Management Decision: Article Information
Management Decision: Article Information
Management Decision: Article Information
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Implementing
Implementing innovative HRM: innovative HRM
trade-off effects on employee
well-being
643
Almudena Cañibano
Management Department, London School of Economics, London, UK
Abstract
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Purpose – Although innovative HRM practices have been found to improve performance, the
management literature has overlooked their effect on individual level outcomes, such as employee
health and well-being. The purpose of this paper is to explore whether the implementation of these
innovative practices has an impact on the three dimensions of well-being (physical, psychological and
social) and whether well-being should be considered as a mediator of the innovative HRM-performance
relationship.
Design/methodology/approach – The paper uses qualitative data collected from an in-depth case
study via document analysis and semi-structured interviews with HR practitioners and employees.
The data were coded using N-Vivo software.
Findings – The paper shows that innovative HRM practices can lead to both positive and negative
well-being outcomes. Furthermore, they create trade-offs between the three dimensions of well-being.
While they increase employee well-being on one dimension, they are detrimental to another.
Research limitations/implications – Due to the scope of the research, the paper bounded itself to
analyzing three innovative HRM practices. Different trade-offs may exist for other practices.
Practical implications – Many organizations are introducing innovative HRM practices assuming
that they will improve performance. However, the existence of well-being trade-offs needs to be
acknowledged and managed.
Originality/value – This paper shows that for a comprehensive understanding of the effects of
innovative HRM practices further studies need to contemplate the different dimensions of well-being
separately, as trade-offs may occur between them. It further suggests that well-being may be an
unexplored mediator of the innovative HRM-performance relationship.
Keywords Innovative HRM, Employee well-being at work, Innovation, Human resource management
Paper type Research paper
1. Introduction
Innovative human resource management (HRM) practices (also called high
commitment, high involvement or high performance work practices) have been a
discussion topic (Boselie et al., 2005) within academy and industry for decades. Interest
lies in the fact they appear to impact positively on performance (Huselid, 1995; Combs
et al., 2006) which is encouraging firms to implement them.
The author would like to thank Oihana Basilio, Daniel Curto-Millet, Susan Fernie, Paloma
Sanchez, Richard Woolley and the two anonymous reviewers, for their comments on different
Management Decision
versions of this paper. She would also like to thank JPM, and TA, members of the company’s Vol. 51 No. 3, 2013
executive board, for kindly granting her access to the organization, as well as all the employees pp. 643-660
q Emerald Group Publishing Limited
that have shared their experiences with her. The author acknowledges the funding support 0025-1747
received from the Fundación Ramón Areces Banco for this research. DOI 10.1108/00251741311309706
MD Some studies assume this effect on performance stems from their positive impact on
51,3 workforce satisfaction (Appelbaum et al., 2000). However, these assumptions have
been challenged (Marchington and Grugulis, 2000) and some authors suggest these
practices may adversely affect employees by intensifying work (Ramsay et al., 2000).
Consensus has still not been reached.
This paper sets out to make a twofold contribution to this debate. First, we identify
644 some of the limitations of extant studies that explain the ambiguous results on the
relationship between HR practices and well-being, namely organisation rather than
employee-centred research (Godard and Delaney, 2000), disregard to HR
implementation and context (Khilji and Wang, 2006; Thompson, 2007), and
multidimensionality of the concept of well-being (Van De Voorde et al., 2011).
Second, we tackle this gap by thoroughly exploring the implementation of three
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2. Literature review
For 25 years, innovative HRM practices have been steadily introduced on the
assumption they are positive to both organisational performance and employee
well-being (Boselie et al., 2005). Som (2006) defines innovative HRM as “any intentional
introduction or change of HRM program, policy, practice or system designed to
influence or adapt employee skills, behaviours, and interactions”. Their positive link to
performance has been evidenced (Delery and Doty, 1996; Combs et al., 2006) but impact
on employee outcomes is still debated.
According to Ramsay et al. (2000, p. 503) researchers reporting a link between
innovative HR practices and organisational performance agree “that the associations
reflect a causal link which flows from practices through people to performance”.
However, there is much uncertainty about the precise nature of this link. Two
contrasting perspectives exist (see Figure 1) (Van De Voorde et al., 2011). One school of
thought defends the “mutual-gains” alternative: employers and employees equally
benefit from the introduction of innovative HR practices, their assumption being that
these practices boost employee well-being (particularly in terms of satisfaction). In
turn, employees perform better, creating a win-win relationship with the organisation
(Appelbaum et al., 2000; Delery and Doty, 1996). However, this research is criticised for
being simplistic and somewhat uncritical (Fleetwood, 2007). The competing approach,
known as the “conflicting-outcomes” perspective, claims that the practices increase
organisational performance at the expense of employee well-being by increasing work
intensity (Gallie, 2005; Green, 2001; Cañibano et al., 2012) and stress (Tarafdar et al., Implementing
2007; Ramsay et al., 2000). innovative HRM
Overall, further research seems necessary to understand the impacts of the
implementation of HR practices on employee well-being.
Three characteristics of extant studies can explain this situation. First, most HR
literature “uses organisations as the unit of analysis, [and] largely ignores the
differences in individual employees’ work attitudes and performance” (Green et al., 645
2006, p. 560). The general belief exists that the positive relationship between HR and
performance operates through employees. Research tends to adopt this reasoning but
neglects to test it or question employees, making assumptions about what is happening
at individual level and then focusing analyses and results on the organisational level
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Figure 1.
The competing
approaches on the link
between innovative HRM
practices, employee
well-being and
performance
MD Third, as noted by Pfeffer (2010), the management literature has largely disregarded
51,3 the study of health and well-being as outcomes of innovative managerial practices and
little research in the HRM field has tackled this problem (Baptiste, 2007). Although
many articles look at certain aspects of well-being, particularly satisfaction (Boselie
et al., 2005) and stress (Landsbergis et al., 1999), they have not holistically explored the
impact of new HR practices on health and well-being (Van De Voorde et al., 2011). This
646 article uses the World Health Organisation’s (1948) definition of well-being as a
three-dimensional concept, composed of physical, psychological, and social aspects.
Awareness of the interrelationship between health or well-being and working life is
not a new phenomenon. However, focus has evolved in occupational health literature,
from emphasising physical working conditions and issues like ergonomics and
engineering safety towards a more holistic approach including physical, psychological,
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3. Methodology
Lindell (2012) argues that the possible negative consequences of innovation, for both
employees and society as a whole, are neglected by existing research because most
models disregard its implementation and use. However, innovative practices are
complex and their effects are contingent on many factors, interpretations, and even
emotional aspects or “moods” (Orlikowski, 2000). Such diversity is hardly apprehended
by mainstream statistical studies. Quantitative analysis of large populations of firms
prevents researchers from assessing complicated and multifaceted processes and
mechanisms (Boxall and Steeneveld, 1999) so disentangling the effects of innovative
HR implementation on employee well-being requires an explorative qualitative
approach (Gratton et al., 1999). Following the example of previous research
(e.g. Donnelly, 2008; Truss, 2001), in furtherance of theory building, our analysis
relies on the in-depth study of a single case.
Research setting
The company is a multinational consulting organisation which has prizes for innovation,
and provides an excellent example of implemented innovative HRM practices. A senior
manager highlighted this specificity saying that they “get so used to the continuous Implementing
innovations, that it seems the normal way to work” (HR Interviewee 2). innovative HRM
Our results focus on the company’s branch in Spain, with more than 10,000 employees.
Spanish subsidiaries of international firms have become strategic test beds for
implementing innovative HR practices (Wächter et al., 2006, p. 55) and have proved key to
establishing new organisational practices and developing HR in Spain (Rodriguez-Ruiz
and Martinez-Lucio, 2010, p. 135). This case analysis should provide valuable empirical 647
and conceptual understanding of the effects of innovative HR practices on employees, and
could be useful to the investigation of such links in other organisations.
Research design
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General questions 1. Are you generally aware of the new working practices the HR team has
implemented in the last two years?
2. In general terms, do you think this organisation cares for the well-being
of its employees?
3. Have you ever used the medical service? What was your concern?
Specific questions 4. Are you a user of this practice?
(repeated for each of the
three practices)
If yes a. Why did you decide to use it?
b. Can you describe your experience with it?
c. What are its advantages in your opinion?
d. What are its disadvantages in your opinion?
e. Has it had an impact on the way you feel?a
If no a. Why have you decided not to use it?
b. Does any of your team-members use it?
c. How do you feel about this new way of working?
d. What are its advantages in your opinion?
e. What are its disadvantages in your opinion?
Note: a If not spontaneously mentioned, the interviewer probed with the question: Would you say this Table I.
practice has influenced your health or well-being at all? In what ways? Interview questions
MD Data analysis
51,3 All the interviews were recorded, transcribed and coded using N-Vivo Software.
Since we wanted to explore the different dimensions of well-being, before examining
the data, we developed three a priori codes (one per dimension: physical,
psychological and social). Then, a total of ten inductive sub-codes emerged from the
data. For physical well-being, we labelled our codes based on symptoms and
648 experiences present in the occupational health literature (Macik-Frey et al., 2007):
musculoskeletal problems, fatigue and energy. At the psychological level, we used
Warr’s (2009, p. 58) categorisation as a guideline. Four of his constructs emerged in
our interviews and are used to code the data: stress, anxiety, satisfaction and
enthusiasm. For social well-being, three sub-codes surfaced that we labelled: social
integration, social acceptance and social coherence following Keyes (1998). Each
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4. Findings
As a result of the initial managerial interviews, three practices emerged as the most
innovative and relevant for the organisation:
(1) telework: giving employees the opportunity to work from home;
(2) communication: enabling physically separated employees to be constantly
connected, share documents, make virtual calls, etc. through a collaboration
toolset; and
(3) participation: allowing employees to share and discuss their innovative ideas
through an online internal platform (each year winning ideas are selected for
implementation).
Implementation and use of these practices differs across the company. Telework is still
not available to all departments, hence only half the interviewees benefited from it. The
communication and participation practices are accessible to all employees but not
everyone uses the latter. Table II summarises the number of interviewees using each
practice.
In this section we present evidence of the positive and negative experiences that
employees report regarding these three practices by focusing on the three well-being
dimensions aforementioned (physical, psychological and social). The complex effect of
implementing HRM is highlighted because none of the practices has an outright
positive or negative consequence on well-being. Instead, they seem to create trade-offs
between the three dimensions.
WB
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very optimistic: “I can’t wait to work from home and have more time!” (I26).
From a social well-being perspective, working outside the office seems to reduce
social integration. Certain interviewees mentioned this as their main reason for not
teleworking: “I don’t work at home because I need to know what’s going on. Besides, it
could spoil my relationship with colleagues and upset our team’s informal
communication” (I33). To support this, one interviewee said: “Even if we’re still in
touch, we’re not together 5 days a week so the relationship isn’t as strong” (E23).
Moreover, telework is still not entirely accepted and can generate mistrust. This
sentiment was coded under “decreased social acceptance”. First, as noted by
interviewee number 10, “many managers feel that people waste their time at home”
(I10). They do not trust them to be as diligent and fellow workers also question this.
Two interviewees said: “I wonder if they really work as much at home. . . I think I’d
take more breaks and get distracted” (I37) and “Some people work less from home
because they’re not supervised” (I21).
Furthermore, the data suggests that telework affects social coherence. Face-to-face
and informal relationships are reduced so the teleworker’s ability to make sense of
social exchanges in the work context is also weakened. “Since I’ve worked at home I’ve
missed things in the office; keeping up with the gossip is sometimes crucial to
understanding what’s going on” (I38).
Telework has unclear effects on family life. Despite enabling workers to manage
their multiple responsibilities better it distorts work boundaries, sometimes invading
private life. One interviewee said: “one of the problems with flexibility is that we can
transfer work to our personal lives, and that’s hard to stop. My wife sees me working at
home and isn’t happy about it” (I19).
All in all, telework seems to increase physical and psychological well-being while
decreasing social well-being.
Communication
Innovative practice 2 was implemented to encourage information sharing and is
enabled by software installed in every employee’s computer. It allows employees to
observe whether colleagues are using their computers, to chat, share documents and
desktops, explore others’ agendas to see what they are working on or when they are
available. Table IV synopsises its effects on well-being.
With this practice, the effects on physical well-being are less straightforward than
for the previous practice and should be considered cautiously. Pieces of discourse
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Communication Physical 2 Muscoloskeletal problems 5 “We get drawn by this communication madness! I love it but I know that
working these long hours, sitting all the time, is affecting my back” (I44)
Increased fatigue 28 “Since the communication tool was launched, waking up at 5 to chat
with Indians and going to bed awfully late because I am discussing with
the Americans has become fairly common for me. I’m exhausted” (I28)
Lack of energy 15 “Many days I can’t take a break for lunch because I have communication
requests (. . .) In the afternoon I don’t have all the energy I should” (I24)
Psychological 2 Reduced satisfaction 20 “I dislike it because it makes me feel I don’t own my time anymore” (I3)
Increased stress 32 “With this tool the requests pop up constantly. You feel intimidated and
stressed because it seems you need to answer immediately” (I29).
Increased anxiety 13 “We are bombarded with questions (. . .) feeling anxious is almost
inevitable when a new window opens up in your screen every 30
seconds” (I39).
þ Increased satisfaction 7 “When we first got this communication system, my team was very
satisfied. It saved us a lot of (. . .) time because we could contact people
with one click” (I15).
Increased enthusiasm 4 “Isn’t it incredible that we can work with someone in India just the way
we do with someone in Spain?” (I17)
Social 2 Reduced social integration 5 “I find myself chatting online with someone that sits two rows behind
me, yet I never see their face of hear their voice” (I30)
Reduced social coherence 4 “Sometimes I ask a question and I get so many different answers and
options to consider that I end up being more doubtful than I was to start
with” (I31)
þ Increased social integration 28 “My team is completely international. Thanks to this tool I am (. . .) in
touch with them and we have weekly meetings, just as if we were in the
same city” (I24).
Increased social acceptance 8 “Even if people are working at home they are available online and one
can see whether a colleague is away from the computer or not” (I36).
Increased social coherence 15 “This is my major tool of information and answers at work” (I23)
Implementing
Communication and
employee well-being
651
innovative HRM
Table IV.
MD coded as “reduced energy” and “increased fatigue” are very common although often
51,3 paired with comments on the constant connectivity that this practice requires, or linked
to the international nature of this firm’s workforce. “Since the communication tool was
launched, it’s not uncommon for me to wake up at 5 to chat with Indians and go to bed
late because I’m discussing something with the Americans. I’m exhausted. ”(I28)
“Often I can’t take a break for lunch because of communication requests and messages
652 coming up from all over the world in the tool. I nibble something and keep working, but
in the afternoon I lack energy.” (I24). Some interviewees suffer musculoskeletal
problems, like backache, which are sometimes linked to this practice because they
work longer hours: “We get drawn into this communication madness! I love it but
working long hours, sitting all the time, is giving me backache.” (I44).
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Participation 653
The third innovative HRM practice provides employees with the opportunity to
participate and suggest innovative ideas by using an online platform for a number of
discussion forums. A summary of its effects on well-being is shown in Table V.
The data suggests this practice is a source of positive psychological well-being and
increased enthusiasm is common among interviewees who talk of “opportunities and
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challenges” (I19). The fact that ideas can be transformed into new practices, products
or services impresses workers. “It’s amazing that one of my ideas can be selected by the
organisation. I’m very excited about the whole process” (I23). Similarly, interviewee 10
describes this practice as a wheel turning: “you do one thing and it motivates you to do
another. It gives you wings” (I10).
Nevertheless, it appears to impact negatively on social acceptance. Its introduction has
created greater competitiveness and even envy owing to the selection process for the best
ideas and the resulting innovation “winners”. A worker said: “paradoxically, in certain
cases, instead of boosting collaboration, it’s making workers distrustful” (I39). Moreover,
as participation is voluntary, most employees say they lack the time. Some think that
“people providing the most ideas have more free time (away from clients) and on top of
that, they get awarded for their participation” (I1). Non-participants suspect that
participants work less. An executive interviewee stated: “I don’t use it. I don’t encourage
my team to. Where would they find the time? People who use it aren’t so busy” (I15).
In sum, the participation practice seems to positively impact on psychological
well-being to the detriment of social well-being. No impact on physical well-being was
reported.
Our findings are summarised in Table VI and suggest that none of the practices has
an overall positive or negative effect on health. Instead, they generate well-being
trade-offs between the three dimensions of well-being explored.
To try to overcome these limitations and provide new insights, this paper has explored
and analysed the effects that implementing innovative HRM practices has on all three
dimensions of employee well-being, in a highly innovative consultancy firm.
First, our findings suggest that the “mutual gains” and “conflicting outcomes”
perspectives are not completely at odds with each other. The same practice can impact
positively on one dimension of well-being and negatively on another. Desirable and
detrimental effects coexist because trade-offs between the different dimensions arise.
In line with Grant et al. (2007), our findings indicate that managerial practices do not
have a single straightforward effect on well-being but different effects on different
dimensions, creating these complex trade-offs.
Even if telework has been implemented because of widespread employee demand,
its positive effects on physical and psychological well-being are counterbalanced by a
negative impact on social well-being. Conversely, while communication practices
increase well-being from a social perspective, they have a negative impact on physical
and psychological health. Participation’s positive effects on psychological well-being
coexist with its negative impact on social health.
into the HRM-performance relationship because it signals that the three well-being
dimensions should be contemplated as different mediators in order to avoid specification
errors in quantitative models (Becker and Gerhart, 1996). Therefore, although not tackled
in this paper, the relationships depicted by arrows four, five and six in Figure 2 would
also need to be specified and tested separately in a quantitative study.
However, our findings also suggest that developing research with a contextual
approach is necessary to further our knowledge. Implementing new HRM practices is a
chaotic process and each employee may interpret it differently (Nishii and Wright, 2008),
leading to a number of sub-stories overlooked by quantitative studies. First, our
interviews highlight perceptions evolving over time. For instance, initially, the
communication practice had a positive psychological impact due to increased
satisfaction and information sharing, however, as time passed the majority of
interviewees started considering it invasive and stressful. Second, HR practices are
socially constructed (Thompson, 2007). Although implemented by the organisation,
employees and managers enact them in different, unintended and unexpected ways.
Although implementing communication was not designed to increase working time,
employees have, in fact, reported working longer hours. Third, the impact of one practice
may be mitigated by another. For example, some interviewees described how increased
communication alleviates some of the negative social effects of telework. In sum, further
longitudinal qualitative studies could provide a better picture of the factors playing a role
in the enactment, evolution and synergistic nature of these practices.
6. Limitations
Due to the nature of this research, our results should be taken cautiously. First, many
innovative HRM practices have not been analysed (e.g. task flexibility, compensation
Figure 2.
A proposed model for the
innovative HRM practice
– organisational
performance relationship:
well-being as a
multidimensional
mediator
MD systems, development practices, etc.) because it was fundamental to focus on particular
51,3 innovations to help interviewees clarify their ideas and allow us to draw useful
conclusions for management purposes. Therefore we cannot assume that trade-offs will
exist for all new implemented HR practices. In addition, there are factors that can shape
the way people make sense of the new practices and their impacts which have not been
explored. Personality and supervisory relationships, as well as organisational, structural
656 and broader socio-economic influences, may affect employees’ perceptions and reactions
to implemented HRM. However, both were beyond the scope of this paper.
Second, the analysis is exploratory and bounded by a single case, so results cannot
be directly extrapolated to other organisations or generalised. However, the fact that
well-being trade-offs exist in this particular context provides insight into the debate on
the link between HRM and well-being and a way to further studies on this issue. It
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more innovative” (HR interviewee 3). Thus innovative HRM practices are not only a
source of well-being, but of innovation as well. Identifying the positive effects could
lead into a virtuous innovative circle.
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Science. Her research focuses on the study of innovative human resource management practices,
flexible work arrangements and their effect on occupational health, employee wellbeing and
organizational performance. Her research has been published as book chapters in the Oxford
Handbook of Participation in Organizations and the book Challenging the Innovation Paradigm
published by Routledge. Almudena Cañibano can be contacted at: [email protected]