HUMAN-RESOURCE BUNDLES AND MANUFACTURING PERFORMANCE - ORGANIZATIONAL LOGIC AND FLEXIBLE PRODUCTION SYSTEMS IN THE WORLD AUTO INDUSTRY

Using a unique international data set from a 1989-90 survey of 62 automotive assembly plants, the author tests two hypotheses: that innovative HR practices affect performance not individually but as interrelated elements in an internally consistent HR ''bundle'' or system; and that these HR bundles contribute most to assembly plant productivity and quality when they are integrated with manufacturing policies under the ''organizational logic'' of a flexible production system. Analysis of the survey data, which tests three indices representing distinct bundles of human resource and manufacturing practices, supports both hypotheses. Flexible production plants with team-based work systems, ''high-commitment'' HR practices (such as contingent compensation and extensive training), and low inventory and repair buffers consistently outperformed mass production plants. Variables capturing two-way and three-way interactions among the bundles of practices are even better predictors of performance, supporting the integration hypothesis.