Does HRM Enhance Organizational Resilience? Evidence from Korean Firms in COVID-19 Pandemic

Abstract

The Coronavirus disease-2019 pandemic arouses scholarly and practical interests in organizational resilience. During the pandemic, we have seen resilient organizations were less negatively affected and thrive despite countless challenges. However, literature remains with the dearth of empirical knowledge about what fosters organizational resilience and how. In this study, we explore the role of high-performance work systems (HPWS) in building organizational resilience. We suggest that the implementation of HPWS prior to crisis stimulates the context where employees are less threatened and persist in change-oriented behaviors in coping with crisis, which engenders core functions of organizational resilience – stability and flexibility. Analyzing quarterly sales of 268 Korean firms during the pandemic, we found that firms with a high level of HPWS had strong organizational trust and climate for innovation, which in turn protected from severe loss and enabled rapid recovery.