Going Beyond the SHRM Paradigm: Examining Four Approaches to Governing Employees

Abstract

Drawing from strategic human resource management and organizational theory, this article develops an integrated typology of employee governance. This typology is based on the dimensions of eliciting employees’ commitment to the organization (commitment-eliciting) and achieving employees’ compliance to rules (compliance-achieving), which yields four approaches to governing employees: disciplined governance, bonded governance, hybrid governance, and unstructured governance. Results from 337 firms show that the hybrid governance approach is linked with significantly higher organizational performance than alternative approaches in the Chinese context. In addition, both commitment-based practices and compliance-based practices are positively related to organizational performance, and their interaction produces additional positive effects.

Keywords

strategic human resource management employee governance commitment compliance organizational performance

Over the past 20 years, studies about generating higher organizational performance through better employee management have sparked great interest for researchers and executives. In the strategic human resource management (SHRM) field, scholars generally classify human resource management (HRM) approaches into two competing categories: commitment and control (Arthur, 1994; Walton, 1985; Whitener, 2001; Wood & Albanese, 1995). According to the existing literature, the commitment approach aims to improve organizational performance by influencing employees’ knowledge, skills, and abilities (KSAs); motivation; and opportunities to contribute (Appelbaum, Bailey, Berg, & Kalleberg, 2000; Arthur, 1994; Bailey, 1993; Lepak, Liao, Chung, & Harden, 2006; MacDuffie, 1995; Wood & de Menezes, 1998), while the control approach aims to increase employees’ efficiency and/or productivity through their compliance and conformity to company rules, regulations, and standard operating procedures (Arthur, 1994; Lepak et al., 2006; Wood & Albanese, 1995; Wood & de Menezes, 1998). Many researchers have called for organizations to move from control-based HRM approaches toward those that elicit commitment (Walton, 1985; Wood & Albanese, 1995).

Consequently, the commitment approach to HRM has attracted extensive attention. Although the terminology is not always consistent (e.g., high-performance work practices and high-commitment work practices are sometimes used interchangeably to refer to the same commitment-based approach), many empirical studies have revealed a positive relationship between commitment-based HRM and organizational performance (e.g., Arthur, 1994; Batt, 2002; Collins & Smith, 2006; Datta, Guthrie, & Wright, 2005; Guthrie, 2001; Huselid, 1995). The relationship between HRM and organizational performance has often been explained based on relational or social exchange perspectives (e.g., Chuang & Liao, 2010; Messersmith, Patel, & Lepak, 2011; Sun, Aryee, & Law, 2007; Takeuchi, Lepak, Wang, & Takeuchi, 2007). These theories emphasize the commitment-eliciting nature of HRM and implicitly view achieving employees’ compliance and conformity to work rules, regulations, and procedures as the opposite of a commitment-oriented HRM strategy. This logic suggests that a compliance-oriented HRM strategy may have a negative relationship with organizational performance. Current research has largely overlooked the possibility that achieving employees’ compliance to work rules could be beneficial to organizational performance. This oversight also allows for the possibility that commitment and compliance HRM strategies might complement rather than oppose each other.

In fact, organizational theory (OT) scholars have widely acknowledged the importance of rules, regulations, and procedures in building organizational capabilities and competitive advantages. They view rules, procedures, and regulations as “routines” and state that routines are important in reducing role ambiguity, providing stability of employee behavior, storing knowledge, facilitating more effective organizational decision-making processes, and providing mechanisms for control and bases for replication (see, e.g., M. C. Becker, 2004; Parmigiani & Howard-Grenville, 2011). For example, Eisenhardt and Martin (2000) identified new product development routines, quality control routines, technology transfer routines, and other routines as important elements of dynamic capabilities. Therefore, the OT literature actually suggests that achieving employees’ compliance to rules, procedures, and regulations is essential for organizations to achieve high performance.

In sum, the traditional SHRM research paradigm may overemphasize people as the firm’s most important asset and by so doing ignore other important tangible and intangible assets of the organization. This emphasis is inconsistent with the existing OT literature that stresses the importance of rules and processes for organizational success. In response, the purpose of this study is to integrate the SHRM and OT literatures and to develop and test a new typology of employee governance. The typology developed in this study is based on two dimensions: eliciting employees’ commitment to the organization (commitment-eliciting) and achieving employees’ compliance to rules (compliance-achieving), which yield four approaches to governing employees: disciplined governance, bonded governance, hybrid governance, and unstructured governance. We then compare the effects of these four approaches and examine the potential interactive effects between the commitment-eliciting dimension and the compliance-achieving dimension on organizational performance. The theoretical framework and empirical findings in this study will help researchers and practitioners better understand how to govern employees for greater organizational performance beyond the traditional high-performance work system (HPWS) models.

Theoretical Background

Research exploring the relationship between HRM and organizational performance has become ubiquitous over the past two decades. Numerous research studies (e.g., Delery & Doty, 1996; Guthrie, 2001; Huselid, 1995; MacDuffie, 1995) have found a positive relationship between HPWPs and organizational performance. In addition, both narrative (Boselie, Dietz, & Boon, 2005) and meta-analytic reviews (Combs, Liu, Hall, & Ketchen, 2006; Jiang, Lepak, Hu, & Baer, 2012) have concluded that HPWPs are consistently related to organizational performance. However, despite two decades of intensive research, some basic but core questions remain unanswered and/or unexplored.

One such core, unresolved issue involves identifying the optimal HRM approach that drives high firm performance (Guest, 2011; Paauwe, Wright, & Guest, 2013). Most previous empirical studies have concentrated on testing the relationship between commitment-oriented HRM approaches and firm performance and have rarely explored multiple forms of HRM simultaneously (Guest, 2011). This presents a basic problem—without examining and comparing the effects of different HRM strategies, one cannot conclude that commitment-based HRM has a stronger influence on organization performance than alternatives. It is possible that other approaches may explain the same or even more variance in organizational performance with the same samples.

Another questionable assumption emerging from the SHRM literature holds that HRM approaches can either be commitment- or control-oriented, limiting previous empirical studies by treating such approaches as mutually exclusive rather than potentially complementary. Drawing on works from both OT and SHRM, we suggest that commitment and control approaches actually focus on different, but not necessarily opposing, factors. The control approach attempts to increase efficiency by enforcing employee compliance with specified rules and procedures (Arthur, 1994; Lepak et al., 2006; Wood & de Menezes, 1998). The commitment approach aims to improve organizational performance by influencing employees’ KSAs, motivation, and opportunities to contribute (Arthur, 1994; Bailey, 1993; MacDuffie, 1995; Wood & de Menezes, 1998). Thus, the commitment approach emphasizes how people contribute to organizational success independent of the rules and procedures favored by the control approach. The opposite of high control is low control, rather than high commitment; and the opposite of high commitment is low commitment, rather than high control. Both rules and procedures and people are essential factors for organizations to achieve high performance, but OT scholars highlight the former whereas SHRM scholars have tended to highlight the latter.

Recently, a few studies have hinted at the need for broadening the range of HRM approaches in a global world beyond the commitment-based strategies popularized in the United States. For example, a recent study from China has shown that a hybrid system of both commitment and control practices can exert more positive effects on firm performance than the typical high-commitment or high-involvement HRM system (Su & Wright, 2012). An Australian study has revealed that behavioral compliance is positively associated with firm performance, stating that “[w]hile customer service is an important value, it is willing engagement with a[n] … efficiency-oriented work process that makes it happen, not a more empowering form of work design” (Boxall, Ang, & Bartram, 2011: 1504). Finally, a study of 1,099 German firms revealed four clusters of HRM systems: high commitment, high control, long-term oriented control, and regulated commitment (i.e., combination of commitment and control) systems (Hauff, Alewell, & Hansen, 2014). The researchers found that high-commitment firms outperformed high-control firms but that the high-commitment and regulated commitment systems did not display significantly different outcomes suggesting that, at worst, the combination of commitment and control does not detract from the effects of a commitment-only approach.

Finally, most existing SHRM studies have primarily taken an additive index approach to measuring HR practices, treating HPWS as a unidimensional construct in a correlation or regression framework. For example, Patel, Messersmith, and Lepak (2013), while arguing that the utilization of certain HR practices may be linked to a context marked by discipline, stretch, trust, and support, combine disparate practices into a single HPWS measure. Even when factor analyses reveal multiple HPWS factors the effects of HRM are often only tested using additive models, ignoring interactions between the different HPWS dimensions. For example, Su and Wright (2012) broke apart HPWS into control and commitment practices and found that including control-based systems separate from commitment-based systems explained additional variability in organizational performance, but they did not examine interaction effects.

In sum, these limitations in the mainstream of SHRM research may render us unable to broaden the range of HRM forms, limit our understanding of the HRM-organizational performance relationship, and lead to biased predictions about an organization’s best choice of HRM practices. Thus, in this study, we do not adopt a typical SHRM paradigm focused on a unidimensional commitment-based HPWS. Instead, we develop and test a two-dimensional typology of employee governance, which helps us better understand how to govern employees for greater organizational performance.

Typologies are a unique form of theory building, which have been very popular and form a central pillar of both the strategic management and organizational literatures (Fiss, 2011). Typologies have also played an important role in SHRM and employee relations theory development. For example, Tsui, Pearce, Porter, and Tripoli (1997) developed a typology depicting four types of employment relationships defined by two dimensions: the employers’ expectation of specific contributions and the employers’ inducements to elicit such contributions. Lepak and Snell (1999, 2002) also developed a typology depicting four employment modes based on the strategic value and uniqueness of human capital.

The typology developed in this study focuses on two dimensions: eliciting employees’ commitment to the organization (commitment-eliciting) and achieving employees’ compliance to rules (compliance-achieving). The commitment-eliciting dimension refers to the degree to which employers invest in their employees in an attempt to foster employees’ commitment to the organization and thus improve the organization’s efficiency and effectiveness. This dimension resembles the “inducements” used in the typology developed by Tsui et al. (1997), which includes training and employment security, and considers training, career opportunities, wages, and benefits.

The compliance-achieving dimension in our typology refers to the degree to which an employer seeks to maintain individual and organizational efficiency by achieving employees’ compliance to standard rules, regulations, and procedures. OT scholars have widely highlighted the importance of rules, regulations, and procedures in building organizational capabilities (M. C. Becker, 2004; Parmigiani & Howard-Grenville, 2011). In addition, they view organizational learning as routine-based activities by encoding historical inferences into rules and procedures that guide the behavior of employees and organizations (B. Levitt & March, 1988). Therefore, because rules, regulations, and procedures are important factors for organizational success, one should also view them as an important objective of a firm’s employee governance strategy.

As Figure 1 shows, employers’ different choices regarding commitment and compliance form four approaches to governing employees: high-commitment low-compliance (bonded governance), low-commitment high-compliance (disciplined governance), high-commitment high-compliance (hybrid governance), and low-commitment low-compliance (unstructured governance). We describe the four different approaches and their possible effects on organizational performance below.

Bonded Governance Approach and Its Outcomes

We first discuss the high-commitment low-compliance approach, what we term as bonded governance. With this approach, employers provide employees with extensive training programs, career opportunities, wages, and other benefits at higher than market levels. Employers then expect those employees’ commitment and discretionary work efforts to increase, enhancing individual and organizational performance. Obviously, this approach highlights eliciting employees’ commitment rather than achieving employees’ compliance in its contribution to organizational success. Analogous to this approach is the high-involvement approach advocated by Lawler (1988, 1992); the commitment strategy of Walton (1985) and Wood and Albanese (1995); the commitment approach of Arthur (1992, 1994); the high-commitment work system described by Wood (1996); the innovative employment practices by MacDuffie (1995); the human-capital enhancement strategy by Youndt, Snell, Dean, and Lepak (1996); and the high-commitment approach by Hauff et al. (2014).

Based on social exchange theory and behavioral perspectives, scholars have noted that high-commitment work practices, such as internal promotion or extensive training, deliver a sense of trust and value from an organization to its employees, which in turn boost employees’ emotional attachment to the organization and their discretionary work efforts (Appelbaum et al., 2000; Lawler, 1992; MacDuffe, 1995). This commitment approach conveys an organizational goal to employees and stimulates employees’ self-management and extrarole behaviors (Walton, 1985; Wood & Albanese, 1995). Many studies have reported that these kinds of employee management or HRM approaches have positive relationships with organizational performance (Arthur, 1994; Batt, 1999, 2002; Collins & Smith, 2006; Huselid, 1995). Studies have also shown that employees’ KSAs, organizational citizenship behaviors, employee discretionary efforts, and degree of social exchange in the workplace could mediate the link between such management approaches and organizational performance (Appelbaum et al., 2000; Bailey, 1993; Messersmith et al., 2011; Sun et al., 2007; Takeuchi et al., 2007).

Although bonded governance seeks to elicit employees’ strong commitment to the organization, we argue that commitment alone may not inspire the highest level of organizational performance since it pays too little attention to employees’ compliance to standard rules, regulations, and procedures. This approach ignores the positive impact of rules, regulations, and procedures. We cannot assume that all organizations make full use of rules, regulations, and procedures in guiding employees’ efficient behaviors, organizational learning, and effective organizational decision making. In some countries, such as China, scholars have noted that with the nation’s traditional familism and noninstitutionalized culture, some employees are not used to complying with clearly defined rules and formal procedures (Su & Wright, 2012). Therefore, it is difficult for organizations to produce the highest level of performance simply by using commitment-eliciting practices without also using some form of compliance-achieving practices.

In fact, previous studies focused on commitment-based HRM examine extrarole behaviors, such as discretionary behaviors or organizational citizenship behaviors, while assuming productive employee in-role behavior. However, employees are not always able to complete their in-role behaviors, even those who are highly committed. For example, it has been reported that some employees cannot complete their in-role behavior and task performance without discipline management in China (Su & Wright, 2012). Therefore, it is possible that without compliance-achieving practices, commitment-eliciting practices may engender a country club context in which “employees benefit from and enjoy a collegial environment but rarely produce up to their potential. … [T]here is a strong sense of support and trust, but no one works too hard and mediocre performance is tolerated” (Birkinshaw & Gibson, 2004: 51-52).

Disciplined Governance Approach and Its Outcomes

The second approach used by companies involves low-commitment high-compliance, which we term disciplined governance. With this approach, employers do not invest much in their employees and tend to reduce labor costs by paying as little as possible for wages, benefits, training programs, and other high-input activities. Meanwhile, employers try to achieve employees’ compliance to rules and regulations through close supervision, emphasis on work rules and procedures, and punishment for violating rules and regulations. Obviously, a disciplined approach highlights rules, regulations, and procedures rather than employees’ commitment in contributing to the organizations’ success. Analogous to this approach is the industrial model described by Osterman (1988), the control strategy by Walton (1985) and Wood and Albanese (1995), the control approach by Arthur (1992, 1994), the administrative HRM practices by Youndt et al. (1996), the compliance-based HRM by Lepak and Snell (2002), and the high-control system by Hauff et al. (2014).

According to some SHRM literature, achieving employees’ compliance to rules has been described as the objective of control HRM (Arthur, 1994; Lepak et al., 2006; Wood & Albanese, 1995; Wood & de Menezes, 1998), and is often criticized. However, empirical evidence has not shown that achieving employees’ compliance to rules is harmful to organizational performance. Organization theory scholars have argued that organizations and jobs usually have policies, procedures, and rules, all of which aim to achieve order (T. Levitt, 2002). Rules and procedures are important in shaping and guiding organizational behavior (M. C. Becker, 2008; B. Levitt & March, 1988; March & Simon, 1958; Parmigiani & Howard-Grenville, 2011). Scholars have also argued that compliance to rules and procedures can facilitate routine performance, idea implementation, efficiency, quality, and incremental creativity (Madjar, Greenberg, & Chen, 2011). Some scholars have acknowledged that an HRM strategy focused on achieving employee compliance to standardized procedures would likely be most appropriate in labor-intensive industries characterized by low prices and strict standardization (Marchington & Grugulis, 2000). Youndt et al. (1996) found that a cost strategy combined with an administrative HR system predicted manufacturing efficiency. Boxall et al. (2011) observed a positive relationship between employee behavioral compliance to work rules and firm performance in a standardized service environment.

Therefore, with a disciplined approach, employers could reduce labor costs and improve work efficiency by achieving employees’ compliance to standard rules and processes, thus ensuring short-term organizational performance. However, with this approach, the high level of conformity to established standards may discourage employee engagement in radical creativity (Madjar et al., 2011). Additionally, emphasizing employees’ compliance to rules while paying little attention to employees’ commitment may create a burnout context and cause employees to feel a lack of social and organizational support. Under such context, employees obviously will not feel committed to the organization, nor will they defend the organization’s interests through discretionary efforts. Thus, with this approach employees may perform well in the near-term, but the depersonalized nature of these management practices typically result in high-levels of employee turnover in the long term (Birkinshaw & Gibson, 2004). Eventually, organizational performance may suffer as exhausted and disenchanted employees have neither the capacity nor the incentive to execute or innovate.

Hybrid Governance Approach and Its Outcomes

Employers may simultaneously emphasize eliciting employees’ commitment to the organization and achieving their compliance to rules as a means to maximize individual and organizational performance, what we term the hybrid governance approach. With this approach, employers provide employees with extensive training programs, career opportunities, wages, and other benefits at higher than market levels in order to maintain a capable and committed workforce. While incorporating commitment oriented practices, employers may also impose punishment for violating rules and regulations, engage in close supervision, emphasize efficiency-oriented work rules and procedures, and facilitate employee performance by articulating operating procedures. While not a perfect match, this system resembles the Regulated Commitment System identified by Hauff et al. (2014).

From a behavioral perspective, the hybrid approach motivates employees to exhibit more in-role and extrarole behaviors. Both in-role and extrarole behaviors are important to organizational performance. In-role behaviors can be achieved through rules, regulations, and procedures, which indicates a need for compliance-achieving practices. Extrarole behaviors can be elicited by improving KSAs and commitment of employees and, thus, indicate the need for commitment-eliciting practices. Some scholars have argued that the contrast between commitment and compliance is actually a contrast between managerial strategies that focus on external control versus those that rely on employees’ self-control (Guest, 1987). From this perspective, HRM or employee governance strategies should emphasize both external control and self-control.

Resource-based view, strategy, and organization theory scholars view rules, processes, and procedures as key underlying components and microfoundations of organizational capability (Amit & Shoemaker, 1993; Eisenhardt & Martin, 2000; Ethiraj, Kale, Krishnan, & Singh, 2005; Parmigiani & Howard-Grenville, 2011; Teece, 2012). These microfoundations enhance the productive value of existing resources (Makadok, 2001; Teece, Pisano, & Shuen, 1997) and the efficiency with which firms transform inputs into outputs (Collis, 1994; Parmigiani & Howard-Grenville, 2011). SHRM scholars also note that “organizational capital, [which is] embedded in standard operating procedures, business processes, rules, [and] routines, … is constructed from what was once the knowledge of individuals” (Youndt & Snell, 2004: 342). Therefore, the hybrid approach helps employees comply with regulations and processes, making full use of organizational capital, while also increasing human capital, which together, as Wright, Dunford, and Snell (2001) suggested, bring sustainable competitive advantages to organizations.

Recent research on organizational ambidexterity also sheds new light on the effectiveness of the hybrid approach. An HRM strategy should fit the context of an organization by reflecting the organization’s environment and other strategies (Schuler & Jackson, 1987). The ambidexterity literature has widely acknowledged that the demands of the environment and an organization’s strategies will always experience some degree of conflict (e.g., investment in current versus future projects, exploration versus exploitation tasks, lowering costs, and enhancing product differentiation; Eisenhardt, 2000; Levinthal & March 1993; Raisch & Birkinshaw, 2008). Therefore, organizations need to develop contextual ambidexterity by building a set of processes or systems that enable individuals to divide their time between conflicting demands for alignment and adaptability (Eisenhardt & Martin, 2000; Gibson & Birkinshaw, 2004; Raisch & Birkinshaw, 2008). Similarly, Dyer and Shafer (1999) stated that human resource strategies could enhance competitive advantage by establishing an agile organization in an attempt to simultaneously optimize adaptability and efficiency. Furthermore, Patel, Messersmith, and Lepak (2013) empirically demonstrated that using certain HR practices might allow a firm to achieve both the alignment and adaptability necessary to produce ambidexterity and firm growth. Based on the above literature, we argue that hybrid governance can cultivate employees’ innovative spirits and abilities, allowing organizations to better adapt to future needs. This approach will also help employees become more efficient in recurring and day-to-day tasks, make better use of existing resources, and produce predictable outcomes. This efficiency is found through rules, procedures, or routines which together create organizational ambidexterity and thus bring better performance.

In sum, by managing the paradoxes that exist between motivation and discipline, in-role and extrarole behaviors, human capital and organizational capital, and innovation and efficiency, we suggest that the hybrid governance (high-commitment high-compliance) could outperform the other three approaches proposed in our typology.

Unstructured Governance Approach and Its Outcomes

The final category of our typology is low-commitment low-compliance, what we call the unstructured governance approach. With this approach, not only are employers unwilling to invest much in their employees in terms of wages, benefits, training, and career opportunities, but they also lack a strategy to achieve employees’ compliance to rules and procedures.

We can infer that with this approach, neither the rules, regulations, and procedures in organizations nor the human capital and commitment of the employees have been optimally used to achieve a high level of organizational performance. From the behavioral perspective, neither in-role nor extrarole behaviors can be effectively exhibited due to employees’ lack of ability and motivation. Employees in these firms are neither induced nor coerced to work hard. Consequently, the unstructured governance approach will be linked to the lowest organizational performance compared to alternative approaches.

Based on the arguments above, we propose the following:

Hypothesis: Organizational performance will be highest with the hybrid approach and second highest with either the bonded or disciplined approaches. Performance will be the lowest with the unstructured approach.

Methods

Sample and Procedures

Procuring high-quality survey data and accessing financial data in China is difficult and necessitates strong interpersonal relationships and social networks. With the help of a Chinese university, data for this study were obtained by surveying firms located in Beijing and Shanghai, the two most economically developed and international cities of the People’s Republic of China. The university provided alumni contact information (including executive education students) from which we contacted potential participants by phone or in person, requesting their firm’s participation and explaining our study’s objectives. To minimize sample bias, we selected alumni from firms that were representative of the industry sectors in the region and excluded alumni working in the public sector or in nonprofit organizations. If the alumni worked at the headquarters of a large firm with multiple independent operating subsidiaries, we required participants to select a single subsidiary to participate in our survey. Of our sample firms, approximately 75% had fewer than 1,000 employees, and two-thirds had fewer than 500 employees.

Alumni were then provided a survey package containing two separate questionnaires with cover letters explaining the objective of the survey and assuring respondents of the confidentiality of their responses. The first questionnaire focused on employee governance (or HRM) practices and organizational characteristics and was to be completed by the HR manager of the firm. The second questionnaire focused on organizational performance and was to be completed by the president, vice president, or other top management team member of the same organization. Survey packages were distributed to 887 firms; 386 survey packages were returned, yielding an initial response rate of 43.5%. The final sample size was reduced to 337 firms due to missing data. Of our sample firms, 221 were located in Beijing and 116 were located in Shanghai.

Measures

In Chinese firms, standard and contingent employees can occupy the same jobs within a single organization. HRM policies for these employee types can be distinct, particularly for the variables used on our survey (e.g., wages, benefits, and career planning). Thus, we asked survey respondents to indicate the degree to which HRM policies or practices are deployed for standard employees on a Likert-type scale from 1 (I do not agree at all) to 5 (I completely agree). The four employee governance approaches were identified using seven items measuring commitment-eliciting and compliance-achieving HRM practices.

Commitment-eliciting

Our measure of commitment-eliciting HRM practices is similar to the inducements measure used in the typology developed by Tsui et al. (1997). Tsui et al.’s study measured two types of inducements, work training and job security, whereas we measured four types of inducements: training, career opportunities, wages, and benefits. We argue that these four inducements represent an employer’s primary means of investing in its employees and are regarded as typical practices aimed at eliciting employees’ commitment to the organization (Appelbaum et al., 2000; Arthur, 1994; Bae & Lawler, 2000; Batt, 2002; Collins & Smith, 2006; Delery & Doty, 1996; Guest, Michie, Sheehan, & Conway, 2003; MacDuffie, 1995; Youndt et al., 1996).

Compliance-achieving

Three items were used to measure compliance-achieving HRM practices: punishment for violating rules and regulations, closer employee supervision practices than competitors, and strong emphasis on work rules and procedures. These three items are conceptually consistent and aim to assess employees’ compliance to rules and regulations (Su & Wright, 2012). To insure content validity in a Chinese context, all items were reviewed by two Chinese HRM professors and four Chinese senior HR managers.

We conducted an exploratory factor analysis on the seven items using Kaiser’s criterion and varimax rotation. This analysis yielded two distinct factors with clean loading patterns, the smallest being .62, and a 62.3% cumulative contribution rate of variance. The Cronbach’s alphas for the commitment eliciting and compliance achieving scales were .73 and .72, respectively. The results of the factor analysis are shown in Table 1.

Table 1

Factor Analysis of Employee Management Practices

	Factors
	Commitment	Compliance
Extensive benefits	.82
Higher wages than market level	.79
More time and money spent on employee training	.67
Career planning	.62
Punishment for violating rules and regulations		.81
Strong emphasis on work rules and procedures		.80
Closer employee supervision practices than competitors		.75
Percentage of variance	32.60	29.67
Alpha coefficient	.73	.72

Note: Kaiser-Meyer-Olkin (KMO) sample test of full value is 0.78; Bartlett spherical test value is 618.28, P < .001; rotation converged in three iterations.

Employee governance approaches

We categorized the four employee governance approaches using a median split of the measures of commitment-eliciting and compliance-achieving HRM practices, as has been suggested by previous typological studies (Dubin, 1978; Tsui et al., 1997). The results of our typology are shown in Table 2. Overall, 102 firms (30.3%) were managed by a high-commitment high-compliance approach (hybrid governance); 53 firms (15.7%) were managed by a high-commitment low-compliance approach (bonded governance); 75 firms (22.3%) were managed by a low-commitment high-compliance approach (disciplined governance); and 107 firms (31.8%) were managed by a low-commitment low-compliance approach (unstructured governance).

Table 2

Frequency and Percentage of Firms Under Four Approaches

	Frequency	Valid Percentage
Hybrid	102	30.3
Bonded	53	15.7
Disciplined	75	22.3
Unstructured	107	31.8
Total	337	100.0

Organizational performance

Financial performance data in China and other Asian countries are rarely disclosed publicly (Bae & Lawler, 2000; Björkman & Fan, 2004; Takeuchi et al., 2007). Moreover, even though the multiple industry sample we used makes our data more generalizable, comparisons of objective performance data across industries is difficult. Therefore, we used perceptual performance indicators to assess firm financial performance. Many previous studies have adopted and validated this subjective approach to measuring firm performance (e.g., Bae & Lawler, 2000; Delenay & Huselid, 1996; Takeuchi et al., 2007; Wall et al., 2004). Using a similar perceptual measurement method as those used in previous studies, we assessed organizational performance by asking senior organizational leaders about their firm’s profit growth rate, employee productivity, product/service quality, and customer satisfaction using a 7-point scale, ranging from 1 = very low to 7 = very high (Cronbach’s alpha = .84). We argue that these four items are essential to assess an organization’s overall performance and sustainable competitiveness (Kaplan & Norton, 1996). However, we excluded other measures of HRM performance (e.g., talent attraction) used in previous studies (e.g., Delaney & Huselid, 1996; Takeuchi et al., 2007) and the learning and development indicators used by Kaplan and Norton (1996). These indicators were excluded because of a concern for potential bias that could lead to an overestimation of the correlations between the predictor and outcome variables. An exploratory factor analysis of these four items, using Kaiser’s criterion and varimax rotation, yielded one factor with a 70.1% cumulative contribution rate of variance.

Control variables

Considering employee management practices and their effects vary significantly due to sector and organizational characteristics, we controlled for sector and organizational attributes. Sector variables were dummy coded and included traditional manufacturing (55 firms), traditional service (52 firms), modern manufacturing (143 firms), and modern service sectors (87 firms). Organizational variables included firm size, firm age, and firm ownership type. Firm size and firm age are important variables that may affect both HRM and firm performance (Jackson & Schuler, 1995). Firm size was measured using number of employees: 61 firms had fewer than 50 employees, 56 firms had 50-100 employees, 93 firms had 101-500 employees, 30 firms had 501-1,000 employees, 95 firms had more than 1,000 employees, and 2 firms did not respond. Firm age was measured in years: 76 firms were less than 5 years old, 97 firms were 6-10 years old, 64 firms were 11-15 years old, 25 firms were 16-20 years old, 73 firms were more than 20 years old, and 2 firms did not respond. Firm ownership type has also been shown to have a significant influence on both HRM and firm performance in China (Wei & Lau, 2008). In our sample, 86 firms were state-owned, 133 firms were foreign-owned or joint ventures, and 118 firms were privately owned domestic companies.

Discriminant Validity of the Constructs

There are three latent constructs in this study: commitment-eliciting HRM practices (four items), compliance-achieving HRM practices (three items), and organizational performance (four items). We conducted a confirmatory factor analyses to examine the distinctiveness of the three constructs. Compared to a one-factor model (χ²/df = 11.68, comparative fit index [CFI] = 0.64, Tucker-Lewis index [TLI] = 0.46, root mean square error of approximation [RMSEA] = 0.18), the proposed model consisting of three constructs resulted in better model fit (χ²/df = 3.54, CFI = 0.92, TLI = 0.88, RMSEA = 0.07) suggesting discriminant validity of the constructs.

Results

The means, standard deviations, and correlations for all variables are shown in Table 3. In this table we see that organizational performance is positively associated with both commitment-eliciting and control-achieving dimensions.

Table 3

Means, Standard Deviations, and Correlations

Variable	Mean	SD	1	2	3	4	5	6	7	8	9	10	11
1. Sector dummy 1	.16	.37
2. Sector dummy 2	.15	.36	−.19***
3. Sector dummy 3	.42	.49	−.38***	−.37***
4. Sector dummy 4	.26	.44	−.26***	−.25***	−.51***
5. Ownership dummy 1	.26	.44	.00	.18***	−.05	−.10
6. Ownership dummy 2	.40	.49	.18***	−.01	−.22***	.10	−.47***
7. Ownership dummy 3	.35	.48	−.19***	−.16***	.27***	−.02	−.43***	−.59***
8. Firm size	3.13	1.45	.11	.00	−.03	−.06	.11**	.08	−.18***
9. Firm age	2.77	1.45	.10	.08	−.10	−.04	.28***	−.02	−.23***	.41***
10. Commitment-eliciting practices	3.08	.73	−.05	−.05	.04	.04	−.06	.08	−.03	.17***	.08
11. Compliance-achieving practices	3.27	.78	−.09	−.01	.11**	−.03	−.09	.04	.05	.10	.06	.43***
12. Organizational performance	4.70	1.06	.04	−.08	.00	.04	−.06	.11**	−.06	.06	.08	.38***	.35***

Note: Sector dummy 1 = traditional manufacturing; Sector dummy 2 = traditional service; Sector dummy 3 = modern service; Sector dummy 4 = modern or high-tech manufacturing; Ownership dummy 1 = state-owned; Ownership dummy 2 = foreign-invested/joint venture; Ownership dummy 3 = domestic private.

p < .05.

***

p < .01.

We first conducted an analysis of variance (ANOVA) to test performance differences among the four different employee governance approaches and found a statistically significant difference in organizational performance among the different employee governance approaches (Table 4; F = 13.22, p < .01). We did not find a significant interaction between employee governance approach and sector or firm age (p > .05) but did find marginally significant interactions between employee governance approach and both firm size (Table 4; F = 1.77, p < .1) and ownership (Table 4; F = 1.89, p < .1).

Table 4

ANOVA of Employee Governance Approaches on Organizational Performance

Source	Sum of Squares	df	Mean Square	F
Corrected model	125.97	55	2.29	2.57**
Intercept	3,313.16	1	3,313.16	3,722.85**
Sector	2.28	3	0.76	0.85
Firm size	2.65	4	0.66	0.74
Firm age	6.43	4	1.61	1.81
Ownership	1.19	2	0.60	0.67
Employee governance approach	35.30	3	11.77	13.22**
Sector × Employee governance approach	10.73	9	1.19	1.34
Firm size × Employee governance approach	18.90	12	1.58	1.77*
Firm age × Employee governance approach	6.44	12	0.54	0.60
Ownership × Employee governance approach	10.10	6	1.68	1.89*
Error	241.18	271	0.89
Total	7,546.94	327
Corrected Total	367.15	326

Note: R² = .34 (Adjusted R² = .21).

p < .10.

p < .05.

Table 5 reports the differences in organizational performance between each of the four approaches. Firms using a hybrid approach have the highest performance mean (μ = 5.30), which is significantly greater than the performance mean for the bonded (Δ = 0.57, p < .01), disciplined (Δ = 0.78, p < .01), and unstructured (Δ = 1.07, p < .01) governance approaches. Firms managed by an unstructured approach have the lowest performance mean (μ = 4.22), which is significantly lower than the bonded (Δ = 0.50, p < .01), and disciplined (Δ = 0.30, p < .05) governance approaches. Finally, the bonded governance approach has a performance mean of 4.73, which did not differ statistically from a disciplined governance approach (μ = 4.55, Δ = 0.20, p > .1). These comparisons lend credible support to our hypothesis.

Table 5

Multiple Comparisons of Organizational Performance in Pairs Among Four Employee Governance Approaches

Dependent variable: Organizational performance
					95% Confidence Interval
Approach (I)	Mean	Approach (J)	Mean Difference (I – J)	SE	Upper Bound	Lower Bound
Hybrid	5.30	Bonded	0.57**	0.16	0.25	0.89
		Disciplined	0.78**	0.15	0.49	1.06
		Unstructured	1.07**	0.13	0.81	1.33
Bonded	4.73	Disciplined	0.20	0.17	-0.14	0.54
		Unstructured	0.50**	0.16	0.18	0.82
Disciplined	4.55	Unstructured	0.30**	0.14	0.01	0.58
Unstructured	4.22

p < .05.

Another way to test our basic model is to examine the impact of each of the governance dimensions (commitment and compliance) on performance across all firms in the sample, rather than test for differences between firms classified by different governance approaches (as above). We used a series of regressions to test the potential interaction between the commitment-eliciting practices and compliance-achieving practices on organizational performance. The results of these regressions are shown in Table 6.

Table 6

Effects of Commitment and Compliance on Organizational Performance

	Model 1	Model 2	Model 3	Model 4
Sector dummy 1	−.01	.03	.05	.04
Sector dummy 2	−.09	−.07	−.06	−.07
Sector dummy 4	−.01	−.01	.01	.01
Ownership dummy 1	.00	.01	.04	.04
Ownership dummy 2	.12	.10	.10	.11
Firm size	.01	−.05	−.06	−.05
Firm age	.10	.07	.06	.05
Commitment-eliciting practices		.38***	.28***	.27***
Compliance-achieving practices			.23***	.23***
Commitment × Compliance				.11**
R ²	.029	.167	.209	.221
F	1.38	7.92***	9.28***	8.94***
ΔR²		.137***	.043***	.012**
ΔF		52.11	16.98	4.85

p < .05.

***

p < .01.

Model 1 represents a baseline model including only control variables and yields an R² of 2.9%. Model 2 shows that the addition of the commitment-eliciting practices to Model 1 produces a significant increase R² of 13.7%. Model 3 introduces the compliance-achieving practices, explaining a significant additional 4.3% of the variance in organizational performance. In this model, both commitment-eliciting practices and compliance-achieving practices have significant positive effects on organizational performance (b = .28 and .23, respectively, p < .01). Finally, Model 4 shows that the interaction between commitment-eliciting and compliance-achieving explains an additional 1.2% (p < .05) of the variance in organizational performance, with a regression coefficient of .11 (p < .05). Thus, our results support the idea that organizations achieve their best performances when they implement commitment-eliciting and compliance-achieving practices simultaneously. Figure 2 illustrates the interaction effect by graphing the relationship between compliance-achieving practices and organizational performance at high and low levels of commitment-eliciting practices (plus and minus one standard deviation from their respective means).

Discussion

Based on the dimensions of eliciting employees’ commitment to the organization and achieving employees’ compliance to rules, we developed a typology with four approaches to governing employees: hybrid, bonded, disciplined, and unstructured. Our findings reveal that a hybrid approach produces the highest organizational performance compared to alternative governance approaches, suggesting that both commitment-eliciting practices and compliance-achieving practices are important for organizational performance.

This study contributes to the existing literature in four important ways. First, it expands the theoretical construct of high performance work systems to include employee governance, placing increased attention on employees’ compliance to rules. While Su and Wright (2012) showed evidence that compliance oriented practices explain incremental variance in performance beyond traditional HPWSs, they viewed these practices as an addition to existing unidimensional HPWS scales. This unidimensional approach was also used by Patel, Messersmith, and Lepak (2013) in an attempt to explain organizational ambidexterity. Conversely, Hauff et al. (2014) derived HRM system types using a cluster analysis of HRM practices, attributing different levels of commitment or control to distinct clusters. Rather than combining the commitment-eliciting and the compliance-achieving practices additively and showing a positive relationship with organizational performance, this article developed a two-dimensional typology of employee governance. This typology revealed that a hybrid governance approach (high-commitment high-compliance) produced higher levels of organizational performance compared to approaches focused solely on commitment or compliance. It also shows that the interaction of commitment-eliciting practices and compliance-achieving practices explains a significant portion of the variance in performance (Table 6, Model 4). These results suggest that this employee governance typology provides a theoretical framework to better understand how to manage employees for greater performance beyond traditional HPWS models. Our findings suggest that future research should broaden the scope of HPWSs, analyzing these systems in a more nuanced way rather than combining all practices into a unidimensional index.

Second, this study demonstrates the importance of integrating HRM with theories from other fields (e.g., organization theory) to better understand employee management. Over the past 20 years, most empirical SHRM research has emphasized a universal commitment model, which implicitly views achieving employees’ compliance to work rules, regulations, and procedures as the opposite of commitment-oriented HRM. Such research has limited our understanding of how HRM can lead to high performance and is inconsistent with existing OT literature that stresses the importance of rules and processes in organizational success. In fact, research has revealed that human capital, commitment of employees, processes and routines, organizational culture, and leadership style are all important factors driving greater organizational performance. Thus, organizations should not limit SHRM or employee governance to advancing employees’ commitment and human capital, but to also making better use of process and routines (organizational capital), promoting relationships among employees (social capital), and facilitating organizational culture and leadership style. Integrating theories from different fields will greatly broaden the range and content of employee governance beyond the traditional HPWS models, and help reveal the mechanisms between human resources assets and organizational performance. To some extent, this shifts the perspective of employee governance research from mechanistic, focused on specific HR practices, to functional, focused on outcomes.

Third, this study provides evidence that effectively governing employees enables a firm to obtain greater performance by shaping organizational ambidexterity or agility. Researchers have argued that long-term survival and success of organizations depend on an organization’s ambidexterity—the ability to balance seemingly contradictory activities, such as exploitation and exploration or lowering costs and enhancing product differentiation (Eisenhardt, 2000; Levinthal & March, 1993). Empirical studies have found that ambidexterity in organizational innovation and organizational learning (Jansen, van den Bosch, & Volberda, 2006; Raisch & Birkinshaw, 2008), organizational contexts (Gibson & Birkinshaw, 2004), and leadership (Cao, Simsek, & Zhang, 2010; Smith & Tushman, 2005) can have positive effects on firm performance. Recently, scholars have realized and stressed the importance of conducting HRM studies using ambidextrous thinking (Cooper & Tarba, 2012; Patel et al., 2013). Our study indicates that the target of HRM strategy or employee governance designs are dual, requiring employees’ compliance to rules and procedures when dealing with recurring and exploitative activities and eliciting employees’ commitment and discretionary behaviors when dealing with innovative and explorative activities. The empirical finding that the interaction between the commitment-eliciting and compliance-achieving practices can produce a synergistic effect shows how ambidextrous thinking can provide more insights into future SHRM or employee governance research.

In addition, this study helps clarify the need to identify potential boundary conditions, under which different employee governance approaches lead to improved organizational performance. Our finding, that a hybrid (high-commitment high-compliance) approach has the most positive effect on firm performance in a Chinese context, indicates that the bonded approach developed in the U.S. might not be a universal or cross-national model. It is possible that in certain contexts, other forms of employee governance might more successfully contribute to achieving organizational goals. Thus, mainline SHRM research, which relies on a universalistic commitment model (Kaufman, 2010), may limit the ability of HRM-organizational performance research to achieve greater depth and understanding. The current study reminds us that we not only need to broaden the range of SHRM approaches but also specify their boundary conditions, such as national context, under which different approaches lead to optimal organizational performance.

The results of this study should be considered in light of its limitations. First, unobserved factors may lead to an endogeneity problem. An “other management” bias (B. E. Becker & Huselid, 2006) could exist since we do not control for alternative management policies, such as supply chain management or leadership, which are normally considered positive influences on both firm performance and HRM forms. Self-selection bias could occur if managers assess certain management policies/practices in their firms with the expectation that they would yield high levels of performance (Hamilton & Nickerson, 2003). Addressing the endogeneity issue in strategic HRM research would require econometric analytical approaches, such as instrumental variable techniques (Angrist & Krueger, 2001). To test and control for endogeneity, we would need to collect firm-level instrumental variables that affect employee governance approaches but do not directly affect organizational performance. These instrumental variables would be used to decompose the employee governance variable into endogenous and exogenous components. With this decomposition we could test for endogeneity using the Hausman test and control for endogeneity by including both the endogenous and exogenous components of employee governance in our original equation. Unfortunately, it is difficult to find such instrumental variables at the firm level, and such variables were not available for our analysis. We propose that using instrumental variable approaches to address endogeneity is an important area for future SHRM research.

Second, this study was conducted exclusively in a Chinese context, which may limit the generalizability of our findings. Su and Wright (2012) argued that because China neither experienced the industrial revolution nor implantations of scientific management practices, some Chinese employees are not used to complying with clearly defined rules and procedures. Thus, it is possible that China’s unique management context creates a need for compliance-achieving practices. However, our data were collected in Beijing and Shanghai, the two most international Chinese cities, and include 133 foreign-invested/joint venture firms, which might negate the influence of Chinese contexts found elsewhere in the country. More importantly, studies based in other countries (e.g., the UK, the U.S., Germany, Canada, and Australia) also suggest a need to distinguish between commitment and compliance employee governance models (Boxall et al., 2011; Gibson & Birkinshaw, 2004; Godard, 2004; Hauff et al., 2014; Mesch, Perry, & Wise, 1995). We predict a hybrid approach could have a positive effect on performance in other countries and encourage future research to explore this potential.

Third, the cross-sectional and subjective performance data limits the extent to which cause-effect relationships can be identified. Future research should utilize longitudinal designs to reveal the influence of different HRM or employee governance approaches on organizational performance. Although Wall et al. (2004) demonstrated the convergent, discriminant, and construct validities of subjective measures of relative performance, future studies should strive to obtain more specific types of objective performance data, such as innovation, growth, efficiency, and labor productivity. Since different management practices are not equivalently related to all types of organizational performance metrics, gathering more types of performance data could allow us to further relate different management practices to different performance metrics. In addition, our use of median splits to classify firms according to our typology loses variance within the commitment and compliance measures. However, our regression analyses did not rely on median splits, and these results further supported our prediction that firms utilizing both commitment- and compliance-oriented governance approaches will see higher performance than firms using alternative approaches.

Despite these limitations, this study contributes to the existing literature by showing a broader and more complex view of how employees can be managed to maximize organizational performance. It sheds new theoretical insights beyond the existing SHRM literature and exceeds the typical research paradigm of commitment HRM leading to high firm performance. It presents compelling evidence that we need to break through the dominating black-and-white thinking in existing SHRM research with an ambidextrous mindset. In addition, this study indicates the importance of combining OT and SHRM theories in future research. Given that these results provide new insights into the theoretical logic linking employee governance and organizational performance, we believe that we have sparked more questions about what other ways of managing employees lead to high performance and, thus, move the rigid and stalled SHRM paradigm forward.

Footnotes

Acknowledgements

This article was accepted under the editorship of Patrick M. Wright. The authors would like to thank editor Deborah E. Rupp and two anonymous reviewers for their helpful and constructive comments as this manuscript was being shaped into final form. This research was funded by the National Natural Science Foundation of China (Project No.: 71272157, 71002095).

References

Amit

Shoemaker

P. J. H.

1993. Strategic assets and organizational rent. Strategic Management Journal, 14: 33-46.

Angrist

J. D.

Krueger

A. B.

2001. Instrumental variables and the search for identification: From supply and demand to natural experiments. Journal of Economic Perspectives, 15: 69-85.

Appelbaum

Bailey

Berg

Kalleberg

A. L.

2000. Manufacturing advantage: Why high-performance work systems pay off. Ithaca, NY: Cornell University Press.

Arthur

J. B.

1992. The link between business strategy and industrial relations systems in American steel minimills. Industrial and Labor Relations Review, 45: 488-506.

Arthur

J. B.

1994. Effects of human resource systems on manufacturing performance and turnover. Academy of Management Journal, 37: 670-687.

Bae

Lawler

J. J.

2000. Organizational and HRM strategies in Korea: Impact on firm performance in an emerging economy. Academy of Management Journal, 43: 502-517.

Bailey

1993. Discretionary effort and the organization of work: Employee participation and work reform since Hawthorne. New York: Columbia University Press.

Batt

1999. Work organization, technology, and performance in customer service and sales. Industrial & Labor Relations Review, 52: 539-564.

Batt

2002. Managing customer services: Human resource practices, quit rates, and sales growth. Academy of Management Journal, 45: 587-598.

10.

Becker

B. E.

Huselid

M. A.

2006. Strategic human resources management: Where do we go from here? Journal of Management, 32: 898-924.

11.

Becker

M. C.

2004. Organizational routines: A review of the literature. Industrial and Corporate Change, 13: 643-678.

12.

Becker

M. C.

2008. The past, present, and future of organizational routines. In Becker

(Ed.), Handbook of organizational routines: 3-14. Cheltenham, UK: Edward Elgar.

13.

Birkinshaw

Gibson

2004. Building ambidexterity into an organization. MIT Sloan Management Review, Summer: 47-55.

14.

Björkman

Fan

2002. Human resource management and the performance of Western firms in China. International Journal of Human Resource Management, 13: 853-864.

15.

Boselie

Dietz

Boon

2005. Commonalities and contradictions in HRM and performance research. Human Resource Management Journal, 15: 67-94.

16.

Boxall

Ang

S. H.

Bartram

2011. Analysing the “black box” of HRM: Uncovering HR goals, mediators, and outcomes in a standardized service environment. Journal of Management Studies, 48: 1504-1532.

17.

Cao

Simsek

Zhang

2010. Modeling the joint impact of the CEO and the TMT on organizational ambidexterity. Journal of Management Studies, 47: 1272-1295.

18.

Chuang

C. H.

Liao

2010. Strategic human resource management in service context: Taking care of business by taking care of employees and customers. Personnel Psychology, 63: 153-196.

19.

Collins

C. J.

Smith

K. G.

2006. Knowledge exchange and combination: The role of human resource practices in the performance of high technology firms. Academy of Management Journal, 49: 544-560.

20.

Collis

D. J.

1994. How valuable are organizational capabilities? Strategic Management Journal, 15: 143-152.

21.

Combs

J. G.

Liu

Hall

Ketchen

D. J.

2006. How much do high-performance work practices matter? A meta-analysis of their effects on organizational performance. Personnel Psychology, 59: 501-528.

22.

Cooper

Tarba

2012. Call for papers: Ambidexterity in human resource management. Human Resource Management. Retrieved from http://euram2012.nl/userfiles/file/Call%20for%20Papers%20-%20Special%20Issue%20on%20Ambidexterity%20In%20Human%20Resource%20Management.pdf

23.

Datta

D. K.

Guthrie

J. P

Wright

P. M.

2005. Human resource management and labor productivity: Does industry matter? Academy of Management Journal, 48: 135-145.

24.

Delaney

J. T.

Huselid

M. A.

1996. The impact of human resource management practices on perceptions of organizational performance. Academy of Management Journal, 39: 949-969.

25.

Delery

J. E.

Doty

D. H.

1996. Systems of theorizing in strategic human resource management: Tests of universalistic, contingency, and configurational performance predictions. Academy of Management Journal, 39: 802-835.

26.

Dubin

1978. Theory building (2nd ed.). New York: Free Press.

27.

Dyer

Shafer

R. A.

1999. From human resource strategy to organizational performance: Lessons from research on organizational agility. In Ferris

G. R.

(Ed.), Research in personnel and human resources management, suppl. 4: 145-174. Greenwich, CT: JAI.

28.

Eisenhardt

K. M.

2000. Paradox, spirals, ambivalence: The new language of change and pluralism. Academy of Management Review, 25: 703-705.

29.

Eisenhardt

K. M.

Martin

J. A.

2000. Dynamic capabilities: What are they? Strategic Management Journal, 21: 1105-1121.

30.

Ethiraj

S. K.

Kale

Krishnan

M. S.

Singh

J. V.

2005. Where do capabilities come from and how do they matter? A study in the software services industry. Strategic Management Journal, 26: 25-45.

31.

Fiss

P. C.

2011. Building better causal theories: A fuzzy set approach to typologies in organization research. Academy of Management Journal, 54: 393-420.

32.

Gibson

C. B.

Birkinshaw

2004. The antecedents, consequences and mediating role of ambidexterity. Academy of Management Journal, 47: 209-226.

33.

Godard

2004. A critical assessment of the high-performance paradigm. British Journal of Industrial Relations, 42: 349-378.

34.

Guest

D. E.

1987. Human resource management and industrial relations. Journal of Management Studies, 24: 503-521.

35.

Guest

D. E.

2011. Human resource management and performance: Still searching for some answers. Human Resource Management Journal, 21: 3-13.

36.

Guest

Michie

Sheehan

Conway

2003. A UK study of the relationship between human resource management and corporate performance. British Journal of Industrial Relations, 41: 291-314.

37.

Guthrie

J. P.

2001. High involvement work practices, turnover, and productivity: Evidence from New Zealand. Academy of Management Journal, 44: 180-190.

38.

Hamilton

B. H.

Nickerson

J. A.

2003. Correcting for endogeneity in strategic management research. Strategic Organization, 1: 51-78.

39.

Hauff

Alewell

Hansen

N. K.

2014. HRM systems between control and commitment: Occurrence, characteristics and effects on HRM outcomes and firm performance. Human Resource Management Journal, 24: 424-441.

40.

Huselid

M. A.

1995. The impact of human resource management practices on turnover, productivity, and corporate financial performance. Academy of Management Journal, 38: 635-672.

41.

Jackson

S. E.

Schuler

R. S.

1995. Understanding human resource management in the context of organizations and their environment. Annual Review of Psychology, 46: 237-264.

42.

Jansen

J. J. P.

van den Bosch

F. A. J.

Volberda

H. W.

2006. Exploratory innovation, exploitative innovation, and performance: Effects of organizational antecedents and environmental moderators. Management Science, 52: 1661-1674.

43.

Jiang

Lepak

D. P.

Baer

J. C.

2012. How does human resource management influence organizational outcomes? A meta-analytic investigation of mediating mechanisms. Academy of Management Journal, 55: 1264-1294.

44.

Kaplan

R. S.

Norton

D. P.

1996. Linking the balanced score card to strategy. California Management Review, 39: 53-79.

45.

Kaufman

B. E.

2010. SHRM theory in the post-Huselid era: Why it is fundamentally misspecified. Industrial Relations, 49: 286-313.

46.

Lawler

E. E.

1988. Choosing an involvement strategy. Academy of Management Executive, 2: 197-204.

47.

Lawler

E. E.

1992. The ultimate advantage: Creating the high-involvement organization. San Francisco: Jossey-Bass.

48.

Lepak

D. P.

Liao

Chung

Harden

E. E.

2006. A conceptual review of human resource management systems in strategic human resource management research. Research in Personnel and Human Resources Management, 25: 217-271.

49.

Lepak

D. P.

Snell

S. A.

1999. The human resource architecture: Toward a theory of human capital allocation and development. Academy of Management Review, 24: 31-48.

50.

Lepak

D. P.

Snell

S. A.

2002. Examining the human resource architecture: The relationships among human capital, employment, and human resource configuration. Journal of Management, 28: 517-543.

51.

Levinthal

D. A.

March

J. G.

1993. The myopia of learning. Strategic Management Journal, 14: 95-112.

52.

Levitt

March

J. G.

1988. Organizational learning. Annual Review of Sociology, 14: 319-340.

53.

Levitt

2002. Creativity is not enough. Harvard Business Review, 80: 137-144.

54.

MacDuffie

J. P.

1995. Human resource bundles and manufacturing performance: Organizational logic and flexible production systems in the world auto industry. Industrial and Labor Relations Review, 48: 197-221.

55.

Madjar

Greenberg

Chen

2011. Factors for radical creativity, incremental creativity, and routine, noncreative performance. Journal of Applied Psychology, 96: 730-743.

56.

Makadok

2001. Toward a synthesis of the resource-based and dynamic-capability views of rent creation. Strategic Management Journal, 22: 397-401.

57.

March

J. G.

Simon

H. A.

1958. Organizations. New York: John-Wiley.

58.

Marchington

Grugulis

2000. Best practice human resource management: Perfect opportunity or dangerous illusion? International Journal of Human Resource Management, 11: 1104-1124.

59.

Mesch

D. J.

Perry

J. L.

Wise

L. R.

1995. Bureaucratic and strategic human resource management: An empirical comparison in the federal government. Journal of Public Administration Research and Theory, 5: 385-402.

60.

Messersmith

J. G.

Patel

P. C.

Lepak

D. P.

2011. Unlocking the black box: Exploring the link between high-performance work systems and performance. Journal of Applied Psychology, 96: 1105-1118.

61.

Osterman

1988. Employment futures: Reorganization, dislocation, and public policy. New York: Oxford University Press.

62.

Paauwe

Wright

Guest

2013. HRM and performance: What do we know and where should we go? In Guest

Paauwe

Wright

(Eds.), Human resource management and performance: Building the evidence base. Oxford, UK: Blackwell.

63.

Parmigiani

Howard-Grenville

2011. Routines revisited: Exploring the capabilities and practice perspectives. Academy of Management Annals, 5: 413-453.

64.

Patel

P. C.

Messersmith

J. G.

Lepak

D. P.

2013. Walking the tight-rope: An assessment of the relationship between high performance work systems and organizational ambidexterity. Academy of Management Journal, 56: 1420-1442.

65.

Raisch

Birkinshaw

2008. Organizational ambidexterity: Antecedents, outcomes, and moderators. Journal of Management, 34: 375-409.

66.

Schuler

R. S.

Jackson

S. E.

1987. Linking competitive strategies with human resource management practices. Academy of Management Executive, 1: 207-219.

67.

Smith

W. K.

Tushman

M. L.

2005. Managing strategic contradictions: A top management model for managing innovation streams. Organization Science, 16: 522-536.

68.

Z. X.

Wright

P. M.

2012. The effective human resource management system in transitional China: A hybrid of commitment and control practices. International Journal of Human Resource Management, 23: 2065-2086.

69.

Sun

Aryee

Law

K. S.

2007. High-performance human resource practices, citizenship behavior, and organizational performance: A relational perspective. Academy of Management Journal, 50: 558-577.

70.

Takeuchi

Lepak

D. P.

Wang

H. L.

Takeuchi

2007. An empirical examination of the mechanisms mediating between high performance work systems and the performance of Japanese organizations. Journal of Applied Psychology, 92: 1069-1083.

71.

Teece

D. J.

2012. Dynamic capabilities: Routines versus entrepreneurial action. Journal of Management Studies, 49: 1395-1401.

72.

Teece

D. J.

Pisano

Shuen

1997. Dynamic capabilities and strategic management. Strategic Management Journal, 18: 509-533.

73.

Tsui

A. S.

Pearce

J. L.

Porter

L. W.

Tripoli

A. M.

1997. Alternative approaches to the employee organization relationship: Does investment in employees pay off? Academy of Management Journal, 40: 1089-1121.

74.

Wall

T. D.

Michie

Patterson

Wood

S. J.

Maura

Clegg

C. W.

West

2004. On the validity of subjective measures of company performance. Personnel Psychology, 57: 95-118.

75.

Walton

R. E.

1985. From control to commitment in the workplace. Harvard Business Review, 63: 77-84.

76.

Wei

L. Q.

Lau

C. M.

2008. The impact of market orientation and strategic HRM on firm performance: The case of Chinese enterprises. Journal of International Business Studies, 39: 980-995.

77.

Whitener

2001. Do “high commitment” human resource practices affect employee commitment? A cross-level analysis using hierarchical linear modeling. Journal of Management, 27: 515-535.

78.

Wood

1996. High commitment management and payment systems. Journal of Management Studies, 33: 53-77.

79.

Wood

Albanese

M. T.

1995. Can we speak of a high commitment management on the shop floor? Journal of Management Studies, 32: 215-247.

80.

Wood

de Menezes

1998. High commitment management in the UK: Evidence from the workplace industrial relations survey and the employer’s manpower skills practices survey. Human Relations, 51: 485-515.

81.

Wright

P. M.

Dunford

B. B.

Snell

S. A.

2001. Human resources and the resource-based view of the firm. Journal of Management, 27: 701-721.

82.

Youndt

M. A.

Snell

S. A.

2004. Human resource configurations, intellectual capital, and organizational performance. Journal of Managerial Issues, 16: 337-360.

83.

Youndt

M. A.

Snell

S. A.

Dean

J. W.

Lepak

D. P.

1996. Human resource management, manufacturing strategy, and firm performance. Academy of Management Journal, 39: 836-866.