High performance worksystems in Ireland - The economic case
2009 – In 2005, 165 Irish companies were involved in an investigation into the use of high performance work systems and the impact they have on the economic performance of these companies (2003-2004).
Why is this social innovation?
A high performance work system is a set of HR practices aimed at making the most of the workforce by maximizing the flow of information and the skills and motivation of the employees.
These HR practices were found to have statistically significant positive effect on the profit per employee and on labor productivity. But they had a statistically significant negative effect on the turnover of staff. If a company would raise its high performance work system from the average of the investigated companies to a standard deviation above average, than would according to the model:
• Sales per employee increase by € 50,000
• Labour productivity increase 15.5%
• The employee turnover by 16% decline
Reference: Flood, P., Liu, W., MacCurtain, S., Guthrie, J.P. (2005) High performance work systems in Ireland – The economic case. NCCP. See attachment.