Why Complementary HRM Practices Impact Performance: The Case of Rewards, Job Design, and Work Climate in a Knowledge‐Sharing Context

• DOI: http://doi.org/10.1002/hrm.21649
• Published date: 01 November 2015
• Author: Torben Pedersen,Mia Reinholt Fosgaard,Diego Stea,Nicolai J. Foss
• Date: 01 November 2015

Human Resource Management, November–December 2015, Vol. 54, No. 6. Pp. 955–976

© 2014 Wiley Periodicals, Inc.

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

DOI:10.1002/hrm.21649

Correspondence to: Nicolai J. Foss, Department of Strategic Management and Globalization, Copenhagen Business

School, Kilevej 14, 2nd floor, 2000 Frederiksberg, Denmark, Phone: +45 38152562, E-mail: njf.smg@cbs.dk

WHY COMPLEMENTARY HRM

PRACTICES IMPACT PERFORMANCE:

THE CASE OF REWARDS, JOB

DESIGN, AND WORK CLIMATE IN A

KNOWLEDGE-SHARING CONTEXT

NICOLAI J. FOSS, TORBEN PEDERSEN,

MIA REINHOLT FOSGAARD, AND DIEGO STEA

The strategic HRM literature suggests that HRM infl uences employees in com-

binations of practices that “fi t” each other rather than as stand-alone practices;

however, it pays little attention to the underlying individual-level mechanisms.

In contrast, the HRM literature on knowledge sharing examines the infl uence of

single practices on individual-level knowledge sharing, but fails to include the

infl uence of combinations of practices. We link the idea of fi t between practices

to employee motivation for knowledge sharing by arguing that rewards may be

ambiguous and diffi cult to interpret, but that such ambiguity may be reduced if

rewards are combined with other aligned HRM practices, notably job design and

work climate. Thus, fi t is established through the ambiguity-reducing effect of

combining specifi c HRM practices. Accordingly, we test for complementarities

among rewards, job design, and work climate in the form of a three-way interac-

tion among these variables with respect to their impact on knowledge-sharing

motivation. Our analysis of 1,523 employees in fi ve knowledge-intensive fi rms

shows that employees who are exposed to knowledge-sharing rewards experi-

ence higher levels of autonomous motivation to share when they are simulta-

neously exposed to a noncontrolling job design and work climate that support

knowledge sharing. © 2014 Wiley Periodicals, Inc.

Keywords: reward systems; knowledge management; job design

956 HUMAN RESOURCE MANAGEMENT, NOVEMBER–DECEMBER 2015

Human Resource Management DOI: 10.1002/hrm

In this research, we

develop a theoretical

framework that links

the idea of internal

fit to employee

motivation for

knowledge sharing.

This offers a way

to fill the void in

the HRM literature

dealing with

knowledge sharing

and internal fit,

respectively.

dealing with knowledge sharing and internal fit,

respectively. Specifically, this research contributes

to the internal fit literature with an understanding

of the workings of internal fit on the individual

level, which in turn broadens our knowledge of

why and how such fit matters for organizational

outcomes. Furthermore, this research contributes

to the HRM literature on knowledge sharing by

showing that employees’ motivation for knowl-

edge sharing is sensitive to the internal fit among

HRM practices utilized to enhance knowledge

sharing, thus providing better grounds for advis-

ing managers on how to enhance knowledge shar-

ing in their organizations.

Our starting point is the well-established

insights from the motivational psychology litera-

ture that rewards may be highly ambiguous and

difficult to interpret, and that “it is not the reward

per se, but rather its meaning to the recipient that

determines the reward’s effects” (Deci, Koestner,

& Ryan, 1999, p. 658). Based on this, we develop

the argument that internal fit reduces the poten-

tial ambiguity posed by rewards, and thus eases

the employees’ interpretation of the managerial

intentions underlying rewards. While the HRM

literature often implicitly assumes that rewards

are unambiguous in the sense that employees

know whether those rewards are meant to play an

informational or controlling role, we argue that

the purpose of rewards is far from obvious. That

is, management may use rewards to convey infor-

mation about employees’ competence, thereby

stimulating feelings of competence and auton-

omy, or management may use rewards to manip-

ulate employees, thereby stimulating feelings of

control and distrust (Bénabou & Tirole, 2003;

Deci etal., 1999). Whether the former or the lat-

ter aspect of a reward is salient largely depends on

other contextual factors (Deci etal., 1999; Gagné

& Deci,2005).

Using the ideas of reward ambiguity as our the-

oretical starting point, and inspired by Gottschalg

and Zollo’s interest alignment framework (2007),

we specifically focus on the role of job design and

work climate as contextual factors that influence

employees’ motivational responses to rewards.

However, in contrast to Gottschalg and Zollo, we

focus on one type of motivation—autonomous

motivation, which unambiguously has been

shown to be superior in predicting behavioral

effort, persistence, and quality (Gagné & Deci,

2005), not least in the context of knowledge shar-

ing and related behaviors (Foss etal., 2009; Gagné,

2009; Grant, 2008; Reinholt, Pedersen, & Foss,

2011; Weinstein & Ryan, 2010). Furthermore,

while Gottschalg and Zollo acknowledge that

rewards, job design, and climate interact in their

Introduction

Much research in the strategic human

resource management (HRM) field

suggests that HRM practices influ-

ence employees jointly rather than in

isolation (Delery, 1998; Jiang, Lepak,

Han, Hong, Kim, & Winkler, 2012; P. M. Wright &

Snell, 1998). A related argument is that the extent

to which a firm’s HRM practices influence its per-

formance depends on the fit among these prac-

tices (Baird & Meshoulam, 1988). Consequently,

research has dealt with the association between

internally aligned HRM practices and organiza-

tional outcomes such as productivity, financial

performance, and turnover (Huselid, 1995; Kepes,

Delery, & Gupta, 2009). However, work on the

individual-level mechanisms through which such

aligned HRM practices gain their

potency is rare (Jiang et al., 2012;

P. M. Wright & Boswell, 2002).1 A

particularly important individual-

level construct is employee motiva-

tion, which is known to be impacted

by a wide range of HRM practices

(e.g., Gottschalg & Zollo, 2007), and

which antecedes many individual-

level outcomes—notably, commit-

ment, job satisfaction, and in-role

and extra-role behaviors (Gagné &

Deci, 2005).

Acknowledging that firms’com-

petitive advantage rests on its

knowl edge resources, another HRM

re search stream has recently ad-

dressed employee-level knowledge

sharing. This literature offers insights

into how HRM practices stimu-

late employees’ knowledge-sharing

behaviors, and specifically how

motivation mediates this relation

(e.g., Á. Cabrera, Collins, & Salgado,

2006; E. F. Cabrera & Cabrera,

2005; Foss, Minbaeva, Pedersen, &

Reinholt, 2009; Gagné, 2009; Minbaeva, Mäkelä, &

Rabbiosi, 2012). Although this literature explicitly

deals with important individual-level mechanisms,

it has largely overlooked the premise underlying

the internal fit literature, specifically that employ-

ees are exposed to multiple HRM practices simul-

taneously and that such practices therefore likely

interact in their effect on knowledge-sharing moti-

vation and, ultimately, behavior.

In this research, we develop a theoretical

framework that links the idea of internal fit to

employee motivation for knowledge sharing. This

offers a way to fill the void in the HRM literature