creation activities. As a result, an employee group possessing certain skill sets may
be particularly critical in one company but may be less critical in another company
pursuing a diVerent source of competitive advantage, even when performing the
same job. And if the nature of the contribution varies, the HR systems that are most
eVective in leveraging their potential are likely to vary as well. For example, pursuit
of innovation does not mean everyone has to be managed with a high-commit-
ment HR system. What it does is increase the importance of product development
and marketing skills as a core skill set for competitive advantage. Similarly, low cost
does not require that everyone be managed for eYciency and cost savings. Rather,
it requires continuous improvement to drive productivity that may potentially be
realized through more commitment-oriented or high-performance work systems
rather than solely through productivity and compliance-oriented HR systems. At
the same time, however, at the margins, low-costWrms probably emphasize stand-
ardized processes more than innovativeWrms.
- 1 Research Implications
Conceptually, an architectural perspective may provide some insights into the
mixedWndings in the literature regarding the notion of externalWt or alignment
between strategy and HR systems. It may be the case that the externalWt hypothesis
only holds for speciWc skill sets within organizations; that is, companies may vary
their HR systems for core skill sets to realize alignment with strategic priorities but
adopt a more general or eYciency-oriented approach for other, non-critical skill
sets. As suggested by Delery and Shaw ( 2001 ), using high-performance HR systems
may be most important for an organization’s strategic core workforce. If this
reXects organizational reality, research that fails to diVerentiate the alignment
between strategy and HR systems for core employees versus the alignment between
strategy and the management of an entire workforce may provide an inappropriate
assessment of how externalWt operates.
If companies rely on diVerent skills sets for various strategic objectives, this
certainly has implications for how we conceptualize the eVectiveness of employ-
ment options and HR systems. Rather than focusing on the overall performance
beneWts related to the use of a single HR system across an entire workforce, it may
be more appropriate to more narrowly examine the use of HR systems for speciWc
employees that are instrumental for a company’s source of competitive advantage.
Moreover, if diVerent business processes are more important than others for
various sources of competitive advantage, and diVerent skill sets are emphasized
for diVerent processes, the metrics we choose to assess HR system eVectiveness
might have to be moreWne grained as well. For example, focusing on ROA or ROE
or market-based performance may fail to truly reXect how the management of sales
employees relates to sales growth or customer satisfaction. There may be a strong
employment subsystems and hr architecture 221