HRM Policies and Firm Performance: The Role of the Synergy of Policies

Abstract

For both academics and practitioners, an insight into the relationship between Human Resource Management (HRM) and performance is essential. In exploring this link, HRM scholars have arrived at a point where the universalistic approach of the performance effects of best HRM practices are criticized. In an effort to move beyond a best-practice mode of theorizing, scholars have proposed different bundles of HRM practices that relate to better performance (Huselid, 1995). An emerging stream of literature proposes that systems of HRM practices have synergic performance effects (e.g. Delery & Doty, 1996). Scholars from the latter research stream argue that systems of HRM practices in so called ‘High Performance Work Systems’ (HRM Systems) lead to significant effects on firm performance, and hence propose that ‘ideal’ systems of HRM practices (i.e. best-systems) lead to superior firm performance (Becker & Huselid, 1998). Against this backdrop, Delery and Doty (1996) called upon scholars to adopt a ‘configurational mode of theorizing’ and indeed sparked a plethora of research in search of ideal-type HRM systems (Becker & Huselid, 1998; Lepak et al., 2006). Taking stock of this field today, its theoretical and empirical advancement is still hindered by ‘deficient empirical support’, in part because researchers have focused on bundles of large numbers of practices. For instance, Guest et al. (2003) identified 48 HRM practices and grouped them into nine HRM domains, but concluded that these formed no coherent factors. Also, measuring and examining the interactions between large numbers of practices is empirically very complex (Martín-Alcázar, Romero-Fernández & Sánches-Gardey, 2005: 645). Individual practices’ interactions with many variables are not as easily empirically testable. Some 20 years after the emergence of the perspective of HRM configurations, this perspective has yet to deliver on its promise.KeywordsFirm PerformanceHuman Resource ManagementManagement JournalPsychological ContractHuman Resource Management PracticeThese keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.