing performance and turnover. Academy of management Journal, Vol. 37, nº. 3, pp. 670-687.

Avella, L.; Fernandez, E.; Whitfield, K. (2001). Analysis of manufacturing strategy as an explanatory factor of competitiveness in the large Spanish industrial firm. International Journal of Production Economics, Vol. 72, nº. 2, pp. 139-157.

Bae, J.; Lawler, J. J. (2000). Organizational and HRM strategies in Korea: impact on firm performance in an emerging economy. Academy of management Journal, Vol. 43, nº. 3, pp. 502-517.

Batt, R. (1999). Work organization, technology, and performance in customer service and sales. Industrial & Labor Relations Review, Vol. 52, nº. 4, pp. 539-564.

Becker, B. E.; Huselid, M. A.; Pickus, P. S.; Spratt, M. F. (1997). HR as a source of shareholder value: Research and recommendations. Human resource management, Vol. 36, nº. 1, pp. 39-47.

Becker, B. E.; Sunny, B.; Huselid, M. A.; Rutgers, U.; Ferris, G. R. (1998). High Performance Work Systems and Firm Performance: A Synthesis of Research and Managerial Implications. Research in personnel and human resources management, Vol. 16, pp. 53-101.

Boselie, P.; Dietz, G.; Boon, C. (2005). Commonalities and contradictions in HRM and performance research. Human Resource Management Journal, Vol. 15, nº. 3, pp. 67-94.

Brown, M. P.; Sturman, M. C.; Simmering, M. J. (2003). Compensation policy and organizational performance: the efficiency, operational, and financial implications of pay levels and pay structure. Academy of management Journal, Vol. 46, nº. 6, pp. 752-762.

Bryson, A.; Forth, J.; Kirby, S. (2005). High-involvement management practices, trade union representation and workplace performance in Britain. Scottish journal of political economy, Vol. 52, nº. 3, pp. 451-491.

Chandler, G. N.; McEvoy, G. M. (2000). Human Resource Management, TQM, and Firm Performance in Small and Medium-Size Enterprises. Entrepreneurship: Theory & Practice, Vol. 25, nº. 1, p. 43.

Collins, C. J.; Clark, K. D. (2003). Strategic human resource practices, top management team social networks, and firm performance: the role of human resource practices in creating organizational competitive advantage. Academy of management Journal, Vol. 46, nº. 6, pp. 740-751.

Collins, C. J.; Smith, K. G. (2006). Knowlwdge exchange and combination: the role of human recource practices in the performance of high-technology firms. Academy of management Journal, Vol. 49, nº. 3, pp. 544-560.

Combs, J.; Liu, Y. M.; Hall, A.; Ketchen, D. (2006). How much do high-performance work practices matter? A meta-analysis of their effects on organizational performance. Personnel psychology, Vol. 59, nº. 3, pp. 501-528.

Delantey, J. T.; Huselid, M. A. (1996). The impact of human resource management practices on perceptions of organizational performance. Academy of management Journal, Vol. 39, nº. 4, pp. 949-969.

Devaro, J. E. D. (2006). Teams, Autonomy, and the Financial Performance of Firms. Industrial relations, Vol. 45, nº. 2.

Eleni, S. (2005). The challenges of human resource management towards organizational effectiveness. Journal of European Industrial Training, Vol. 29, nº. 2, pp. 112-134.

Ericksen, J. E. F. (2007). High performance work systems, dynamic workforce alignment, and firm performance, Academy of Management, pp. 1-6.

Fey, C. F.; Bjorkman, I. (2001). The Effect of Human Resource Management Practices on MNC Subsidiary Performance in Russia. Journal of International Business Studies, Vol. 32, nº. 1, pp. 59-75.

Gelade, G. A.; Ivery, M. (2003). The impact of human resource management and work climate on organizational performance. Personnel psychology, Vol. 56, nº. 2, pp. 383-404.

Guerrero, S.; Barraud-Didier, V. (2004). High-involvement practices and performance of French firms. International journal of human resource management, Vol. 15, nº. 8, pp. 1408-1423.

Guest, D. E.; Michie, J.; Conway, N.; Sheehan, M. (2003). Human Resource Management and Corporate Performance in the UK. British Journal of Industrial Relations, Vol. 41, nº. 2, pp. 291-314.

Guthrie, J. P. (2001). High-involvement work practices, turnover, and productivity: Evidence from New Zealand. Academy of management Journal, Vol. 44, nº. 1, pp. 180-190.

Harel, G. H.; Tzafrir, S. S. (1999). The effect of human resource management practices on the perceptions of organizational and market.. Human resource management, Vol. 38, nº. 3, p. 185.

Hitt, M. A.; Biermant, L.; Shimizu, K.; Kochhar, R. (2001). Direct and moderating effects of human capital on strategy and performance in professional service firms: a resource-based perspective. Academy of management Journal, Vol. 44, nº. 1, pp. 13-28.

Huselid, M. A. (1995). The impact of human-resource management-practices on turnover, productivity, and corporate financial performance. Academy of management Journal, Vol. 38, nº. 3, pp. 635-672.

Huselid, M. A.; Becker, B. E. (1996). Methodological issues in cross-sectional and panel estimates of the human resource-firm performance link. Industrial relations, Vol. 35, nº. 3, pp. 400-422.

Huselid, M. A.; Jackson, S. E.; Schuler, R. S. (1997). Technical and strategic human resource management effectiveness as determinants of firm performance. Academy of management Journal, Vol. 40, nº. 1, pp. 171-188.

Ketkar, S.; Sett, P. K. (2009). HR flexibility and firm performance: analysis of a multi-level causal model. International journal of human resource management, Vol. 20, nº. 5, pp. 1009-1038.

Khatri, N. (2000). Managing human resource for competitive advantage: a study of companies in Singapore. International journal of human resource management, Vol. 11, nº. 2, pp. 336-365.

Lau, C. M.; Sholihin, M. (2005). Financial and nonfinancial performance measures: How do they affect job satisfaction? British Accounting Review, Vol. 37, nº. 4, pp. 389-413.

Li, J. (2003). Strategic human resource management and MNEs' performance in China. International journal of human resource management, Vol. 14, nº. 2, pp. 157-173.

McClean, E. J. (2009). High commitment HR practices, employee effort, and firm performance. Academy of Management Annual Meeting Proceedings pp. 1-6.

Michie, J.; Sheehan-Quinn, M. (2001). Labour market flexibility, human resource management and corporate performance. British journal of management, Vol. 12, nº. 4, pp. 287-306.

Miller, D.; Lee, J. (2001). The people make the process: commitment to employees, decision making, and performance. Journal of management, Vol. 27, nº. 2, p. 163.

Moideenkutty, U.; Al-Lamki, A.; Murthy, Y. S. R. (2011). HRM practices and organizational performance in Oman. Personnel Review, Vol. 40, nº. 2, pp. 239-251.

Murphy, T. E.; Zandvakili, S. (2000). Data- and metrics-driven approach to human resource practices: Using customers, employees, and.. Human resource management, Vol. 39, nº. 1, p. 93.

Paul, A. K.; Anantharaman, R. N. (2003). Impact of people management practices on organizational performance: analysis of a causal model. International journal of human resource management, Vol. 14, nº. 7, pp. 1246-1266.

Perry-Smith, J. E.; Blum, T. C. (2000). Work-family human resource bundles and perceived organizational performance. Academy of management Journal, Vol. 43, nº. 6, pp. 1107-1117.

Richard, O. C.; Johnson, N. B. (2004). High performance work practices and human resource management effectiveness: substitutes or complements? Journal of Business Strategies, Vol. 21, nº. 2, pp. 133-148.

Riordan, C. M.; Vandenberg, R. J.; Richardson, H. A. (2005). Employee involvement climate and organizational effectiveness. Human resource management, Vol. 44, nº. 4, pp. 471-488.

Shaw, J. D.; Duffy, M. K.; Johnson, J. L.; Lockhart, D. E. (2005). Turnover, social capital losses, and performance. Academy of management Journal, Vol. 48, nº. 4, pp. 594-606.

Skaggs, B. C.; Youndt, M. (2004). Strategic positioning, human capital and performance in service organizations: a customer interaction approach. Strategic Management Journal, Vol. 25, nº. 1, pp. 85-99.

Takeuchi, R.; Lepak, D. P.; Heli, W.; Takeuchi, K. (2007). An Empirical Examination of the Mechanisms Mediating Between High-Performance Work Systems and the Performance of Japanese Organizations. journal of applied psychology, Vol. 92, nº. 4, pp. 1069-1083.

Wall, T. D.; Michie, J.; Patterson, M.; Wood, S. J.; Sheehan, M.; Clegg, C. W.; West, M. (2004). On the validity of subjective measures of company performance. Personnel psychology, Vol. 57, nº. 1, pp. 95-118.

Wright, P. M.; Gardner, T. M.; Moynihan, L. M.; Allen, M. R. (2005a). The relationship between HR practices and firm performance: Examining causal order. Personnel psychology, Vol. 58, nº. 2, pp. 409-446.

Wright, P. M.; Gardner, T. M.; Moynihan, L. M.; Allen, M. R. (2005b). The relationship between HR practices and firm performance: Examining causal order. Personnel psychology, Vol. 58, nº. 2, pp. 409-446.

Yao-Sheng, L. (2005). Business strategy and performance: the role of human resource management control. Personnel Review, Vol. 34, nº. 3, pp. 294-309.

Youndt, M. A.; Snell, S. A. (2004). Human Resource Configurations, Intellectual Capital, and Organizational Performance. Journal of Managerial Issues, Vol. 16, nº. 3, pp. 337-360.

Zhang, Y. C.; Li, S. L. (2009). High performance work practices and firm performance: evidence from the pharmaceutical industry in China. International journal of human resource management, Vol. 20, nº. 11, pp. 2331-2348.

Zheng, C.; Morrison, M.; O'Neill, G. (2006). An empirical study of high performance HRM practices in Chinese SMEs. International journal of human resource management, Vol. 17, nº. 10, pp. 1772-1803.