Human resource management systems research – how to gain impactful insights through formative measurement and hierarchical component models

This paper emphasizes that paying greater attention to howhuman resource management (HRM) systems are conceptu-alized in empirical studies could provide more actionableinsights and increase the impact of HRM systems research.We advocate the use of formative measurement models,arguing that this approach aligns better with the concept ofHRM systems, and allows for a nuanced understanding ofhow each HRM practice and the system contribute to theoutcomes of interest. In the same vein, we advocate the use of hierarchical component models, which allow a multi-levelconceptualization representing HRM practices, the HRM sys-tem, and their intermediate levels of abstraction (e.g. ability, motivation, and opportunities as subcomponents of high-performance work systems). As a result, HRM systems research can move beyond general assertions and instead offer specific and actionable recommendations. We discuss and illustrate how these conceptual ideas can be implemented in partial least squares-structural equation modeling (PLS-SEM), and enriched by predictive model evaluation fol-lowing state-of-the-art guidelines.