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Perceived Labor Productivity in Small Firms—The Effects of High–Performance Work Systems and Group Culture through Employee Retention

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  • Pankaj C. Patel
  • Betty Conklin

Abstract

In small firms, high–performance work systems (HPWS) may not always yield benefits that outweigh their costs. Using a sample of 145 small enterprises (SEs) with 10–100 employees, we examine how small firms may realize mutually reinforcing effects of group culture on HPWS to increase employee retention and improve perceived labor productivity. Using a novel methodology, we find that employee retention does not mediate the effects of HPWS on perceived labor productivity, but that mediation becomes significant and increases with greater levels of group culture. This study provides insights into conditions in which HPWS can enhance SE perceived labor productivity.

Suggested Citation

  • Pankaj C. Patel & Betty Conklin, 2012. "Perceived Labor Productivity in Small Firms—The Effects of High–Performance Work Systems and Group Culture through Employee Retention," Entrepreneurship Theory and Practice, , vol. 36(2), pages 205-235, March.
    • Handle: RePEc:sae:entthe:v:36:y:2012:i:2:p:205-235
    DOI: 10.1111/j.1540-6520.2010.00404.x
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    1. Kyriaki Papadopoulou, 2020. "Comparative Review Of Performance Measurement Methods Effectiveness," Economics and Management, Faculty of Economics, SOUTH-WEST UNIVERSITY "NEOFIT RILSKI", BLAGOEVGRAD, vol. 17(1), pages 127-139.

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