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The Mediating Effects of HR Outcome and Operational Outcome in the Relationship between HPWS and Financial Performance in Public Enterprises in Ethiopia

Author

Listed:
  • Wondimagegne Assefa REDA

    (Mekdela Amba University, South Wollo, Amhara Region, Ethiopia)

  • Berhanu Temesgen ESHETU

    (Addis Ababa University, Addis Ababa, Ethiopia)

Abstract

This study examines the contribution of high performance work system (HPWS) to organizational performance in the public sector in a developing country context. It relates HPWS to the human resource (HR) outcome, operational outcome, and financial performance of public enterprises in Ethiopia by focusing on the mediating effects of HR outcome and operational outcome. The results of the structural equation modeling (SEM) analysis, based on data gathered on a survey of 480 managers who work in nine public enterprises, demonstrate that operational outcome has a significant positive mediating effect in the HPWS-financial performance relationship. The research advises the public enterprises to design and implement HPWS practices as increased use of HPWS in the enterprises has a significant direct and indirect positive effect on financial performance. The paper suggests future researchers to examine the effects of high commitment work system (HCWS) and high involvement work system (HIWS) on the performance of public enterprises in a developing country context.

Suggested Citation

  • Wondimagegne Assefa REDA & Berhanu Temesgen ESHETU, 2025. "The Mediating Effects of HR Outcome and Operational Outcome in the Relationship between HPWS and Financial Performance in Public Enterprises in Ethiopia," Annals of the University of Craiova for Journalism, Communication and Management, Department of Communication, Journalism and Education Sciences, University of Craiova, vol. 11(1), pages 125-132, July.
    • Handle: RePEc:edt:aucjcm:v:11:y:2025:i:1:p:125-132
    DOI: 10.5281/zenodo.15851165
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    More about this item

    Keywords

    HPWS; HR outcome; operational outcome; financial performance; public enterprise; Ethiopia;
    All these keywords.

    JEL classification:

    • M12 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Personnel Management; Executives; Executive Compensation
    • L3 - Industrial Organization - - Nonprofit Organizations and Public Enterprise

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