Leverage point in high-performance work systems

Abstract

AbstractDrawing on systems theory, this paper aims to search for a leverage point in a high-performance work system (HPWS) wherein a small change of a constituent part significantly enhances the effect of the whole system on organizational performance (OP). Based on meta-analysis of 59,207 firms and establishments from 240 sample studies up to December 2021, the paper examines the effect of HPWS composition, coupled with country of origin and industrial affiliation, on the HPWS–OP relationship. The paper finds that training and development serves as a leverage point to significantly strengthen the synergy of HPWS. However, this leverage point works in advanced countries rather than developing countries, and in service industries rather than manufacturing industries. The finding indicates that a leverage point is not omnipresent, but contingent on country of origin and industrial affiliation. This study has practical implications for managers, highlighting the importance of a leverage point to the HPWS–OP relationship and the contingency nature of the leverage point.