Purpose
– The purpose of this paper is to explore the relationship between being a “great place to work” (GPTW) and firm performance. While lists such as the “Fortune 100 best places to work” were initially regarded solely as publicity vehicles for ranked firms, researchers have since tried to untangle the relationship between being a GPTW and firm performance, often by focussing on HRM systems and practices. In contrast, the study focusses on the valuable, rare, costly to imitate, and organization-exploitability aspects of being a trustworthy employer, place where workers take pride in their work and enjoy the people with whom they work.
Design/methodology/approach
– This study uses four distinct samples of firms drawn from Fortune’s best companies to work for, Glassdoor.com’s Employees’ Choice Awards, Careerbliss.com’s 50 Happiest Companies in America, and Achievers.com’s 50 Most Engaged Workplaces Awards databases in a longitudinal design to compare performance attributes of listed firms to their respective industry peer groups.
Findings
– Being a GPTW is associated with greater productivity, growth potential, and higher operating profits.
Research limitations/implications
– Some GPTW firms are privately held and were excluded from analysis.
Practical implications
– Rather than focussing on individual HRM practices and techniques, employers may realize greater performance improvements by focussing on building a reputation as a trustworthy employer and fostering an environment where employees take pride in their work and enjoy working with each other.
Originality/value
– Other GPTW studies have focussed on HRM practices as antecedents to performance outcomes, which may not accurately reflect the attributes of the GPTW construct. This study focusses squarely on the underlying attributes of being a GPTW: employer trustworthiness, worker pride, and camaraderie and how they affect firm performance.
