Expanding the concept of fit in strategic human resource management: An examination of the relationship between human resource practices and charismatic leadership on organizational outcomes

CITATION

Mcclean, E., & Collins, C. (2019). Expanding the concept of fit in strategic human resource management: An examination of the relationship between human resource practices and charismatic leadership on organizational outcomes. Human Resource Management, 58(2), 187–202

For library access / research help in a similar topic: anyangoceline19@gmail.com

ABSTRACT
We investigate the relationship between high-commitment human resources (HCHR) practices
and chief executive officer (CEO) charismatic leadership on voluntary employee turnover and
relative performance to peers in a sample of 281 small firms. In this study, we expand upon prior
conceptualizations of fit within the literature on strategic human resources (HR) to include the
fit of HCHR with other aspects of the people management system. Specifically, we hypothesize
a variety of relationships that may occur (e.g., positive synergistic, deadly combination, or substitution)
and find that when a firm uses a system of HCHR practices and has a charismatic leader,
performance is highest and turnover lowest. Conversely, when a firm does not invest in either,
performance is lowest and turnover highest. We also found some support for a substitution
effect as our data showed that when there is a mismatch between a firm's HR system and the
leadership characteristics of the CEO, turnover is higher and performance lower than the highinvestment
people management system (high HCHR and high-charismatic leadership), but turnover
is lower and performance higher than the low-investment (low HCHR and low-charismatic
leadership) people management system.


REFERENCES
Agle, B. R., Nagarajan, N. J., Sonnenfeld, J. A., & Srinivasan, D. (2006). Does
CEO charisma matter? An empirical analysis of the relationships among
organizational performance, environmental uncertainty, and top management
team perceptions of CEO charisma. Academy of Management
Journal, 49, 161–174.

Aiken, L. S., & West, S. G. (1991). Multiple regression: Testing and interpreting
interactions. Newbury Park, CA: Sage.

Allen, M. R., Ericksen, J., & Collins, C. J. (2013). Human resource management,
employee exchange relationships, and performance in small businesses.
Human Resource Management, 52, 153–173.

Appelbaum, E., Bailey, T., Berg, P., & Kallerberg, A. (2000). Manufacturing
advantage: Why high performance work systems pay off. New York, NY:
Columbia University Press.

Arthur, J. B. (1994). Effects of human resource systems on manufacturing
performance and turnover. Academy of Management Journal, 37,
670–687.

Baron, J. N., Hannan, M. T., & Burton, M. D. (1999). Building the iron cage:
Determinants of managerial intensity in the early years of organizations.
American Sociological Review, 64, 527–547.

Baron, J. N., Hannan, M. T., & Burton, M. D. (2001). Labor pains: Change in
organizational models and employee turnover in young, high-tech
firms. American Journal of Sociology, 106, 960–1012.

Bass, B. M. (1998). Transformational leadership: Industry, military, and educational
impact. Mahwah, NJ: Erlbaum.

Batt, R. (2002). Managing customer services: Human resource practices,
quit rates, and sales growth. Academy of Management Journal, 45,
587–597.

Batt, R., & Colvin, A. J. (2011). An employment systems approach to turnover:
Human resources practices, quits, dismissals, and performance.
Academy of Management Journal, 54, 695–717.

Becker, B. E., & Huselid, M. A. (1998). High performance work systems
and firm performance: A synthesis of research and managerial implications.
In G. R. Ferris (Ed.), Research in personnel and human resources
management (Vol. 16, pp. 53–101). Greenwich, CT: JAI Press.

Bliese, P. D. (2000). Within-group agreement, non-independence, and reliability:
Implications for data aggregation and analysis. In K. J. Klein &
S. W. J. Kozlowski (Eds.), Multilevel theory, research, and methods in
organizations: Foundations, extensions, and new directions
(pp. 349–381). San Francisco, CA: Jossey-Bass.

Bordia, P., Restubog, S. L. D., & Tang, R. L. (2008). When employees strike
back: Investigating mediating mechanisms between psychological contract
breach and workplace deviance. Journal of Applied Psychology, 93,
1104–1117.

Bowen, D. E., & Ostroff, C. (2004). Understanding HRM-firm performance
linkages: The role of the strength of the HR system. Academy of Management
Review, 29, 203–221.

Boxall, P., & Macky, K. (2009). Research and theory on high-performance
work systems: Progressing the high-involvement stream. Human
Resource Management Journal, 19, 3–23.

Bureau of Labor Statistics. (2014). Business employment dynamics: Entrepreneurship
and the U.S. economy. U.S. Department of LaborRetrieved
from U.S. Department of Labor, Washington, D.C. https://www.bls.
gov/bdm/entrepreneurship/entrepreneurship.htm.

Cannella, A. A., & Monroe, M. J. (1997). Contrasting perspectives on strategic
leaders: Toward a more realistic view of top managers. Journal of
Management, 23, 213–237.

Chadwick, C. (2010). Theoretic insights on the nature of synergies in
human resource systems: Toward greater precision. Human Resource
Management Review, 20, 85–101.

Chadwick, C., Way, S. A., Kerr, G., & Thacker, J. W. (2013). Boundary conditions
of the high-investment human resources systems-small-firm
labor productivity relationship. Personnel Psychology, 66, 311–343.

Chuang, C. H., Jackson, S. E., & Jiang, Y. (2016). Can knowledge-intensive
teamwork be managed? Examining the roles of HRM systems, leadership,
and tacit knowledge. Journal of Management, 42, 524–554.

Collins, C. J., & Clark, K. D. (2003). Strategic human resource practices, top
management team social networks, and firm performance: The role of
human resource practices in creating organizational competitive
advantage. Academy of Management Journal, 46, 740–751.

Collins, C. J., & Smith, K. G. (2006). Knowledge exchange and combination:
The role of human resource practices in the performance of hightechnology
firms. Academy of Management Journal, 49, 544–560.

Combs, J., Liu, Y., Hall, A., & Ketchen, D. (2006). How much do high performance
work practices matter?: A metaAnalysis of their effects on organizational
performance. Personnel Psychology, 59, 501–528.

Conger, J. A., & Kanungo, R. N. (1998). Charismatic leadership in organizations.
Thousand Oaks, CA: Sage.

Conger, J. A., Kanungo, R. N., Menon, S. T., & Mathur, P. (1997). Measuring
charisma: Dimensionality and validity of the Conger-Kanungo scale of
charismatic leadership. Canadian Journal of Administrative Sciences, 14,
290–302.

Cooke, F. L. (2018). Concepts, contexts, and mindsets: Putting human
resource management research in perspectives. Human Resource Management
Journal, 28, 1–13.

Daily, C. M., & Dalton, D. R. (1992). The relationship between governance
structure and corporate performance in entrepreneurial firms. Journal
of Business Venturing, 7, 375–386.

Datta, D. K., Guthrie, J. P., & Wright, P. M. (2005). Human resource management
and labor productivity: Does industry matter? Academy of
Management Journal, 48, 135–145.

Delaney, J. T., & Huselid, M. A. (1996). The impact of human resource
management practices on perceptions of organizational performance.
Academy of Management Journal, 39, 949–969.

Delery, J. E. (1998). Issues of fit in strategic human resource management:
Implications for research. Human Resource Management Review, 8,
289–309.

Delery, J. E., & Doty, D. H. (1996). Modes of theorizing in strategic human
resource management: Tests of universalistic, contingency, and configurational
performance predictions. Academy of Management Journal,
39, 802–835.

Delery, J. E., & Shaw, J. D. (2001). The strategic management of people in
work organizations: Review, synthesis, and extension. In G. R. Ferris
(Ed.), Research in personnel and human resources management (Vol. 20,
pp. 165–197). Greenwich, CT: JAI Press.

Dodge, H. R., Fullerton, S., & Robbins, J. E. (1994). Stage of the organizational
life cycle and competition as mediators of problem perception
for small businesses. Strategic Management Journal, 15, 121–134.

Drazin, R., & Van de Ven, A. H. (1985). Alternative forms of fit in contingency
theory. Administrative Science Quarterly, 30, 514–539.

Gerhart, B., Wright, P. M., McMahan, G. C., & Snell, S. A. (2000). Measurement
error in research human resources and firm performance: How
much error is there and how does it influence effect size estimates?
Personnel Psychology, 53, 803–834.

Griffeth, R. W., Hom, P. W., & Gaertner, S. (2000). A meta-analysis of antecedents
and consequences of employee turnover: Update, moderator
tests, and research implications for the next millennium. Journal of
Management, 26, 463–488.

Hambrick, D. C., & Mason, P. A. (1984). Upper echelons: The organization
as a reflection of its top managers. Academy of Management Review, 9,
193–206.

Han, J. H., Liao, H., Taylor, M. S., & Kim, S. (2018). Effects of highperformance
work systems on transformational leadership and team
performance: Investigating the moderating roles of organizational orientations.
Human Resource Management, 57, 1065–1082. https://doi.
org/10.1002/hrm.21886

Hausknecht, J. P., & Trevor, C. O. (2011). Collective turnover at the group,
unit, and organizational levels: Evidence, issues, and implications. Journal
of Management, 37, 352–388.

Howell, J. P., Bowen, D. E., Dorfman, P. W., Kerr, S., & Podsakoff, P. M.
(1990). Substitutes for leadership: Effective alternatives to ineffective
leadership. Organizational Dynamics, 19, 21–38.

Huselid, M. A. (1995). The impact of human resource management practices
on turnover, productivity, and corporate financial performance.
Academy of Management Journal, 38, 635–672.

James, L. R. (1982). Aggregation bias in estimates of perceptual agreement.
Journal of Applied Psychology, 67, 219–229.

Jiang, K., Chuang, C. H., & Chiao, Y. C. (2015). Developing collective customer
knowledge and service climate: The interaction between
service-oriented high-performance work systems and service leadership.
Journal of Applied Psychology, 100, 1089–1106.

Jiang, K., Lepak, D. P., Hu, J., & Baer, J. C. (2012). How does human
resource management influenceorganizational outcomes? A metaanalytic
investigation of mediating mechanisms. Academy of Management
Journal, 55, 1264–1294.

Kehoe, R. R., & Collins, C. J. (2008). Exploration and exploitation strategies
and the contingency of HR systems. Research in Personnel and Human
Resources Management, 25, 149–176.

Kehoe, R. R., & Collins, C. J. (2017). Human resource management and unit
performance in knowledge-intensive work. Journal of Applied Psychology,
102, 1222–1236.

Kepes, S., & Delery, J. E. (2007). HR policy and the problem of internal fit.
In P. Boxall, J. Purcell, & P. Wright (Eds.), The Oxford University Press
handbook of human resource management (pp. 385–404). Oxford,
England: Oxford University Press.

Kobe, K. (2012). Small business GDP: Update 2002–2010. U.S. Small Business
Administration, Washington, DC. Retrieved from https://www.
sba.gov/sites/default/files/rs390tot_1.pdf

Lazar, A. A., & Zerbe, G. O. (2011). Solutions for determining the significance
region using the Johnson-Neyman type procedure in generalized
linear (mixed) models. Journal of Educational and Behavioral Statistics,
36, 699–719.

LeBreton, J. M., & Senter, J. L. (2008). Answers to 20 questions about
interrater reliability and interrater agreement. Organizational Research
Methods, 11, 815–852.

Liao, H., Toya, K., Lepak, D. P., & Hong, Y. (2009). Do they see eye to eye?
Management and employee perspectives of high-performance work
systems and influence processes on service quality. Journal of Applied
Psychology, 94, 371–391.

Ling, Y., Simsek, Z., Lubatkin, M. H., & Veiga, J. F. (2008). The impact of
transformational CEOs on the performance of small- to medium-sized
firms: Does organizational context matter? Journal of Applied Psychology,
93, 923–934.

Lubatkin, M. H., Simsek, Z., Ling, Y., & Veiga, J. F. (2006). Ambidexterity
and performance in small-to medium-sized firms: The pivotal role of
top management team behavioral integration. Journal of Management,
32, 646–672.

MacDuffie, J. P. (1995). Human resource bundles and manufacturing performance:
Organizational logic and flexible production systems in the
world auto industry. Industrial and Labor Relations Review, 48,
197–221.

Nishii, L. H., & Wright, P. (2008). Variability at multiple levels of analysis:
Implications for strategic human resource management. In D. B. Smith
(Ed.), The people make the place (pp. 225–248). Mahwah, NJ: Lawrence
Erlbaum Associates.

Podsakoff, P. M., MacKenzie, S. B., & Bommer, W. (1996). Transformational
leader behaviors and substitutes for leadership as determinants
of employee satisfaction, commitment, trust, and organizational citizenship
behaviors. Journal of Management, 22, 259–298.

Renko, M., EL Tarabishy, A., Carsrud, A.L., & Brannback, M. (2015). Understanding
and measuring entrepreneurial leadership style. Small Business
Management, 53, 54–74.

Rousseau, D. M. (1995). Psychological contracts in organizations: Understanding
written and unwritten agreements. Thousand Oaks, CA: Sage.

Salancik, G. R., & Pfeffer, J. (1978). A social information processing
approach to job attitudes and task design. Administrative Science Quarterly,
23, 224–253.

Schneider, B. (1987). The people make the place. Personnel Psychology, 40,
437–453.

Schuler, R. S., & Jackson, S. E. (1987a). Linking competitive strategies with
human resource practices. The Academy of Management Executive, 1,
207–219.

Schuler, R. S., & Jackson, S. E. (1987b). Organizational strategy and organizational
determinants of human resource management practices.
Human Resource Planning, 10, 125–141.

Shamir, B. (1995). Social distance and charisma: Theoretical notes and an
exploratory study. The Leadership Quarterly, 6, 19–47.

Shamir, B., House, R. J., & Arthur, M. B. (1993). The motivational effects of
charismatic leadership: A self-concept based theory. Organization Science,
4, 577–594.

Shaw, J. D., Delery, J. E., Jenkins, G. D., & Gupta, N. (1998). An
organization-level analysis of voluntary and involuntary turnover.
Academy of Management Journal, 41, 511–525.

Siehl, C. J. (1985). After the founder: An opportunity to manage culture. In
P. Frost, L. Moore, M. Louis, C. Lundberg, & J. Martin (Eds.), Organizational
culture (pp. 125–140). Beverly Hills, CA: Sage.

Simons, T. (2002). Behavioral integrity: The perceived alignment between
managers' words and deeds as a research focus. Organization Science,
13, 18–35.

Sun, L., Aryee, S., & Law, K. S. (2007). High performance human resource
practices, citizenship behavior, and organizational performance: A relational
perspective. Academy of Management Journal, 50, 558–577.

Takeuchi, R., Lepak, D. P., Wang, H., & Takeuchi, K. (2007). An empirical
examination of the mechanisms mediating between high performance
work systems and the performance of Japanese organizations. Journal
of Applied Psychology, 92, 1069–1083.

Tomaskovic-Devey, D., Leiter, J., & Thompson, S. (1994). Organizational
survey nonresponse. Administrative Science Quarterly, 39, 439–457.

Trevor, C. O., & Nyberg, A. J. (2008). Keeping your headcount when all
about you are losing theirs: Downsizing, voluntary turnover rates, and
the moderating role of HR practices. Academy of Management Journal,
51, 259–276.

Tsui, A. S., Pearce, J. L., Porter, L. W., & Tripoli, A. M. (1997). Alternative
approaches to the employee-organization relationship. Does investment
in employees pay off? Academy of Management Journal, 40,
1089–1121.

Tushman, M. L. (1979). Work characteristics and subunit communication
structure: A contingency analysis. Administrative Science Quarterly, 24,
82–98.

Verdú-Jover, A. J., Lloréns-Montes, F. J., & García-Morales, V. J. (2006).
Environment–flexibility coalignment and performance: An analysis in
large versus small firms. Journal of Small Business Management, 44,
334–349.

Waldman, D. A., & Yammarino, F. J. (1999). CEO charismatic leadership:
Levels-of-management and levels-of-analysis effects. Academy of Management
Review, 24, 266–285.

Wall, T. D., Michie, J., Patterson, M., Wood, S. J., Sheehan, M.,
Clegg, C. W., & West, M. (2004). On the validity of subjective measures
of company performance. Personnel Psychology, 57, 95–118.

Way, S. A. (2002). High performance work systems and intermediate indicators
of firm performance within the US small business sector. Journal
of Management, 28, 765–785.

Wright, P. M., Dunford, B. B., & Snell, S. A. (2001). Human resources and
the resource based view of the firm. Journal of Management, 27,
701–721.

Wright, P. M., Gardner, T. M., Moynihan, L. M., & Allen, M. R. (2005). The
relationship between HR practices and firm performance: Examining
causal order. Personnel Psychology, 58, 409–446.

Wright, P. M., & McMahan, G. C. (1992). Theoretical perspectives for strategic
human resource management. Journal of Management, 18,
295–320.

Youndt, M. A., Snell, S. A., Dean, J. W., Jr., & Lepak, D. P. (1996). Human
resource management, manufacturing strategy, and firm performance.
Academy of Management Journal, 39, 836–866.

Zacharatos, A., Barling, J., & Iverson, R. D. (2005). High-performance work
systems and occupational safety. Journal of Applied Psychology, 90,
77–93.

Zhu, W., Chew, I. K., & Spangler, W. D. (2005). CEO transformational
leadership and organizational outcomes: The mediating role of human–
capital-enhancing human resource management. The Leadership Quarterly,
16, 39–52.