High-performance work systems and workplace performance in small, medium-sized and large firms

Abstract

This article draws on the Organisational Growth and Development (OGD) life cycle model to explore the relationship between high-performance work systems (HPWS) and performance in firms of different size, thereby extending understanding of congruence or ‘best fit’ theory within strategic HRM debates. With reference to management control theory, economies of scale and the availability of specialist managerial skills, the article hypothesises that while an HPWS–performance relationship might exist in small, medium-sized and large firms, the relationship will be stronger in large firms than in both small and medium-sized firms, and stronger in medium-sized firms than in small firms. Analysis of data from the British Workplace Employment Relations Survey demonstrates, however, that there is no association between HPWS and workplace performance in medium-sized firms, in contrast to the positive relationship between HPWS and performance found in large firms and between HPWS and labour productivity in small firms.