Teamwork and Organizational Innovation: The Moderating Role of the HRM Context

Abstract

Evidence is accumulating on the role of teams in shaping a variety of business outcomes, but our knowledge on the effect of teamwork on organizational innovation is still evolving. This study examines whether the extent to which two staff groups are organized in teams (production staff and management/administrative staff) affects organizational innovation and whether human resource management (HRM) systems, which can be of facilitating or constraining nature, enhance the teamwork/innovation relationships. Hypotheses were tested with lagged and longitudinal data derived from 18 to 45 organizations from the UK manufacturing sector. Results suggest that the more widespread the use of teamwork in organizations, the higher the level of organizational innovation. Furthermore, this effect depends, particularly for production teams, on the overall quality of the HRM systems that exist in their organizations. Teamwork/innovation relationships are further moderated (for management and administrative teams) by an HRM practice that provides teams with time for thoughtful reflection. Thus, HRM systems can be of more or less facilitating or constraining nature for teams in organizations.