How Does Executive Strategic Human Resource Management Link to Organizational Ambidexterity? An Empirical Examination of Manufacturing Firms in China

• Date: 01 September 2016
• Published date: 01 September 2016
• Author: Yang Chen,Jiafei Jin,Fang Lee Cooke,Guiyao Tang
• DOI: http://doi.org/10.1002/hrm.21797

Human Resource Management, September–October 2016, Vol. 55, No. 5. Pp. 919–943

© 2016 Wiley Periodicals, Inc.

Published online in Wiley Online Library (wileyonlinelibrary.com).

DOI:10.1002/hrm.21797

Correspondence to: Guiyao Tang, School of Management, Shandong University, No. 27, Shanda South Road, Licheng

District, Jinan, Shandong 250100, P. R. of China, Phone: +8615066134318, E-mail: tangguiyao2010@gmail.com

HOW DOES EXECUTIVE STRATEGIC

HUMAN RESOURCE MANAGEMENT

LINK TO ORGANIZATIONAL

AMBIDEXTERITY? AN

EMPIRICAL EXAMINATION OF

MANUFACTURING FIRMS IN CHINA

YANG CHEN, GUIYAO TANG, FANG LEE COOKE, AND

JIAFEI JIN

Despite a plethora of studies that demonstrate the positive impact of strategic

human resource management on fi rm performance, existing knowledge of the

processes through which such gains can be achieved remains limited. This study

aims to extend our knowledge by investigating the mechanism through which

a teamwork-oriented executive strategic human resource management system

impacts organizational ambidexterity. Specifi cally, by integrating the resource-

based view and information-processing theory, we examine the mediating role

of top management team effectiveness and the moderating role of knowledge–

sharing intensity from middle managers to top management teams. Drawing on

a multiple-source and multiple-respondent survey from 144 manufacturing fi rms

in China, we show that top management team effectiveness partially mediates

the effect of the executive strategic human resource management system on

organizational ambidexterity. Moreover, knowledge-sharing intensity from mid-

dle managers to top management teams strengthens the effect of the executive

strategic human resource management system on organizational ambidexterity.

©2016 Wiley Periodicals, Inc.

Keywords: executive strategic HRM system, knowledge sharing, organizational

ambidexterity, TMT effectiveness

920 HUMAN RESOURCE MANAGEMENT, SEPTEMBER–OCTOBER 2016

Human Resource Management DOI: 10.1002/hrm

Research argues that middle managers are

important internal agents with substantial deci-

sion-making authority that might influence

organizational processes underpinning firm per-

formance (Wooldridge, Schmid, & Floyd, 2008).

Organizational ambidexterity may challenge the

professional and functional identity of middle

managers who play a role in the implementation

of strategies designed by TMTs to realize ambi-

dexterity. Thus, consideration of both TMTs and

middle managers is crucial to understanding how

key internal agents may intervene in the process

through which firms leverage their resources to

enhance performance, in particular the process

through which firms use their executive SHRM

system to realize ambidexterity.

Our study seeks to address two research

questions:

1. How does an executive SHRM system influ-

ence organizational ambidexterity?

2. Do middle-manager-related variables play an

intervening role in the relationship between

an executive SHRM system and organizational

ambidexterity?

The study bridges the gaps in the current

research on SHRM and organizational ambidex-

terity by building a conceptual model linking the

executive SHRM system to TMT members and

organizational ambidexterity. For the purpose of

this study, we define organizational ambidexter-

ity as the organization’s capacity to simultaneously

exploit existing competencies and explore new oppor-

tunities across an entire business unit (Cao et al.,

2009; Gibson & Birkinshaw, 2004; Lubatkin et al.,

2006). Drawing on extant literature on resource-

based view (RBV) and information-processing

theory (e.g., Lin & Shih, 2008; Wooldridge et al.,

2008), our model posits two critical intervening

mechanisms to help explain the linkage between

the executive SHRM system and ambidexterity:

TMT effectiveness and knowledge-sharing inten-

sity from middle managers to TMTs. This study

contributes to the SHRM literature by focusing on

the HRM system at the TMT level and develop-

ing a theoretically grounded model that traces the

path from the executive SHRM system to a firm’s

organizational ambidexterity by theorizing the

mediating role of TMT effectiveness. By respond-

ing to the call for studies on the interface between

TMTs and middle managers, this study further

contributes to the management literature by high-

lighting the strategic and operational significance

of middle managers for firms to achieve superior

performance and investigating the moderating

Introduction

Research on the upper echelons of firms

has long acknowledged the importance

of top management team (TMT) func-

tions and effectiveness on organizational

behavior and outcomes (Song, Zhang,

& Wu, 2014). This suggests that an executive-

focused strategic human resource management

(SHRM) system may exert an effect on firm out-

comes. An executive SHRM system represents a set

of teamwork-oriented HRM practices toward TMT

executives, including recruitment and selection,

team-level compensation, collaboration training,

team performance appraisal, and teamwork cli-

mate building (Lin & Shih, 2008). Distinct from

organization-wide SHRM systems, the executive

SHRM system aims to improve team collaboration

and effectiveness among strategic decision mak-

ers and thus produce widespread effects on firm

strategic and financial results (Lin & Shih, 2008).

The process through which the executive SHRM

system impacts firm performance has received

little research attention (take Lin & Shih, 2008, as

an exception), despite its importance.

A recurring proposition in management

literature is that successful organizations in a

dynamic environment are ambidextrous (Gibson

& Birkinshaw, 2004). An ambidextrous organiza-

tion is one that is capable of both exploiting exist-

ing competencies (e.g., upgrading existing skills

in product development, experiential refinement,

and reuse of existing technology) and exploring

new opportunities (e.g., acquiring new technol-

ogy, skills, and innovation). Achieving ambi-

dexterity enables an organization to enhance its

performance and competitive advantage (Cao,

Gedajlovic, & Zhang, 2009). A number of studies

have concluded that organizational ambidexterity

can be a means to competitiveness improvement,

adaptation, and survival, and thus can serve as a

proxy of firm performance (Cao et al., 2009; He &

Wong, 2004; Junni, Sarala, Taras, & Tarba, 2013).

However, organizational ambidexterity remains

undertheorized, and its antecedents especially are

poorly understood (Cao, Simsek, & Zhang, 2010;

Patel, Messersmith, & Lepak, 2013). Based on the

upper-echelon theory, some studies highlight the

critical role of TMT in helping firms to achieve

ambidexterity (e.g., Cao et al., 2010; Lubatkin,

Simsek, Ling, & Veiga, 2006). This study treats the

executive SHRM system as a critical antecedent

(Junni, Sarala, Tarba, Liu, & Cooper, 2015; Patel

et al., 2013) and analyzes the process through

which the executive SHRM system impacts orga-

nizational ambidexterity.