HIGH COMMITMENT WORK SYSTEMS AND EMPLOYEE PERFORMANCE IN SAVINGS AND CREDIT CO-OPERATIVE SOCIETIES IN MOMBASA COUNTY, KENYA
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Abstract
This study examined the effect of high-commitment work systems on employee performance in Savings and Credit Cooperative Societies (SACCOs) in Mombasa County, Kenya. Specifically, it investigated the effect of performance-based compensation, training and development, performance appraisal, and communication on employee performance. The study was anchored on expectancy theory, social exchange theory, and resource-based theory. A cross-sectional survey design was employed, targeting ten SACCOs registered with SASRA with memberships of 20,000 or more. The unit of analysis included top managers, middle managers, and supervisory staff. A sample of 133 respondents was selected using Slovin’s formula, with multistage sampling comprising stratified and simple random techniques. Primary data were collected using semi-structured questionnaires with a five-point Likert scale. Data analysis involved correlation and multiple regression techniques using SPSS Version 29. The findings indicate that all four high-commitment work system variables were positively correlated with employee performance, with performance-based compensation showing the strongest correlation (r = 0.534, p < 0.05). Regression results further revealed that performance-based compensation (β = 0.984, p < 0.001), training and development (β = 0.301, p = 0.003), performance appraisal (β = 0.173, p = 0.007), and communication (β = 0.366, p = 0.026) had significant positive effects on employee performance. The study concluded that high-commitment work system practices are critical for improving employee performance in SACCOs, with performance-based compensation emerging as the most influential factor. Based on these findings, it was recommended that SACCOs should strengthen performance-linked reward systems, expand training and development programs, enhance appraisal processes, and promote open and effective communication to maximize employee performance and organizational outcomes.
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References
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Chen, Z. X., Tsui, A. S. & Zhong, L. (2018), Reactions to Psychological Contract Breach: A Dual Perspective. Journal of Organizational Behavior, 29(5), 527–548.
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Delery, J. (2017), Issues of fit in strategic human resource management: implications for research, Human Resource Management Review, 8(3) 289–309.
De Menezes, L. M., & Kelliher, C. (2017). Flexible working, individual performance, and employee attitudes: Comparing formal and informal arrangements. Human Resource Management, 56(6), 1051–1070.
De Nobile, J. J. D., & McCormick, J. (2008). Organizational communication and job satisfaction in Australian Catholic primary schools. Educational Management Administration & Leadership, 36(1), 101-22.
Dessler, G. (2017). Human resource management, (15th ed.), Pearson Education, Inc.
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Huselid, M. A. (2011), The impact of human resource management practices on turnover, productivity, and corporate financial performance. Academy of Management Journal, 38(3), 635–672.
Islam, R., & Rasad, S. B. M. (2006). Employee performance evaluation by the AHP: A case study. Asia Pacific Management Review, 11(3), 163-76.
Iverson, R. D., & Zatzick, C. D. (2007). High-commitment work practices and downsizing harshness in Australian workplaces. Industrial Relations, 46(3), 456–480.
Jorfi, H., Yaccob, H. F. B., & Shah, I. M. (2011). The relationship between demographics variables, emotional intelligence, communication effectiveness, motivation, and job satisfaction. International Journal of Academic Research in Business and Social Sciences, 25(3), 35-58.
Judge, T. A.; Thoresen, C. J.; Bono, J. E.; Patton, G. K. (2005), The Job Satisfaction–Job Performance Relationship: A Qualitative and Quantitative Review. Psychological Bulletin, 127(3), 376.
Kalogiannidis, S. (2020). Impact of Effective Business Communication on Employee Performance. European Journal of Business and Management Research, 5(6). https://doi.org/10.24018/ejbmr.2020.5.6.631
Lawler, E. J., & Thye, S. R. (2006), Social Exchange Theory of Emotions. Cornell University, ILR School
Li, C., Khan, M. A. S, Kusi, B. & Murad, M. (2019), The relationship between a high-performance work system and employee performance. Psychology Research and Behavior Management, 12(3), 397–416
Lin, Y. T., & Liu, N. C. (2019). Corporate citizenship and employee outcomes: Does a high-commitment work system matter? Journal of Business Ethics, 156(1), 1079–1097. https://doi.org/10.1007/s10551-017-3632-1.
Ogbonnaya, C., & Messer smith, J. (2019). Employee performance, well-being, and differential effects of human resource management sub dimensions: Mutual gains or conflicting outcomes? Human Resource Management Journal, 29(3), 509–526. https://doi. org/10.1111/1748-8583.12203
Park, O., Bae, J., & Hong, W. (2019). High-commitment HRM system, HR capability, and ambidextrous technological innovation. The International Journal of Human Resource Management, 30(9), 1526–1548. https://doi.org/10.1080/09585192.2017.1296880
Peccei, R., & Van De Voorde, K. (2019). Human resource management-wellbeing-performance research revisited: Past, present, and future. Human Resource Management Journal, 29(4), 539–563. https://doi.org/10.1111/1748-8583.12254
Supian, C., Nor, M., Kumah, R., Mohamed, H., Mohamed, B., & Hassan, A. C. (2020). Human resources management practices and its impact on employee commitment among staffs of road transport department, Perak, Malaysia. Journal of Environmental Treatment Techniques, 8(1), 28–34.
Syrek, C. J., Apostel, E., & Antoni, C. H. (2013). Stress in highly demanding IT jobs: Transformational leadership moderates the impact of time pressure on exhaustion and work-life balance. Journal of Occupational Health Psychology, 18(3), 252–262. https://doi.org/10.1037/a0033085
Teece, D. J., Pisano, G., & Shuen, A. (2009). Dynamic capabilities and strategic management. Strategic Management Journal, 18 (7), 509–533.
Tracey, J. B. (2014), A review of human resources management research. International Journal of Contemporary Hospitality Management, 26(2), 679–705.
ILO. (2017), Guidelines on Decent Work and Socially Responsible Tourism 2017. International Labour Office, Sectoral Policies Department—ILO: Geneva, Switzerland, 2017. Available online: https://www.ilo.org/wcmsp5/groups/public/---ed_dialogue/---sector/ documents/normative instrument/wcms_546337.pdf (retrieved on September, 2021).
Vanden Berghe, J. (2011), Job satisfaction and job performance at the work place [doctoral thesis]. Helsinki: Arcada University of Applied Sciences Ltd.; 2011;1-51.
Wahab, M. A, Tatoglu, E., Glaister, A. J., & Demirbag, M. (2021), Effect of high-commitment work systems on firm performance, employee burnout and wellbeing. The International Journal of Human Resource Management, 32(1), 24-48. https://doi.org/10.1080/09585192.2020.1833069
Wu P-C, Chaturvedi S. (2015), The role of procedural justice and power distance in the relationship between high performance work systems and employee attitudes: A multilevel perspective. Journal of Management, 35(5):1228–1247.
Xiao, Z., & Björkman, I. (2016). High commitment work systems in Chinese organizations: a preliminary measure. Management and Organization Review, 2(3), 403–422. doi: 10.1111/j.1740-8784.2006.00049.x
Xiao, Z. & Tsui, A.S. (2014), When brokers may not work: the cultural contingency of social capital in Chinese high-tech firms, Administrative Science Quarterly, 52(1), 1-31.
Zhang B, & Morris J. L. (2014), High-performance work systems and organizational performance: testing the mediation role of employee outcomes using evidence from PR China. International Journal of Human Resource Management, 25(1), 68–90. doi:10.1080/09585192.2013.781524
Akhutar, M. N., Zhang, J., Rofcanin, Y. & Zhang, Y. (2019), High-commitment work systems and employee voice: A multilevel and serial mediation approach inside the black box. Employee Relations: The International Journal, 41(4), 811-827.
Armstrong, M. (2009). Armstrong’s handbook of human resource management practice, (11th ed.), Kogan Page Limited.
Baum, T. (2015), Human Resources in Tourism: Still Waiting for Change? Reprise. Tourism Management, 50(3), 204–212.
Becker, B. E., & Huselid, M. A. (2000). High performance work systems and firm performance: A synthesis of research and managerial implications. In K.M. Rowland & G.R. Ferris (Eds.), Research in personnel and human resources management, 16(5), 53-101. Greenwich, CT: JAI.
Boon, C. & Kalshoven, K. (2014), How high-commitment HRM relates to engagement and commitment: the moderating role of task proficiency, Human Resource Management, 53(3), 403-420.
Ceylan, C. (2013). Commitment-based HR practices, different types of innovation activities and firm innovation performance. International Journal of Human Resource Management, 24, 208–226. doi: 10.1080/09585192.2012.680601
Chen, Y., Jiang, Y. J., Tang, G., & Cooke, F. L. (2018). High-commitment work systems and middle managers’ innovative behavior in the Chinese context: The moderating role of work-life conflicts and work climate. Human Resource Management, 57(5), 1317–1334.
Chen, Z. X., Tsui, A. S. & Zhong, L. (2018), Reactions to Psychological Contract Breach: A Dual Perspective. Journal of Organizational Behavior, 29(5), 527–548.
Chiang, Y. H., Shih, H. A., & Hsu, C. C. (2014). High-commitment work system, transactive memory system, and new product performance. Journal of Business Research, 67(4), 631–640. https://doi.org/10.1016/j.jbusres.2013.01.022
Chillakuri, B., & Vanka, S. (2020). Understanding the effects of perceived organizational support and high-performance work systems on health harm through sustainable HRM lens: A moderated mediated examination. Employee Relations: The International Journal, ahead-of-print. https://doi.org/10.1108/ER-01-2019-0046.
Collins, C. J., & Smith, K. G. (2006). Knowledge exchange and combination: the role of human resource practices in the performance of high-technology firms. Academy of Management Journal, 49, 544–560. doi: 10.5465/AMJ.2006.21794671
Currivan, D. B. (2000), The Causal Order of Job Satisfaction and Organizational Commitment in Models of Employee Turnover. Human Resource Management. Review, 9(4), 495–524.
Delery, J. (2017), Issues of fit in strategic human resource management: implications for research, Human Resource Management Review, 8(3) 289–309.
De Menezes, L. M., & Kelliher, C. (2017). Flexible working, individual performance, and employee attitudes: Comparing formal and informal arrangements. Human Resource Management, 56(6), 1051–1070.
De Nobile, J. J. D., & McCormick, J. (2008). Organizational communication and job satisfaction in Australian Catholic primary schools. Educational Management Administration & Leadership, 36(1), 101-22.
Dessler, G. (2017). Human resource management, (15th ed.), Pearson Education, Inc.
Detnakarin, S., & Rurkkhum, S. (2019). Moderating effect of perceived organizational support on human resource development practices and organizational citizenship behavior. Journal of Asia-Pacific Business, 20(3), 215–234. https://doi.org/10.1080/10599231.2019.1647078
Dorta-Afonso, D., González-de-la-Rosa, M., García-Rodríguez, F. J., & Romero-Domínguez, L. (2021), Effects of High-Performance Work Systems (HPWS) on Hospitality Employees’ Outcomes through their Organizational Commitment, Motivation, and Job Satisfaction. Sustainability, 13(6), 3226. https:// doi.org/10.3390/su13063226.
Downs, C. W., & Adrian, A. (2014), Communication audits. Lawrence, KS Communication Management, Inc.
Ho, H., & Kuvaas, B. (2020). Human resource management systems, employee wellbeing, and firm performance from the mutual gains and critical perspectives: The well-being paradox. Human Resource Management, 59(3), 235–253. https://doi.org/10.1002/hrm.21990
Hussain, R. M. (2011). An empirical study of the relationship between motivation to transfer and transfer of training. Far East Journal of Psychology and Business, 5(4), 47-56.
Huselid, M. A. (2011), The impact of human resource management practices on turnover, productivity, and corporate financial performance. Academy of Management Journal, 38(3), 635–672.
Islam, R., & Rasad, S. B. M. (2006). Employee performance evaluation by the AHP: A case study. Asia Pacific Management Review, 11(3), 163-76.
Iverson, R. D., & Zatzick, C. D. (2007). High-commitment work practices and downsizing harshness in Australian workplaces. Industrial Relations, 46(3), 456–480.
Jorfi, H., Yaccob, H. F. B., & Shah, I. M. (2011). The relationship between demographics variables, emotional intelligence, communication effectiveness, motivation, and job satisfaction. International Journal of Academic Research in Business and Social Sciences, 25(3), 35-58.
Judge, T. A.; Thoresen, C. J.; Bono, J. E.; Patton, G. K. (2005), The Job Satisfaction–Job Performance Relationship: A Qualitative and Quantitative Review. Psychological Bulletin, 127(3), 376.
Kalogiannidis, S. (2020). Impact of Effective Business Communication on Employee Performance. European Journal of Business and Management Research, 5(6). https://doi.org/10.24018/ejbmr.2020.5.6.631
Lawler, E. J., & Thye, S. R. (2006), Social Exchange Theory of Emotions. Cornell University, ILR School
Li, C., Khan, M. A. S, Kusi, B. & Murad, M. (2019), The relationship between a high-performance work system and employee performance. Psychology Research and Behavior Management, 12(3), 397–416
Lin, Y. T., & Liu, N. C. (2019). Corporate citizenship and employee outcomes: Does a high-commitment work system matter? Journal of Business Ethics, 156(1), 1079–1097. https://doi.org/10.1007/s10551-017-3632-1.
Ogbonnaya, C., & Messer smith, J. (2019). Employee performance, well-being, and differential effects of human resource management sub dimensions: Mutual gains or conflicting outcomes? Human Resource Management Journal, 29(3), 509–526. https://doi. org/10.1111/1748-8583.12203
Park, O., Bae, J., & Hong, W. (2019). High-commitment HRM system, HR capability, and ambidextrous technological innovation. The International Journal of Human Resource Management, 30(9), 1526–1548. https://doi.org/10.1080/09585192.2017.1296880
Peccei, R., & Van De Voorde, K. (2019). Human resource management-wellbeing-performance research revisited: Past, present, and future. Human Resource Management Journal, 29(4), 539–563. https://doi.org/10.1111/1748-8583.12254
Supian, C., Nor, M., Kumah, R., Mohamed, H., Mohamed, B., & Hassan, A. C. (2020). Human resources management practices and its impact on employee commitment among staffs of road transport department, Perak, Malaysia. Journal of Environmental Treatment Techniques, 8(1), 28–34.
Syrek, C. J., Apostel, E., & Antoni, C. H. (2013). Stress in highly demanding IT jobs: Transformational leadership moderates the impact of time pressure on exhaustion and work-life balance. Journal of Occupational Health Psychology, 18(3), 252–262. https://doi.org/10.1037/a0033085
Teece, D. J., Pisano, G., & Shuen, A. (2009). Dynamic capabilities and strategic management. Strategic Management Journal, 18 (7), 509–533.
Tracey, J. B. (2014), A review of human resources management research. International Journal of Contemporary Hospitality Management, 26(2), 679–705.
ILO. (2017), Guidelines on Decent Work and Socially Responsible Tourism 2017. International Labour Office, Sectoral Policies Department—ILO: Geneva, Switzerland, 2017. Available online: https://www.ilo.org/wcmsp5/groups/public/---ed_dialogue/---sector/ documents/normative instrument/wcms_546337.pdf (retrieved on September, 2021).
Vanden Berghe, J. (2011), Job satisfaction and job performance at the work place [doctoral thesis]. Helsinki: Arcada University of Applied Sciences Ltd.; 2011;1-51.
Wahab, M. A, Tatoglu, E., Glaister, A. J., & Demirbag, M. (2021), Effect of high-commitment work systems on firm performance, employee burnout and wellbeing. The International Journal of Human Resource Management, 32(1), 24-48. https://doi.org/10.1080/09585192.2020.1833069
Wu P-C, Chaturvedi S. (2015), The role of procedural justice and power distance in the relationship between high performance work systems and employee attitudes: A multilevel perspective. Journal of Management, 35(5):1228–1247.
Xiao, Z., & Björkman, I. (2016). High commitment work systems in Chinese organizations: a preliminary measure. Management and Organization Review, 2(3), 403–422. doi: 10.1111/j.1740-8784.2006.00049.x
Xiao, Z. & Tsui, A.S. (2014), When brokers may not work: the cultural contingency of social capital in Chinese high-tech firms, Administrative Science Quarterly, 52(1), 1-31.
Zhang B, & Morris J. L. (2014), High-performance work systems and organizational performance: testing the mediation role of employee outcomes using evidence from PR China. International Journal of Human Resource Management, 25(1), 68–90. doi:10.1080/09585192.2013.781524