Effects of training and development on employee outcomes and firm innovative performance: moderating roles of voluntary participation and evaluation

Abstract

This study investigates the effect of training and development (T&D) on firm innovation. Given the inconsistent findings on the performance implications of T&D and the lack of studies on the T&D-innovation relationship, we elaborate the multiple dimensions of T&D, intermediate employee outcomes, and boundary conditions to elucidate the pathways of T&D toward firm innovation. We specifically identify two distinct T&D dimensions, namely, firm investment and employees' positive perceptions. The former and the latter, respectively, reflect top-down and bottom-up approaches. We suggest that these two dimensions indirectly affect firm innovative performance by enhancing employees' competence and commitment. We further hypothesize that T&D-related contingencies (i.e., employees' voluntary participation and T&D evaluation) moderate the indirect effects of T&D on firm innovative performance. We examine the current framework by using multisource data collected at three time points over a 5-year period from 325 Korean organizations. Our analysis confirms that the positive indirect effect of T&D on firm innovative performance through employees' competence and commitment becomes stronger (a) when employees voluntarily participate in T&D and (b) when firms do not implement T&D evaluation. This study provides useful and valid theoretical explanations and practical insights into the design and implementation of T&D in firms.