Effects of training and development on employee outcomes and firm innovative performance: Moderating roles of voluntary participation and evaluation

• Author: Jin Nam Choi,Sun Young Sung
• Date: 01 November 2018
• Published date: 01 November 2018
• DOI: http://doi.org/10.1002/hrm.21909

ORIGINAL ARTICLE

Effects of training and development on employee outcomes

and firm innovative performance: Moderating roles of

voluntary participation and evaluation

Sun Young Sung

1

| Jin Nam Choi

2

1

School of Business, Nanjing University,

Nanjing, China

2

College of Business Administration, Seoul

National University, Seoul, South Korea

Correspondence

Jin Nam Choi, College of Business

Administration, Seoul National University,

Gwanak-gu, Gwanakro 1, Seoul, South Korea,

151-742.

Email: jnchoi@snu.ac.kr

This study investigates the effect of training and development (T&D) on firm innovation. Given

the inconsistent findings on the performance implications of T&D and the lack of studies on

the T&D–innovation relationship, we elaborate the multiple dimensions of T&D, intermediate

employee outcomes, and boundary conditions to elucidate the pathways of T&D toward firm

innovation. We specifically identify two distinct T&D dimensions, namely, firm investment and

employees’positive perceptions. The former and the latter, respectively, reflect top-down and

bottom-up approaches. We suggest that these two dimensions indirectly affect firm innovative

performance by enhancing employees’competence and commitment. We further hypothesize

that T&D-related contingencies (i.e., employees’voluntary participation and T&D evaluation)

moderate the indirect effects of T&D on firm innovative performance. We examine the current

framework by using multisource data collected at three time points over a 5-year period from

325 Korean organizations. Our analysis confirms that the positive indirect effect of T&D on

firm innovative performance through employees’competence and commitment becomes stron-

ger (a) when employees voluntarily participate in T&D and (b) when firms do not implement

T&D evaluation. This study provides useful and valid theoretical explanations and practical

insights into the design and implementation of T&D in firms.

KEYWORDS

commitment, employee participation, human capital, innovation, training and development

1|INTRODUCTION

In a contemporary business environment, developing idiosyncratic,

inimitable, and nonsubstitutable human capital is a major strategic

tool and necessary condition to improve organizational performance

(Shaw, Park, & Kim, 2013). For this reason, organizations bear enor-

mous capital spending on training and development (T&D) programs

and activities (Association for Talent Development, 2017). Nonethe-

less, meta-analytic reviews on empirical findings raise considerable

doubt on the actual contribution of T&D to firm performance

(Nguyen, Truong, & Buyens, 2010; Tharenou, Saks, & Moore, 2007).

For example, several empirical studies have demonstrated that train-

ing contributes to employees’motivation and competence and firm

performance (Castellanos & Martin, 2011; Kim & Ployhart, 2014). By

contrast, other studies have reported that training is not a meaningful

predictor of employees’knowledge, skills, and abilities (KSAs) and

firm performance because T&D frequently irritates employees, result-

ing in unintended dysfunctional outcomes that cancel out potential

benefits (Glaveli & Karassavidou, 2011). Ployhart, Call, and McFarland

(2017) noted that T&D investment often helps improve employee

performance but simultaneously leads to negative consequences,

such as increased job mobility, bargaining power, and turnover. Ara-

gón-Sánchez, Barba-Aragón, and Sanz-Valle (2003) revealed that

training can even hinder employees’task involvement and firm profit-

ability. These findings present a critical theoretical challenge in under-

standing why some studies have revealed positive effects of T&D on

performance, whereas other studies have obtained nonsignificant or

even negative effects.

To address the gap between the prevailing assumption and mixed

empirical evidence on the value of T&D, the present study investi-

gates the distinct functions associated with different dimensions of

T&D, their intermediate employee outcomes, and critical boundary

conditions to explain firm performance. In so doing, we focus on firm

innovation as a critical performance domain. Unfortunately, innova-

tive performance has been largely neglected in T&D-related literature

despite its importance in organizations to continually adapt to

DOI: 10.1002/hrm.21909

Hum Resour Manage. 2018;57:1339–1353. wileyonlinelibrary.com/journal/hrm © 2018 Wiley Periodicals, Inc. 1339