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Theories of innovation and strategic management highlight the role of distinctive capabilities in creating and sustaining a firm's competitive advantage. Of concern has been understanding the micro-foundations for these capabilities, especially in dynamic environments. We draw on strategic human resource management (SHRM) to examine the linkages between two fundamental elements of a firm's HR system'people and practices. We argue that these elements provide important means by which firms generate the resources and capabilities required for innovation and, ultimately, firm performance. We explore how SHRM practices and leadership competence relate to dynamic capabilities for innovation and foster organizational engagement'both of which provide important organizational-level capabilities for generating innovation outcomes under different environmental conditions. We test our model using a large, nationally representative survey of organizations in Australia. Under more stable environmental conditions, the formation of the underlying capabilities required for innovation is associated with more processual routines in the form of SHRM practices, while in more dynamic environments, leader competence plays a more pronounced role. These findings support the view that different forms of both human capital and employee motivation and behaviors are critical organizational resources that link HRM to organizational outcomes. [ABSTRACT FROM AUTHOR]

The largest operation cost for many organizations is employee compensation. An important management task is therefore the design of an appropriate system to reward and recognise employees. Many practitioners and scholars have advocated the use of pay-for-performance systems (i.e. performances bonuses or merit pay) to increase employee motivation. However, empirical findings are inconsistent and less supportive than expected. To add more clarity in this research stream, we draw on distributive justice research and the instrumental justice perspective to analyse the mechanism and boundary condition of the effects of different performance bonus systems on employee outcomes. To test our hypotheses, we use data from a survey study with 3,231 employees and 666 managers. To analyse the results, we conducted multilevel structural equation modelling using Mplus. Employees perceive individual and team performance bonus systems as fairer than fixed pay. However, low workplace performance weakens the relationship between an individual performance bonus system and distributive justice. Further, organizational and hybrid performance bonus systems are not perceived as fairer than fixed pay. Distributive justice mediates the relationships between the different performance bonus systems and employees' work engagement and organizational affective commitment. [ABSTRACT FROM AUTHOR]

Scholars and practitioners have held great interest in how workforce diversity and inclusion relates to organizational outcomes. Similarly, much attention has focused on the inclusion of cultural minorities and women through the ranks of leadership and the effects of leadership team diversity on organization-level outcomes. We extend this work, exploring the effects of having traditionally underrepresented senior leaders on individual employee perceptions and engagement. We propose that organizations with a climate for innovation and flexibility are likely to see positive impacts from having a traditionally underrepresented individual as a senior leader, particularly when faced with environmental turbulence. Drawing on data from a large-scale study of Australian leadership, we tested our hypotheses with hierarchical linear modelling (HLM). Results suggest that promoting an innovative and flexible work climate has a number of positive benefits in general, and particularly when cultural minorities are leading their workplaces in turbulent environments. However, we observed some unexpected patterns when examining workplaces with female senior leaders. [ABSTRACT FROM AUTHOR]

In response to the diffusion of group-based forms of work organization, conflict research has examined the consequences of workgroup conflict. To help organizations to reduce workgroup conflict, scholars have begun to investigate antecedents of workgroup conflict. This body of work has focused in particular on how attributes of the individual employee, the group, and the task might predict conflict within groups. Drawing on social learning theory and social exchange theory, we extend this work by exploring the role of leaders in influencing the emergence of workgroup conflict. Our approach integrates research on group leadership and workgroup conflict to help organizations predict and manage workgroup conflict effectively. We argue that leadership empowerment behavior, an important group-oriented leadership approach, is negatively associated with workgroup relationship and task conflict through employees' affect- and cognition-based trust in leaders. To test our theory-driven model, we utilize data drawn from matched surveys of leaders and employees in 311 workgroups. Consistent with our model, we find that leadership empowerment behavior relates negatively to relationship and task conflict through affect- and cognition-based trust in leaders. Empowering and trustful leaders further influence workgroup performance by reducing workgroup conflict. Relationship conflict has a direct negative relationship with performance, while task conflict has an indirect negative relationship with performance through relationship conflict. [ABSTRACT FROM AUTHOR]

An increasingly complex, dynamic, and interdependent organizational environment has driven many organizations to favor leaner and flatter organizational structures. This is often accompanied by the utilization of strategic human resource management (HRM) practices that seek to enhance employee abilities and motivation and provide opportunities for participation in decision-making. While previous research has considered the effects of such practices for overarching organizational performance, the circumstances outlined above have also renewed emphasis on internalizing and utilizing external knowledge (absorptive capacity) as a precursor to generating innovative outcomes and in turn increasing market performance. In this study, we integrate research on strategic HRM systems, absorptive capacity, and individual leadership empowerment behaviors and first demonstrate how strategic HR systems serve as foundations for the development of absorptive capacity. We then show how leader empowerment behaviors act as a social integration mechanism to enhance the effectiveness of HR practices for developing absorptive capacity, and encourage the utilization of absorptive capacity for generating innovative outcomes. Empowerment allows employees to more readily and more autonomously react to changing external conditions or to proactively initiate the acquisition, transformation, and application of new knowledge in light of environmental changes. [ABSTRACT FROM AUTHOR]

Prior research has highlighted the critical role of dynamic capabilities-that is, an organization's ability to sense changes and opportunities in its markets, seize these opportunities, and continuously reconfigure its assets to changing market conditions-for innovation outcomes. This work has identified the micro-foundations for the development of such capabilities, with an increasing focus placed on the role of senior managers and leaders in influencing the development and deployment of dynamic capabilities. In this study, we examine the conditions under which organizational routines and leadership action provide the foundation for organization-level dynamic capabilities associated with innovation. In particular, we argue that the relative impacts of both leadership and routines-based HR systems as micro- foundations are contingent on conditions of the external operating environment. Our results suggest that under more stable environmental conditions, dynamic capabilities formation is associated more with processual routines (in the form of HRM systems), while in more dynamic environmental contexts, individual leader capabilities play a more pronounced role in the development of dynamic capabilities associated with innovation outcomes. [ABSTRACT FROM AUTHOR]