Political contingency of performance management practices: the role of stakeholder groups

Although performance management (PM) practices are considered best practices in enhancing organizational performance, their effectiveness is questioned by the prevalent implementation problems and inconsistent empirical evidence. Drawing on the insights from political theories of organizations, I develop a political contingency model of HRM, which states that the utilization, implementation, and ultimately the effectiveness of the focal HR practices is contingent on whether the contents of the focal HR practices are aligned with the core interests and preferences of the key stakeholder groups. I test the political contingency model in the case of PM practices adopted by Korean firms. Considering the unique corporate governance and institutional context of South Korea, I focus on four stakeholder groups – family owners, professional CEOs, HR professionals, and labor unions. Using panel data on Korean firms between 2007 and 2017, I found that PM practices were fully utilized, thoroughly implemented, and effective in achieving the intended performance outcomes in firms managed by professional CEOs rather than family owners and those with a formal HR department. However, I found that the effect of unionization on the utilization and effectiveness of PM practices was not significant. By capturing the lingering influence of the initial sentiment, cultural preferences, and general interests of the stakeholder groups toward a given HR practice on its effectiveness, this study contributes to the strategic HRM, political models of policy adoption and implementation, and comparative corporate governance literature.

Name thesis:degree_name

Ph.D.

Level thesis:degree_level

Dissertation

Discipline thesis:degree_discipline

Human Res & Industrial Rels

Grantor

University of Illinois at Urbana-Champaign

Year dc:date

2022

Author dc:creator

• Lee, Yin

Contributors dc:contributor

• Kramer, Amit
• Jung, Ji Wook
• Lamare, Ryan
• Kraatz, Matthew

• Performance management practices
• Political contingency
• Stakeholder groups
• Firm performance

Statement dc:rights

• Copyright 2022 Yin Lee

Language dc:language

en, eng

Handle dc:identifier

https://hdl.handle.net/2142/115693

OAI record oai:identifier

https://www.ideals.illinois.edu/oai-pmh?verb=GetRecord&metadataPrefix=etdms&identifier=oai%3Awww.ideals.illinois.edu%3A2142%2F115693