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Taking It to Another Level: Do Personality-Based Human Capital Resources Matter to Firm Performance?
Journal article   Open access   Peer reviewed

Taking It to Another Level: Do Personality-Based Human Capital Resources Matter to Firm Performance?

In-Sue Oh, Seongsu Kim and Chad H Van Iddekinge
Journal of applied psychology, Vol.100(3), pp.935-947
05/01/2015
DOI: 10.1037/a0039052
PMID: 25822069
url
https://papers.ssrn.com/sol3/Delivery.cfm/SSRN_ID2732610_code2226320.pdf?abstractid=2550794&mirid=1View
Open Access

Abstract

Drawing on the attraction-selection-attrition perspective, strategic human resource management (SHRM) scholarship, and recent human capital research, this study explores organization-level emergence of personality (i.e., personality-based human capital resources) and its direct, interactive, and (conditional) indirect effects on organization-level outcomes based on data from 6,709 managers across 71 firms. Results indicate that organization-level mean emotional stability, extraversion, and conscientiousness are positively related to organization-level managerial job satisfaction and labor productivity but not to financial performance. Furthermore, organization-level mean and variance in emotional stability interact to predict all three organization-level outcomes, and organization-level mean and variance in extraversion interact to predict firm financial performance. Specifically, the positive effects of organization-level mean emotional stability and extraversion are stronger when organization-level variance in these traits is lower. Finally, organization-level mean emotional stability, extraversion, and conscientiousness are all positively related to firm financial performance indirectly via labor productivity, and the indirect effects are more positive when organization-level variance in those personality traits is lower. Overall, the findings suggest that personality-based human capital resources demonstrate tangible effects on organization-level outcomes. Theoretical and practical implications of these findings are discussed along with study limitations and future research directions.
human capital resources attraction-selection-attrition performance personality

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