Can Firms Perform Without Good HR Practices and Inspiring Leaders?

Abstract

Key Findings A positive match between leadership behaviors and HR practices produce the best organizational outcomes. However, there is evidence that having either strong HR systems or charismatic leaders results in better organizational outcomes over having neither in place; Voluntary turnover is lowest when charismatic leadership and high commitment human resource (HCHR) practices are both high; Firm performance relative to peers is highest when charismatic leadership and HCHR practices are both high; and If either HCHR practices or a charismatic CEO is present within a firm, then employees will be less likely to quit or turn over and performance will be higher compared to when neither exists, suggesting that firms with limited resources can get some positive results if they have the ability to only develop great leaders or invest in great HR practices for their employees.