Share:


High-performance work system on sustainable organizations performance in SMEs

    Anthony Abiodun Eniola   Affiliation
    ; Zhaxat Kenzhin   Affiliation
    ; Ledwin Chimwai   Affiliation
    ; Gaukhar Kairliyeva Affiliation
    ; Mercy Modupe Adeyeye Affiliation
    ; Clainos Chidoko   Affiliation
    ; Munyaradzi Mutsikiwa   Affiliation

Abstract

Managing performance is quite easy, but sustaining that performance is the real challenge for organizations in the 21st century. Hence, the research’s main objective is to examine the impact of high-performance work system on sustainable organizational success in small and medium business (SMEs). Moreover, for global business organizations to succeed innovation must be involved. Therefore, the study is mediated by the Innovative work behaviour. Data were obtained among 820 SME employees in Nigeria. The Analysis used Partial Least Square (PLS) to check the hypothesis. In order to introduce creativity or inspire workers to behave innovatively in the workplace, they need a sense of well-being to actively engage employee organisations. This research will allow managers to agree to invest in workers so that employees work successfully and display creative actions in order to achieve sustainable organisation. This study adds to the scientific management literature by exploring the phenomena sustainable lens innovation and high-performance work by the SMEs in concurrently improve innovation-specific skills, inspiration, and voice habits across employees, resulting in higher innovation efficiency.

Keyword : high performance work systems, innovative work behaviour, sustainable organizational performance, Small and Medium Enterprises, Partial Least Square (PLS), Nigeria

How to Cite
Eniola, A. A., Kenzhin, Z., Chimwai, L., Kairliyeva, G., Adeyeye, M. M., Chidoko, C., & Mutsikiwa, M. (2023). High-performance work system on sustainable organizations performance in SMEs. Business: Theory and Practice, 24(2), 447–458. https://doi.org/10.3846/btp.2023.17342
Published in Issue
Sep 12, 2023
Abstract Views
649
PDF Downloads
503
Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

References

Afriyie, S., Du, J., & Ibn Musah, A.-A. (2019). Innovation and marketing performance of SME in an emerging economy: The moderating effect of transformational leadership. Journal of Global Entrepreneurship Research, 9(1), 40. https://doi.org/10.1186/s40497-019-0165-3

Alhakimi, W., & Mahmoud, M. (2020). The impact of market orientation on innovativeness: Evidence from Yemeni SMEs. Asia Pacific Journal of Innovation and Entrepreneurship, 14(1), 47–59. https://doi.org/10.1108/APJIE-08-2019-0060

Al Hammadi, F., & Hussain, M. (2019). Sustainable organizational performance. International Journal of Organizational Analysis, 27(1), 169–186. https://doi.org/10.1108/IJOA-10-2017-1263

Augustie, C., & Saad, N. M. (2019). Examining the moderating effect of environmental hostility on the relationship between entrepreneurial orientation and international performance of Indonesian SMEs. International Journal of Academic Research in Business and Social Sciences, 9(7). https://doi.org/10.6007/IJARBSS/v9-i7/6144

Bagozzi, R. P. (1996). Principles of marketing research. Blackwell Business.

Baker, W. E., & Sinkula, J. M. (2002). Market orientation, learning orientation and product innovation: Delving into the organization’s black box. Journal of Market-Focused Management, 5(1), 5–23. https://doi.org/10.1023/A:1012543911149

Bakhshi, H., McVittie, E., & Simmie, J. (2008). Creating innovation: Do the creative industries support innovation in the wider economy? Nesta.

Balkin, D. B., Markman, G. D., & Gomez-Mejia, L. R. (2000). Is CEO pay in high-technology firms related to innovation? Academy of Management Journal, 43(6), 1118–1129. https://doi.org/10.5465/1556340

Bamber, G. J., Hoffer Gittell, J., Kochan, T. A., & von Norden­flycht, A. (2009). Contrasting management and employment-relations strategies in European airlines. Journal of Industrial Relations, 51(5), 635–652. https://doi.org/10.1177/0022185609346185

Barney, J. B. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17(1), 99–120. https://doi.org/10.1177/014920639101700108

Barney, J. B. (2001). Is the resource-based “view” a useful perspective for strategic management research? Yes. Academy of Management Review, 26(1), 41–56. https://doi.org/10.5465/amr.2001.4011938

Bititci, U., Garengo, P., Dörfler, V., & Nudurupati, S. (2012). Performance measurement: Challenges for tomorrow. International Journal of Management Reviews, 14(3), 305–327. https://doi.org/10.1111/j.1468-2370.2011.00318.x

Chowhan, J. (2013). High performance work systems: A causal framework of training, innovation, and organizational performance in Canada [PhD, McMaster University]. Hamilton, Ontario.

Crépon, B., Duguet, E., & Mairessec, J. (1998). Research, innovation and productivity: An econometric analysis at the firm level. Economics of Innovation and New Technology, 7(2), 115–158. https://doi.org/10.1080/10438599800000031

Damanpour, F., & Evan, W. M. (1984). Organizational innovation and performance: The problem of “Organizational Lag”. Administrative Science Quarterly, 29(3), 392. https://doi.org/10.2307/2393031

Damanpour, F., Szabat, K. A., & Evan, W. M. (1989). The relationship between types of innovation and organizational performance. Journal of Management Studies, 26(6), 587–602. https://doi.org/10.1111/j.1467-6486.1989.tb00746.x

de Jong, J., & den Hartog, D. (2010). Measuring innovative work behaviour. Creativity and Innovation Management, 19(1), 23–36. https://doi.org/10.1111/j.1467-8691.2010.00547.x

Dediu, V., Leka, S., & Jain, A. (2018). Job demands, job resources and innovative work behaviour: A European Union study. European Journal of Work and Organizational Psychology, 27(3), 310–323. https://doi.org/10.1080/1359432X.2018.1444604

Dibrell, C., Craig, J., & Hansen, E. (2011). Natural environment, market orientation, and firm innovativeness: An organizational life cycle perspective. Journal of Small Business Management, 49(3), 467–489. https://doi.org/10.1111/j.1540-627X.2011.00333.x

Eniola, A. A. (2014). The role of SME firm performance in Nigeria. Arabian Journal of Business and Management Review, 3(12), 33–47. https://doi.org/10.12816/0016552

Eniola, A. A. (2018). SME firm characteristics impact on the choice of sources of financing in South-West, Nigeria. International Journal of Business and Globalisation, 21(3), 344–366. https://doi.org/10.1504/IJBG.2018.095482

Eniola, A. A. (2020a). Cultural identity and entrepreneurial performance. In Entrepreneurship as empowerment: Knowledge spillovers and entrepreneurial ecosystems (pp. 23–44). Emerald Publishing Limited. https://doi.org/10.1108/978-1-83982-550-720201004

Eniola, A. A. (2020b). Internal control procedures and firm’s performance. International Journal of Scientific & Technology Research, 9(2), 6407–6415.

Eniola, A. A. (2021). The entrepreneur motivation and financing sources. Journal of Open Innovation: Technology, Market, and Complexity, 7(1), 1–25. https://doi.org/10.3390/joitmc7010025

Eniola, A. A., & Entebang, H. (2014). SME firms performance in Nigeria: Competitive advantage and its impact. International Journal of Research Studies in Management, 3(2), 75–86. https://doi.org/10.5861/ijrsm.2014.854

Eniola, A. A., & Olorunleke, G. K. (2020). Marketing strategies impact on organizational performance. International Journal of Scientific & Technology Research, 9(1), 1758–1762.

Eniola, A. A., Olorunleke, G. K., Akintimehin, O. O., Ojeka, J. D., & Oyetunji, B. (2019). The impact of organizational culture on total quality management in SMEs in Nigeria. Heliyon, 5(8), e02293. https://doi.org/10.1016/j.heliyon.2019.e02293

Eniola, A. A., & Osigwe, K. C. (2021). Entrepreneurship education and venture intention. In P. Jones, N. Apostolopoulos, A. Kakouris, C. Moon, V. Ratten, & A. Walmsley (Eds.), Universities and entrepreneurship: Meeting the educational and social challenges (Vol. 11, pp. 97–116). Emerald Publishing Limited. https://doi.org/10.1108/S2040-724620210000011007

Farrelly, F., & Quester, P. (2003). The effects of market orientation on trust and commitment. European Journal of Marketing, 37(3/4), 530–553. https://doi.org/10.1108/03090560310459078

Fazzari, S. M., Hubbard, R. G., & Petersen, B. C. (1996). Financing constraints and corporate investment: Response to Kaplan and Zingales. National Bureau of Economic Research. https://doi.org/10.3386/w54622

Ferrier, W. J., & Lyon, D. W. (2004). Competitive repertoire simplicity and firm performance: The moderating role of top management team heterogeneity. Managerial and Decision Economics, 25(6–7), 317–327. https://doi.org/10.1002/mde.1193

Finlay, W., Appelbaum, E., Bailey, T., Berg, P., & Kalleberg, A. L. (2001). Manufacturing advantage: Why high-performance work systems pay off. Administrative Science Quarterly, 46(4), 781. https://doi.org/10.2307/3094834

Fornell, C., & Larcker, D. F. (1981). Evaluating structural equation models with unobservable variables and measurement error. Journal of Marketing Research, 18(1), 39–50. https://doi.org/10.1177/002224378101800104

Frega, J. R., Ferraresi, A. A., Quandt, C. O., & da Veiga, C. P. (2018). Relationships among knowledge management, organisational innovativeness and performance: Covariance-based versus partial least-squares structural equation modelling. Journal of Information & Knowledge Management, 17(01), 1850008. https://doi.org/10.1142/S0219649218500089

Fu, N., Flood, P. C., Bosak, J., Morris, T., & O’Regan, P. (2015). How do high performance work systems influence organizational innovation in professional service firms? Employee Relations, 37(2), 209–231. https://doi.org/10.1108/ER-10-2013-0155

Gamage, P. (2020). High performance work practices: A comprehensive analysis of theories and practices. ReserchGate. https://www.researchgate.net/publication/346943879_High_Performance_Work_Practices_A_Comprehensive_Analysis_of_Theories_and_Practices

Garengo, P., Biazzo, S., & Bititci, U. S. (2005). Performance measurement systems in SMEs: A review for a research agenda. International Journal of Management Reviews, 7(1), 25–47. https://doi.org/10.1111/j.1468-2370.2005.00105.x

Garengo, P., & Bititci, U. (2007). Towards a contingency approach to performance measurement: An empirical study in Scottish SMEs. International Journal of Operations & Production Management, 27(8), 802–825. https://doi.org/10.1108/01443570710763787

Gittell, J. H., Seidner, R., & Wimbush, J. (2010). A relational model of how high-performance work systems work. Organization Science, 21(2), 490–506. https://doi.org/10.1287/orsc.1090.0446

Hair, J. F., Ringle, C. M., & Sarstedt, M. (2011). PLS-SEM: Indeed a silver bullet. Journal of Marketing Theory and Practice, 19(2), 139–152. https://doi.org/10.2753/MTP1069-6679190202

Hair, J. F. (2014). Multivariate data analysis (7th ed. ed.). Pearson.

Hair, J. F., Black, W. C., Babin, B. J., & Anderson, R. E. (2014). Multivariate data analysis (7th ed.). Pearson Education Limited.

Handiwibowo, G., Nasution, A., Arumsari, Y., & Astuti, R. (2020). Strategic fit implication of technological innovation capabilities for SMEs with new product development. Management Science Letters, 10(12), 2875–2882. https://doi.org/10.5267/j.msl.2020.4.020

Hoffer Gittell, J. (2016). Transforming relationships for high performance. Stanford University Press. https://doi.org/10.1515/9780804797047

Huselid, M. A. (1995). The impact of human resource management practices on turnover, productivity, and corporate financial performance. Academy of Management Journal, 38(3), 635–672. https://doi.org/10.2307/2567411

Jaworski, B. J., & Kohli, A. K. (1993). Market orientation: Antecedents and consequences. Journal of Marketing, 57(3), 53. https://doi.org/10.1177/002224299305700304

Kaplan, R. S., & Norton, D. P. (1992). The balanced scorecard – measures that drive performance. Harvard Business Review, 71–79.

Kirner, E., Kinkel, S., & Jaeger, A. (2009). Innovation paths and the innovation performance of low-technology firms – An empirical analysis of German industry. Research Policy, 38(3), 447–458. https://doi.org/10.1016/j.respol.2008.10.011

Kitsios, F. C., & Grigoroudis, E. (2020). Evaluating service innovation and business performance in tourism: A multicriteria decision analysis approach. Management Decision, 58(11), 2429–2453. https://doi.org/10.1108/MD-09-2019-1326

Kleindorfer, P. R., Singhal, K., & Van Wassenhove, L. N. (2005). Sustainable operations management. Production and Operations Management, 14(4), 482–492. https://doi.org/10.1111/j.1937-5956.2005.tb00235.x

Laforet, S. (2009). Effects of size, market and strategic orientation on innovation in non‐high‐tech manufacturing SMEs. European Journal of Marketing, 43(1/2), 188–212. https://doi.org/10.1108/03090560910923292

Linton, J. D., Klassen, R., & Jayaraman, V. (2007). Sustainable supply chains: An introduction. Journal of Operations Management, 25(6), 1075–1082. https://doi.org/10.1016/j.jom.2007.01.012

Mehta, N. (2015). Impact of high performance work systems on innovation and firm’s performance thesis guide [PhD, Calorx Teacher’s University]. India.

Morgan, G. (1986). Images of Organization (1st ed.). SAGE Publications.

Naranjo‐Valencia, J. C., Jimenez‐Jimenez, D., & Sanz‐Valle, R. (2017). Organizational culture and radical innovation: Does innovative behavior mediate this relationship? Creativity and Innovation Management, 26(4), 407–417. https://doi.org/10.1111/caim.12236

National Bureau of Statistics/Small & Medium Enterprises Development Agency of Nigeria. (2017). National Survey of Micro Small & Medium Enterprises (MSMEs). National Bureau of Statistics (NBS)/Small and Medium Enterprises Development Agency of Nigeria (SMEDAN). http://smedan.gov.ng/images/NATIONAL%20SURVEY%20OF%20MICRO%20SMALL%20&%20MEDIUM%20ENTERPRISES%20(MSMES),%20%202017%201.pdf

Nonaka, I. (1998). The knowledge-creating company. In The economic impact of knowledge (pp. 175–187). Elsevier. https://doi.org/10.1016/B978-0-7506-7009-8.50016-1

Nonaka, I., & Takeuchi, H. (1995). The knowledge-creating company: How Japanese companies create the dynamics of innovation. Long Range Planning, 29(4). https://doi.org/10.1016/0024-6301(96)81509-3

Oldham, G. R., & Cummings, A. (1996). Employee creativity: Personal and contextual factors at work. Academy of Management Journal, 39(3), 607–634. https://doi.org/10.2307/256657

Özçelik, G., Aybas, M., & Uyargil, C. (2016). High performance work systems and organizational values: Resource-based view considerations. Procedia – Social and Behavioral Sciences, 235, 332–341. https://doi.org/10.1016/j.sbspro.2016.11.040

Pfeffer, J. (1998). Seven practices of successful organizations. California Management Review, 40(2), 97. https://doi.org/10.2307/41165935

Pisano, G. P., & Teece, D. J. (2007). How to capture value from innovation: Shaping intellectual property and industry architecture. California Management Review, 50(1), 278–296. https://doi.org/10.2307/41166428

Porter, M. E. (1985). Competitive advantage. The Free Press.

Porter, M. E. (1991). Towards a dynamic theory of strategy. Strategic Management Journal, 12(S2), 95–117. https://doi.org/10.1002/smj.4250121008

Prifti, R., & Alimehmeti, G. (2017). Market orientation, innovation, and firm performance – an analysis of Albanian firms. Journal of Innovation and Entrepreneurship, 6(1), 8. https://doi.org/10.1186/s13731-017-0069-9

Queensland Government. (2010). Australia’s International Research Engagement, Queensland Government Submission. Queensland Government.

Rasheed, M. A., Shahzad, K., Conroy, C., Nadeem, S., & Siddique, M. U. (2017). Exploring the role of employee voice between high-performance work system and organizational innovation in small and medium enterprises. Journal of Small Business and Enterprise Development, 24(4), 670–688. https://doi.org/10.1108/JSBED-11-2016-0185

Rosenbusch, N., Brinckmann, J., & Bausch, A. (2011). Is innovation always beneficial? A meta-analysis of the relationship between innovation and performance in SMEs. Journal of Business Venturing, 26(4), 441–457. https://doi.org/10.1016/j.jbusvent.2009.12.002

Scott, S. G., & Bruce, R. A. (1994). Determinants of innovative behavior: A path model of individual innovation in the workplace. Academy of Management Journal, 37(3), 580–607. https://doi.org/10.2307/256701

Sethibe, T., & Steyn, R. (2016). Innovation and organisational performance: A critical review of the instruments used to measure organisational performance. The Southern African Journal of Entrepreneurship and Small Business Management, 8(1), 12. https://doi.org/10.4102/sajesbm.v8i1.50

Shahzad, K., Arenius, P., Muller, A., Rasheed, M. A., & Baj­wa, S. U. (2019). Unpacking the relationship between high-performance work systems and innovation performance in SMEs. Personnel Review, 48(4), 977–1000. https://doi.org/10.1108/PR-10-2016-0271

Shin, J., Kim, C., & Yang, H. (2018). The effect of sustainability as innovation objectives on innovation efficiency. Sustainability, 10(6), 1966. https://doi.org/10.3390/su10061966

Siddique, M., Procter, S., & Gittell Jody, H. (2019). The role of relational coordination in the relationship between high-performance work systems (HPWS) and organizational performance. Journal of Organizational Effectiveness: People and Performance, 6(4), 246–266. https://doi.org/10.1108/JOEPP-04-2018-0029

Siddiqui, M. (2001). Book reviews: Robert S. Kaplan and David P. Norton, beyond balanced scorecard: The strategic-focused organization. Harvard Business School Press, 2001, 400 p., Rs 1434. Global Business Review, 2(2), 309–313. https://doi.org/10.1177/097215090100200211

Sindakis, S., & Kitsios, F. (2014). Entrepreneurial dynamics and patient involvement in service innovation: Developing a model to promote growth and sustainability in mental health care. Journal of the Knowledge Economy, 7(2), 545–564. https://doi.org/10.1007/s13132-014-0228-1

Tajeddini, K., Trueman, M., & Larsen, G. (2006). Examining the effect of market orientation on innovativeness. Journal of Marketing Management, 22(5–6), 529–551. https://doi.org/10.1362/026725706777978640

Takeuchi, R., Lepak, D. P., Wang, H., & Takeuchi, K. (2007). An empirical examination of the mechanisms mediating between high-performance work systems and the performance of Japanese organizations. Journal of Applied Psychology, 92(4), 1069–1083. https://doi.org/10.1037/0021-9010.92.4.1069

Teece, D. J. (2007). Explicating dynamic capabilities: The nature and microfoundations of (sustainable) enterprise performance. Strategic Management Journal, 28(13), 1319–1350. https://doi.org/10.1002/smj.640

Timiyo, A. (2014). High performance work practices: One best-way or no best-way. IOSR Journal of Business and Management, 16(6), 8–14. https://doi.org/10.9790/487X-16610814

Tran, V. D., & Tookey, J. E. (2011). Labour productivity in the New Zealand construction industry: A thorough investigation. Construction Economics and Building, 11(1), 41–60. https://doi.org/10.5130/AJCEB.v11i1.1841

UK Commission for Employment Skills. (2010). Towards Ambition 2020: skills, jobs, growth for Scotland: Expert advice from the UK Commission for Employment and Skills (9781906597320). UKCES. https://dera.ioe.ac.uk/id/eprint/9545/1/skills_jobs_growth_finalpdf_231009.pdf

Van der Vegt, G. S., & Janssen, O. (2003). Joint impact of interdependence and group diversity on innovation. Journal of Management, 29(5), 729–751. https://doi.org/10.1016/S0149-2063_03_00033-3

Walsh, E., Gilvarry, C., Samele, C., Harvey, K., Manley, C., Tattan, T., Tyrer, P., Creed, F., Murray, R., & Fahy, T. (2004). Predicting violence in schizophrenia: A prospective study. Schizophrenia Research, 67(2–3), 247–252. https://doi.org/10.1016/S0920-9964(03)00091-4

Wang, C. L., & Chung, H. F. L. (2013). The moderating role of managerial ties in market orientation and innovation: An Asian perspective. Journal of Business Research, 66(12), 2431–2437. https://doi.org/10.1016/j.jbusres.2013.05.031

Wolfe, R. A. (1994). Organizational innovation: Review, critique and suggested research directions. Journal of Management Studies, 31(3), 405–431. https://doi.org/10.1111/j.1467-6486.1994.tb00624.x

Woltjer, G., van Galen, M., & Logatcheva, K. (2021). Industrial innovation, labour productivity, sales and employment. International Journal of the Economics of Business, 28(1), 89–113. https://doi.org/10.1080/13571516.2019.1695448

Wood, D. J. (2010). Measuring corporate social performance: A review. International Journal of Management Reviews, 12(1), 50–84. https://doi.org/10.1111/j.1468-2370.2009.00274.x

Woodman, R. W., Sawyer, J. E., & Griffin, R. W. (1993). Toward a theory of organizational creativity. Academy of Management Review, 18(2), 293–321. https://doi.org/10.2307/258761

Wright, P. M., & McMahan, G. C. (1992). Theoretical perspectives for strategic human resource management. Journal of Management, 18(2), 295–320. https://doi.org/10.1177/014920639201800205

Yidong, T., & Xinxin, L. (2012). How ethical leadership influence employees’ innovative work behavior: A perspective of intrinsic motivation. Journal of Business Ethics, 116(2), 441–455. https://doi.org/10.1007/s10551-012-1455-7

Yu, L., Duan, Y., & Fan, T. (2020). Innovation performance of new products in China’s high-technology industry. International Journal of Production Economics, 219, 204–215. https://doi.org/10.1016/j.ijpe.2019.06.002

Zehir, C., & Zehir, M. (2019). The relationship between market orientation, coopetition, innovation capabilities and firm performance. In C. Zehir & E. Erzengin (Eds.), Leadership, technology, innovation and business management. European Proceedings of Social and Behavioural Sciences (vol. 75, pp. 163–174). Future Academy. https://doi.org/10.15405/epsbs.2019.12.03.14

Zhu, C., Liu, A., & Chen, G. (2018). High performance work systems and corporate performance: The influence of entrepreneurial orientation and organizational learning. Frontiers of Business Research in China, 12(1), 4. https://doi.org/10.1186/s11782-018-0025-y