Do human resource systems indeed have "system" effects? The dual internal fit model of a high-performance work system.

Abstract

The configurational or "internal fit" perspective proposes that human resource (HR) systems are most effective when individual practices are configured such that they fit together and are mutually reinforcing. The Ability-Motivation-Opportunity (AMO) model has emerged as a predominant way to select and configure HR practices based on whether they attempt to enhance employee ability, motivation, or opportunities. Despite the widespread use of the configurational perspective and AMO model in building a high-performance work system (HPWS), researchers have not clearly articulated how HR practices across the AMO domains should be configured to maximize internal fit across the system. Moreover, research has overlooked the hierarchical nature of an HPWS, such that HR practices are nested within a particular AMO domain, and the AMO domains, in turn, are nested within the HPWS. To address these gaps, we develop and test a dual internal fit model that specifies synergistic interactions within and among AMO domains. Analyses of six-wave panel data from 640 firms reveal that internal fit effects of HR practices simultaneously exist within (i.e., HR practice-level interactions) and among AMO domains (i.e., AMO domain-level interactions) to predict workforce productivity and ultimately firm profitability. Moreover, the two sets of interactions predict outcomes beyond the additive effects of the HR practices on which prior research has typically focused. These findings show that HR practices can be configured to have "system" effects. They also highlight the value of the dual internal fit model to understand the performance benefits of optimally configured HR systems. (PsycInfo Database Record (c) 2024 APA, all rights reserved).