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CEP discussion paper

Do Organisational Climate and Strategic Orientation Moderate the Relationship Between Human Resource Management Practices and Productivity?


Contingency formulations of Human Resource Management (HRM) theory suggest that the effectiveness of HRM practices should vary across firms. This study examined whether the relationship between HRM practices and productivity in manufacturing companies is contingent upon organizational climate and strategic orientation. Information on HRM, organizational structure, and competitive strategy was collected by interviewing senior managers, whilst organizational climate was assessed via employee surveys. Although organizational climate and HRM practices were both positively associated with subsequent productivity, the relationship between HRM practices and subsequent productivity was stronger for firms with a poor climate.


Andrew Neal, M Patterson and M West

March 2004     Paper Number CEPDP0624

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This CEP discussion paper is published under the centre's Labour markets programme.