Exploring the relationships between HPWS, organizational ambidexterity and firm performance in Chinese professional service firms

Abstract

Purpose – The purpose of this paper is to better understand the indirect link between high-performance work systems (HPWSs) and firm performance in Chinese professional service firms (PSFs) by investigating the mediating role of organizational ambidexterity, i.e. a firm’s capability to simultaneously explore new ideas and exploit existing resources. Design/methodology/approach – Data were collected from 120 Chinese accounting firms. The authors used hierarchical and polynomial regression analyses to test their hypotheses. Findings – The proposed positive link between the HPWS and organizational ambidexterity was found. Further, the results showed a non-linear relationship between organizational ambidexterity and organizational performance. Research limitations/implications – The present study is limited in terms of small sample size, single industry and self-report data. Practical implications – Firms which reported a higher level of HPWS demonstrated better performance due to their organizational capability to explore new ideas and exploit existing resources. In the Chinese context, firms that had high levels of exploration (exploring new resources) and exploitation (exploiting existing resources) or that had a high level of exploration experienced higher performance. The authors can conclude from these findings that without exploration, organizational success is difficult to achieve for PSFs. Originality/value – This is the first study examining the underlying mechanism of organizational ambidexterity in the indirect relationship between HPWS and firm performance in Chinese PSFs. It advances the authors understanding of HPWS and firm performance relationship in an Eastern country and an emerging context of PSFs. This is also the first study to use polynomial regression to operationalize organizational ambidexterity.

Employee ambidexterity, high performance work systems and innovative work behaviour: How much balance do we need?

“…Prior research has shown that immediate work contexts shape the relationship between ambidexterity and various performance measures (e.g. Fu et al, 2015;Garaus et al, 2015). In a seminal paper Patel et al (2013) suggested that HPWS may assist organisations in establishing an organisational context that promotes ambidexterity among employees.…”

“…In a seminal paper Patel et al (2013) suggested that HPWS may assist organisations in establishing an organisational context that promotes ambidexterity among employees. A HPWS contains several HR practices that work in concert to develop an organisational context that benefits the abilities and the motivation of employees (Garaus et al, 2015;Patel et al, 2013), and creates opportunities for their further development (Boxall & Purcell, 2011;Fu et al, 2015).…”

“…Until now, studies, including Patel et al (2013) and Fu et al (2015), have investigated the direct relationship between HPWS and organisational ambidexterity. However, when examining the relationship between ambidexterity and innovative work behaviour, it is likely that HPWS acts as a moderator.…”

“…Finally, we investigate the moderating effect of HPWS on the ambidexterityinnovation relationship. As prior research has identified HPWS as an important determinant of ambidexterity (Fu et al, 2015;Patel et al, 2013), it may be interesting for future research to investigate whether ambidexterity mediates the relationship between HPWS and innovation. HPWS may enhance different configurations of ambidexterity, which in turn may positively affect innovative behaviour.…”

Servant Leadership Style and High-Performance Work System Practices: Pathway to a Sustainable Jordanian Airline Industry

“…Previous empirical studies on HPWS and its impact on organizational performance can be classified into three categories. The first category shows how the HPWS practices as a bundle have an impact on overall organizational performance [49,54,55]. The second category of studies reveals the influence of individual HPWS practices, such as recruitment and selection [56,57], training and development [58,59], compensation and rewards [60,61], and performance appraisal [62] on organizational performance.…”