It Takes Three to Tango: How the Performance-Oriented HR System Influences Employee Creativity

Abstract

A firm’s performance-oriented human resource (HR) system may encourage employees to adhere to workplace standards and thus meet performance expectations. Yet, can a firm’s performance-oriented HR system also facilitate employee creativity, which oftentimes involves risk and deviation from conventions? To address this question, we examine the joint influence of the performance-oriented HR system and HR creativity-building orientation on line managers’ tolerance of failure and further employee creativity. Analyses of multi-source, multi-phase data regarding 1086 employees in 107 high-technology companies reveal that when an organization’s HR manager interprets the organization’s HR practices as having a strong creativity-building orientation, a performance-oriented HR system will enhance line managers’ tolerance of failure in employee’s creative attempts. Moreover, managers’ tolerance of failure will shape employees’ creative role identity and further enhance employee creativity.