High performance work systems and organizational service performance: The roles of different organizational climates

Abstract

Prior research on high-performance work systems (HPWSs) has extensively examined their effects on establishment- or firm-level performance in manufacturing settings. This study extends the literature to how HPWSs relate to organizational performance in a service setting. Studies in strategic human resource management indicate that organizational climate plays a critical role when exploring the relationship between HPWSs and organizational performance. However, little research has examined the roles of different organizational climates on this relationship. Extending the prior research on the mediating effect of service climate on organizational practices and service performance, we examine flexibility climate of the management team as a moderating indicator on the HPWSs—service climate link. Data collected from multiple sources involving 203 store owners/store managers and 568 management team members for 203 food-service chain stores reveal that service climate constitutes the mediating role for the relationship between skill- and motivation-enhancing HPWS and organizational service performance. Moreover, flexibility climate has the moderating effect on the relationship between the two types of HPWSs and service climate. Interestingly, flexibility climate can complement the effect of skill-enhancing HPWS and, on the other hand, substitute for the effect of motivation-enhancing HPWS on service climate. Managerial implications and suggestions for future research are offered.