Multilevel Effects of HCHRM Systems on Psychological Well-being and Sales Performance

Previous strategic human resource management literature have requested a multilevel approach in examining the effects of HRM systems on micro- level variables. We investigate individual-level variables (i.e., psychological capital, psychological well-being, and sales performance) of 487 financial consultants in 100 branches of a nation-wide insurance corporation in South Korea. Specifically, we develop a multilevel model to show the psychological mechanism underlying on the relationship between branch high-commitment HRM systems and two individual-level variables - psychological well-being and sales performance. The paper suggests that branch high-commitment HRM systems enhance financial consultants' psychological well-being and sales performance through increased psychological capital. Moreover, it presents two boundary conditions (i.e., HRM systems decoupling and growth need strength) in both macro and micro levels which moderate the relationship between high- commitment HRM systems and employee psychological capital. A hierarchical linear modeling is employed and results support all four hypotheses. Implications of these results are then discussed.