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Abstract
The effect of formalization in high‐growth firms' performance is still unclear. We propose that formal commitment‐based human resource practices contribute positively to the financial performance of established high‐growth firms but have little effect on emergent ones. Using a sample of 101 Portuguese high‐growth firms (2006–2009 period), we tested the effect of formal HR practices during the high‐growth period in their financial results two years later (2011). Our results suggest that adopting a formal performance appraisal and a formal R&D function contributed positively for the performance of only established firms, while adopting a formal training activity negatively affected the performance of only emergent firms.
Notes
Following prior research recommendations (Davidsson, Steffens, and Fitzsimmons Citation2009), the specific formula used to calculate the variation was the change from Year 1 (that is, 2006) to Year N (that is, 2009) as a percentage of the employees in Year 1. We used this to calculate variation of size (that is, number of employees), net profits, and financial turnover.
PROCESS is a modeling macro for SPSS developed by Andrew F. Hayes. Its usefulness resides in the integration of many of the functions of published statistical tools for mediation and moderation analysis. It allows testing simple conditional effects as well as more complex indirect effects (that is, mediated moderation and moderated mediation) (Hayes Citation2009).
We conducted linear regressions in each subsample of emergent and established HGFs. According to our results, for established firms, we obtained significant relationships for HRP2 and HRP5 (B = 309838.37, p < .05; and B=3322274.66, p < .05, respectively) a marginal effect for HRP1(B = 232465.83, p < .10), and nonsignificant effect for HRP3 and HRP4 (B = –20117.87, p >.05; B = ‐155478.71, p >.05, respectively). No significant effects were found in the emergent HGFs subsample (B = ‐50312.10, p >.05; B = 11823.38 p >.05; B = ‐20922.99, p >.05; B = 64457.10, p >.05; B = 27406.72, p >.05; for HRP1, HRP2, HRP3, HRP4, HRP5, respectively).
* The authors would like to thank Informa D&B for providing the data. For more information visit https://www.informadb.pt/idbweb/.
Additional information
Notes on contributors
Aníbal López
Aníbal López is the Academic Director of the Nova SBE Venture Lab at Faculdade de Economia da UNL, Campus de Campolide, 1099‐032, Lisboa, Portugal.
Pedro Neves
Pedro Neves is an Associate Professor at Faculdade de Economia da UNL, Campus de Campolide, 1099‐032, Lisboa, Portugal.
Miguel Cunha
Miguel Cunha is a Full Professor at Faculdade de Economia da UNL, Campus de Campolide, 1099‐032, Lisboa, Portugal.