This study advances the literature on high-performance work systems (HPWS) by investigating their impact on employee job performance (JP) through the mediation of digital transformation (DT). Further, authors conceptualize individual absorptive capacity (AC) as a boundary condition, the extent to which DT enhances employee JP. It examines the moderating role of AC in the indirect relationship between HPWS and JP via DT.
A total of 422 responses from the information technology sector were used for final analysis. For analysis, the PROCESS approach in Partial Least Squares Structural Equation Modeling (PLS-SEM) is chosen.
The results show that DT significantly mediates the high performance work systems-job performance (HPWS-JP) relationship, and AC strengthens the relationship between digital transformation and job perfromance. At higher AC levels, the positive effect intensifies, whereas at lower levels, the relationship becomes insignificant. Similar results emerge in the moderated mediation analysis, where the indirect HPWS–JP relationship via DT is significant only when AC is high.
These findings provide one of the first empirical validations of the idea that technology-driven performance outcomes are contingent upon employees’ cognitive ability to absorb and apply digital knowledge. The research advances HRM and DT research by highlighting the crucial role of individual AC in realizing DT benefits at the employee level, reinforcing the need for HR-driven transformative strategies to sustain competitive advantage in dynamic business environments.
