In your eyes: Unpacking employee perceptions of HRM system strength

Rationale and key contributionHRM research has gradually evolved beyond demonstrating more abstract associations between HRM practices and organisational performance to better appreciate more proximal concerns (Guest, 2011).... [ view full abstract ]

Rationale and key contribution

HRM research has gradually evolved beyond demonstrating more abstract associations between HRM practices and organisational performance to better appreciate more proximal concerns (Guest, 2011). Notably, a stream of research has moved to unpack the dynamics within the firm including by incorporating employee voice and perceptions (Heffernan & Dundon, 2016). The work of Bowen and Ostroff (2004) has been instrumental in this regard, offering a framework to move understanding from the content of practices to the processes by which they are enacted, and the means by which HR messages are received and understood by employees. Yet despite its conceptual resonance, in their reflection on the Academy of Management Review article of the decade award Ostroff and Bowen note that “the concept of HRM system strength still remains largely underexplored” (2016: 197). Specifically, they argue that researchers use the system strength logic to frame or build a rationale for their research, but fail to directly explore its key premise. This paper addresses this deficiency by directly exploring HRM system strength amongst a sample of employees from Malaysia. Critically, we propose that human relations climate acts as mediator through which HRM system strength takes effect. We also address calls to explore boundary conditions and systems perspectives (Alvarez & Barney, 2010; Chadwick, Way, Kerr, & Thacker, 2013) by exploring open systems theory as a moderator influencing this relationship.

Theoretical propositions

Recent research has sought to further unpack the complex causal chain between HRM and organisational performance by focusing on employees (Kehoe & Wright, 2013), framing conditions (Chadwick et al., 2013) and /or exploring sector specific dimensions (Fu et al., 2017). Bowen and Ostroff’s (2004) framework unpacks system strength to constitute distinctiveness, consistency and consensus. HR systems have a signalling function that allows employees to form a shared sense of the behaviours that are expected, supported and rewarded by management, thereby promoting employee reactions to HRM that are consistent with organisational goals through motivating employees to adapt desired attitudes and behaviours (Bowen and Ostroff 2004). Distinctiveness represents the visibility and legitimacy of HR, consistency concerns the HRM message and its delivery, while consensus involves agreement and fairness. In this research we explore employee perceptions of these dimensions to examine their impact on affective commitment. We focus on affective commitment as it is said to predict critical employee behaviour, such as discretionary effort and organisational citizenship behaviour (Gilbert, De Winnie, & Sels, 2011). To foster understanding of how this impact takes effect, we explore human relations climate as a key mediating variable. Based on the human relations school of thought (McGregor, 1960), human relations climate focuses on the wellbeing, development and commitment of employees with emphasis on an internal focus (employees) (Patterson et al., 2005).

One key concern with HRM research is that it has increasingly focused inwards within the firm to neglect critical external determinants. Thus we propose open systems as a moderator impacting on the extent on this relationship. Open systems theory stresses two significant characteristics of organisations and organisational actors; a) that they are embedded in a broader system so that all action is informed, shaped, and sometimes even determined, by the context in which they operate and b) interdependence between elements so that movement and change in one sphere will necessarily result in change in another (Wright & Snell, 1991). Of particular significance is the interdependence between existing internal structures of an organisation and the conditions of the environment in which it operates and competes (see Wright & Snell, 1991). Appreciation of environmental interdependency allows for consideration of the numerous factors simultaneously at play in informing the relationship between internal HRM-strength and affective commitment.

Methodology For this research we use employee data collected from nine organisations, representing the dominant five sectoral groupings in the Malaysian economy i.e. research and education, logistics, manufacturing and Government. Surveys were distributed to a representative sample of 10% of the largest employee grouping in each respective organisation, resulting in an overall sample of 2,069 employees. The surveys received prior endorsement from the HR Manager/ Director before distribution and each organisation provided a specific individual to assist with the distribution and follow up. 94 responses were eliminated due to excessive missing data, and therefore, the final sample size for testing was 585 representing a 28.8 percent usable response rate. Over half of the respondents were male (57 percent); 71 percent had a higher level of education beyond secondary school; and 55.9 percent were aged 31 years or more. 47.1 percent of the sample had worked in the organisation for 5 years or more. 

Measures Unless otherwise noted, each measure required a response on a 5-point Likert response scale ranging from 1 (strongly disagree) to 5 (strongly agree).  HRM system strength was measured by an adapted 10-item scale developed by Delmotte et al. (2012). This scale identified three components: distinctiveness, consistency and consensus. Affective commitment was measured using an 8-item scale developed by Meyer and Allen (1991).To measure organisational climate we drew on the work of Patterson et al. (2005). For this study we identified Human Relations Climate as having proximity to both HR activities and attitudinal outcomes. Human Relations Climate measured (1) Autonomy, (2) Supervisory Support, (3) Training and (4) Welfare using 18 items. In measuring open systems climate we are in keeping with the logic of Quinn and Rohrbaugh (1983) and again draw on Patterson et al., (2005). In this sense open systems is composite of innovation and flexibility, outward focus and reflexivity. Controls variables: To control for employee characteristics, we include age in years, gender, level of education, tenure, and finally industry sector. 

Implications This paper represents an ongoing project examining employee perceptions of HRM system strength. It offers the potential for a number of insights. Notably the paper draws on Bowen and Ostroff’s leading work to further a process based understanding of how HRM operates. This is explored via our presentation of human relations climate as a prospective mediator in the HRM strength-affective commitment relationship. We also explore moderation in the form of open systems climate, thereby adding an important and under-represented boundary conditioning logic to understanding (Jackson, Schuler, & Jiang, 2014; Jiang & Messersmith, 2017). Underpinning the above is a much needed focus on employees and an application of core HRM concepts to the developing socio-economic context of Malaysia (Bainbridge, Sanders, Cogin, & Lin, 2017).

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