High-Performance Growth and Productivity

In the logic of the RBV, HR practices can configure a firm toward the acquisition, retention,and mobilization of human capital resources (Lado & Wilson, 1994). MHR practices differ from more generic sets of HR practices (e.g., benefits, paid vacation) because scholars argue that they influence employees’ actions by aligning their goals with those of the organization and also by enhancing the employees’ capacity to pursue those goals (Appelbaum,Bailey, Berg, & Kalleberg, 2000; Gardner et al., 2011; Huselid, 1995; Subramony, 2009;Wright & Snell, 1998). MHR practices also conceptually differ from high-performance work systems (HPWSs) in that HPWSs focus on a broader and more heterogeneous set of HRpractices that can also include skill-enhancing practices designed to increase the knowledge,skills, and abilities of a workforce via training or selection (Jiang et al., 2012). Past research on how MHR practices influence behavior suggests that they function via signaling effects associated with social exchange (Blau, 1964; Gardner et al.).MHR practices signal an organization’s investment and trust in its employees and thereby foster a psychological perception of mutual employer-employee investment (Kehoe & Wright, 2013; Tsui, Pearce, Porter,& Tripoli, 1997; Whitener, 2001). This perception of mutual investment contributes to a norm of reciprocity between the individual and the organization that motivates individuals to pursue actions aligned with the organization’s needs and also enables them with the discretionary ability to do so as part of their exchange with the organization (Eisenberger, Fasolo,Davis-LaMastro, 1990; Eisenberger, Huntington, Hutchison, & Sowa, 1986; Rousseau &McLean Parks, 1993).Despite significant research on the value of MHR practices in general, the exact number and structure of MHR practices used varies substantially across firms, industries, and contexts (Gardner et al., 2011; Kehoe & Wright, 2013; Ulrich, 1997).Many different typologies exist because no single practice or set of practices has universal utility: The efficacy of such ractices varies on the basis of the specific strategic needs of businesses in different environments (Gerhart,2007; Wright & Brewster, 2003). Because of this contextual specificity, we follow recommendations in the literature (e.g., Appelbaum et al., 2000; Batt, 2002; Batt & Colvin, 2011; Gerhart;Shaw, Dineen, Fang, & Vellella, 2009) and focus on a subset of MHR practices relevant to the entrepreneurial context. In this study, the practices we focus on are bonus programs (e.g., Chung& Vickery, 1976; Lee, 1988), employee stock options (e.g., Chingos & Engel, 1998; Gonzalez-Mulé & O’Boyle, in press; Lawler, Mohrman, & Ledford, 1995), and flex-time programs (e.g.,Baltes, Briggs, Huff, Wright, & Neuman, 1999; Combs, Liu, Hall, & Ketchen, 2006).Leaders of new ventures make decisions about HRs and human capital as part of an adaptive response process to changing environmental cues (Sonnenfeld & Peiperl, 1988), and managerial decisions about resource investments play a central role. New ventures are designed to grow, change, and adapt over time, and the use of more sophisticated HR practices can facilitate future growth as part of this adaptation (Kepes, Delery, & Gupta, 2008).As firms show the potential for significant growth, managers may choose to invest resources in HR practices because they believe these practices will facilitate the future growth and productivity of the firm (Gerhart et al., 2000; Wright et al., 2005).