High-performance work systems and the performance of public sector workplaces in Britain

We assess the role played by high-performance work systems (HPWSs) in public sector management achieving cost reductions and efficiency savings, and in introducing ‘modernizing’ technical and operational changes. Using a nationally representative survey of public sector workplaces with 50 or more employees we find that increased use of HPWS was positively correlated with workplace financial performance ratings and the implementation of workplace organizational change, and negatively correlated with wage costs. We also find target setting (TS) practices are, as much as HPWS, significantly associated with workplace outcomes. First difference estimates for the financial rating and workplace change outcomes qualitatively support the cross-section findings in these respects. We conclude that both HPWS and TS are important management technologies for managers pursuing government objectives in the public sector.