Information technology, human resources management systems and firm performance: An empirical analysis from Spain

INFORMATION TECHNOLOGY, HUMAN RESOURCES MANAGEMENT SYSTEMS AND FIRM PERFORMANCE: AN EMPIRICAL ANALYSIS FROM SPAIN Ph.D. Pilar Ficapal-Cusí(*) Ph.D. Joan Torrent-Sellens(*) Ph.D. Pilar Curós-Vilà(**) (*)Economics and Business Studies. Open University of Catalonia (UOC) (**)Faculty of Business and Economics. University of Girona (UdG) SOCIETY AND INFORMATION TECHNOLOGIES: ICSIT 2010 April 6th – 9th, Orlando, Florida, USA

Structure
Introduction
Hypotheses
Model
Methodology
Results
Conclusions
Limitations and future research

1. Introduction New forms of HRM and results Murphy (2002) Bresnahan, Brynjolfsson y Hitt (2002) Gant, Ichniowski y Shaw (2002) Bartel, Ichniowski y Shaw (2004) Osterman (2005) Foss (2005) Lundvall and Nielsen (2007) Torrent and Vilaseca (2007) The delegation of responsibilities to the worker and less hierarchy allow more innovation and improve business results, associated with: a) an intensive use of ICT, and b) a HRM that increases employee engagement Ichniowski (1990) Huselid (1995) Ichniowski, Shaw and Prennushi (1997) Osterman (2005) The use of a set of HRM practices, combined with the new systems of work organization, further improve the competitive advantage of firms Appelbaum et al. (2000) Carayannis and Sagi (2001) Child and McGrath (2001) Gant, Ichniowski and Shaw (2002)
Companies are more competitive if:
They transform the basis of competency of their workers,
They organize their production and work flexibility and
develop working relationships that increase commitment

1. Introduction
Thus, considering the symbiotic relationship with Information Technology (IT), organisational change and HRM practices, this research will analyse innovative human resources management systems (IHRMS) for the specific case of the Spanish firm.
The aim of the study is to find and characterize what types of HRM practices are adopted by Catalan firms a (Spanish region), and to establish determinants of implementation of IHRMS.

1. Introduction
By Innovative Human Resources Management Systems ( IHRMS) we mean that group of practices which, acting as a complete system, is characterised by:
a) a higher level of competence of their employees;
b) the effort made in selecting and training them;
c) a set of practices related to the transfer of power;
d) the quality of labour relations; and
e) remuneration which is managed through a system of setting objectives and performance review.

2. Hypotheses
Thus we formulate three research hypotheses:
Hypothesis 1: HRM practices operate as a system where they are mutually reinforcing
Hypothesis 2 : The adoption of IH RMS is linked with firms that :
a) are more internationalised and show greater ability to adapt to the changing environment, to innovate and to collaborate;
b) focus product/service differentiation strategy enhancing quality
c) apply a greater degree of new forms of work organization;
d) have more technological equipment and use IT more intensively; and
e) invest more in training their employees
Hypothesis 3: Firm structure, new forms of work organisation, Information Technology use level, interaction with international suppliers, collaboration networks for innovation, and business efficiency, are determinants in the adoption of IHRMS.

3. Model

4. Methodology Methodology : Sample firms were contacted through telephone calls to confirm a contact person in each firm, followed by survey questionnaires (128 items) that were answered by managers by means of a face-to-face, hour-long interview. Total Staff members: 2,038 firms Sample: 1,518 cases (exclusion 520 cases with contradictory or non-plausible answers) Confidence interval: 95.5% p=q=0.5 Sampling error: +/- 2.2 percent Period: five months (January and May 2003) Statistical Method: 1)Factor analysis: Principal components analysis, Cluster analysis: Non hierarchical cluster analysis of K-means and Association analysis. 2)Estimation: Binomial Logit Model

4. Methodology

5. Results Practices of HRM adopted by frequency

5. Results Varimax Rotated Factor Matrix of HRM practices

5. Results IHRMS in Catalan firms. Results of k-means analysis

5. Results
We carried out statistical analysis of the relationships between the IHRMS and several measurements of structure and firm results. Thus, IHRMS is evidenced in percentages that are higher than expected in:
Structure of the firm
a) firms on the services sector;
b) firms that form part of a business group;
c) firms which have foreign capital;
d) he most internationalised firms;
e) firms with a differential presence of clients and suppliers from outside Catalonia; and
f) firms with a high degree of collaboration with their competitors
Competitive strategy
a) firms that opt for a strategy of product differentiation or specialised service; and
b) firms have carried out improvements in their productive process through quality control of products or services.

5. Results
Work organisation practices
a) firms with delegation of authority in decision making;
b) using flexible and adaptable work teams;
c) a greater flow of communication among workers;
d) coordination systems based on work supervision by objectives; and
e) a significantly greater percentage of externalised or subcontracted operations.
Technological and innovation perspective
a) more digital technological equipment;
b) a better level of internet equipment;
c) more advanced IT use;
d) a dynamic of greater innovation in the productive process through IT; and
e) superior development of organisational innovation.

5. Results Determinants for the adoption of innovative HRM system (IHRMS)

6. Conclusions
The most important overall results of our analysis are:
The empirical evidence that was obtained demonstrates that most of Catalan firms (about two thirds) have traditional forms of HRM, and that those firms incorporating innovative system of HRM practices ( slightly more than a third of the total ) have considerably different profiles.
On the basis of the four basic dimensions of HRM (selection, training, hiring and remuneration), we obtained five factors: flexible remuneration, job training, qualifications, employment security, and managerial competences, which have allowed us to identify a system of IHRM practices (H1).

6. Conclusions
Using association analysis we find that firms that adopt IHMRS are more internationalised ; show greater ability to adapt to the change environment , to innovate and to collaborate ; focuses product/service differentiation strategy enhancing quality; apply a greater degree of new forms of work organization ; use IT more intensively; and invest more in training their employees (H2).
Medium-sized and large firms (more than 20 workers); which form part of a business group; belong to a knowledge-intensive sector; with advanced IT use; which establish collaboration networks with firms and institutions in order to innovate; whose suppliers are geographically international ; that favour more decentralised decision-making; and are efficient; are the firms which are more likely to incorporate IHRMS (H3).

7. Limitations and future research
Despite the limitations of the research, particularly the lack of a time series and the restrictions imposed by the indicators and the methodologies used, the results obtained are consistent with other studies carried out at firm level as well as in other regions and sectors (Huerta-Arribas, 2002; Foss, 2005; García-Olaverri, Huerta-Arribas and Larraza-Kintana, 2006)
The specific characteristics of the overall productive systems in Catalonia (very small firms, low intensity in technology and knowledge, with low levels of training and serious problems of productivity and competitiveness) allow the results obtained to be extrapolated to other regions and groups of firms .

7. Limitations and future research
Everything seems to indicate that the processes technological, strategic and organisational co-innovation combine with efficiency in the explanation for the adoption of innovative HRM systems. This process which, undoubtedly, generates sources of competitive advantage, is only valid for a small group of Catalan firms (no more than a third of the total). It will be difficult to improve the competitive advantage of the remainder of the Catalan productive network without tackling new combinations in HRM, together with other new innovation processes.
In this respect, in upcoming research we propose to tackle the analysis of the sources (technological, strategic, organisational and HRM-related) of business efficiency.

INFORMATION TECHNOLOGY, HUMAN RESOURCES MANAGEMENT SYSTEMS AND FIRM PERFORMANCE: AN EMPIRICAL ANALYSIS FROM SPAIN PhD. Pilar Ficapal-Cusí(*) PhD. Joan Torrent-Sellens(*) PhD. Pilar Curós-Vilà (**) (*)Economics and Business Studies. Open University of Catalonia (UOC) (**)Faculty of Business and Economics. University of Girona (UdG) SOCIETY AND INFORMATION TECHNOLOGIES: ICSIT 2010 April 6th – 9th, Orlando, Florida, USA

Information technology, human resources management systems and firm performance: An empirical analysis from Spain

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Information technology, human resources management systems and firm performance: An empirical analysis from Spain — Presentation Transcript