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High-Performance Work System and Innovation Capabilities: The Mediating Role of Intellectual Capital

Author

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  • Hafiz Ali Javed

    (International Business School, Teesside University, Middlesbrough TS1 3BX, UK)

  • Naveed Ahmad Khan

    (Faculty of Business Administration, Brandenburgh University of Technology, 03046 Cottbus, Germany)

  • Silke Michalk

    (Faculty of Business Administration, Brandenburgh University of Technology, 03046 Cottbus, Germany)

  • Noor Ullah Khan

    (Malaysian Graduate School of Entrepreneurship and Business (MGSEB), Universiti Malaysia Kelantan (UMK), Taman Bendahara, Pengkalan Chepa 16100, Malaysia
    Department of HRM, NUST Business School, National University of Sciences and Technology H-12, Islamabad 44000, Pakistan)

  • Muhammad Kamran

    (Wyższa Szkoła Gospodarki Euroregionalnej im. Alcide De Gasperi, 05-410 Jozefow, Poland)

Abstract

This study examined the effect of high-performance work systems on developing incremental and radical innovation capabilities. Drawing on resource-based and knowledge-based theories, the mediating effects of human capital, social capital, and organizational capital were tested. Data were collected from 233 middle-to-senior level managers working in the banking sector of Pakistan, and hypotheses were tested through partial least squares structural equation modeling using Smart PLS 4.0. The findings showed that all components of intellectual capital mediated the relationship to develop both types of innovation capabilities. In terms of the strength of the relationship, social capital was found to be a more effective mediator, and next to this were human capital and organizational capital, respectively. Our findings contribute to the existing literature by explaining the relationship between HPWS and innovation capabilities, which is also referred to as the black box through the mediation of intellectual capital. Decision makers should recognize the importance of this relationship because it develops innovation capabilities that enhance organizational performance by giving them a competitive advantage.

Suggested Citation

  • Hafiz Ali Javed & Naveed Ahmad Khan & Silke Michalk & Noor Ullah Khan & Muhammad Kamran, 2023. "High-Performance Work System and Innovation Capabilities: The Mediating Role of Intellectual Capital," Administrative Sciences, MDPI, vol. 13(1), pages 1-19, January.
    • Handle: RePEc:gam:jadmsc:v:13:y:2023:i:1:p:23-:d:1032749
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    References listed on IDEAS

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    1. Sung‐Choon Kang & Scott A. Snell, 2009. "Intellectual Capital Architectures and Ambidextrous Learning: A Framework for Human Resource Management," Journal of Management Studies, Wiley Blackwell, vol. 46(1), pages 65-92, January.
    2. Franklyn A Manu, 1992. "Innovation Orientation, Environment and Performance: A Comparison of U.S. and European Markets," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 23(2), pages 333-359, June.
    3. Joseph F. Hair & G. Tomas M. Hult & Christian M. Ringle & Marko Sarstedt & Kai Oliver Thiele, 2017. "Mirror, mirror on the wall: a comparative evaluation of composite-based structural equation modeling methods," Journal of the Academy of Marketing Science, Springer, vol. 45(5), pages 616-632, September.
    4. Amna Yousaf & Qasim Ali Nisar & Shahzad Ali & Aamir Zamir Kamboh & Muhammad Sajjad Hussain, 2019. "Do High-Performance Work Practices Influence Organizational Innovation? Mediating Role of Human Capital," Pakistan Journal of Humanities and Social Sciences, International Research Alliance for Sustainable Development (iRASD), vol. 7(1), pages :107-120, March.
    5. Chen, Chung-Jen & Huang, Jing-Wen, 2009. "Strategic human resource practices and innovation performance -- The mediating role of knowledge management capacity," Journal of Business Research, Elsevier, vol. 62(1), pages 104-114, January.
    6. Harishankar Vidyarthi, 2019. "Dynamics of intellectual capitals and bank efficiency in India," The Service Industries Journal, Taylor & Francis Journals, vol. 39(1), pages 1-24, January.
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    Cited by:

    1. Sunwang Kim & Jimin Kwon & Dongil Jung, 2023. "Going beyond the firm perspective: what do employees think of high-performance work systems (HPWS)?," Asian Business & Management, Palgrave Macmillan, vol. 22(5), pages 2106-2134, November.

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