Section Fiveproblem-solving skills, developmental and behavior-based
performance appraisal, external equity [linking compensation to
external market indicators], group incentives, skill-based pay,
and salaried compensation.”^112
Operational performance measures were based on
responses to questionnaires that asked general managers and
functional managers to compare their firm’s performance with
other firms in their industry. Three indices of performance were
developed from these responses: employee productivity,
machine efficiency, and customer alignment in terms of quality
products and on-time delivery. Manufacturing strategy was
measured on four dimensions: cost, delivery flexibility (e.g., on-
time delivery, ramping production up quickly), scope flexibility
(e.g., handling nonstandard orders, adjusting product mix), and
quality.^113 The results of this study found the following sup-port
for the contingency approach:
Overall, however, the moderation results provide
strong evidence that manufacturing strategy
influences the HR-performance relationship with a
quality strategy interacting with human–capital-
enhancing HR to predict performance and
delivery flexibility and cost strategies interacting
with administrative HR to predict performance. In
short, maximizing performance appears to