EFFECTS OF HUMAN RESOURCE SYSTEMS ON MANUFACTURING PERFORMANCE AND TURNOVER.

Abstract

Using an empirical taxonomy identifying two types of human resource systems, “control” and “commitment,” this study tested the strategic human resource proposition that specific combinations of policies and practices are useful in predicting differences in performance and turnover across steel “minimills.” The mills with commitment systems had higher productivity, lower scrap rates, and lower employee turnover than those with control systems. In addition, human resource system moderated the relationship between turnover and manufacturing performance.