High‐performance work systems and firm capabilities in Korea: a fit perspective with organizational culture

Abstract

Taking a behavioral perspective on high-performance work systems (HPWS), we examine the role that organizational trust plays as a key psychological mechanism linking HPWS and firm capabilities (customer response capability and internal process capability). We further draw on configuration theory and explore how the fit between organizational culture and HPWS can be mutually reinforcing, leading to superior firm capabilities. Based on multisource data collected from 2094 employees in 500 companies in South Korea, the results show that HPWS are positively related to firm capabilities and that the link is fully mediated by organizational trust. HPWS show significant interaction effects with adhocracy, market, and clan cultures on firm capabilities but show no interaction effects with hierarchy culture. These findings highlight the importance of organizational trust and organizational culture aligned with human resource practices in the successful implementation of HPWS.Keywords: customer response capability, high-performance work systems, internal process capability, organizational culture, organizational trust Key points 1 High-performance work systems (HPWS) were positively related to firm capabilities (customer response capability and internal process capability) by strengthening employees' trust in the organization. 2 It is important to cultivate adhocracy, market, or clan cultures prior to implementing HPWS to achieve organizational goals. 3 Management's decisions and actions that consistently support the focus of HPWS on human capital development are likely to nurture organizational trust and thereby encourage successful implementation of HPWS.

High-Performance Work System and Employee Performance: Case Study at Koja Container Terminal

“…HPWS contributes to the company's capabilities by growing employee trust in the organization. (Rhee et al, 2018) but will also HPWS will affect employee performance with a social exchange approach and views that will give employees meaning to their performance that not only requires reciprocity, knowledge, and skills but requires employees' resources especially when facing stress and ongoing challenges. (J.…”

High‐performance work systems as a remedy for growing pains: evidence from South Korean organizations

“…) particularly in the South Korean context (e.g. Rhee, Oh and Yu ). Since the 1997–1998 financial crisis, HPWS have been dispersed through South Korean organizations (Frenkel and Lee ) in an effort to adopt so‐called best practices originating from leading US firms for overcoming problems with existing approaches in managing employees, thereby establishing performance‐oriented management (Lee and Kim ).…”

Strategic human resource management and employees' intention to leave: testing the moderated mediation

“…HPWS is defined as a set of HR practices that provide employees the necessary skills, knowledge and motivation to aid an organization in achieving sustainable competitive advantage (Datta et al, 2005). Although there has been disagreement over which HR practices constitute a HPWS, empirical evidence suggests that organizational characteristics, especially business strategy determines the adoption of HPWS in an organization (Arthur, 1992;Lee et al, 2019;Rhee et al, 2018). A prominent perspective that potentially explains this relationship is "resource based view" (Barney, 1991) which suggests that the set of employee attitudes and behaviours underlying an organization's HR systems can be instrumental in the implementation of the business strategies.…”

“…In the opinion of Schuler and Jackson (2014), linking HPWS to the competitive strategy adopted by the organization is central to its effectiveness. This clearly implies that HPWS shapes the outcomes of the overall business strategy, which are experienced by both the employees and organizations (Rhee et al, 2018). Wang and Verma (2012) have proposed that business strategies may well determine the employees' turnover intentions through a possible means of investment in HPWS.…”