High Performance Work Systems Defined

HPWS is a name given to a set of management practices that attempt to create an

environment within an organization where the employee has greater involvement
and responsibility. More specifically, HPWS has been defined by Bohlander et al
(2004) as “a specific combination of HR practices, work structures, and processes
that maximizes employee knowledge, skill, commitment and flexibility” .

A HPWS is all about determining what jobs a company needs done, designing the
jobs, identifying and attracting the type of employee needed to fill the job, and then
evaluating employee performance and compensating them appropriately so that
they stay with the company.

The first component is the concept of “increased opportunity to participate in

decisions” (Barnes, p. 9) for employees. The ability for an employee to
participate in the decision making process is considered to be one of the key
elements of an HPWS because it allows the employee to make decisions that
effect their immediate environment, which in turn effect the entire organization.
This participation provides leads to employees feeling more empowered, which
leads to a more committed workforce.

The second component is training. This training provides employees with the
necessary skills to perform their jobs in a more effective manner as well as the
opportunity to assume greater responsibility within an organization. Training
also gives organizations a way to cross-train employees in different skills and
roles to ensure that employees understand many roles within an organization.
The third component is employee incentives. The two previous elements help to
prepare employees and organizations for successful HPWS implementation and
operation, but without incentives, the system will most likely fail. Organizations
need to find a way to link pay with performance in order to incentivize an
employee to focus “on outcomes that are beneficial to themselves and the
organization as a whole” (Bohlander & Snell, 2004, p. 698). Incentives can take
many forms, with some examples as profit sharing plans, pay raises, bonuses for
meeting performance targets and other monetary incentives. In addition,
incentives can take the form of non-monetary options such as time off, flextime,
group lunches and other special employee benefits.

In addition to the three components of involvement, training and incentives,

there is also a fourth element that makes up another key component of modern
day high performance work systems. Technology is everywhere in the world
today and must be considered as part of any organizational development
exercise. Within high performance work systems, technology does not have to
be leading edge technology solutions, but it does provide an “infrastructure for
communicating and sharing information vital to business performance”.
Combining the four components outlined above is necessary to create a high
performance work system within an organization. The original definition of HPWS
as provided by Nadler et al (1992) is: The High Performance Work System is an
organizational architecture that brings together work, people, technology and
information in a manner that optimizes the congruence of fit among them in order
to produce high performance in terms of the effective response to customer
requirements and other environmental demands and opportunities (Nadler,
Gerstein, & Shaw, 1992, p. 118)

Nadler et al (1997) outlined ten key principles (shown in Table 1 below) that
should be considered when designing a high performance work These principles
are basic guidelines to consider, not a strict roadmap for designing a high
performance work system.

The steps required to develop an HPWS are described below:-

1. Analyze the business strategy • Where is the business going? • What are the
strengths and weaknesses of the business? • What threats and opportunities face the
business? • What are the implications of the above on the type of work practices
and people required by the business, now and in the future?

2. Define the desired performance culture of the business • What differences do

we want to make to working arrangements? • How do we want to treat people
differently? • What do we want people to do differently?
3. Analyze the existing arrangements • What is happening now in the form of
practices, attitudes and behaviors? • What should be happening?

What do people feel about it?

4. Identify the gaps between what is and what should be :Clarify specific
practices where there is considerable room for improvement.

5. Draw up a list of practices that need to be introduced or improved: At this

stage only a broad definition should be produced of what ideally needs to be done.

6. Establish complementarities: Identify the practices that can be linked together

in ‘bundles’ to complement and support one another.

7. Assess practicality • Is it worth doing? What’s the business case in terms of

added value? What contribution will it make to supporting the achievement of the
organization’s strategic goals? • Can it be done? • Who does it? • Do we have the
resources to do it? • How do we manage the change?

8. Prioritize In the light of the assessment of practicalities: Decide on the

priorities that should be given to introducing new or improved practices. A realistic
approach is essential. There will be limits on how much can be done at once or any
future time. Priorities should be established by assessing: • the added value the
practice will create; • the availability of the resources required; • anticipated
problems in introducing the practice,

9. Define project objectives :- Develop the broad statement of objectives and

define what is to be achieved, why and how.

10. Get buy-in This should start at the top with the chief executive and members
of the senior management team, but so far as possible it should extend to all the
other

11. Plan the implementation :This is where things become difficult. Deciding
what needs to be done is fairly easy; getting it done is the hard part. The
implementation plan needs to cover: • who takes the lead – this must come from
the top of the organization: nothing will work without it; • who manages the
project and who else is involved; • the timetable for development and introduction;
• the resources (people and money required); • how the change programme will be
managed, including communication and further consultation; • the success criteria
for the project.

12. Implement Too often, 80 per cent of the time spent on introducing an HPWS
is devoted to planning and only 20 per cent on implementation. It should be the
other way round. Whoever is responsible for implementation must have
considerable project and change management skills.