Calculative and collaborative HRM practices, turnover and performance

Purpose - The purpose of this paper is to study the human resource management (HRM)–performance linkage by exploring alternative relationships between different HRM practices, categorised as either calculative or collaborative, and employee turnover and organisational and financial outcomes, in Uruguayan multinational companies (MNCs) and domestic companies, to better understand the implications of the Latin American context in this relationship. Design/methodology/approach - The study is performed at the firm level, using data from a representative sample of 274 firms, including both multinationals and locally owned firms in Uruguay, collected through the Cranet 2009 survey. The authors tested the hypotheses of the proposed model using structural equation modelling (SEM) and hierarchical multiple regression analysis. Findings - Empirical results show that collaborative HRM practices are significantly related to lower employee turnover rates, whereas calculative HRM practices are significantly associated with higher organisational and financial outcomes. These findings show the importance of the Latin American context in the relationships between HRM practices and firms’ outcomes. Research limitations/implications - The use of survey data with single respondents might produce reliability problems. Additionally, the data used are cross-sectional, making it difficult to determine causality. Practical implications - Managers in MNCs and local firms in the context of developing economies and Latin American cultures must be aware that different types of HRM practices will influence different outputs and impacts on overall outcomes. Originality/value - The paper examines the extent to which HRM practices have a significant relationship with firm performance. In addition, it identifies the differential effects of calculative and collaborative HRM practices on performance, using data from a Latin American contextual setting rarely examined, in order to determine similarities and differences from results obtained in US and European contexts.