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“Does HR enhance organizational success?’ is a question every organization leader,policy-maker, employee and management scholar must consider. This book isimportant reading, because it describes what decades of research tells us – and what itdoes not, featuring a worldwide group of the most respected and widely-publishedscholars in the HR field.”

—John Boudreau – University of South Carolina – South Carolina - USA

This is a very timely book by an impressive array of international scholars. Here wehave – in one neat package – the intellectual impetus and insights that will take the HRstrategy literature to the next level”.

—Lee Dyer – Cornell University – Ithaca - USA

“This is the book we have been waiting for. The distinguished author team provide atour de force of the HRM and performance debate. The coverage is comprehensiveand both advocates and critics will find much to inspire their research. I stronglyrecommend this book to academics, managers, postgraduate masters students anddoctoral candidates worldwide.”

—Patrick Flood – Dublin city University – Dublin - Ireland

“Written by leading scholars in the field, this book is a must-read for all who areinterested in further understanding the HRM-performance linkages from differentperspectives. Paauwe, Guest and Wright have done a great job via eleven chaptersin the book in picking-up the core issues in the field and propose a meaningfulway forward.”

—Pawan Budwhar – Aston Business School – Birmingham - United Kingdom

“This is a must read book for everyone researching the subject of human resourcemanagement and performance. Paauwe, Wright and Guest (three of the leaders in thefield) have put together an excellent volume with an outstanding international cast ofauthors; it is a lucid and cogent coverage of the current state of research and sets up arich agenda for future scholary endeavour. It will become the standard reference inthis research area.”

—Adrian Wilkinson – Griffith University – Brisbane - Australia

“Unraveling how HRM influences firm performance is one of those HARD researchproblems that really is worth the effort. To crack this problem, we need to get beyondgeneric HR systems research to the heart of how things work. This collection ofresearch from scholars both within and outside the U.S. is just the sort of critical workthat will help to advance the field.”

—Clinton Chadwick – University of Kansas - USA

“Edited by three leading scholars long associated with this field, this book lays out allthe critical and supportive arguments that have arisen in the HRM-performancedebate. It is a powerful summary of what we know and what remains unansweredand successfully starts a new conversation about, and creates a roadmap for, how wecan improve on theory, method and evidence.”

—Paul Sparrow – Lancaster University – Lancaster - United Kingdom

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HRM AND PERFORMANCE

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HRM AND PERFORMANCE

ACHIEVEMENTS AND CHALLENGES

EDITED BY

JAAP PAAUWE, DAVID GUEST ANDPATRICK WRIGHT

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This edition first published 2013ª 2012

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ISBN 978-1-405-16833-5 (paperback)ISBN 978-1-118-48261-2 (emobi)ISBN 978-1-118-48262-9 (epdf)ISBN 978-1-118-48263-6 (epub)

Set in 10/12pt Meridien by MPS Limited, Chennai, India.Printed in Great Britain by TJ International Ltd, Padstow, Cornwall

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CONTENTS

Preface ixEditor biographies xiAuthor biographies xiv

Chapter 1 HRM and Performance: What Do We Know andWhere Should We Go? 1Jaap Paauwe, Patrick Wright and David Guest

Chapter 2 HRM, Well-Being and Performance:A Theoretical and Empirical Review 15Riccardo Peccei, Karina van de Voorde and Marc van Veldhoven

Chapter 3 Building Highly-Performing Work Systems:Analysing HR Systems and Their Contributionto Performance 47Peter Boxall

Chapter 4 Reconceptualizing Fit in Strategic HumanResource Management: ‘Lost in Translation?’ 61Jaap Paauwe, Corine Boon, Paul Boselie and Deanne den Hartog

Chapter 5 HRM and Performance: The Role ofEffective Implementation 79David Guest and Anna Bos-Nehles

Chapter 6 Strategic HRM and Organizational Behaviour:Integrating Multiple Levels of Analysis 97Patrick M. Wright and Lisa H. Nishii

Chapter 7 Measuring Human Capital:A Strategic Human Resource Management Perspective 111Gary C. McMahan and Christopher M. Harris

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Chapter 8 Measurement of Human Resource Practices:Issues Regarding Scale, Scope, Source and SubstantiveContent 129Angela Langevin Heavey, Susanne Beijer, Jessica Federman,Michel Hermans, Felice Klein, Elizabeth McClean andBrian Martinson

Chapter 9 Research on Human Resources andEffectiveness: Some Methodological Challenges 149Barry Gerhart

Chapter 10 Progress and Prospects for HRM–Performance Researchin Small and Medium-Sized Businesses 173Sophie de Winne and Luc Sels

Chapter 11 Progress and Prospects 197David Guest, Patrick Wright and Jaap Paauwe

References 207Index 239

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viii CONTENTS

PREFACE

For more than two decades the three of us have been involved in the topic ofHRM and Performance. We kept track of all the publications, both theoretical aswell as empirical and also contributed to the field ourselves in various ways. We alsotried to build bridges between the USA, UK and mainland Europe. And, we orga-nized in various places and at various times seminars, meetings to discuss findings,developments and progress and . . . obstacles to further progress to ensure thatacademics from around theworld can benefit fromeach other’s insights. Andwewillcontinue to do so.More specifically thefirstmeeting related to this book dates back toa seminar organized in 2004 at Erasmus University in order to celebrate and presentthe book HRM and Performance: Achieving long term viability (Paauwe, 2004). Duringthat conference a number of interesting paperswere being discussed, which led us tothink it would be a good idea to collect these papers under the heading HRM andPerformance: What’s Next?. Since that time, papers were replaced by new papers,the field progressed and also young, bright scholars entered the domain. So, rightnowwe finally have a collection of papers, which bundles both the achievements ofthe past two decades, but more importantly looks forward to future challenges.Moreover, we have been able to include generations of researchers as authors of thedifferent chapters with a mixture of more established academics, the ‘about to takeover’ generation and new upcoming academics. We also made sure to includethe macro (organizational) perspective and the micro (individual) perspective aswell as the multitude of linkages between these two perspectives; linkages that willtake the field forward.

We hope you will enjoy reading this volume and that it will indeed inspireothers to take up the challenges for future research. We - as editors- owe much toour contributing fellow-authors from across the globe, who also represent a globalcommunity of dedicated academics, always open to the debate, and always eager totake the field forward.

Jaap PaauweDavid Guest

Patrick Wright

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EDITOR BIOGRAPHIES

Patrick Wright is Thomas C. Vandiver Bicentennial Chair in the Darla MooreSchool of Business at the University of South Carolina. Prior to joining USC he hasserved on the faculties at Cornell University, Texas A&M University, and theUniversity of Notre Dame.

Professor Wright teaches, conducts research, and consults in the area of Stra-tegic Human Resource Management (SHRM), particularly focusing on how firmsuse people as a source of competitive advantage and the changing nature of theChief HR Officer role. For the past 8 years he has been studying the CHRO rolethrough a series of confidential interviews, public podcasts, small discussiongroups, and conducting the Cornell/CAHRS Survey of Chief HR Officers. Inaddition, he is the faculty leader for the Cornell ILR Executive Education/NAHRprogram “The Chief HR Officer: Strategies for Success” aimed at developingpotential successors to the CHRO role. He served as the lead editor on the recentlyreleased book “The Chief HR Officer: Defining the New Role of Human ResourceLeaders” published by John Wiley and Sons.

He has published over 60 research articles in journals as well as over 20 chaptersin books and edited volumes. He has co-authored two textbooks titled HumanResource Management: Gaining Competitive Advantage (now in its third edition)and Management of Organizations. He has co-edited a special issue of Research inPersonnel and Human Resources Management titled “Strategic Human ResourceManagement in the 21st Century,” and Guest Edited a special issue of HumanResource Management Review titled “Research in Strategic HRM for the 21st

Century.”He has conducted programs and/or consulted for a number of large organiza-

tions including Comcast, Royal Dutch Shell, KennaMetal, AstraZeneca, BT, andBP. He currently serves as a member on the Board of Directors for the NationalAcademy of Human Resources (NAHR). He is a former board member of HRPS,SHRM Foundation and World at Work (formerly American Compensation

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Association). In 2011 he was named by HRM Magazine as one of the 20 “MostInfluential Thought Leaders in HR”.

Department of ManagementDarla Moore School of BusinessUniversity of South Carolina1705 College StreetColumbia, SC 29208 USATel: 1 803 777 5955Email: patrick.wright@moore.sc.edu

David E Guest is one of the leading academic experts on human resource man-agement and related aspects of work and organizational psychology. He has a firstdegree in Psychology and Sociology from Birmingham University and PhD inOccupational Psychology from London University.

His first job was a research officer in the Department of Occupational Psychologyat Birkbeck College. He then spent three years as behavioural science adviser toBritish Rail before joining the London School of Economics in 1972. He moved toBirkbeck in 1990 and for ten years was Professor of Occupational Psychology andhead of the Department of Organizational Psychology. During that period he had aspell as a Governor of Birkbeck and as Pro-Vice Master. He moved to King’s Collegein 2000 where he has served as Head of The Department of Management andDeputy Head of the School of Social Science and Public Policy.

He has written and researched extensively in the areas of human resourcemanagement, employment relations and the psychological contract, motivation andcommitment, and careers. His most recent book is “Psychological Contracts,Employment Contracts and EmployeeWell-Being: An International Study” (OxfordUniversity Press, 2010). He is a member of the editorial advisory board of a numberof journals. He has been a member of the NHS SDO Commissioning Board and ofUK Skills and Employment Advisory Group. Over the years, he has worked closelywith a range of companies including Shell, IBM, HSBC, Hong Kong MTRC, as wellas with the UK National Health Service and a number of government departments.

His current research is concernedwith the relationship between human resourcemanagement, organisational performance and employee well-being in the privateand public sectors; the role of human resource departments; the individualizationof employment relations and the role of the psychological contract; flexibility andemployment contracts; partnership at work; and the future of the career. For fiveyears up to July 2012 he was Programme Director for Workforce issues and alsoManaging Director of the King’s NIHR Patient Safety and Service Quality ResearchCentre, engaged in research on human resource issues in healthcare.

Department of ManagementKing’s College, London150 Stamford StreetLondon SE1 9NHTel: 02078483723Email: david.guest@kcl.ac.uk

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xii EDITOR BIOGRAPHIES

Jaap Paauwe (PhD, Erasmus University Rotterdam) is Professor of HumanResource Studies at Tilburg University, The Netherlands. Before joining Tilburg heworked as a full professor of Organization at Erasmus University Rotterdam,School of Economics. At Erasmus University he is still involved in supervising PhDstudents in the area of HRM and performance in the health care.

He has written and co-authored books on human resource managementand published more than 150 papers/chapters in international refereedjournals and books. In 1991 he was Academic Visitor at the London School ofEconomics. In 1996 he was Visiting Professor at Templeton College, OxfordUniversity. Before joining the university he worked for the trade unionmovement (Head of CNV Research Department 1983-1988) and a Dutch basedmultinational company (SHV 1980-1983). His main research interests are inthe area of HRM, performance and well-being, HR function and -delivery,corporate strategy, governance and risk management, organizational changeand industrial relations. These research and consultancy activities mainly takeplace in the market sector in close cooperation with internationally operatingfirms/MNC’s.

Also active in the health care sector, with a special focus on the HR function andthe relationship between HRM, organizational climate and performance.

In 2005 he joined Cornell University (Ithaca, USA) as a visiting fellow. Inaddition he is a fellow at the TIASNIMBAS Business school and fellow of the JudgeBusiness School/Cambridge University (UK) and academic director of the execu-tive Advanced Human Resource Program of the People Management Centre(PMC), which aims to build bridges between the university and the HR practi-tioners’ community. In 2010 he spent his sabbatical leave at Pablo de OlavideUniversity in Seville, Spain. His latest book is on HRM and Performance: achievinglong term viability (Oxford University Press, June 2004), for which he received theDutch HRM network Award in 2005. Together with Cambridge, INSEAD andCornell University he is involved in a large scale international research project onimproving the excellence of the HR function within multinational companies. Nextto this project the research group at Tilburg has initiated a similar internationalproject, but then focused on the role of the HR-function in corporate governanceand risk management. In 2010 he received -together with his co-authors theinternational HRM Scholarly Research Award from the Academy of Management-HR Division. Next to his academic work Jaap is also involved in more practiceoriented research, coaching and acting as a moderator for a leading group of HRdirectors.

Department of Human Resource StudiesTilburg University, TilburgWarandelaan 2, 5000 LE TilburgTel: +31 13 466 2851/2371Email: paauwe@tilburguniversity.edu

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EDITOR BIOGRAPHIES xiii