author 1 : ujjal mukherjee designation : associate

Author 1 : Ujjal Mukherjee

Designation : Associate Professor, OB and HR area

University : CMS B School, Jain University, Bengaluru

Email: [email protected]

Author 2 : Dilip Kaushik

Designation : Ph.D Scholar, Management

University : Jain University, Bengaluru

Email: [email protected]

INFLUENCE OF HIGH PERFORMANCE WORK SYSTEM AND

PERSONALITY ON CREATIVITY AMONG INFORMATION

TECHNOLOGY SECTOR

Abstract

The aim of this research is to study the influence of High-performance work system and

personality on creativity among Information Technology (IT) sector. Confirmatory factor

analysis (CFA) and structural equation modelling (SEM) was applied in the data collected from

273 employees working in IT sector companies in India. Validated questionnaires were used

to collect the data. Personality is found to moderate the relationship between high performance

work system and creativity among employees. The practitioners working in HPWS

environment can use this study to identify the personality kind of employees whose creativity

may be developed. This study will also add value to personality, HPWS and creativity

literature.

Introduction

The information technology (IT) industry in India continues to be one of the prime components

of GDP which contributes about 7.5% to India in 2018 This has attracted the worldwide

attention in driving economic growth. According to NASSCOM and EY study (Future of jobs

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in India, 2018), India continues to be the world's prime sourcing destination for IT-BPM

services with 55% market share and IT-BPM sector will undergo a transformative change in

the next few years. Industry 4.0 has impacted the rapid changes in the way that the IT sector

operates by adopting new ways of work, business models with emerging technologies to cater

to the expectation of customers (“Deloitte Review: Industry 4.0 : Are you ready?,” 2018). The

practitioners in the service sector are creating value for customers in day to day transactions

and operations. The activities involved in developing new Information technology products

and services make the employees active, experimental and exhibit creativity their work.

Creating skill capabilities for the future has become a fast and minimum expectation for the

organizations. Based on the report from World Economic Forum (The Future of Jobs Report

2018 Insight Report Centre for the New Economy and Society, 2018), Along with the core

technical skills required for Industry 4.0, Creativity is ranked at third place among the core

human skills and will continued to be sustain for few more years. Recent research from

LinkedIn (Petrone, 2019) found that creativity is the single most skill required for business

professionals. The investment in fostering creativity among employees can foster innovation,

have more satisfied customers, be competitive, provide better customer experience and

financially successful (“ADOBE State Creat. 2016,” 2016)

A combination of human resource, structure and work process of an organization gains the

competitive advantage. Human resource strategy plays a crucial role in fostering culture and

yields the best performance from the employees (Wright, 2013). To be successful and effective,

many organizations develop their best human resource practices to align the employees to the

organization and build competitive capabilities (“HR preparedness for 2020 — People

Matters,” 2016). It is an opportunity for HR as a strategic partner to the business to drive the

performance by considering creativity as one of the prioritized skills to be fostered among

employees.

Literature Review

Creativity is about generating ideas which are novel, useful and accepted(Amabile, 1983).

Creativity is a subjective judgment of an individual which is a domain-specific outcome of a

particular action results in the novelty and value of an outcome(Ford,1996). The componential

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theory of creativity established the relationship between skills, talent and motivation which

influences the creative behavior of an individual(Amabile, 1983).

According to the componential theory of creativity(Amabile, 1983), the influencers on

creativity depends on three components (domain-relevant skills, creativity related skills, and

task motivation). The theory emphasis on the impact of these components on the creative

process which supports creativity. For an individual, domain-relevant skills component

consists of basic talent in that domain, which is developed and fostered through the

combination of various HR practices. Creativity related skills depend on individual

characteristics. Task motivation is the attitude and perception of own motivation towards the

work through intrinsic and extrinsic factors. The componential theory of creativity outlined the

importance of talents, education, cognitive skills and individual characteristics in influencing

creative behaviour.

Creative Performance behavior is a behavior exhibited by an individual with a set of

interdependent observable and unobservable activities that occur during a non-algorithmic

task(Gupta & Singh, 2014). It is a precursor of creativity, creativity implementation and

innovation which is exhibited by the employees while generating new ideas and solving

problems. Individuals undergo a creative process engagement while generative new ideas such

as problem identification, information search, idea generation and idea promotion

High-performance work systems and Creativity

In the past, an extensive body of research provided a linkage between Human Resource

Management and Performance(Bowen, 2004; Boxall, 2003; Guest, 1987; Huselid, 1995;

Huselid & Becker, 1995). Aligning to this, considerable literature on Systems Thinking

approach in the area of human resource management which influences on performance,

behavior, and productivity, conceptualized as High-Performance Work Systems(HPWS)

(Boxall, 2012; Combs et al., 2006; Huselid & Becker, 1995; Macduffie, 1995; Shih et al., 2006;

Takeuchi et al., 2007). It has been comprehensively examined and studied on both employee

and organizational outcomes. HR strategies need to focus on building skills, motivation and

positive behavior for a successful business outcome (Wright, 2013)

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In the literature, HPWS is defined “as an integrated system of HR practices that are internally

consistent(alignment among HR practices) and externally consistent (alignment with

organizational strategy)” (Evans and Davis, 2005). It is “a group of separate but interconnected

human resource practices designed to enhance employees’ skills and effort” (Takeuchi et al.,

2007). It is a range of innovative human resource management (HRM) practices is used in

certain combinations or bundles which attain synergistic benefits through an interactive and

mutually reinforcing impact (Huselid & Becker, 1995). High performance work systems are

characterized by three components (1) a work organization that provides employees with the

opportunity for direct participation in operational decisions, and human resource practices that

(2) increase workforce skills and (3) create incentives for workers to participate

effectively.(Appelbaum et al., 2001). As there is no specific list of dimensions for a HPWS,

various researchers have selected the dimensions based on the work and kind of the Business

that the organization does. Dimensions of HPWS were identified as selective hiring(Huselid &

Becker, 1995; Pfeffer, 1998; Zacharatos et al., 2005), compensation level and incentive(Pfeffer,

1994), effective and personalized learning and development(Appelbaum et al., 2001; Den

Hartog & Verburg, 2004; Huselid, 1995), performance management, work design, policies &

practices(Huselid & Becker, 1995), information sharing(Pfeffer, 1998; Tomer, 2001),

employment security(Pfeffer, 1998), self-managed and effective teams(Reynolds & Lewis,

2018; Pfeffer, 1998), participation and diversity & inclusion(Pfeffer, 1998).

A landmark study on human resource practices (Huselid, 1995)has given a framework which

integrates the human resource practices as bundles with the organization strategy to form a

High-Performance Work Systems(HPWS). HPWS is a system with a set of HR practices

connected to each other and with the Organizational strategy with a consistent alignment. The

synergistic effect created by this configuration enhances the efficiency of the workforce and

work practices in terms of skills, commitment and productivity to achieve a greater result than

it is expected and becomes a sustainable competitive advantage for an Organization.

Creativity at the workplace relies on the knowledge base and knowledge process of an

individual(Amabile, 1988). Organizations strive to achieve their competitive advantage

through creativity in the dynamic market. High-performance work practices enhance the

positive relationship between the employee and organization, thereby enhances creativity

among employees(Gupta, 2016). A carefully designed High-Performance work System can

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foster the employee creativity which can impact on the Organizational Performance.

Performance-oriented HR practices help the employees in enhancing their skills and improve

their future prospects. To achieve innovation and foster creativity among employees, it is

important to exhibit creative behavior in their work.

Although there are many studies, the research relating to HPWS and employee creativity

remains limited. Still, there are considerable amount of studies required to address the influence

of HPWS on proactive behavior(Beltrán-Martín et al., 2017), employee creativity(Tang et al.,

2017) and understanding of HPWS and innovation relationship(Fu et al., 2015). Gupta (2016)

claimed that the previous studies failed to provide the coherence between HRM practices and

creativity. In previous studies, the relationship between HPWS and creativity is limited to

individual creativity(Tang et al., 2017) and creativity implementation(Agarwal & Farndale,

2017). The literature on creative performance behavior of employees is less consistent and

rarely analyzed in the literature. A more systematic and theoretical analysis is required to

answer the influence of HPWS on creative behavior among employees while considering the

mediator effects to individual psychology.

The creativity of an individual is the building block for the organization innovation(Amabile,

1983). The role of creative behavior accelerates creativity and innovation and allows an

individual to explore ways to generate novel and meaningful ideas(Larach & Cabra, 2011). As

innovation and creativity have become the key difficulties of the organization in achieving

competitive advantage. HR plays a vital role in engineering all its activities on fostering the

creativity among the employees(Hilton, 2016). Stimulating creativity in employees helps in

thinking out of the box, generate new ideas and improves the problem solving which helps in

the productivity of the organization(Sokolova, 2015)

The element of creative performance includes domain relevant skills, creativity relevant skills

and task motivation(Amabile, 1983). Domain skills consist of knowledge about the domain,

the Technical skills and relevant special skills. These skills can be acquired the effective

training and development programs. Creativity-relevant skills include cognitive style, working

style and implicit or explicit knowledge of heuristics for generating novel ideas which depend

on training, participation in idea generation and discussions and personality characteristics.

Task motivation includes attitude towards the work and perception of self-motivation for

undertaking the task. The internal motivation is generated by the task and extrinsic motivation

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is generated by the extrinsic factors like rewards, recognition and job promotions(Amabile,

1988). Thus, it is hypothesized as

H1 - There is an influence of high-performance work systems on creative performance

behavior among employees.

Moderating role of Personality

Further capitalizing to the componential theory, the theory of organizational

creativity(Woodman & Schoenfeldt, 1990) outlines that personality is one of the individual

characteristics which is necessary to foster creativity among individuals. Behavior is often

discussed at the individual level. Individuals personal resources are linked to their sense of

ability to control successfully and impact upon their environment(Hobfoll et al., 2003).

Individuals with higher personal resources are more positive on their self-regard and more goal

congruent(Judge et al., 2002). Thus, individuals with more goal congruent are intrinsically

motivated to pursue their goal and results in higher performance(Youssef & Luthans, 2007).

Personality traits signify how people tend to behave in various situations and indicate the basic

dimensions on which people differ(Matthews et al., 2003). The Big five personality traits

describe five of the most critical distinctions between people. According to Big five trait theory,

openness to experience, extraversion, conscientiousness, agreeableness and neuroticism are the

broad traits where every individual fall somewhere in each of the traits with low, medium or

high on any specific trait

Openness to experience personality trait differentiates a person based on individual

characteristics like curious, broad-minded, cultured, intellectual, etc.,(Mccrae & John, 1992).

It is about individual characteristics which a person is open to experiencing a variety of

activities(Barrick & Mount, 1991). This personality trait has been most empirically

investigated with creativity in the past and found to be a positive predictor of creativity.

(George & Zhou, 2001; McCrae & Costa, 1997)

Agreeableness personality trait differentiates a person based on individual characteristics like

generous, appreciative, kind, trusting, forgiving, tolerant, etc., (Mccrae & John, 1992). It is

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about individual characteristics which a person's tendency to be kind and accommodating

toward others(Barrick & Mount, 1991).

Extraversion personality trait differentiates a person based on individual characteristics like

energetic, enthusiastic, active, assertive, outgoing, talkative, etc., (Mccrae & John, 1992). It is

about individual characteristics which person's tendency to seek stimulation in the group of

others(Barrick & Mount, 1991). An individual's proactive behavior may results in creativity by

engaging themselves in an activity for attempting out various ideas.

Neuroticism personality trait differentiates a person based on individual characteristics like

anxious, self-pitying, tense, touchy, unstable, worrying, etc.,(Mccrae & John, 1992). It is about

individual characteristics which a person's emotions are sensitive to the individual's

environment(Barrick & Mount, 1991) . Creativity requires the ability to mitigate the risk and

may sensitive to attempt a new way of thinking that generates an idea.

Conscientiousness is one of the five big personality traits which differentiates a person based

on the individual characteristics i.e organized, orderliness, cautiousness, etc., (Mccrae & John,

1992). It is about individual characteristics how a person controls, regulates and direct their

impulse towards the goal achievement(Barrick & Mount, 1991). Conscientious people are

generally goal-oriented, spend time in preparations and act in a thoughtful way(Goldberg,

1992). Conscientious individuals are self-disciplined, naturally hard-working, careful, well

organized and dedicated to their goal achievement(Goldberg, 1990; Roberts et al., 2005).

H2 – Personality moderates the relationship between High-performance work system and

creative performance behavior among employees.

Conceptual model

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Research Question 1. What is the influence of High-performance work systems on Creative performance

behavior of employees?

2. What is the influence of Personality on Creative performance behavior of employees?

Research Objectives 1. To examine the relationship between HPWS and Creative performance behavior of

employees

2. To investigate the moderating role of Personality between HPWS and Creative

performance behavior of employees

Research Methodology

Sample and data collection

We collected the data from 273 employees of Information Technology (IT) sector companies

located in southern part of India. These organizations are involved in development of their HR

practices as a high-performance work system to improving their work procedure, productivity

and innovative culture. Employees in these organizations are activities involved in developing

new Information technology products and services and creating value for customers in day to

day transactions and operations.

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Data was collected over eight weeks with two phases. During phase 1, we collected data on

HPWS and Personality and data pertaining to CPB was collected during phase 2. The

respondents were coded to identify for the consecutive data collection, which the researcher

and the respondent were only aware of coding.

Measures

High-performance work systems: To measure HPWS, we adopted 18 items scale(Jiang, 2013)

developed in the Indian context and used to capture employee perceptions on standard HR

practices like selective hiring, effective training, performance based compensation, flexible

work design etc., using 5 point Likert scale ranging from 1 (strongly disagree) to 5 (strongly

agree).

Personality: To measure personality, 10 items scale of The Ten-Item Personality Inventory

(TIPI) on Big Five (or Five-Factor Model) dimensions is used to assess individual characteristic

towards the dimensions: Openness to experience, Conscientiousness, Extraversion,

Agreeableness and Neuroticism based on the 5 point Likert scale.

Creative performance behaviour: To measure Creative performance behaviour 14 items

validated scale in the India context(Gupta & Singh, 2014) which is derived from combination

of scales(Ramamoorthy et al., 2005; Zhang & Bartol, 2010) is used. The scale has four

dimensions: problem identification, information search, idea generation and idea promotion, to

capture the employee’s behaviour on their creative process engagement.

Control variables:

Employee’s demographic variables such as gender, qualification and organizational tenure are

considered as control variables in this study.

Statistical analysis for scales

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Regarding the reliability and validity tests for scales, the composite reliability and the

Cronbach’s alpha of the scales were found to be above 0.7, which is acceptable(Bagozzi & Yi,

1988). Average variance extracted (AVE) is used for convergent validity and found to be

satisfactory for HPWS, CPB and PER. But the PER was found to be above 0.5. In previous

research, AVE has been considered as conservative and CR can be considered as a reflector in

these cases (Malhotra and Dash, 2011). Tests for Common Source Effects and Discriminant

Validity has been done and The three factor (HPWS, PER, CPB) model displayed a good fit

among the variables ( RMSEA = .06; CFI = .90; IFI = .92; SRMR = .03; GFI = .93). The two-

factor model did not display a satisfactory fit (RMSEA = .30; CFI = .68; IFI = .83; SRMR =

.12; GFI = .77) and one factor model also showed a very poor fit with the data (RMSEA = .21;

CFI = .71; IFI = .77; SRMR = .31; GFI = .83).

Data Analysis and Results

The data obtained from participants were analyzed using the Statistical Package for the Social

Sciences (SPSS) 21.0. We used hierarchical moderated regression to predict creative

performance behavior from personality and HPWS, while simple slope analysis was used to

test the moderating influence of personality in the relationship between HPWS and CPB. For

the regression analysis, we entered the demographic variables (gender, job position, age, and

organizational tenure) in the first step of the equation in order to control for any probable

influence they may have had on the criterion variable (i.e., CPB), and then followed by HPWS,

HPWS and personality in the second and third steps of the equation, respectively. In the fourth

step, we entered the interaction terms between personality and HPWS. The hierarchical

regression analyses allowed us to determine the unique contributions of each of the predictors

and the interaction terms to CPB. Simple slope analysis enabled us to ascertain at what level

of personality, HPWS would influence CPB, more or less.

Descriptive statistics, correlations, and scale reliabilities are presented in Table 1. Results of

the hierarchical moderated regression are displayed in Table 2.

Table 1

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Variable Mean Std.Dev 1 2 3 4 5 6 7 8 1 Gender 1.25 0.25 2 Marital status 1.11 0.31 0.38** 3 Job Position 1.2 0.35 0.16* 0.02 4 Age 2.56 0.89 0.17* 0.31** 0.39** 5 Organizational tenure 2.35 1.78 0.01 0.31** 0.07** 0.55** 6 HPWS 3.51 0.49 0.012 0.09 0.02 0.01 -0.2 7 Personality 2.95 0.66 0.03 -0.03 0.1 0.03 0.04 0.39** 8 CPB 3.44 0.47 -0.1 0.05 0.07 0.05 -0.06 (-)0.31** 0.27**

Table 2

Variable Step 1- β Step 2- β Step 3- β Step 4- β

Controls

Gender -0.01 -0.06 -0.01 -0.03

Marital Status -0.03 -0.02 -0.03 -0.01

Job Position 0.05 0.01 0.05 -0.06

Age 0.01 0.05 0.01 -0.01

Organizational Tenure -0.18 -0.14 -0.18 -0.16

Main Effects

HPWS (-)0.31** (-)0.29** (-)0.23**

Personality 0.21** 0.29**

Interaction effects

HPWS x Personality (-)0.33***

Adjusted R Square 0.001 0.11 0.31

Δ R Square 0.021 0.12 0.22

Δ F 0.9 13.21 33.15 Note. *p ≤ 0.05, **p ≤ 0.01, ***p ≤ 0.001

As shown in Table 1, the results indicate that none of the demographic variables of gender,

marital status, job position, age, and organizational tenure were significantly correlated with

CPB. Personality was significantly and positively correlated with HPWS. There was a

significant negative correlation between HPWS and CPB. H1 is accepted but with a negative

influence of HPWS on CPB. The interaction between HPWS and personality was significant

and positive and contributed an additional 22% variance in CPB. Hence, H2 is accepted.

Discussion

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This study aimed at gaining insight into the moderating role of personality in the HPWS-CPB

relation among IT professions in India. Our results indicate that personality was positively

related to CPB. These suggest that IT professionals who higher levels of personality are likely

to indulge in CPB . These findings are in congruence with other findings(Oldham &

Cummings, 1996). These findings could be explained on the grounds of individual

characteristics through Big five personality traits. Individuals with a mindset of imagination,

flexible, broad-minded and curious will attempt to experience an unfamiliar situation to

embrace novel ideas(Goldberg, 1990). Creative ideas are often valued as challenging.

Individuals with high agreeableness may have difficulty in generating and expressing ideas and

avoid being conflict and abrasive in the given situation. People who are enthusiastic with high

extraversion may lead them to connect with various people to confront their problems and come

up with ideas and share them for usefulness and acceptance as creativity. Individuals with high

neuroticism are temper, worry about things that might happen in a stressful situation and

individual with more emotional stability(i.e., low in neuroticism) willing to engage in activities

with relaxed, self-controlled and confident in a given situation. Conscientiousness people are

confident and have a sense of competence to accomplish their goals. On the other hand, people

with low conscientiousness are more disorganized and may act spontaneously without thinking

carefully.

Implications of the study

This study contributes to the creativity theories to fill the gap where a combination of HR

practices as a system(HPWS) influences the creative behavior of employees which was rarely

studied in the past. This study helps the organization to explore the fine-tuning combination of

HR practices as a system(HPWS) to influence the creative behavior among employees.

Organizations have to consider the personality (individual characteristics) to foster creativity

among employees along with HPWS. This strengthens the relationship between the HPWS

and CPB.

This study reveals that the organizations which focus a very structured a strong High-

performance work systems approach without flexibility may hamper the creativity among

employees. Our results showed that the positive relationship between CPB and HPWS was

moderated by personality. That is, IT professionals who are likely to indulge in CPB following

HPWS are those with high levels of agreeableness, openness to experience, Conscientious,

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extravert and lower in neuroticism. It is important to have employees with strong personality

traits to foster an innovative culture in the organization. Although there are different kinds of

tests are conducted during the selection process, personality tests are also essential where an

organization can align its employees to the HPWS to foster creativity. IT professionals with

strong personality traits, working in organizations having HPWS exhibits their creative

behavior in their day to day operations and experiment new things to satisfy the customers with

effective solutions.

Limitations and future research directions

Despite the implications and contribution as discussed above, it remains with a number of

limitations to our study. This study was conducted in the Indian context. First, it was conducted

in the Indian context and by considering the cultural context, it can be further studied in other

cultural contexts. Second, this study focused on the practitioners of the Information

Technology sector and we expect to examine and validate our findings in other sectors. Third,

there might be some alternate variables that can mediate the influence of HPWS on creativity.

Future studies can examine the HPWS and CPB relationship with any mediators. Finally,

Future research can also examine the moderating effect of supervisor's support in fostering

creativity along with HPWS.

Conclusion

The study was conducted to examine the influence of the High-performance work system and

personality on the creative performance behavior of employees in the Information technology

sector. we found the personality as a strong moderator to influence HPWS on the creative

behavior of employees positively. This study evidenced the IT organizations to consider the

personality traits of employees along with implementing HPWS to foster creative performance

behavior among employees. The practitioners working in the HPWS environment can use this

study to identify the personality kind of employees whose creativity may be developed.

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author 1 : ujjal mukherjee designation : associate

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