How universal is WMS? A contextual analysis of the relationship between people management practices

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The World Management Survey (WMS) initiative has collected firm-level data in more than 35 countries for the cross-country measurement of management quality. Abundant research shows that management quality is a good and universal predictor for productivity. However, firms’ environments differ from each other substantially. The purpose of our study is to critically examine whether the people management dimension in WMS, as an important dimension of management quality, is equivalently associated with productivity across countries. We do so by investigating the association between people management and labour productivity in varying contexts of cultural values and labour markets in 14 countries. Our results confirm earlier findings that people management significantly relates to labour productivity. More importantly, we do not find any moderating contextual effects of culture or labour market characteristics on the relationship between people management and productivity, suggesting that the best practices of people management that WMS offers seem to be valid across countries with different cultural values and labour market characteristics. Therefore, we offer valuable insights into the debate of convergence versus divergence of management practices across the globe.