Impact of High Performance Work System on Organizational Performance: A Study from Sri Lankan Cable Manufacturing Industry

Abstract

Decades of empirical research have given rise to an innovative paradigm of performance excellence through the institutionalization of appropriate work performance models. There is a wealth of empirical and theoretical evidence for the positive impact of high performance work systems on employees’ productivity and profitability, where high performance work systems are associated with key elements of performance excellence. Sri Lankan companies have begun to participate in high performance work systems as a performance enhancement tool and have launched the institutionalization of innovative work systems at work. Nonetheless, XYZ Cables PLC, one of the leading cable manufacturers in Sri Lanka, is concerned about the most difficult obstacles to reaching its heights and maintaining a competitive edge, resulting in higher production costs and lower employee engagement, leading to lower profitability due to dynamic market conditions and ineffective people management. Therefore, the main objective of this study was to evaluate the impact of the high performance work methodology on the firm performance of XYZ Cables PLC using the AMO model developed by Jiang, Lepak, Han, Hong, Kim, and Winkler (2012) to formalize a high performance work culture that enhances organizational performance through three layers that present employees’ abilities, motivation and opportunities. A case study approach was utilized via quantitative and qualitative data analysis tools for a focused vision using a structured questionnaire and focused group discussions.