The two faces of HPWS in employee perceptions and organizational performance

Abstract

In this study, we examine the two faces of high-performance work systems (HPWS) regarding employees' perceptions and organizational performance. Drawing on regulatory focus theory, we propose that, on the one hand, performance-enhancing HPWS improves organizational performance by fostering employees' competency (promotion foci) and that, on the other hand, performance-enforcing HPWS increases organizational performance by intensifying high-performance pressure (prevention foci). We tested the hypothesized relationships with longitudinal analysis using panel survey data (499 Korean firms with 1389 observations in four waves) from South Korea. The results of the hierarchical regression analysis showed that both performance-enhancing and performance-enforcing HPWS improved organizational performance, but that the underlying mechanisms in employees' perceptions markedly differed (i.e., employees’ perceived competency vs. performance pressure on employees). In the Discussion section, we take up implications, limitations, and future research directions.