Competition, market commonality, and resource similarity: precursors to HPWS

Abstract

PurposeThe purpose of this paper is to investigate the effect competition has on organizations’ use of high-performance work systems (HPWSs). Specifically, using the resource-based view (RBV) of the firm, it develops a logic for why firms will increase their use of an HPWS when competition increases. It investigates the direct effect of competition on HPWS use. Additionally, it takes a look at the impact market commonality and resource similarity have on the influence of competition on organizations’ use of an HPWS.Design/methodology/approachSurvey method design was used to collect data about organizations from 127 alumni of two large Midwestern universities in the USA. Data were analyzed using OLS regression analysis.FindingsThe main finding of this paper is that competition increases the use of HPWSs. There was not statistical support for the effect of market commonality or resource similarity to influence the competition–HPWS relationship.Originality/valueThis study uses the RBV of the firm to understand how competition influences the adoption of HPWSs. Additionally, it also investigated the effect of market commonality and resource similarity, which has not previously been looked at.