HPWS-after mid notes by Noureen Mushtaq Page 1

1
st
lecture after mid: dated 22-4-2014
What, why and fro whom (Petter Boxall, 2012)
How to do work is dependent on the context in which the work has to be done.
Your context defines your HPWS, therefore each component of HPWS will be
defined differently, in different contexts.
As the needs of these components are defined by the context, everything else si also
determined by what context demands and the black box will work likewise, thus the
causality would be different also.
Therefore, in simple words we can conclude that for effective use of HPWS,
organizations should be aware of their context in which they are suppose to operate or
are operating presently.
It means that organizations have to know their context well before going for HPWS.
For which organizations have to collect extensive data for defining or identifying the
context
That is why an organization needs different sets of practices at each level as per the
requirements of the contexts or needs of the contexts.

Two lines of analysis HPWS:
This article argues that there are two lines of analysis in the high-performance
work systems literature that are important for HR researchers and strategists.
1. The first involves mapping the diversity that exists in work systems and
understanding which ones perform in which contexts and why. This line of analysis is
most relevant where there are serious misfits between a firms models of HRM and
its strategic context.
2. The second line of analysis can help to enhance performance in any firm. It involves
analysing the chain of links inside the black box of HRM, asking how managers
envisage HRM:
How they interpret and enact it
How it affects the psychological and social climates inside the
organization,
For whom it performs.
Following these lines of analysis, and improving our research methods, will make our
discipline more relevant to the larger debate around economic and employee well-being in
our societies.
1
st
line:
It includes following two aspects:
1. Mapping the diversity that exists in work systems and understanding which one
performance, in which context and for what reasons (why).
2. Where are serious misfits present between the business model of HRM and strategic
context of the organization
2
nd
line:
It includes analyzing the chain of links inside the black box of HRM, by asking:
How manager visualize HRM (means; intended HR practices, takes HR as soft
or hard variant)
How they interpret (because of the influence of various external factors) and
enact (means; actual HR practices) it.
How it effects the psychological climate (referring to employees perception
about HR practices) and social climate (referring to the relationships or
HPWS-after mid notes by Noureen Mushtaq Page 2

interactions between different jobs and employees) of the organization. This
consists two main simple questions:
1. How do you perceive it?
2. How do you interact?
This aspect defines that for which party these HR practices are actually
serving?? It is either the employee or the employer?
And that is why there should not be any gap or conflict between the perception of employees
or employers about HR practices because the positive perception ill result into positive
enhancement of HPWSs outcomes. It is obvious that because of the positive perception of
employees, organizations will get its work done by the core of heart by its employees. In this
way the path of accepting, understanding and following becomes more comfortable for
them.

That is why the contribution of human resource management in the organizational
performance has been discussed in literature on the basis of high performance work systems.
It can be illustrated this way that:
HRM HPWS OP

HRM is an essential function of organizations and the contributions of HRM have
been explained through HPWS. That is why HPWS is a common term nowadays.
1. Industrial relations researches actually gave momentum to this concern. In the
Anglophone world it is used by:
Government ministries
Think tanks
HR professional associations
Trade unions
Management consultancies etc
And the levels or fields in which the concept of HPWS have been used, shows that how
important HPWS is in all management or organizational fields.
2. But these are mere illustrations, whereas
What Author is doing in this article?
3. As the literature of HPWS is beneficial for practitioners and researchers, this article
will review what has been going on in this important, but puzzling body of literature
and make an argument about what we should take seriously in it.
4. Author has attempted to review that while work systems are critical to any
organizations performance
o there are many types of them
o To chart this variety
o Explain its causes
o Model its mechanisms
o Measure its outcomes.
5. This is an analytical approach to the study and practice of HRM (Boxall and
Purcell 2010; Boxall, Purcell and Wright 2007), in simple words it is attempted to
build a thorough and accurate understanding of:
o What managers try to do in managing work and people,
o What motivates their actions,
o What affects their success
o What are the implications for organizational stakeholders of their actions.
Two Parts of Article:
HPWS-after mid notes by Noureen Mushtaq Page 3

1. How the HPWS literature has emerged and then author tried to disentangle what it
means.
2. Identified two sets of useful questions it raises:
i. What work systems prevail in which contexts and why?
ii. How can the performance of any work system be improved and for
whom?
Note: that author has used the term work system and HR system interchangeably in this
article.
Objective of Article:
The first part of the article contains:
Analysis for practitioners and researchers
But still it is not a settle body
Work systems are critical to any kind of organizational performance, because:
There are many types of work systems
Primary task is to chart the variety
Explain its mechanism
Measure its outcomes
Outcomes of all nature (financial as well as attitudinal )
Etc
While the second part of the article consists of:
What kind of work systems and for which context and for what reasons (why)
Performance of work systems is more important and for whom it is important
And it will be presented in the following pattern:
Present literature
Questioning on that literature
Conclusion

HPWSs: Background and Meanings:
For understanding HPWS, we have to keep the social and historical context in front of
our sight. HR systems and work systems are almost alike because:
The way in which work is organized is alike
The way in which people are managed who would do it is alike
We cannot understand HPWS without the knowing the history of HPWS along with the
social context such as:
Scientific management
Human resource movement
Socio-technical work systems
Industrial democracy
Job enrichment
Job enlargement
And all other conceptual steps for reaching at HPWS
Stimulus for Reaching to HPWS:
The objective of HPWS cannot be completely achieved without understanding those
reasons that caused a diversion of management towards the emergence of HPWS. Therefore
there were various stimulating factors that resulted into diverting focus on HPWS.
To reform the future of US manufacturing industry.
Widespread terminology usage in Academic fields (in industrial or employment
relations, HRM, organizational behaviour and operations management).
HPWS-after mid notes by Noureen Mushtaq Page 4

Inferiority of US models as restricted use of workers abilities and discretionary
efforts, because of the rise of Japanese Lean production, including quality enhancing
techniques resulting into improved quality, flexibility, cost and delivery, such as:
Quality circles
Just in time inventory
Team based production
At that time US model of management was considered as inferior because::
Not able to have Discretionary efforts
restricted use of abilities

Over the last 30 years, there are other stimulations of change in work systems because
of the AMT etc (Advanced manufacturing technology), in the forms of:
robots
computer aided systems etc
And because of technological advancements, many other fields are facing
change also. That is why organizations are now more focused on off shoring and
competitive performance etc.
Most recently, because of Offshoring to China, India and other low-cost producers,
the discussion is getting more spotlight of Competitive Performance cause in the form
HPWS.
Nature of Problem and Solution:
Up till here it is viewed that how the nature of the problems in the form of stimulating
factors have focused on HPWS> when the nature of the problem is different, then its solution
cannot be similar or based on rule of thumb either, means that for different natured problems,
its solutions have to be different in their nature likewise. Because of the difficult nature of
these problems HPWS is supposed to address, this phenomenon of HPWS is a blurred one,
which covers three concepts, that needs to be understood in variety of ways:
1. Performance
2. Systemic effects
3. Work practices
Literature focuses on the performance of the organization in terms of Economic performance
or social legitimacy or corporate social responsibility as the criteria for performance
measurement. There are following important elements to be kept in mind regarding HPWS:
1. A very important basis or idea that is present throughout in the literature of HPWS is
that HPWS depends upon the Positive response fromemployees.
2. Importance of systemic effects; Bundling of work (Mac Duffie, 1995, 2000) has been
considered as crucial in HPWS literature defined as it is the combination of
practices into a bundle, rather than individual practices, which shapes the pattern
of interactions between and among managers and employees. His research
emphasized on making:
i. Changes to skill formation strategies
ii. Employee incentives (driving forces of motivation)
What is more important in HPWS literature is the extent to which all related concepts,
components or systems are aligned (strategic linkages) of business elements beyond
HRM.
Systemic Linkages or Interactions:
Because of technological advancements of the firms, there are higher requirements of
high human infra-structure now. In various studies the productive utilization of technology
has been achievement by the ability of technology to improve the human infrastructure of the
HPWS-after mid notes by Noureen Mushtaq Page 5

organization. While in other studies discussing the US firms adopting Japanese style of lean
manufacturing systems perform much better when they are supported by empowering styles
HRM. Therefore, for better performance of organizations even while incorporating change or
technological advancement, human infrastructure has to be modified and aligned to be able
to support the system for desired performance outcomes. And for this, organizations have to
go beyond the limited HRM sphere and understand the importance of integration and
complementarily to the management system of workplace or business unit. It will also enable
HPWS to get closer to the senior managers thinking regarding their business.



Major Weakness of HPWS literature in terms of IV and DV:
Although in this article, author had taken IV and DV like any other study but because of
existing confusion and diversity of concepts of HR practices, there are not censuses present,
making IV and DV both as weak. In five leading HPWS studies and al of the practices
mentioned in it are not similar to the other one. That is why this becomes the greatest
weakness of HPWS literature:
I t is hard to define the nature of the proposed solution and the term itself is not
inherently descriptive
Thus there are problems existing whenever it is attempted to solve this problem that:
There is Absence of consensus regarding HR components or practices
And then these HR practices have to accommodate the Socio-Cultural variations
when moved from one nation to another
And because authors claiming to mention their IV (HR practices) as to be the best
practices have ignored the contextual factors involved and that makes their studies
flawed.
Because when contextual aspects are overlooked whiel conducting study, then it
contains majore falws in the conceptualization.
Even Context-defined practices are not even able to answer the concerns of variation
but only presence and coverage of those practices among the workforce the way these
practices are implemented and experienced by workforce.
One cannot know the exact underpinning effects of these HR practices only by their
face value because it is difficult to answer that when an employee has been
empowered, does he perceives it as effective or intensification? It is difficult to
identify it on the face value of these practices only.
Therefore it is important to answer the question that how these practices are
implemented and experienced in particular situations.
Answering these concerns:
On the basis of the HPWS literature there are two main variations in HPWS
terminologies, being more meaningful and descriptive as they indicate dominant theme
underpinning the managerial actions:
1. High involvement Management (reflects efforts to redesign job for enhanced
worker responsibilities and authority; it includes reverse engineering,
involvement in skill development and incentive to participate)
2. High commitment HR practices (reflects efforts to enhance employee
commitment to organization not to the HR practices)
Two sets of important Questions:
There are two important theoretical questions which have to be focused:
1. What work systems prevail in which contexts and why?
Management Taking Care OF HR Employees Taking Care of organization
HPWS-after mid notes by Noureen Mushtaq Page 6

2. How can the performance of any work system be improved and for whom?
Q1:What work systems prevail in which contexts and why?
Instead of asserting best practices try indentifying different kinds of works
or HR systems in an organization
Develop their reasonably descriptive terms
Examine which one works highly in which context
Reason of their high performance
HPWS literature shows that there is greater diversity in the paths that manager
follows their quest for higher performance. As Kaufman and Miller (2011) demonstrate with
data on 381 US firms, there is major variation in the per capita expenditure of firms on HRM.
Their analysis shows, for example, that firms with more capital-intensive production
processes spend more per employee on HRM, something that is only logical if their
expensive equipment is to be handled skilfully and carefully. Similarly, Fabling and Grimes
(2010) show wide variation in HRM through a study of 3378 New Zealand firms, with the
adoption of particular HR practices being related to the size and age of firms and the level of
technology used.
As an initial categorization of variation in HR systems, Boxall and Purcell (2011)
construct a typology that go across:
familial HR models
informal models
industrial models
salaried models
high-involvement models
craft-professional models
and outsourcing models,
And relates these to organizational and industry contexts.
Similarly, but using more technical language, Toh, Morgeson and Campion (2008) identify
five major HR systems cost minimizers, contingent motivators, competitive motivators,
resource makers, and commitment maximizers and relate each of them to key contextual
variables in a study of 661 US organizations. Their unsurprising conclusion is that:
HR bundles are adopted that fit with the context in which the organizations are
embedded
Variation of HPWS exists at different levels in and among organizations, as each
layer of management will need to apply different HR systems for workforce groups of
different value
Studies likewise show that it is unwise to generalize HR practices from sectors like
capital intensive manufacturing or professional services etc.
Thus, these studies imply that what is Highly performing in HRM is going to depend heavily
on the economics of the particular business model
Thus, for HR strategists, the first useful question that arises in the HPWS literature is
about:
o Whether a firms work systems fit its particular context and strategy.
o Are they consistent with both its economic and social viability?
o And can they adapt to shifts in what is viable?
o Changes in such factors as competitive intensity, technology, labour markets
and social regulation will render the work systems of a proportion of firms a
bad fit with their environment.
HPWS-after mid notes by Noureen Mushtaq Page 7

o Poor fit brings a need for radical surgery in work systems. Being able to
identify the kind of HR systems a firm has, and assess their fit with its
unfolding context, is the first step in using the HPWS literature effectively in
practice. (to identify and detect that particular practice that is causing mismatching with teh
fit)
Q2: How can the performance of any work system be improved and for whom?
1. The first question is important for all those firms in which the fit of HR
systems is poor.
2. The second question is relevant to every firm (as every organization needs
improvements as perfection does not exist) because it focuses on how to
improve the mediating links that exist inside the black box of any HR
system, which are depicted in Figure 1. How so?
The HPWS debate has fostered an understanding of the way in which all HR systems depend
on influencing the abilities (A), motivations (M), and opportunities (O) of individuals to
perform. And these variables are inevitable set of mediators that defines the relationship of
performance. But this is not all. Management itself is a complex variable in this chain of
links, especially in large organizations. Senior managers set HR policies with varying degrees
of clarity and consensus, and act in terms of this policy framework with varying degrees of
consistency, as Bowen and Ostroff (2004) have argued. Then, what senior managers envisage
in HRM is interpreted and enacted in various ways as line managers fill in the blanks and
put their own mark on HRM in direct relationships with their team members (line managers
as executives see and analyze such decisions in the light of the availability of resources).





















According to HPWS literature it is more like a fact that HR systems affect :
o Psychological climates of individual employees
o Organizational context in which they are implant
Various studies show that how this individual level attributes varies under managerial
motives inside the HR practices and how these varying responses linked with
individual level outcome and unit level organizational outcomes at last.
HPWS-after mid notes by Noureen Mushtaq Page 8

It is very important to identify that which kind of performance climate organization
is trying to create in its contexts.
Describing HR systems in relation to managements desired climates has the virtue
of enabling us to recognize equifinality: the idea that companies will most likely
adopt an idiosyncratic (specific) set of HR practices in their particular context in an
effort to achieve a certain kind of climate (how would you go to build such kind of
psychological climate).
Because of the studies of Black Box examining employees perceptions and
responses, a question is raised that whose interests are served by any particular HR
system
We had been discussing win/win situation and it appealed to politicians but the nub
or core of this question is:
o For whom, is a highly performing work system highly performs?
As high performance has to be mutually serving and there could be various contribution in
this regard but one would be to assist the parties to build mutually satisfying, more
sustainable types of HR practices and systems on a good analysis of when, why, how and
for whom they will work. And this is the actual essence of HPWS that it must not be a tool
of manipulation but of Mutuality.
Improving our Research Methods:
There are various lessons present in HPWS literature regarding the methodologies. Such as:
Importance of collecting data from management regarding the intended practices
while collecting data from employees on perceived practices etc
Using Employee-reported data and management-reported data
Taking care of the directions of causality

In brief, these include:
identifying the target employee group in any study (rather than
assuming that all employees in an organization are subject to the
same HR system),
gathering multiple responses from well-informed managers on their
particular theory of HRM for this group,
obtaining data from employees on their perceptions of, and
responses, to management goals, practices and behaviours, locating
proximal outcome measures that are not provided by the source(s)
used for the independent variables and that are measured
subsequent to them,
and building longitudinal data sets, wherever possible (e.g. Gerhart
2007; Lepak et al. 2006 Nishii and Wright 2008; Paauwe 2009;
Van de Voorde, Paauwe and Van Veldhoven 2010; Wall and Wood
2005; Wright et al. 2005).
As a result of these sorts of critical reflections on methods, the standard for what
constitutes good data in any study of HR strategy and outcomes has risen, and this is a good
thing.
Conclusions
For all its faults, there are two lines of analysis in the HPWS literature that can add
valueto the theory and practice of HRM:
HPWS-after mid notes by Noureen Mushtaq Page 9

The first involves mapping the diversity that exists in work systems, and understanding
which ones perform in which contexts and why.
Rigorous research shows that what is highly performing in HRM is variable. It
depends on fit or compatibility with an unfolding business environment and strategy, and is
not set in the stone of any particular writers conception of best practices or high-
performance practices.
Our first task is to uncover and describe the patterns that characterize HRM in
particular contexts, and understand what shapes them. Where they are seriously out of kilter
with their environment or the firms aspirations, the role of the HR strategist is to reshape
them to achieve a better fit. This first line of analysis is most relevant to those firms where
there are serious misfits between HRM and its surrounding context but the second line of
analysis applies to every firm, however well it is managed in HRM. It involves analysing the
chain of links or mediators inside the black box of the firms models of HRM. We are now
more attuned to the need to study how managers envisage HRM, how they interpret and enact
it, and how it affects the complex psychological and social climates inside organizations,
particularly the larger ones. Given the centrality of employee responses, we have begun to
think seriously about who is best served by the diverse HR systems we see in action in
todays world. When and how can HR systems become more mutually beneficial? The
HPWS literature has also pushed along the methodological debate so that we are now much
more sensitive to data quality in HRM studies. Following these lines of analysis, and
improving our research methods, will make our discipline more relevant to the larger debate
around economic and employee well-being in our societies.
HPWS-after mid notes by Noureen Mushtaq Page 10

2
nd
lecture After mid: dated: 29
th
April 2014

Unlocking the black box: Exploring the link between HPWS and performance

Issue of Black Box:


Throughout the discussion in the class, with reference to the articles, empirical studies
and literature, we had been discussing that HPWS has a positive impact on the organizational
outcomes. But literature is still unable to prove that:
o What actually mediates?
o What actually changes?
o What actually translate?
That makes HPWS results into organizational enhanced performance or outcome.
This article explains:
That is why recent researches have been focusing on exploring the underlying
mechanism that enables this connection between High performance work practices
and organizational performance.
In this particular article, authors have found that there are various Individual level
attitudinal factors (job satisfaction, organizational commitment and psychological
empowerment, as well s OCB) having potential to provide the insights into how HR
systems influences the organizational performance.
The results prove the unit-level path model; departmental level HPWS is linked with
enhanced levels of JS, OC and PE.
Therefore, these individual level attributes are linked with OCB and then OCB is
linked to a second order construct and that is departmental performance.
Another Attempt to Break the Cover:


Literature has shown that there is positive relationship between High
investment, high involvement or high performance work systems and various
firm performance outcomes
HPWS has been operationalized the links of various factors (productivity,
voluntary turnover, profitability, growth, innovation, customer service,
survival and firm level performance metrics).
As per the definition of HPWS (Takeuchi, Lepak, Wang & Takeuchi,2007):
A group of separate but interconnected human resource (HR) practices
designed to enhance employees skills and efforts
Yet there are consensuses in literature that there is a lack of clear
understanding of the key mediating factors.
HPWS-after mid notes by Noureen Mushtaq Page 11

In short researchers have fairly strong evidence that HPWS work but are
less clear as to exactly how this relationship unfolds
Some studies stated that HPWS (as an entire HR system) influences
employees skills, motivation and opportunities.
Concluding that the entire HR system of an organization influences one of
these three drivers of employee performance.
Studies have also shown more emphasise to examine the role of employee
interpretation of HR system.
Author of this study states that the human resource system of an organization actually
influences the attitudinal factors of an employee, such job satisfaction, affective commitment
& Psychological empowerment of the employee and these are the attitudinal changes not just
behavioural changes, which motivates or stimulates individuals or employees to exhibit
positive behaviours for the enhanced performance of the organization by putting extra efforts,
known as discretionary behaviour such organizational citizenship behaviour (OCB). And in
this way Human resource system of an organization ultimately influences the departmental
level performance of the organization (as studied in by the author).

We can very easily see that how much complexity exists in between these linkages, which
have been tried to uncover by literature of HPWS and organizational performance, because
exploring the function or process in-between HPWS and Organizational performance is not
that simple. There are possibilities of number of factors involved in it.

Contributions:
This paper has addressed a blind spot in the literature and showed the important role
of the combination of important attitudinal variables is effects by HPWS and
impacting on organizational performance.
Provided empirical tests of key attitudinal and behavioural constructs.
Complete model has been used in this study that may urge continued refinement of
the theoretical models
A multi source model offers additional insights to this research base as compare to
single-respondent data.
This paper has used aggregate employee data (individual attitudes and behaviours)
with unit level outcomes because characteristics that are common tothat is
shared bythe members of a unit
And this enabled researchers to test the strength of perception across different
departments, and also helped to assess the link between perceived HR system and
aggregate level of OCB.
This paper has allowed connecting shared perceptions to an objective and relevant
measure of departmental performance.
The remainder (over view) of the paper proceeds as follows:
Discussed the primary theoretical mechanisms linking HPWS with employee
attitudes, OCB and Departmental performance.
Hypotheses development
Testing of hypotheses by multi source data
Ann analysis are made at departmental levels
Discussed that how these results fit within existing strategy, HRM paradigm
Future directions for analysis are purposed

HPWS-after mid notes by Noureen Mushtaq Page 12

This paper has focused on the individual level attitudes and behaviours such as job
satisfaction, organizational commitment, psychological empowerment and
organizational citizenship behaviour while the sample size was taken from public
sector. Therefore, the results gained by this study, supports a unit level path model
that is departmental level performance of the organization was linked HPWS through
the attitudinal factors of individuals such as JS, OC, PE and OCB.
Studies of over 25 years indicate that there are finds reported in literature that high
investment in HPWS has shown variance for performance ratios, which are not only
organizational level but also of individual level outcomes such as enhanced employee
skills etc.
The value addition by this article is its methodology, data testing, sampling,
arguments, empirical evidences from literature etc

Other Problems, when Attempted to Unlock the Black Box:
There are a number of problems or issues that are presenting when we try to discuss the
mechanism between HPWS and organizational performance linkage such as:
Measures of HPWS (consisting of HR practices would be same generally across the
world)
Another important issue regarding measure the effects of HPWS on organizational
performance is how to operatioanlize HPWS for which factors:
For Productivity?
For turnover?
Lack of clear understanding of mediating factors in this linkage
It has been proved even empirically that HPWS works positively in welfare of th
organization. But how? Is still not answered confidently.
Thus, A major issue in this area of research is that the mechanism or mechanistic is
not being understood regarding this linkage.

Mechanism Studied in this paper:
Therefore, this study has attempted to address these issues by making the linkage of
HPWS with organizational performance through employees. According to this study, HPWS
operates by influencing the employees of an organization, along with their skills,
motivational level; opportunities etc are also enhanced as a result of HPWS. Therefore, an
obvious relationship between HPWS and performance can be proved by using employees as
that mediating factor.

Another important point also arises regarding employees interpretation of HR systems
Outcomes = Perceived HR practices Employees Reactions, when we discuss this
linkage through the help of employees, as the mechanism translating this relationship.

Nishi, Lepak and Schnieder:




Purpose:
HPWS-after mid notes by Noureen Mushtaq Page 13

Potential individual attitudinal and behavioural mediators in the linkage
between HPWS and organizational performance.
Exploring one key mediating path out of so many
Contributions:
Contributions of this study were:
It has addressed the blind spot
It has discussed important attitudinal factors or variables in this relationship
He has also provided empirical overview of the existing knowledge
Research TipThe basic essence of research is that they know what they are up to/their
objectives are clear to them. Therefore the objectivity of the research is very important and it
has to be very clear to the researcher, himself. On the basis of the gap and future directions
provided by the existing literature, you can refer that why have you choose this model. And
theory along with the existing empirical support has to be used for develop hypotheses
development. Time frame for data collection has to be specified in study while theory and
data type directs towards the methodology of testing to be adopted. Whenever performance
will be measured, it should never be done by singular data source.
Through factor analysis we try to identify the variables or factors on the basis of the
responses. It ensures that the variable have been identified by the respondents as made by
researcher or not. By rotating through various ways, it tries to refine or explain the scattered
data (it can attempts rotations 200 times). If you dont do it, then some responses or data
would be cutting or omitting others and your results would not be significant.

Theoretical background and hypotheses:
Macro HRM relies on RBV for defining how performance is achieved
RBV states that competitive advantage can be achieved from combining
idiosyncratic/distinctive resources
Because firm level resources are heterogeneous and these difference can lead to
sustainable competitive advantage
HR is the potential for achieving sustainable competitive advantage
But RBV by general abstraction of the concept has not demonstrated the clear
evidence documenting it
Conceptually, Organizational performance results from human efforts resulted from
HR system
Thus, HR systems are effective to the extend that they help to positively affect
employees and inspire them to contribute to important organizational outcomes
Therefore it is concluded that performance would be defines to the extent employees
display their discretionary behaviours
Instead of using HPWS as a system level construct, unit level (departmental
performance) have been used in this study on the basis of the statement by Bowen and
Ostroff (2004):
The characteristics of strong HRM systems are more likely t promote shared
perceptions and give rise to the emergence of a strong organizational
climate about HRM content
As these shared perceptions are more likely to be similar on departmental level and
will influence the discretionary behaviour of employees
HPWS-after mid notes by Noureen Mushtaq Page 14

HRM has a strong literature regarding the importance of employee behaviours in the
performance of the organization
Differences of HR systems and practices are depended upon the differences in
employee behaviours
Importance of Extra role positive behaviours of employees in performance




HPWS-after mid notes by Noureen Mushtaq Page 15

3
rd
lecture after mid: dated: 6
th
May 2014
HPWSs impact on Organization through Employees:
As it has been discussed before that there is no rule of thumb for defining the
mediation that exists in the form black box. Whatever HR practices or systems you may
apply; it has to be influencing the employees psychology etc, so that they exhibit
discretionary behaviours/efforts that would be the reason of organizational betterment.
Therefore:

HRS has to be positively perceived by employees.
This is the key of the success of this relationship. This is what has been attempted to discuss
in this article by the author on the departmental level because:

Sum of all employees performanceDepartmental Performance Sum of All
Departments Organizational Performance
As it is needed that the black box has to be properly explained that is why behavioural
perspectives have also been used.

Behavioural Perspectives:
There are basically two types of roles:
i. In role behaviours
ii. Extra Role Behaviours

It is obvious that for achieving high performance, organizations have to align all of the
practices with the expected discretionary behaviours from the employees.

There are different supportive theories that are also present in literature such as:

Social Exchange Theory:
Organization invest through walking Extra mile for employees and then employees
try to pay back by benefiting organization through their discretionary efforts

HPWShelps employees by enhancing their skills, experiencing and training etc (SET).
Morrison (1996) has also used OCB as a mediator
HPWS has to be utilized for performance enhancement because only the adoption of
HPWS will not affect the performance f the organization
After the utilization of HPWS, organization will be able to attract employees,
motivating them so that they will exert discretionary efforts for the organizational
purposes.
In this regard, employees perception about the implemented HR practices or system
matters a lot, because the result of HPWS highly depends upon it.
HPWS will influence the employees to enhance their OCB.
Empirical results show that OCB partially mediates the relationship between HPWS
and organizational performance
Theoretical Importance of article being studied:
Impact on employees performance, generally
Impact on discretionary behaviour specifically
That is why the success of a manager lies in aligning the direction of employees and line
managers.
Reasons of the relationship between HPWS and Satisfaction:
HPWS-after mid notes by Noureen Mushtaq Page 16

Through the following components, we are actually talking about Person-Job fit through
using HPWS and empirical endorsement existing in literature (which were discussed in
lecture also):
Rigorous selection procedure and training in company and industry specific skills
Selective staffing and training initiatives
Greater information sharing
High level of job security
Tighter linkages between ones performance and ones compensation





































Researching Employee reactions to HPWS in service sector: Role of Organizational
Justice Theory

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We had been seeing in literature that one thing is confirmed that whatever human
resource practices are used, it would be implemented and effected by employees
When through event theory, various events (terrorism etc) are linked with the stock
exchange rates, without any intervening factors such as investors perceptions etc) at
this level comes the concept of Behavioural Finance.
This question regarding the intervening factors, has not been addressed or considered
by Finance theory
But everything has been effecting or resulting into outcomes, through employees.
In this article, the black box has been attempted to be unlocked by perception of
justice and al four kinds of justice have been studied in this article
Distributive justice would impact the standards, procedural justice will impact on the
process of decision making and interpersonal justice will influence the quality of
interpersonal treatment.
In this article, author has used constructs to explain the relationship
It has also explained causality
As HPWS is a firm level constructed, it is implemented or selected at this level while
the responses are depending on individual level of the organization. If employees
perceive the system on the basis of equality then, he will enhance performance
accordingly.
Organizations bottom line objective is always Profits etc.
A greater or intense level integration would pressurize the employees to meet the high
expectation (and these expectations are holding an employee just like an octopus)
In the basis of Negative perceptions, all of the HR practices would impact negatively.
For instance, Employee Voice (refers to participating, representing work floor
decision etc) is the factor that would ultimately result in satisfaction

Methodology:
Studies have covered on two levels of the organization:
1. Organizational level
2. Individual level












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