Low-Performance
Company HR System
Bottom 10% (42 firms)High-Performance
Company HR System
Top 10% (43 firms)
Percentage of the eligible workforce covered by a
union contract 30.00^ 8.98^
Firm Performance
Employee turnover 34.09 20.87
Sales per employee $158,101 $617,576
Market value to book value 3.64 11.06
*Each of the variables in the "HR Out Comes" section is scaled from 1 to 6,
Where 1 = "not at all" and 6 = "to a very great extent."
Source: ibid pp16- 17Table 2.6 also helps to illustrate another aspect of high-performance work
systems, namely that they have a definite bias toward helping and
encouraging workers to manage themselves. The high-performing firms
generally emphasize placing employees in self-managing, cross-functional
teams. In fact, the whole thrust of the HPWS's superior recruiting, screening,
training, and other HR practices is to build the sort of highly trained,
empowered, self-governing, and flexible workforce that companies today need
as a competitive advantage.The need for HPWS became apparent as global competition intensified in the
1990s. Companies needed a way to better utilize their human resources as
they strove to improve quality, productivity, and responsiveness. In the early
1990s, the U.S. Department of Labor identified several characteristics of high-
performance work organizations: multiskilled work teams; empowered front-
line workers; more training; labor management cooperation; commitment to
quality; and customer satisfaction.30 HR practices like those in Table 2.6
foster these characteristics.