High-performance work systems and organizational performance across societal cultures

Abstract

This paper assesses whether societal culture moderates the relationship between human resource management (HRM) practices and organizational performance. Drawing on matched employer–employee data from 387 organizations and 7187 employees in 14 countries, our findings show a positive relationship between HRM practices combined in High-Performance Work Systems (HPWS) and organizational performance across societal cultures. Three dimensions of societal culture assessed (power distance, in-group collectivism, and institutional collectivism) did not moderate this relationship. Drawing on the Ability–Motivation–Opportunity (AMO) model, we further consider the effectiveness of three bundles of HRM practices (skill-enhancing, motivation-enhancing, and opportunity-enhancing practices). This analysis shows opportunity-enhancing practices (e.g., participative work design and decision-making) are less effective in high-power-distance cultures. Nevertheless, in markedly different countries we find combinations of complementary HPWS and bundles of AMO practices appear to outweigh the influence of societal culture and enhance organizational performance.