Workplace practices and firm performance in manufacturing

Abstract

PurposeThe purpose of this paper is to investigate the use of innovative workplace practices in a sample of manufacturing establishments.Design/methodology/approachThe sample comprises manufacturing establishments located in Italy and a comparable sample extracted from the British Workplace Employee Relations Survey (WERS). The paper controls for sector, size, skill quality and industrial relations.FindingsJob rotation and technical training are positively associated with current performance in both samples. On average, British establishments are more productive: the different endowment in terms of workplace practices, skills and industrial relations accounts for 40 per cent of the gap, while the different efficacy of the endowment on performance accounts for the remainder.Originality/valueIn both samples the introduction of team working implies a relatively important advance along the reorganisation process, which was undertaken in the early stages of reorganisation in British establishments but much later in Italian firms. Linking the progression of the reorganisation to non‐convexities in supermodular production functions may be an interesting line of future research.