Desire for balance and impact - The perception of high involvement work system and its role in building middle managers' organizational commitment in a Chinese subsidiary

Abstract

The purpose of this thesis was to investigate the perception of High Involving Work System (HIWS) among Chinese middle managers in a Chinese subsidiary, and to study the effect of the perceived HIWS on Organizational Commitment (OC). This study responded to the need for an improved TM system out- lined by the previous studies (Bloom & Reenen 2010; Collings & Mellahi 2009), and addressed the meth- odological, empirical and contextual gap.

The theoretical framework was built on Lawler's (1986) four mutually reinforcing elements of HIWS (i.e. PIRK) and Cohen's two-dimensional OC model. HIWS is a complex configuration, a 'black box', that creates value directly by optimizing employees' capabilities and indirectly by increasing the managers' satisfaction and other affective reactions (e.g. Boxall & Macky 2009). The contingency with the internal (Comb et al. 2006) and the external environment plays a significant role in practice (Youndt et al. 1996). The results of this study found four moderators for strengthening OC. The identified moderators are pur- pose (P), recognition and respect (R), opportunities and growth (O), as well as, balance (B). The PIRK and PROB elements act as the foundation for building a highly enabling and committing work system.

The system has a positive multiplying effect. When the individuals have reached a higher OC, they are more likely to utilize the system more profoundly. The underlying reason is they have gained the firm- specific skills and knowledge that match the firm's strategy (Lazear & Gibbs 2009). Thus, their in-house value exceeds their market value, and the in-house information asymmetry on their skills is smaller than on the market (ibid.). Also, they feel that they do not need to hedge greatly against the potential turnover or renegotiation. Thus, they are even more dedicated to invest in enhancing the firm-specific skills and productivity. The positive results lead to a stronger perception of PROB, which in turn leverages OC.

To counteract the perceived heavy workload, it would be increasingly important to drive reforms and tar- geted initiatives to optimize the PIRK and PROB elements. The resulted productivity growth versus global competitors would be the main factor that determines the case firm's competitive advantage and industry leadership in the long run.