Human resource practices and organizational effectiveness : an organization-level analysis

This organization-level field study examined the linkages between human resource practices and organizational effectiveness. Three perspectives on how human resource practices can be implemented and managed are presented: emphasis, quality, and alignment. Emphasis refers to the mere existence of human resource practices in an organization. Quality moves beyond emphasis to focus on how well different practices are implemented. Six specific human resource practices; recruitment, selection, performance appraisal, training, compensation, and job design; function as facets of the quality variable. Alignment concerns the relationship between a firm's mission and its human resource practices. The criterion variables reflect organizational effectiveness and include five indicators: overall evaluation, customer service reputation, turnover, employee morale, and objective productivity, as well as a composite scale. Questionnaires were mailed to key informants at 1,052 randomly-selected organizations. Possible spurious industry effects were prevented by drawing the sample from a single industry, college admission offices. In order to comprehensively assess the organizations, multiple strategically-selected key informants (N = 927) from the following positions were used: chief admission officer, professional employee, and dominant coalition outside the organization. These represented 247 organization-level data sets. The utility of using multiple key informants was endorsed by supportive results from analyses of interrater agreement. Results clearly illustrate the importance of human resource practices in general, and how they are implemented and managed in particular, in organizational effectiveness. The emphasis organizations place on their human resource practices was linked to overall evaluation and the composite criterion. In addition, even after accounting for control variables and the emphasis perspective, the quality with which human resource practices were implemented and managed was strongly related to customer service reputation, employee morale, objective productivity, and the composite criterion. Furthermore, the degree of alignment between human resource practices and organizational mission was associated with overall evaluation, customer service reputation, employee morale, and the composite criterion, even when the control variables and the emphasis and quality perspectives were controlled for. Depending on the criterion, the most predictive specific human resource practices were training, compensation, and job design.